We live in an era where information is available on every conceivable aspect of business management, marketing and customer acquisition. The temptation is to think that the more data we have, the better our business can perform. But that is not always the case.
We live in a world where companies store and use a massive amount of information (data) regarding their clients and customers.
All of this data and information is helping businesses do a better job at serving customers. Although big data is useful, it can make life difficult for businesses.
In the last few years, the world has seen an increase in the data available to organizations. According to Science Daily, from 2011 to 2013, 90 percent of the world's data was generated.
Each day, businesses produce and release data that could be useful to someone. Sometimes we generate data even without meaning to; for instance, when we get recorded in the mall's closed-circuit TV camera system.
The data from each source is then combined into a larger group. All of these sets of data have to then be analyzed, managed and interpreted by professionals. We refer to this data as Big Data.
We all acknowledge that our ability to manage and generate data has improved dramatically. We can also accept that our ability to handle big data will improve over time. But when we look at the amount of data we have amassed in so short a period, the question for businesses is: Do we really need it? Is it valuable? Who benefits from it?
How it's used
Yes, we surely do benefit from big data. Here are some ways big data is helping organizations to achieve their goals:
- Improvements in health care
- Advances in research
- Insights into customers' behaviors
- Understanding and optimizing business processes
- Optimization opportunities for individuals
Why it's good
Big data isn't all talk and no action. Volumes of data have enabled organizations – and even individuals – to increase their efficiency and optimize themselves.
Over time, companies have used big data to come up with ways to better serve their customers. This big data is then used in targeted advertising, which enables companies to cater to the needs of a specific niche.
Individuals, too, can benefit from data generation. Smart bracelets, smartwatches, in short, all smart devices analyze a large volume of data to get insights about the individual.
Big data and data analysis is being utilized in most, if not all, digital dating sites and dating apps in order to create, "matches made in heaven." Even in health care, big data is used for drug testing that has increased the likelihood of identifying drug-related side effects.
Why it's a problem
With the increased use of data, problems arise. As the volume of data grows, a company's ability to benefit from it declines. In other words, with too much data at hand, companies fail to make sense of it, which can eventually result in unstable strategic decisions.
It's vital to understand that voluminous data is not always good for a company. Data can only be considered good as long as it enables you to make reliable decisions. In short, more choice doesn't always improve results. It is not a straight line from data to productivity or profit.
Having more data will not always mean better business. Indeed, too much data can actually make it harder for business leaders to know what to do. On top of that are the increased data security risks inherent in storage, management and software development.
Entrepreneurs, managers and decision-makers may suffer information overload – often the result of having too many choices. These circumstances can easily create gaps in planning that allow for security vulnerabilities.
Making the most of big data
By managing big data properly, companies can leverage it to their advantage. First, businesses can reduce the problems of big data by having more effective data management systems in place.
Most companies end up duplicating a great deal of data as it moves from department to department. By developing more universal management systems, businesses can reduce their data – and subsequently their storage and infrastructure maintenance costs.
Business owners can look at data warehouse software and hardware options that help integrate data across platforms, systems and departments.
Audit your data
In order for big data to be used productively, a business needs to commit to auditing its own data. Most data will have its own life cycle. Data that has fulfilled its purpose needs to be scrutinized. And if it's no longer of value, it needs to be removed from the system.
It may also be necessary to bring in expert data and systems management consultation to provide a more objective view of a company's true data needs.
Visualize your data
One of the biggest game-changers for small- to medium-size businesses has been not only how to store data, but how to make the most of the data they have. Data visualization helps overcome that obstacle.
Historically, businesses have presented and comprehended their data using graphs, charts and basic diagrammatic symbols. The limitation here has to do with the relationships between sets of data. For example, understanding the relationship between the history and current pharmaceutical treatment of a medical patient, or the relationship between a customer's purchasing habits and their hobbies, career or education.
Data visualization allows businesses to break up big data into smaller, more manageable chunks, which is vital for effective data analytics. Data visualization tools, such as Tableau and Infogram, allow users to visualize and understand data in new and more effective ways.
Big data visualization creates an interactive environment in which people can explore the relationships between big data through personalized animation, graphics and other rich media. It helps businesses to see the connections between data and how it can assist their economic, marketing or user-experience goals.
Finally, the advent of cloud computing and storage has made it possible for businesses to totally reconfigure their data-management systems.
Businesses must do their own due diligence here to ensure they are engaging with a cloud computing system with high integrity and minimal risks. They need to be able to trust that the service providers are safeguarding the valuable data of its clients.
An ideal scenario in the better management of big data will be a gradual movement from private cloud solutions to more secure hybrid systems.
Ideally, big data being management by businesses will prove to be a means of boosting revenue, rather than a revenue sinkhole. By managing big data more efficiently now, businesses can only stand to gain from the insights and productivity that big data promises to deliver.