As companies start using more digital channels and IoT, they’ll have no other choice but to start analyzing all incoming data with powerful algorithms, in order to stay competitive. Big data will be a key to their success
Finding needle in a haystack actually means when something is very difficult (or impossible) to find. In the digital world, where companies are witnessing an exponential growth in their data, this idiom would definitely be true, had it not been for Big data and associated technologies. So, if done right, you would be able to find the needles of insight you need from the haystack of data about your business!
There are a few trends taking shape that will give companies no other choice but to start leveraging big data. For one, Gartner forecasts a 1.5 per cent increase in worldwide IT spending this year, from $3.6 Trillion last year. In this, the IT industry will largely be driven by digital business and a connected world, with spending on IoT hardware likely to exceed by $2.5 million every minute in 2016. So, in the next five years, 1 million new devices will come online every hour.
These interconnections will create billions of new relationships that won’t be driven by data, but by algorithms. It will be something that will drive the future businesses. Without algorithms, data is inherently dumb. In fact, according to various surveys done in the past, more than 90 per cent of the data created is never accessed beyond the first time. Algorithms will change all that as they’ll help pull out insights from this data. Moving forward, M2M communication with IoT will become more popular, and it will be powered by algorithms. Organizations will define new products and services using such algorithms. In fact, this is already creating a need for data scientists in organizations, which HBR (Harvard Business Review) dubs as ‘the Sexiest job of the 21st century’!
Companies won’t have a choice but to use algorithms, and there are enough examples of digitally led companies who’re already doing it. Amazon’s recommendation algorithm is an example of that, which keeps customers engaged and buying. Netflix has a dynamic algorithm that was built through crowdsourcing, and ensures that people keep watching. India’s own unicorn, Myntra.com runs an entire department with only bots and no humans. It uses algorithms to design clothes based on what customers are buying, thereby eliminating the need for fashion designers; and bots place the orders to suppliers.
Besides tech companies, another area where big data and analytics is picking speed is talent analytics. According to a survey by TJinsite and TimesJobs, talent analytics is the future of HR in India, with 65 per cent of Indian companies aiming to embrace Predictive Talent Analytics in next one year. It will be used to predict employee performance, attrition and cost using Big Data analysis. The IT sector will be a pioneer in using this for recruitment, followed by healthcare.
Big data and associated technologies can be a powerful weapon to gain a competitive edge, provided you know how to use it. There are enough use cases now for big data usage by companies across a wide array of industries. The BJP used Big Data to win elections by mining user data to understand voter sentiment and local issues. With 800 million voters, it marked a change in how elections are fought and won in India. Likewise, a matrimony site captures customer registrations and analyses this data to drive marketing campaigns to match potential partners faster. A utility company uses Big Data and predictive analytics to create systems for monitoring water distribution systems to minimize water pilferage by detecting large changes in water flow with real-time monitoring.
Essentially, as companies start using more digital channels and IoT, they’ll have no other choice, but to start analyzing all data that they capture. Big Data combined with algorithms is therefore the answer. It’s something that companies can’t afford to ignore.