How Cloud Computing Helps Mine User Data

While alarming to some, cloud computing’s effectiveness at gathering user data enables managers to make better decisions.
One of the unique benefits -- not yet fully realized -- of the emerging cloud computing trend is also one of the most controversial aspects of today’s on-demand services. It’s the ability of smart cloud vendors to capture valuable user data and put it to good use on behalf of their customers. Not to resell to others, but to recraft it into valuable insight that can help users achieve their business objectives.

One of the age-old demands of corporate managers is access to timely benchmark data that can help them evaluate their operations. Of course, the most valuable benchmark data is information gathered from comparable organizations that permits the manager to measure themselves against their peers.

I helped to launch a benchmark consulting practice in the 1990s when it was a costly, cumbersome, paper-based and manual process. At that time, it wasn’t easy getting companies to participate in benchmark studies because it forced them to spend countless hours collecting hard-to-find operational data. And it produced limited results because it was hard to compare data from various sources.

In contrast, today’s cloud computing services can give vendors unprecedented access to valuable data that can quickly and clearly help corporate managers better understand how they’re doing in relation to others.

This idea scares many people who confuse this ability with the inappropriate use of personal or proprietary data that clearly violates privacy laws. Instead, I’m talking about the authorized capture of higher-level activity data which can help users see how their behavior and experience compares to their peers.

For instance, I use a Software-as-a-Service (SaaS) email marketing vendor who publishes aggregate click-through and response rate statistics by industry based on its user experiences. This helps me evaluate the effectiveness of my email campaigns.

Another example is SysAid, a web-based service desk infrastructure solution provider, which can show its users how their day-to-day service desk management activity compares with others.

A broader illustration of this idea is the analytic tools that are being embedded into various SaaS applications. Rather than view business intelligence as a separate application, today’s leading SaaS solutions include analytic tools and management dashboards in their applications to allow end-users and corporate executives to easily monitor key performance indicators (KPIs).

Shrewd SaaS and cloud computing vendors that have built a solid customer base are experimenting with ways of delivering more value to their customers. They’re working to more clearly differentiating themselves by producing useful benchmark statistics.

Done right, this information gives end-users and corporate decision-makers greater insight, which can help them be more successful. Their success encourages greater vendor loyalty and makes the customers more comfortable sharing their activity data with their vendors and peers.

This dynamic will redefine the nature of the customer/vendor relationship. It also creates a more meaningful customer community than the typical user groups of the past. Rather than simply encouraging individual customers to share their ‘best practices’ on an anecdotal basis, SaaS/cloud vendors will be able to produce statistically valid and strategically more valuable information and insight for their customers.

Kaplan is the Managing Director of THINKstrategies and Founder of the SaaS Showplace. He can be reached at

Tags: cloud computing, cloud services, SaaS, IT management, data mining

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