Excellent article about how big data is affecting all areas of our lives – link to the source is below.
The lifeblood of the information age is data and the prevailing wisdom is that the companies that can extract insights from data have an advantage over those that don’t.
The term “big data” refers to the huge quantities of raw data from outside the organization that can be commingled with internal data and mined for intelligence.
Analysis company Gartner says big data is
“high-volume, high-velocity and high-variety information assets that require cost-effective, innovative forms of information processing for enhanced insight and decision-making”.
Not necessarily, says Matt Kuperholz, a partner in PwC’s modelling and analytics group.
“Big data is simply using different tools and techniques to extract the full value from data.”
WHAT DO YOU WANT TO KNOW?
Businesses should tackle big data by asking themselves a business question, says Sally Wood, professor of business analytics at the University of Sydney Business School.
“I always say to businesses, ‘Tell me what you would do with the data if you had all the data in the world. What is the research question you want to answer?’ ”
Wood believes it’s the nature of the question that determines whether big data is the solution. So what sorts of questions require a big data solution?
Big data is also useful far beyond the realm of sales. “Some companies want to understand what factors affect leadership qualities,” Wood says. “All these things that were thought of as fluffy and non-rigorous suddenly can become much more evidence based.”
PwC’s Kuperholz says big data comes into its own when a business has a large number of customers who are serviced via multiple channels with different costs. Throw in serious competition to win those customers away and retain their loyalty and the case to use big data grows stronger.
“Then you have complex supply chains or complex processes that can be optimized,” he says. “How does [global freight and logistics company] UPS get a jump on lower cost of delivery? Because they optimize routes.”
In many US states, drivers can turn right through a red traffic light, so UPS puts more right-hand turns in its drivers’ routes. This has saved hundreds of millions of dollars. “That’s a clever use of analytics,” Kuperholz says.
ANALYTICS BEGINS AT HOME
Getting more from existing data wasn’t a reason for avoiding external big data among survey respondents. Of the 58 per cent of respondents not using big data, the reasons largely fell into two categories: cost and lack of understanding about its nature and benefits.
In fact, the advice is for businesses to make absolutely sure, before embracing big data, that they have a fantastic handle on the data they already generate.
“Most organizations have more than enough data to get started, but more need to know how to use it to drive commercial value,” says Sahil Merchant, head of McKinsey Digital Australia.
The challenge for companies is to develop their internal capabilities with their own data. “Rather than focusing on big data, companies can start with medium data and use what they have got.
INSTINCTS PUT TO THE TEST
Are we moving into an age when human instinct is redundant? The majority of those using big data still see greater value in the expertise of people (70 per cent rated the team as most important) over data (30 per cent). But that mindset is increasingly insufficient.
DOING IT RIGHT
Start learning what insights you can gain from big data by contacting us for a free consultation.
Source: If you don’t really understand big data how about tackling medium data first?