A Data Science Central Community
Your relationship with data and your attitude towards it will be one of the biggest predictors of the health of your business in 2013 and beyond. Why? Because the data revolution is upon us, and organizations are reaching the limit of possible improvements based on older methods. The transformational change occurring in organizations today is dependent upon adopting insight from data for visibility and profit improvement.
Some business sectors have a natural affinity for data. These include investment banking, financial services, insurance and pharmaceuticals. The day-to-day operation for these businesses is very closely aligned with data and what the numbers are telling them. Hence, businesses in these sectors employ analysts and encourage data-driven decision-making. With the onslaught of Big Data, the speed and fury of data usage will increase in these sectors. They will compete on their ability to react faster and operationalize the insight from data into their processes.
By contrast, other sectors seem very distant from data, preferring to ignore it as though it were irrelevant to their strategy or decision making processes. They may use data on an ad-hoc basis, but they do not employ departments of analysts. Why? Because most capital intensive businesses often have a circuitous route between the cause and effect of their economics, and their day-to-day processes are too far removed from the sales cycle. Instead they are absorbed in the sourcing, production and delivery of their products such that analyzing the data is thought to be too time-intensive and cost prohibitive. These businesses are at risk.
Meanwhile, sectors such as retail understand the value of data to their decision making process because they see the direct and immediate financial results between inventory and sales. However, the cost of converting data to insight is still very high; this cost is calculated based on the time and resources it takes to translate the data into something useful and actionable. The economics of this process are not yet in the sensible range for most businesses, but the data revolution is changing that equation because one of the drivers of the revolution is operationalizing data insight in an economical way. As a result, we will see transformational changes in retail over the next few years.
The data revolution is here and it will be a replay of the Internet revolution, which significantly changed the way we think and work in a matter of five short years. As Mark Twain said, “History doesn’t repeat itself, but it does rhyme.” The rise of the Internet was a time of great opportunity, job creation, and enormous wealth; likewise, the Big Data revolution will transform industries. The Big Data revolution, however, will be even bigger and last longer because it is based on the conversion of data into value. The proof will be clear and easy to prove and will separate the winners from the laggards.
As you go into this year, ask yourself what your vision is for 2013. Will you embrace the data revolution to transform your business? How you answer this question will determine the viability of your business.