In the ‘age of big data’, I read Tim Cummins’ recent post, ‘Contracting as a Data Centre‘ with interest. The comparison of the contracting function as a data centre is an interesting one. The value of a company is largely made up of the value of its contracts, agreements, and relationships. As Tim points out, based on this, there is significant value to be had from being able to understand and analyse the data held in the contracts.
The term ‘big data’ is used a lot at the moment, and usually in the context of it being a great opportunity. In the purist form the opportunities from big data are there, but not for as many organisations as you would think. Yes, in the security space, big data has the potential to help identify and track potential threats, or the utilities sector it may be able to help better predict power consumption, but for many the term is slightly misleading.
In the contracting space companies are probably creating no more data today than in the past, after all we probably sign a similar number of agreements year on year, and there are, despite, the regulators’ best efforts, about the same number of pages in the agreements.
The real ‘big data’ opportunity in the contracting space is to better capture the data from the various agreements. This is where there is a really interesting point in Tim’s post. The challenge that the contracting function often sees is how do we capture and/or convert complex inter-connected agreements and codify them to become data. By their very nature these agreements are bespoke, or at least tailored, and therefore harvesting meaningful data is a real challenge. In reality what is needed is for the data to be married up with context to form information, and then synthesised into knowledge. In looking at it from this ‘bottom up’, data focused, way the function can miss the reason they are carrying out the work in the first place. We are perhaps too often looking down the telescope from the wrong end.
If you turn the telescope around, and ask the C-suite or the business what insights would they like to have from the portfolio of agreements, then it’s likely that as a first pass there would be no more than a handful requests. Mainly around financial performance, change management, and portfolio risk. With the imagination that Tim speaks of, it is likely that the data required to give these insights would be a very small subset of the agreements. It could be captured and converted very quickly, fused with context and judgement to create the insight that the business needs and without waiting for a massive data capture programme to be completed.
There are an increasing number of contracting teams who are, perhaps looking down the telescope the right way, and are understanding that ‘big data’ for the contracting profession is less about large amounts of data, but more about accessing focused data, fusing it with analytics and judgement, to create insights. Perhaps what we need as a profession is big information rather than big data.