Global businesses are spending much more time focused on data, huge amounts of data. In 2017 data was calculated to be more valuable than oil, making it the most valuable resource! This is big news for business, those have data and are able to use that data have grown significant businesses. You can’t but help to think about data businesses like Facebook, Google, Uber, and Airbnb.
Why is data so valuable? In simple terms data provides information and with information comes an insight into trends that when predicted correctly becomes immensely valuable. Hypothetically, imagine you could travel back in time (say 15 years) with all the knowledge you have today. What would you do? Start a social network, a ride or property sharing service. You might if you had the time build a smart phone.
Obviously we can’t time travel but with the knowledge of future events, we could make better-informed decisions to influence the present. This is what data has allowed – if you were an advertiser you would obviously want your adverts to get to the right people (people who are going to buy your products). Social networks and search engines collect data about our personal habits (more on that a bit later) and determine what would be interesting to us. It is also ideal for using their software effectively but equally ideal for advertisers to target a very, very specific market. If we consider my time travel example again but imagine not going back in time, rather predicting the next 5 minutes. In this case, we want to predict which people will click on the link to an advert.
Data gathered from past interactions are in indicator of interest in similar topics for the future. If the data is right, the user will click the link – thus making the advertiser very happy and giving the company a repeat customer. The user is also happy because they get something they are interested in.
Admittedly, the theory of a search engine or social media is well established. What’s new? Thus far data has been gathered by computers from human interactions. That’s great for predicting human interactions but thus far not great for dealing with any other interaction that does not involve it being captured into a computer.
The big picture for 2019 and going forward! Imagine an airline cockpit. In the cockpit, the plane reports on absolutely everything that is happening inside and out of the airplane. The pilots control everything from a single source. Business trends are moving in that direction but are being expanded upon 10 fold because of the internet. Sensors, connected to the internet are now able to report on every aspect of a business’s process and report automatically. Where businesses were reliant on staff to input data or measured their success based on a finished product they can now accurately measure what’s happening in the middle, and visualise it from a “business cockpit”.
There is a dark side to data namely privacy and hacking/security. Let’s start with privacy. Personal privacy is very different from business privacy. Personally, I’m not very happy for someone to know my every movement but that isn’t to say that nobody can know my location ie my wife can see where I am especially while I am out running. Personal data privacy becomes complex and in my mind revolves around consent. Businesses own the assets, or have a right to the components in the operations to know what is happening – the consent of a business tracking its own data is already implied because they are giving themselves the right to keep track of their own assets. There is another important distinction. The data being gathered isn’t necessarily of a personal nature – a business may gather data on how fast their machine is moving. If there is a slow down it may be an early indication of a part failure. Gathering data of that nature is neither controversial nor personal and can only serve to improve the operations of the business.
Let’s make it practical. Data seems very much like an IT department’s responsibility. In reality, IT typically should not be very involved. Data gathering is only a part of the process. If we consider the end goal – data serves to provide the business with knowledge of what is happening with their operations. Managers need to design their systems and ultimately base their overall decisions on what the data is saying with regard to the systems they have designed.
Businesses who want to take advantage of data need to first understand what problems they want to solve or what information they need. They need to ask critical questions of their own processes in-order to gather the right information.
Data is only valuable when it is analysed. The business process needs to speak directly to the data gathering to make it worthwhile.
What about IT? They will help install the sensor or upload the code required. IT from an operational viewpoint isn’t designed to provide operational business management, they’re designed to provide IT services.
Data is gathered for business to make them more profitable through wasting fewer resources, making better decisions and operating more efficiently. If we think back 40 years – personal computers revolutionised the way we worked allowing us to be more profitable, 30 years internet connectivity brought the world closer, 20 years – the cell phone and then the smartphone. In every instance, technology has allowed businesses to re-engineer parts of their business to allow the new technology to make their business flourish. Data is the next trend, but it is going to work a bit differently.
Businesses need to understand their models and be able to identify problems. Eg are all my staff working or is my stock arriving at customers unbroken. They need to start asking questions about why events happened and then find ways to interpret their data to find solutions.
Key factors business managers need to focus on;
- Problem identification
- Solution finding
- Process engineering and re-engineering
- Finding efficiencies
Business optimisation is a complex topic in itself. If we consider that once a problem is identified, and solved it can’t be solved again – well, not in the same way. If a business wants to continue finding ways to improve they need to solve every problem they can and constantly find new issues to solve. Technology trends are the most pragmatic way of doing this.
TechThrive helps businesses find problematic areas of their business and provides solutions based on accurate real-time data collection from within the core of the business activities. Contact us on 010 007 1717 or firstname.lastname@example.org or www.techthrive.co.za