Data is currently growing faster than ever before. According to the IDC Digital Universe Study, by 2020, we will be creating about 1.7 megabytes of new information every second for every human being on the planet. Our accumulated digital universe of data will grow from today's 4.4 zettabytes to around 44 zettabytes or 44 trillion gigabytes. That's an incredible amount of data, and within it, businesses can find a wealth of valuable insight. While previously, the amount of data available to a business could be overwhelming, this rarely needs to be the case now, according to Paul Toner, partner and head of consulting at KPMG.
"In the past, it was daunting, because you were looking at all this wild data and the most sophisticated thing you had access to was something like Sequel. There are much greater tools out there that will help and automatically look at your internet traffic and feed you back meaningful insights that you can then look at and tweak, that will help you continuously improve what you've got", he said.
Despite the more widespread availability of more sophisticated tools, Toner has found that often businesses still find themselves overwhelmed by the wealth of data and use it as an excuse not to get started making sense of the data they have.
"Businesses can spend a lot of time trying to find 'the' way. What we say to clients is, first of all, it's a journey and it's a journey that never ends. Like all of these things, you're not really going to know where you'll end up but you have to start somewhere. What you need to do first is understand what you've got. You don't need to analyse it to death, but just get a sense of what you've got. The second thing then is to make sure it's secure and also reliable", he said.
"It is a boring journey to get going. There's no black art to this, though there are things emerging that will help. Get your data under control, secure and manage it effectively, and then go to work and see what you get out of it."
The biggest benefit businesses can see from implementing a business analytics strategy is greater surety, according to Toner. While in the past, businesses produced strategies often based at least in part on their own hypothesising, having access to concrete data allows you a concrete base.
"The greatest thing you get is insight. When you've got insight, you can then come up with a strategy to react to it. It will give you a fact-base to support your assumptions of the past, but it will give you a sounder platform for being able to plan or make decisions on future things", he said.
Having this insight not only allows for better business strategies, but it also allows room to discover how to differentiate and compete effectively. Insights around cost allow you to look at how you can take advantage of alternative strategies to reduce costs by appointing different solutions to various elements of your costs. The grounding you get from the data insight allows you to create that cost differentiator.
"If you look at service and customer experience, that can have a dramatic difference. If you've got an online presence and somebody designed it, you don't just leave it there; you continuously look at your customers' habits, then based on feedback and insight you get from that data, you can continue to refine it and make it better. It's an opportunity to remain competitive and create differentiators but it takes the guesswork out of it."
Demand for data analytics is only growing, according to Toner, but what's driving that demand differs from industry to industry. "Fundamentally, it's all about insight", says Toner.
In financial services and retail, a greater focus on digital service delivery has meant a much greater focus on trying to gain an understanding of customer behaviours to try and increase the customer experience, to improve your offering.
For service industries, the focus on cost has brought about a need to get an understanding and transparency around cost to serve. In healthcare, data analytics is providing insights to allow businesses to understand the effectiveness of all the different elements of care, and to link all the different points of contact to create a single view. This makes it easier to determine the best actions to take for patients.
While demand is on the increase and tools are becoming more sophisticated, allowing more and more useful applications of business analytics, Toner feels that we're not getting access to more intelligent data, but as practices mature, we're just finding better ways to apply the data we already had.
"The data that you've got is the data that you've got. The first thing you do is make sure it's reliable, then when you start to combine it and slice it and dice it, you can get more intelligence out of it. I think, for a lot of organisations, what they've got, they understand more, it's more reliable and then they're applying tools on top of it to get greater intelligence", he says.
"It's still not the human intelligence that everyone is forecasting . . . But it's moving the whole thing away from early stages and into starting to deliver an up-growth towards maturity."
This article first appeared in the Sunday Business Post and is reproduced here with their kind permission.