As we have entered the age of big data analytics, we are discovering innovative opportunities everywhere. Organizations are becoming proficient at analyzing huge amounts of structured and unstructured data, and telling their customers exactly what they need to buy.

But, along with the advent of new business opportunities, comes the additional costs which are needed to maintain and secure such a massive amount of data.

Many companies, especially in the telecommunications and retail sector, need to invest heavily in data warehousing solutions. But, as raw data has started to come on a petabyte scale, these traditional solutions cannot handle it. Thus, they resort to cloud storage. This leads to further implementation of costs. Also, many of these organizations face difficulties in integrating the cloud services with their legacy systems to solve this require additional expenditure. The government is now leveraging strict laws on companies using analytics regarding data privacy. Now, organizations have to also invest in data security technology. Moreover, analytics vendors like us are offering different licensing models to companies. Organizations must constantly monitor these different licensing models and select a suitable model for their company. Ignoring this will result in spending more money on an irrelevant model and also create difficulties in managing the analytic initiative. In this article, I shall discuss three techniques that can be used to tackle the rising analytics costs:

1.   Identify

In this step, you have to identify the potential areas to tackle costs. In our opinion, business owners and analytics leaders can retain much of their company funds if they choose the correct licensing model. Thus, while initiating or expanding your analytics venture, you must consider the licensing models provided by multiple vendors. This will ensure that the company chooses the correct licensing model and also create a competitive environment. Choosing a correct licensing model will lead to better business outcomes, risk avoidance, and more flexibility.

2.   Review

Business owners and analytics leaders must review the licensing metrics offered by analytics vendors. Many analytics vendors use land-and-expand sales tactics to offer multiple licensing metrics. Hence, these vendors must be asked to show the relevant proposals that illustrate all their metrics. This will help in determining which licensing models are more cost-effective and also aligns with your organization's current sourcing strategy.

3.   Pre-negotiate

Data scientists at Gartner believe that the number of business analysts will keep on increasing. Thus, business owners must encourage the expansion of analytics software throughout the business and promote innovation across LOBs as part of an enterprise analytics program that demonstrates business value. They should also pre-negotiate with the analytics vendor costs for future user-based licenses. Business owners must negotiate with all the relevant stakeholders to discuss the licensing needs of the business, current sizing requirements, and predictions for future licensing needs.

Even though big data analytics offer big business gains, the increasing cost and complexity are the barriers that organizations struggle with. Data and analytics leaders must embrace the above-given cost tackling strategies and collaborate with their stakeholders.