By Jeff Olson
We are living in the era of the data gold rush, with enterprises eager to collect as much information as possible to inform their decision-making.
In fact, according to IDC, by 2020 organisations that analyse all relevant data and deliver actionable information will achieve an extra $430 billion in productivity gains over less analytical, less data driven businesses.
This deluge of data is driven by smartphones, sensors, social media and more. The data flood gates are burst open, and the resulting flow of information means that everything around us – every person, structure or community – is part of an ecosystem in which humans, machines and data are connected and getting smarter all the time.
On one hand we are drowning in data – on the other, many businesses are still starving for insights. They remain unable to unlock the value that’s at their fingertips.
To overcome this uncertainty and build competitive advantage, enterprises must make the move from having data to being data-driven. They must treat data as a form of capital and put it at the heart of everything they do, so as to unlock huge potential and drive previously unimaginable value from data.
Being data-driven can help organisations across every industry to thrive and compete in a world of digital disrupters, many of which were born data-driven. This will empower the data driven retailer to create individualised customer experiences. A data-driven utility company can twin weather and consumer data to monitor and predict energy usage. In healthcare, data is enabling leading to amazing breakthroughs and personalised medicine.
Today data-driven companies do exist - these leaders recognise that data has economic value and put a premium on the value this information. They understand the value of the information flowing through their eco-systems and how varying sources of data fit together to inform business decisions. They use a combination of people, data and machines in perfect harmony – and focus on how data can be used to learn and continuously improve operations, create new business models and unearth new opportunities.
The likes of Uber, Netflix and Airbnb are obvious examples of organisations that have been born data-driven, and just recently, Alibaba shares have surged following an announcement that the e-commerce company is expanding from traffic monetisation to data monetisation.
However, in Asia Pacific, enterprises remain at very different stages of data maturity. IDC reports that more than 65 percent of organisations in the region have yet to move past the first two stages of the data journey; which are the experimental and intentional stages, in which new opportunities are visible but yet to be realised.
Businesses that put data at the heart of everything they do will have significant competitive advantage in the years to come – and those that don’t could soon fall behind. So how can companies make the move from having data to being data-driven?
There is a trifecta of managing, acquiring and applying data that must be mastered:
-Managing data: To do this well, the data-driven business captures, keeps data and importantly uses data. While many currently capture and store data, most have yet to make full use of the data and much of its sits idle. In fact, most organisations on average only use at most 25-30 percent of their data.
-Acquiring data: This requires moving through three levels of maturity: acquiring your own data, buying in anonymised third party data, and at the most sophisticated level, sharing data with organisations with overlapping markets. Most organisations sit at the start of this journey. A truly data-driven business understands that its own data can be amplified by information bought in or shared from outside of the organisation as an aid to strategic decision-making.
-Applying data: Moving through a sliding scale moving from using analytics, to algorithms and then to intelligent applications. Many companies today are using analytics to ask questions of data and gain insight, but they need to go further.
The next step is to take the output of the analytics and feed it into algorithms so as to identify trends and anomalies far better than a human could and move to automate outcomes based on actionable insight. This move to artificial intelligence will be essential given the tsunami of data now faced – businesses won’t be able to keep up. Finally, there is the need to build this insight into the heart of business, its applications, so as to make them smarter.
Data-driven organisations are already mastering the ability to manage, acquire and apply data. They are taking the evolution of analytics further than ever before; moving beyond traditional methods of capturing data and insights to transform themselves into insight-powered enterprises that can anticipate their future. They understand how to bring together a ‘golden ratio’ of the right people, using the right data and machines in perfect balance in order to capitalise on collective intelligence and robust analytics to maintain a competitive advantage in the uncertain landscape. Can you?
The author, Jeff Olson, is the head of Big Data and Analytics, Oracle APAC