More and more organizations lately are turning to alternative sources of information – unstructured data – for valuable business insights. Harnessing unstructured data is becoming a top focus area in driving business value and unstructured data is being used by companies to gain a more in-depth understanding of their customers, products, services and business overall. However, when it comes to corporate budgeting, perils do exist, so we need to be aware of the risks.

While much of what we refer to as unstructured data – emails, webpages, audio and video files, social media, presentations – contains important information from which we can derive essential insights, it is inherently problematic. Why? Because it doesn’t fit neatly into a database.

One of the biggest problem exists in volume. The sheer amount of data available means departments can quickly become inundated with it. With so much data available, one of the key essentials is knowing what to use and what not to use. You need to decide what data to collect and analyze and what you can disregard. Just because you have access to all of this data, doesn’t mean that it is all actually of value. It’s sort of like buying an elephant for a nickel.

Identification is another issue. In order to properly manage this data, you need to be able to identify and classify it. However, with many of these alternative data sources, there is no way to accurately identify the data other than the filename and extension – there is no way to “look” at the data and know whether it is a video file, audio file, image, etc. As result, critical tasks such as identification, classification, or even basic searches, can become quite challenging.

Yet another issue is time. While unstructured data can provide valuable business insights, it can also become outdated very quickly. Often it is unavailable to those using and analyzing it while it is being curated and as result by the time it becomes available, it could be out of date. You need to be sure that the data you are collecting is still relevant.

Unstructured data can be beneficial, but in order to tap into it, you also need to be aware of the inherent risks and challenges associated with using it. Going full tilt, without stopping to think, can lead to problems.

At True Sky, our Excel-based corporate performance management system can help you make sense of your data. For more information, please visit www.truesky.com or call us today at 1 855 878 3759.