What is Big Data?
First coined by the philosopher Aristotle: “The Whole is Greater than the Sum of its Parts” is a great way to describe the value of big data. There is normally an abundance of data in any business which is great, but it’s a lot more valuable when brought together under one analytical model.
Big Data is an extremely large data set that generally needs computational analysis to identify patterns, trends and correlations. It allows you to see new, or different solutions that you never knew existed.
Big Data has been around for a long time, but has only been in the hands of those who had the power to manually capture this data, and more recently, those who had the money to invest in systems to record and store the data. However, in the digital age that we live in today, and with the increase in advanced technology to record transactions at minimal costs, the amount of data in the world is doubling every 2 years, which means that we are surrounded by an overwhelmingly large amount of information to try and make sense of. The abundance of information does not necessarily mean that the information is valuable, because it only becomes valuable when you use it to identify and act on opportunities that will help grow your business.
An example of Big Data in a retail business is the sales that it makes to its customers. There will be thousands of orders taking place every single day from customers. They will be purchasing various products at different prices from different shelf locations and at various times of the day. Add all this data together and you have a set of Big Data.
The data needs to be relevant.
The aim is to have the information available as quickly as possible so that you have enough time to analyse it and take action on the opportunities identified while the data is still relevant. Some data sets tend to lose value with time, so it’s important to ensure the data that you are using is still relevant to your business question.
What are some of the opportunities?
It’s very hard to accurately and effectively identify and summarize big data call outs without doing some form of analysis. Through thorough analysis, you can start identifying trends or gaps in your business, which is when you start identifying opportunities.
The biggest opportunity with Big Data is that it gives you the chance to make better decisions on optimal resource allocation. Knowing who your most valuable customers are, or what your most profitable products are, allows you to optimally invest in your marketing and sales strategy to improve your business offering.
Every business should be making decisions based on facts. But you can’t look at facts alone, you need to be able to understand their meaning and how the facts interact with each other and how they may change under different scenarios. Running a scenario analysis allows you to prepare your business for different outcomes based on the decisions that are made. This makes you strategically better off, more flexible and ready for what lies ahead.
If you have any questions, please feel free to get in touch with us.