Is Big Data Just a Business Fad?
By Ryan Ayers
When it comes to hot new industries, big data appears near the top of the list. It seems like every company is hiring for roles in data science, and new startups are basing nearly all their business decisions on the hard data they collect. The sharing economy operates using big datasets, and it's becoming hard to imagine a world without big data usage. Of course, the amount of data is only expected to grow-potentially to 44 zettabytes by 2020. It's impossible to deny that many businesses have had massive success using the big data approach, trimming their internal inefficiencies and improving overall service. However, many trends in business simply don't last long-term, and the popularity of big data isn't necessarily built to last. Is big data just a business fad, or something that will transform the business world for years to come and provide lasting value to companies?
What is Big Data?
Businesses have always collected and stored data from their customers, but since the advent of the Internet and the vast number of mobile devices in the world today, the amount of data that has become available to companies has become massive. These large datasets comprise what we know as "big data," datasets that are too large to analyze manually, but can be processed with algorithms to find specific insights that can help a business grow and succeed, informing everything from internal processes to advertising campaigns. For example, big data could be used to analyze shopping trends within a company's entire customer base to help generate a new advertising campaign, or it could be used to tailor coupons and other offers to meet individual customers' needs.
Big data's potential doesn't just help by increasing engagement with customers and increased revenue, however. It can help with making large-scale hiring decisions, calculate risk quickly, and even detect anomalies to protect against cyber-attacks, a growing concern every year.
Big Data's Success
Though only 23% of organizations in 2012 had enterprise-wide big data strategies in place, many companies have had major success applying this approach to different aspects of business.
UPS boasts one of the most impressive big data stories of all-using data, they optimized the route data for all their drivers on a daily basis, preventing wasted distance and saving time and fuel costs. Using powerful algorithms, UPS's big data system "Orion" can calculate the best route for a driver in about 3 seconds. This had saved the company 1.5 million gallons of fuel and 14,000 metric tons of CO2 emissions after being applied to only 10,000 of the standard routes out of 55,000. The company has continued to build on this success since 2013, and has more than proved that its investment in big data has been worth it.
Big data isn't just helping companies save money, however, it's helping to save lives. Hitachi Consulting, Vital Connect, and ClearStory Data teamed up to help hospitals fight sepsis-a deadly infection that kills hundreds of thousands each year in the US. It's also an expensive condition to treat, costing hospitals about $20 billion per year. Using a proprietary patch, the device developed by the three companies monitors vital signs and relays that information back to a smartphone app, which stores the data in the cloud. Caregivers can then see if signs of sepsis are imminent and take action immediately, potentially saving the patient's life.
Big Data in Organizational Leadership
Today, big data has become such an important tool for businesses that it has begun to play a large role in organizational leadership and development. Instead of building strategy based on experience and assumptions, senior executives can now use big data to help shape strategic decisions in a more informed way. 44% of executive and C-level executives believe that data is an important tool for decision-making, and the success many large companies have enjoyed supports this view. Using data effectively can help improve customer relationships, product development, and make organizations more organized and efficient.
A Versatile and Valuable Asset
While there are some concerns about how big data held by private companies could negatively impact the general public (and public opinion tends to worry about privacy over the benefits of collecting and leveraging data), the use of big data has been overall helpful to companies and their customers alike. Despite concerns of privacy, most people are willing to offer some of their data in exchange for convenience-data that can be used to help serve customers better in the long run. Due to its versatility and ability to reveal powerful insights, it seems that big data is valuable enough to continue as an essential business focus. No wonder nearly every company is trying to get on board with this trend, and make it work for their goals.