June 18, 2020
Organizations looking to mitigate risk while making their businesses more agile and responsive are using big data to transform how problems are viewed and strategic policies formed. By embracing the capabilities of big data, they’re able to make more informed decisions that help them gain a competitive edge, improve overall performance, and boost their bottom line.
Big Data is Big Business
“Big data” refers to vast sets of digital information businesses use to analyze and reveal patterns, trends, and associations as they relate to human interactions and behaviors. Based on facts instead of intuition or past personal experience, this evidence-based information can be used to automate processes, gain insight into target audiences, and improve performance using readily available feedback.
Amazon is the recognized leader in using big data; collecting its customers names, addresses, search histories, purchases, and wish lists to produce advertising algorithms and improve customer service. But other, less well-known or niche organizations are also integrating big data to boost their brand’s success:
- Accounting, audit, and financial advising firm BDO uses big data to identify risks and fraud during audits.
- Government agencies such as U.S. Immigration and Customs and the Department of Homeland Security use big data to keep passengers safe and prevent terrorism.
- Next Big Sound provides analytics and insights for the music industry. It gathers data from iTunes sales, Spotify streams, social media likes, and more to predict the next big thing in music.
With 2.5 quintillion bytes of data created each day, enterprises that know how to properly collect, analyze, and transform their own data into value-added information have the power to enhance business performance and ROI.
Building a Data-Driven Decision-Making (DDDM) Culture
Though the quote is often attributed wrongly to Einstein, it remains true: The definition of insanity is doing the same thing over and over again and expecting a different result. When enterprises rely on intuition or past experiences to guide future initiatives, they can find themselves making decisions that don’t pan out. What they often fail to take into consideration is times and people change and what was relevant when one product or service launched may not be consistent with current market trends.
The most important step in adopting a DDDM strategy is the first one. Acknowledging decisions based on facts can help you:
- Become more agile
- More quickly identify new business opportunities
- Respond to market changes ahead of your competition
Research backs these claims, with studies showing businesses that use big data for making decisions realize up to a 10% increase in profits and a 10% decrease in overall costs. Data can be used to make financial, growth-related, marketing and sales, and customer service decisions that drive your business forward.
Here’s how putting your faith in big data works and how it can pay off:
- Analyzing data to find the questions that need answers lets you focus on responding to customer needs.
- By reducing or eliminating bias in decision-making, you can let the data speak for itself; you can discover more and better opportunities.
- When objectives are defined before analysis begins, you can create strategies that avoid hype and instead serve your business needs.
Because the timeframe for decision making is rapidly decreasing, organizations must make decisions more quickly than they did in the past. Real-time data helps improve customer engagement and retention while boosting employee productivity and job satisfaction. Today, big data platforms backed by Cloud provider technologies like AWS, Azure, and Google Cloud are being used to provide personalized, multichannel experiences that are timely and relevant.
The Future of DDDM
Looking ahead, enterprises that can quickly adapt to sudden market changes are the ones that will survive and thrive. Creating a data-driven culture takes time, but by investing in the right tools, you’ll be able to swiftly measure results, become more competitive, and deliver higher-quality, reality-based decision making.