Big Data: Hype Or Hyper Important?
Business is all about asking the right questions and pursuing the right projects. But without evidence, most entrepreneurs are running blind. The good news is that the world is generating more data than ever before. Big data and its associated analytics are churning out trillions of data points. So many data, in fact, that the world’s servers crunch the equivalent of a stack of books stretching to the nearest star.
Big data is going to change the way that we do business. It’s a way of drilling down into the essence of what it is they do and finding meaning. It’s about bringing multiple platforms together in a way that can be easily interpreted and acted upon. And it’s about uncovering data that is biased or potentially misleading.
As big data analytics develop, businesses are finding new applications and ways to use the technology. For instance, one critical application right now is in Formula One cars. Teams are using driver data to find ways to make their drivers and cars safer. Data from vehicles can be utilized by the teams in real time. It can then be shared and used to make decisions throughout the race. Systems can be monitored and data collected to predict imminent failure. It’s all about finding the warning signs and doing something about it before additional costs are incurred.
The drivers themselves have access to all the data themselves from their steering wheels. They’re able to make adjustments in real time, depending on the data they are fed. Each driver gets a 10 point menu, giving overviews of their systems, allowing them to make smart choices.
The Formula One example is an extreme example. Obviously, it is very different to a typical small business operation. But it emphasizes some important principles. Namely, that companies can use data to make better decisions and gain competitive advantage. The more data a business can leverage, the more competitive it will be.
Let’s take a look at some of the ways that businesses can up their competitiveness using big data.
Proving Value Of Information Technology In Business
Most businesses track the costs of their IT systems – that’s easy. But far fewer measure the results with any kind of accuracy. It would be nice to know the precise ROI from different IT investments so that decisions regarding IT can be made in the future.
Small businesses are forever wondering whether they should invest more in their IT or cloud platforms. But they rarely have the data to do so. That is, of course, unless they’re leveraging big data.
Big data is now key to many budding small businesses and the way they approach new investment opportunities. They want to know whether their IT projects are delivering measurable results. And they want to make sure that they are not just being carried along by a wave of hype.
In the past, most IT costing was done on the basis of how much it costs to run a computer or cool a server. Businesses would work out how much the server space cost, or how much floor space had to be dedicated to their IT. But today, the nature of IT has changed. Because of the cloud, small business IT is often distributed across multiple sites. And these sites all have different costs structures and ROI.
Companies, like Allerin, are trying to make sense of all this data. The idea is to find ways to improve the ability of businesses to collect data on their IT performance. Data can be collected from multiple sites, crunched, and then analyzed. The analysis should reveal whether the IT investments are worthwhile or not. The ultimate goal is to place a financial value on the additional efficiency delivered by IT projects. It’s about figuring out how much time a new system saves, in monetary terms. And it’s about working out whether new systems are driving new customers to the business – like apps, for example.
Five years ago, the software simply did not exist to provide these kinds of answers. There weren’t solutions that could bring all the data companies were generating together. If you wanted to do a study yourself, you had to use generic, technical statistics apps. But today, that’s all changed. Data analysis has moved on considerably and become a lot friendlier to small businesses. New tools allow companies to assess whether they are making the right decisions with regards to their IT. They’re able to assess their productivity in real time and develop action plans, based solely on the data they collect.
Big Data And The Importance Of Analytics
When it comes to expanding their businesses, small businesses live in the data dark ages. They rarely have any concrete information about whether a new business expansion will pay off.
Take the example of a company that wants to launch a new marketing campaign in a new area. Clearly, the company will want to know what the sales penetration will be and the ROI on that investment. Without data, it’s practically impossible to predict the effect. But with big data, the business can make informed decisions, based on similar campaigns. It can take data from past campaigns with similar demographics. And it can then use those data to predict the outcome of a similar campaign in a similar geography. Businesses that use big data are no longer blind. Instead, they become informed and can make decisions that don’t just rely on instinct.
These big data applications are critical for working out which locations offer the greatest return. Two regions might have dozens of different characteristics. But both might seem like a great place to open a new location. Big data allows small businesses to choose the site that has the best chance of profitability.
The cool thing about big data is that with the right data, information becomes granular. Small businesses don’t just get information on total profitability. They’re able to ask questions like, how many new sales will I make by increasing my advertising budget by 1 percent? This allows small businesses to optimize their limited budgets – something that they were unable to do before.
Finally, data is also being used to improve the customer experience in a way never before possible. Small businesses are able to collect and aggregate customer information. And then they are able to predict their needs, based on the needs of similar customers. Just think how useful this is for things like product selection and advertising. Big data allows your business’s advertisements to be far more targeted to a particular group. By targeting customers in the right way, big data could allow you to increase your conversion percentage dramatically.
Data could also tell you things about the behavioral preferences of your customers. Do they want to be marketed to in the evenings? Do they prefer banner ads? Do they like your content? And how do different customers respond to different methods of marketing?
So How Do You Do Big Data?
The best solutions help to get businesses and IT working together as one, with common goals. With big data, the direction that IT should take is clear. Without it, people are running blind. At it’s best, big data should be able to avoid many of the disastrous pitfalls associated with installing new systems. Big data is a tool to avoid losing time, money and effort so often wasted when IT doesn’t match up to business goals.