Published: February 13, 2014
For those who don’t understand it, it simply seems like 2014’s newest buzzword. Yet, those who grasp the value of this all encompassing, somewhat sprawling term find themselves part of a movement, with the potential to one-up competition using better metrics and a higher degree of business intelligence.
According to Forbes, “in its most simple explanation, Big Data represents the ability to process a large amount of complex information to make better-informed business decisions.” From customers and machines to products and services, new sources of data emerge daily through things like sensors, social business sites, website interaction and more. As a result, companies must find a practical way to deal these large quantities of information to stay competitive.
If “data” seems simple enough, there’s more to it. It’s much more than acquiring large amounts of data. It’s what you do with the data that counts. In short, it all comes down to gathering information about customers and their behaviors and analyzing it in a way to help gain the right insights and advance business strategically. Once information is gathered, there are a variety of approaches to processing (data mining) and strategically leveraging that information. Data mining techniques from artificial intelligence to pattern matching to map reduce. Big Data refers to ‘how are people using our stuff’ while Data Mining translates to ‘how can we help people of sub group A use our stuff more efficiently.’
Why It Matters:
As we settle into 2014 and articles abound about ‘mobile,’ ‘the Internet of Things, ‘cloud computing’ and of course Big Data, many struggle to grasp the implications of each and more importantly what new trend to focus on for effective business growth; when in fact, all of the above work hand in hand.
Gathering information (Big Data) is made possible as more and more things are internet connected, mobile and easily shared online. An excellent example is one manufacturer’s shift by now including what they call “Asset Management Technology”. In this case, the manufacturer provides real time machine performance data for the operator and owner — a niche approach to gathering and leveraging data for valuable outcome.
This results in:
- Unlocking significant value by making information transparent and usable at much higher frequency.
- Using data collection and analysis to conduct controlled experiments to make better management decisions.
- Sophisticated analytics that substantially improve decision-making.
- Improved development of the next generation of products and services.
“The amount of data in our world has exploded, and analyzing large data sets — so-called Big Data — will become a key basis of competition, underpinning new waves of productivity growth, innovation and consumer surplus,” according to research by MGI and McKinsey’s Business Technology Office. Leaders in every sector will have to grapple with the implications of big data, not just a few data-oriented managers. The movement is sweeping into every industry and business function and data collection is now an important factor of production, alongside labor and capital.
You know it’s important. The real question now is are you ready reevaluate how you are collecting and strategically using data?