December 13, 2019
On big data and its business impacts
Big data has a lavish potential to change the way people run businesses. This year, Statista published some encouraging success rates of enterprise big data projects. The industry-leading companies all over the world see a range of benefits brought in by their big data initiatives, from decreasing expenses to creating a data-driven culture.
Once the progress of data analytics made it possible to analyze large data sets at great speed, big data started to influence internal processes of many businesses. It can determine how decisions are made, strategies are created, and customer relationships are sustained.
In this article, we deliberate on how big data impacts businesses today and outline the major prerequisites for big data to bring benefits.
For many industries, big data isn’t a choice but a naturally shaped reality, as the amount of structured and unstructured data is growing exponentially, along with a wide network of IoT devices capturing it.
The major business opportunities presented by big data for any industry include:
Let’s go over specific use cases for big data in different industries.
Competitors in online and offline retail bite at one another trying to win customers. To stay at a safe distance, companies need to provide a comparatively better customer experience. Big data gives retailers new ways to stay ahead and innovate.
Big data is now one of the critical aspects of the digital customer experience. By collecting data from multiple channels, such as social media, call logs, store visits, browsing history, and other, retailers can get a full view of their customers and fine-tune their operations accordingly, from marketing to customer service.
Such data assets are available not only to Amazon-like giants. Smaller brick-and-mortar businesses can leverage big data to stay competitive too, says Jessica Smith from aifora, a product development company. “Traditional brick-and-mortar have long struggled to collect data from multiple sources, but the advent of new technologies such as RFID, NFC, AI-cameras, people counters, etc. now enables them to collect far more data on their customer's buying journeys.”
She suggests, data sharing platforms might be the answer to the data-collection challenge. “By anonymously sharing their data on one central platform, smaller retailers could build up a big data set, from which actionable insights can be drawn for each individual retailer. On their own, these retailers would not have sufficient data to draw meaningful conclusions.”
You can anticipate customer demand by using big data for uncovering trends such as seasonal demand, promotion success among various customer segments, popular complementary products, and more. Using these insights, it’s possible to build models for launching new products and services.
By feeding big data to machine learning algorithms in retail that power recommendation engines, it's possible to serve personalized recommendations even to anonymous surfers. This way, visitors are more likely to find exactly what they want, as well as purchase more.
Instead of giving way to online stores, brick-and-mortar retailers can tap into IoT and big data to provide unmatched in-store experiences.
Offline businesses can analyze data from mobile apps, online and offline sales, customers’ locations and in-store behavior and use the insights to augment offline experiences, optimize store design and merchandizing, as well as encourage repeat purchases.
Manufacturers leverage big data to improve operational efficiency and enhance business processes with the ultimate goal of increasing profits.
Manufacturers need to analyze production processes in order to react to abnormal events that can disrupt production lifecycles and lead to customers’ dissatisfaction.
Big data helps manufacturing companies keep multiple processes in control, for example, by correlating downtime with other events to understand why the stoppage occurs.
Big data can also be used to prevent or predict when another stoppage may or could happen, explains Maryanne Steidinger (Webalo), who’s been in manufacturing for 35+ years.
“Big data can take in variables such as weather, temperature, line speed, and type of worker involved, and contextualize it, providing meaning to what all of those variables could do within the process.”
Manufacturers use structured data, such as equipment release date, make, and model, and unstructured data, such as sensor data and error logs, to maintain it proactively and save costs.
What’s more, big data helps to plan for equipment shutdown. It’s also used to predict that certain equipment can’t perform within specifications by identifying the strain caused by excessive load or defective parts.
With big data, manufacturers understand how exactly items are moving through their production lines. For example, they can reveal a bottleneck causing an increased production time.
Healthcare services extensively use big data for many purposes, from clinical research and better care to building patient engagement platforms.
Researchers now have a huge layer of data that helps them identify disease genes and biomarkers pointing to health risks.
For providers, each patient goes with a number of accompanying records. Big data is what creates a full view of each patient from multiple data sources and formats. In this environment, each doctor has access to a complete profile, whatever path the patient takes in their health and treatment journey.
Healthcare claims usually consist of multiple associated reports with records kept in different formats. This makes it difficult to apply insurance programs accurately and spot fraud timely.
Big data analysis helps to detect potentially fraudulent cases by spotting suspicious behavior and running checks much faster, compared to long waiting with traditional fraud detection models.
Logistics companies leverage big data to increase the quality of their services and provide safe environment for their employees.
Companies take data collected from GPS trackers, telemetry systems, weather and traffic monitoring services, in order to optimize delivery routes in real time.
Companies use big data to predict demand by analyzing it per customer segments or specific periods. This way, they can reduce order-to-delivery times, anticipate demand spikes, avoid over- or under-stocking, and distribute products among regional warehouses more efficiently.
Logistics companies leverage big data to track the state of their fleet, including fuel usage or braking system health, to optimize costs and improve driver safety.
The high success rates of predictive analytics initiatives based on big data prompt businesses to allocate budgets for the tools that are able to process large data sets using machine learning algorithms.
As a matter of fact, the market for big data analytics apps is projected to grow from $5.3B in 2018 to $19.4B in 2026:
This evident upward trend shows no sign of stopping, but adopters still need to come well-equipped for such data-centered transformations. Big data does need to be harnessed, so we came up with this checklist for you to understand how prepared you are before you embark on your big data journey.
In order to avoid bottlenecks, such as data processing speed and capacity, you need to have the appropriate network, data storage, and processing infrastructure.
The infrastructure should consist of the following layers:
This may sound trite by now, but poor data quality is still taking its toll on businesses worldwide. According to Gartner, bad data costs businesses $15 million per year.
With big data, mistakes just get bigger. Irrelevant, duplicated, missing, incorrect, mistyped, or poorly integrated data affects all business sides that rely on data by their nature: human resource management, customer relationships, supply chains, finances, compliance, and more.
Poor data quality may result from human error, malfunctioning machines, or data being transferred incorrectly and thus becoming corrupted. Even minor errors in big data processing can have a detrimental impact if they influence decision-making or affect customer satisfaction.
One way or another, poor-quality data will show its teeth, and there’s no way to go about it except by investing in master data management (MDM) and data cleaning.
As an umbrella term, MDM includes a range of automated processes that serve the goal of delivering a single point of truth and reference. In the organizational setting, it is a central hub that accumulates data from a range of sources and then shares it between other internal systems without creating duplicates.
You can notice the potential problem here. While there is only one version of data in use by everyone, if this data is incorrect, errors will start snowballing from one data user to another. To prevent this, data cleansing and validation processes should be in place, and it’s not only about having software to perform this task. It’s also about data governance policies and user training sessions on how to fill in, audit, and process data correctly.
Be critical to your data and don’t just assume your data is correct. If data analysis results seem unexpected or suspicious, check the data validity by searching for and fixing errors. You should consult data analysts for an explanation or visualize big data to find extreme outliers and their causes. When data is transferred, be extra aware of possible errors or corruptions.
In some cases, poor data quality is the direct consequence of a migration project gone wrong. For example, now migrating to the cloud is one of the biggest trends, yet cloud computing poses a few risks in its own right.
Data migration failures can result from poorly documented legacy systems, lack of well-described project requirements or thorough testing practices, but the outcome is likely to be the same. That is fractured, lost or incorrect data, which sends us back to the first point above.
To avoid this scenario, data migration projects need to involve specialists from all departments, including real data users. These user groups should collaborate with the data migration team made up of techies and executives, who will guide the project toward meeting the business requirements.
Strategy is also important. That’s why it’s necessary to allocate powerful system resources to support data migration and map out steps for each stage: before, during and after the migration.
Here’s your possible action plan:
Self-service BI tools bring in enormous opportunities to run ad-hoc big data analysis, minimize requests to IT departments, and give business users a better visibility into performance and productivity.
These benefits drive enterprises to make self-service BI applications their highest strategic priority. However, some of the users of advanced and predictive analytics, like business, financial and marketing analysts, won’t necessarily succeed when dealing with such applications.
The first pitfall is in the lack of role-tailored customizations. Part of the self-service BI success is having readily comprehensible interfaces and dashboards based on end users’ needs and preferences. Yet, these users can be the ones left out of the picture when the actual system is developed and deployed. Skipping the stage of interviewing end users and incorporating their feedback upfront might keep user buy-in down simply because the users will find reports and layouts irrelevant.
Another potential loophole is in low technical proficiency of self-service BI users. While analysts may know their job well, it’s unlikely they can start using a completely overhauled analytical platform right away. Counterbalancing this risk requires investing into user training in the form of typical demos and ongoing learning sessions, aimed at educating the BI workforce about technical implications of self-service BI systems.
To cut it short, it’s better not to overestimate your users’ technical skills but prevent productivity losses upfront.
At large enterprises, different data types are scattered across departments. They are stored for different purposes and owned by different teams that often don’t communicate as efficiently as they should. Sometimes, one department stays unaware of the data located at another department, and therefore can’t take actions on it. This means overlooking a tremendous value that such cooperation could bring.
Such internal bottlenecks can be caused both by the lack of cross-departmental collaboration and poor system interoperability. Either way, remember that departmental division and information silos should not intervene with data dissemination throughout the enterprise.
A good starting point would be to bring together employees in charge of enforcing shared data policies in their respective teams. You could rely on your high-rank professionals who could motivate the rest of the organization to minimize bottlenecks and lags in data delivery.
Speaking of system interoperability, this should be addressed at the technical level, to provide accessibility that would satisfy security and efficiency standards. First, it takes mapping out data consumers to create a role-based access model with well-defined user rights. This would help you avoid data privacy issues and any cases of intentional or unintentional data misuse. Second, maintaining common data formats is key to your ability to use this data across internal systems.
The steps to overcoming internal bottlenecks include but are not limited to the following:
Big data has a say in many industries, from manufacturing to healthcare. However, like any enterprise innovation, big data projects come at a cost. This cost can be well-balanced with an appropriate degree of preparation, though. Big data and its business impacts are tremendous, and many business executives have already started enjoying the benefits. The secret recipe of this success is likely to be in a well-thought-out strategy of developing and adopting big data management solutions.
This guide has demonstrated how big data can be useful in different industries, as well as summed up four areas where big data will demand your attention—from data quality and migration precautions to self-service BI proficiency and internal stoppers. Just remember that each of these aspects can affect the value of big data initiatives in their own way, so addressing them is much easier before you set off.
Find out 5 predictions of the future of big data up to 2025 and its influence on consumers and businesses worldwide according to experts.
Learn about the benefits of big data visualization and get a checklist of things to look for when picking the vendor.
Read our Tableau vs Power BI comparison to review the major pros and cons of each tool and choose the best option for your business.
Discover new opportunities machine learning brings to retail, improve the efficiency of your processes and personalize customer interactions.
Look up the various use cases, challenges, and benefits of applying IoT in retail in Itransition’s guide.
Find out how Itransition migrated a BI suite to the cloud and delivered brand-new cloud business intelligence tools for the automotive industry.
Utilize these 5 steps to guarantee a safe, efficient and cost-effective cloud migration strategy for your company.
Learn how data storytelling helps businesses get all the teams on board for reaching common strategic goals.