The Growing Importance Of Big Data In Business
As with most walks of life, business has transformed considerably over the last twenty or so years. Since the growth and sophistication of the internet and emerging technologies have increased, their influence on all aspects of society has been unmistakable.
Indeed, the internet’s reach has become so prevalent across all parts of society that many experts suggest we are on the cusp of a fourth industrial revolution – an age of increased automation, artificial intelligence, and machine learning.
With the vast amount of data now being collected by computers has come increasing demand for analysts with skills capable of collating, interpreting, and understanding the reams of information gathered. Somewhat ironically, many of these skills can be learned over the web, and there is now a huge range of degrees and qualifications available – everything from business analytics masters online courses to specific data analyst training.
How big data is used in business
In days of old, business owners would have to manually try to predict market forces, buying habits, and consumer preferences. Now, with so much more significant information available, bosses can gain a far greater understanding of their markets and predict with accuracy what goods or services might be in demand.
To take a simple example, all supermarkets know that, in the run-up to Christmas, shoppers will increase the amount they buy – and can be sure there will be a sharp rise in the demand for turkeys. However, that doesn’t mean turkey is only eaten over the festive period, but with the big data now available, these same supermarkets can study buying habits over the entire year, to predict with accuracy the demand for this type of meat.
Of course, big data doesn’t just stop there. Data analytics is now having a huge impact on all areas of work. Pretty much all companies generate data of some kind on a daily basis – whether that be sales stats, employee information, customer details, or even just payroll information. All firms are different and generate different amounts of data; however, across the board, it’s now estimated that humans produce around 2.5 quintillion bytes of data per day around the world – much of it by companies.
The data generated by firms is now ushering in a new era of understanding and empowering businesses to make informed decisions based on real, trusted information. However, having access to data isn’t enough by itself – in order to you properly interpret and understand information on this scale requires formal training – for example, a business analytics masters online course or similar. Here are just a few ways data is improving the world of work and the effect it’s having to effectively streamline business processes.
Superior business intelligence: Having a greater understanding of how a business works puts owners and bosses in a far better position to make predictions on how a company might perform in the future, its growth potential and also gives them the ability to anticipate consumer demand. Moreover, by using Business Intelligence (BI) tools across a corporation complete with data intelligence and visualizations, managers and business owners can get a clearer picture of how their business is performing – and likely to perform in the future. Data is now at the heart of almost all companies and drives many of the key decisions made by firms on a daily basis. As the scope and sophistication of this software increase, so the extent of understanding will increase. The greater a firm integrates with BI tools, the better the insight to the firm becomes. Nonetheless, no matter how intelligent this software becomes, there is still the need for human interpretation – typically performed by a skilled analyst who might have studied a business analytics masters online.
Happier, more satisfied customers: All businesses operate to make money – and the best way to do that is by ensuring your customers remain happy and satisfied. In today’s highly competitive world, it’s becoming harder and harder for firms to attract new clients. The fast-moving, slightly cut-throat nature of internet marketing, social media promotion, Search Engine Optimization (SEO), and other online promotional tactics mean companies can’t afford to sit still – and, more importantly, can’t afford to lose clients. A happy customer is significantly more likely to make a repeat purchase – and possibly even recommend a business to family and friends. The importance of customer satisfaction really can’t be over-stated – and data analysis can help considerably. In order to adequately serve its customers’ needs, a business can either wait for clients to come forward with suggestions as to what they actually want or can attempt to preempt what they want first. By studying and analyzing customer data, previous buying habits, products of interest, and personal data, a company becomes far better informed on what its clients’ needs and wants – in turn, improving customer satisfaction (and possibly even attracting entirely new clients). With so much commerce now happening online, it’s also possible to study browsers’ habits and see which products appear to more popular with more potential buyers – again, giving e-commerce firms a considerable edge and advantage over their real-world competitors. In days of old and traditional brick and mortar stores, there simply was no way of knowing which items attracted the most interest – and even the sales data was harder to interpret, normally just a ledger at best. Data analysis completely turns that on its head. Again, a knowledge of data analysis is required to properly interpret the data gathered so, if you’re interested in getting a better handle on your clients, you should consider studying a business analytics masters online.
Improved marketing with precise targeting: In a similar way to predicting what a client might want to buy, data analysis can also put firms in a much better position to predict what style of marketing might work best to attract new clients – and, almost as importantly, where they should concentrate their marketing and on what particular vehicle (e.g., traditional forms of advertising like TV, radio, press or choosing to spend more on more modern forms such as internet marketing and promotions). For example, a woman’s clothing store could start out targeting the 30-40 age group but, on studying its sales and client data, might find that actually, the majority of its customers were in the 20-30 grouping. In this instance, the firm might decide to increase its budget for web marketing, SEO, or social media promotions i.e. technologies used much more by younger consumers. In this instance, they would also likely change the style, tone, and imagery used in their advertising to attract a more youthful market. Using data in this way, the firm would be empowered to be moreon point’ with its promotions, in turn increasing sales and widening its customer base. With so much business and taking place online in the internet age, it’s become significantly more important for companies to have a better understanding of their potential markets – and to target them precisely. Data analysis offers this with extreme precision and allows companies to devise significantly improved marketing campaigns and promotions. Studying a business analytics masters online will help your company interpret this data better, so you have a clearer understanding of how to promote your company.
Improve internal process to drive efficiency: Data analysis can be used for far more than just understanding external business processes like clients’ wants and needs or the best type of marketing to employ. Rather, if used effectively, data can also provide valuable insights into the inner workings of a firm. Data is now the backbone of most companies, and with such high integration with modern technology these days, it’s possible to study everything from staff efficiency to a company’s most-used software – which can lead to far greater efficiency and opportunities for streamlining expenses. For example, when a company is starting out, bosses often overbuy when it comes to software, without really knowing if the apps they’re buying are needed. On average, it’s estimated that each computer in every office around the world has, on average, $259 data of unnecessary, unneeded or unwanted software on it. With so many apps now moving to subscription models, this kind of needless spending can soon mount up and can cost firms considerably. However, by studying usage statistics and having the skills taught in a business analytics masters online course, bosses can soon identify and eliminate this type of wasteful spending. It doesn’t just stop there either – with modern project management tools, managers can now study employee productivity and time spent on individual tasks to get a clear picture of each employee’s overall efficiency. As these types of software improve in the future, this kind of deep-down monitoring and understanding will only increase and improve the overall throughput of firms, allowing for greater streamlining and allocation of resources. Data analysis also lets businesses isolate areas of waste – both in terms of time and money – to improve overall processes.
Driving down costs and promoting better efficacy: As a company builds more data over time, it becomes possible to make accurate predictions regarding trends for the possible demand and supply of goods and services. Studying previous data and employing a combination of predictive science and event prediction techniques (exactly the types of skills taught in a business analytics masters online course), companies are enabled to make accurate decisions regarding anticipated resources or needs at any particular time of the year. So, for example, if previous data suggests that the first three months of the year are the busiest a company gets, bosses might look to hiring freelancers for this period to cover the potential shortfall. The cost reductions can be substantial taking this ‘on-demand’ approach to requirements – in this case, removing the burden of employing workers full-time when, really, they’re only needed for this short period. The benefits of taking this same approach of only investing in resources as required is perhaps most evident in the Fast Moving Consumer Goods (FMCG) sector, particularly with regards to foods that have a limited shelf-life. It’s for this reason that big data analysis has now become a tool so beloved by the larger supermarket chains around the world. By closely studying consumer habits and purchasing trends, supermarkets can go a long way to eliminating waste from food going out of date or other products becoming unusable through passing their sell-by date.
Improving websites, apps and e-commerce platforms: It may take a little time to build up by closely studying client-generated data in apps or online; a company can vastly improve the efficacy of its website or other associated digital tools. There are now numerous web-based tools that can allow website administrators to see which pages, products, or information is most viewed or used by site visitors. It’s very common for companies to set out a rough sitemap when initially building their website only to then find that information they buried way below the homepage is actually of the most interest. Using these monitoring tools, the web admin can effectively change the focus of a website to bring this more popular content to the fore, perhaps even featuring it on the homepage to make it easier to find. Using a combination of these tools and also SEO tools (plus the skills and knowledge built up from studying a business analytics masters online), it’s also possible to track consumers’ passage through a site or app to discover the precise buying track and route to purchase. This type of monitoring has been used to great effect by e-commerce powerhouse Amazon. In fact, in a recent study, it was found that one second extra loading time could cost the company as much as $1.6 billion. Using data on this level has helped Amazon become the commercial behemoth it is today – but it’s still worth remembering no matter how small your company is, the rules stay the same.
The take-out
There’s little doubt that big data and data analysis are having a considerable impact on the world of business – and, in fact, the world in general. With the impending predicted explosion in the Internet of Things (IoT), our understanding of business processes and the planet is only going to increase (as is the amount of data we produce). The IoT is essentially an internet of smart connected devices capable of gathering, broadcasting, and interpreting information. These days, an increasing number of our everyday devices are being fitted with chips so they can communicate to each other or, more commonly, to mobile apps – however, the tech is perhaps best utilized when it’s applied in the manufacturing sector to effectively automate and monitor many of our previous human-performed production tasks. The IoT is set to considerably increase the amount of data we produce and, while many detractors suggest computers and tech are removing jobs, it’s very likely demand in the data analysis sector will increase, requiring the skills of analysts who will need to have studied a business analytics masters online or similar.
As our data production levels increase, so will our understanding of the world around us alongside our ability to streamline business processes and drive efficiency. In very real terms, we’ve only just got started on this exciting, data-driven future.