Research Paper Example on Big Data

Big Data can be defined as colossal amounts of complex unstructured data, which in itself can hold hidden information beneficial to businesses and can be categorised with the 5 V's. The authors believed that big data alone cannot improve a firm's performance, but firms "must possess big analytic capabilities and a certain level of knowledge management" to add value to the insights of big data to improve firm performance: BDAC and KM are co-dependent Ferraris et al. (2019).  They conducted an empirical study based on resource-based theory which focused solely on Italian SME’s who have previous knowledge of big data analytics and found it can enhance a firm’s financial performance. Big Data helps management accountants move from utilising their intuition to relying on factual data, which will help in strategic planning. But to develop in house data analysis capabilities firms, need to invest in their personnel not just the technology, management accountants should be leaders in this and bring the company a new digital age of big data, otherwise without everyone at least having a basic understanding of what big data analytics is, then there'll be no effect on firm performance.

The era of big data may provide greater insight into their customer's behaviour thus creating a more tailored experience and curating better marketing strategies for firms, but many choose to avoid the negative implications of having so much accessible data online, unlike Borah and Palamatier's findings. Through their research they found that merely the idea of a firm's having easy access to data about consumers 'initiates feeling of violation and reduces trust,' resulting in many choosing to falsify information collected in Big Data, making it insignificant. (Borah and Palamatier 2016)This supports the original paper idea that data alone cannot be successful and needs to be integrated with firm knowledge, as many managers don’t even trust the information mined is 100% true. Although they recognise that data breach is a risk if managed correctly can provide increased firm performance through customer retention and increased brand value. They believe 'firms need a more tempered approach to data and analytics initiative that involves the collection and use of customer information,' which is something management accountants can work on. (Borah and Palamatier 2016) One takeaway from this is that firms have to pay attention to the quality of data being collected and that data needs to be managed correctly. 

This paper shows that whilst companies are investing in the integration of big data technology into their company, many don’t have anything to show for it. They divulged that the biggest reason is that most companies are unable to utilise the data they have already, so they’re in no position to benefit from big data. They found that companies who are familiar with the process of evidence-based decision making have improved firm performance; able to generate value from data. Businesses that failed tend to be because their management practices haven't caught up to their technological investments. Additionally, big data does not necessarily mean increased firm performance, an example of one of the companies they researched was Seven-Eleven in Japan which were able to use small relevant in-store data to further enhance the performance of the business. Consequently, its success has proceeded more than 30 years. Whilst this paper doesn’t necessarily correlate to the use of big data it shares a similar message of it’s how it’s the value of data, and ‘getting all people to use data more effectively,' essentially referring back to the need to use analytic capabilities and the use of knowledge management to gain insight on how to increase firm performance. Ross, Beath, and Quaadgras (2013)

Chai, Labbe, and Stedman (2021) take a different approach to big data analytics (BDA) by proposing a more ambivalent viewpoint, showcasing the positive and negative effects it may have on a company's firm performance. Their research shows the internal and external benefits such as greater customer acquisition & retention, price optimisation, and product development. It greatly shows how supply chain and channel analytics has improved, as BDA has provided predictive analytic models allowing them to make better-informed decisions for strategic management. However, a common theme with my research is that many recognised that a great challenge of big data is that firms need to choose the right tools when applying BDA to their company. This is why Ferraris et al (2019) recognised 'managers need to align existing organisational culture and capabilities across the whole organisation', otherwise there will be no visible improvement. There are many resources available such as Hadoop, and an increased amount of training is readily available to gain analytic skills; so, organisations much utilise these correctly to fill the gap of internal analytic skills.

Consequently, BDA has proven to be immensely beneficial to firms, it provides a framework for decision making with real data. But Big Data alone isn’t enough to improve firm performance, value must be added to the information found otherwise the investment into the technology is insignificant and doesn’t help management accountants see the possible opportunities and risks a firm may encounter. In conclusion, big data analytic capabilities are beneficial, but not all organisations are the same either, so what may work for one won't work for all, and managers should be advised accordingly.