The big data revolution that we witness today has transformed companies and revolutionized the use of data as we know it. No leading company today disputes the use of advanced analytics for decision-making and its crucial role in transforming the industry.
Given the significance that big data analytics has today, there is no denying that it is here to stay. So the question is: how is the digital use of data transforming the world? Did world leaders predict such a massive change?
Data is termed the “new oil” in the 21st century, and the opportunities it offers to businesses and corporations explain its popularity in the global stage. However, there is more to big data analytics than what meets the eye.
Before we discuss how big data impacts companies, it is imperative to understand how data analytics can revolutionize an enterprise. Here are some factors that might explain its significance.
Targeted Marketing
Generating leads and increasing revenue is something that all companies are looking to achieve. By using big data analytics, businesses can create targeted marketing campaigns. The data channel that you use for targeted marketing determines the success of the method; data channels and streams allow you to understand the needs of the customers.
The use of big data analytics allows customers to predict customer behavior. Companies and businesses can use past trends to understand what the customers would like to have in the future.
The current data you possess does not have the potential to predict your customers’ needs in the future. Businesses use the data to specify target audiences and potential customers, providing them with a significant advantage.
Cross-Selling and Up-Selling Opportunities
One of the major benefits of using data analytics is that you get the opportunity to cross-sell and up-sell products. The business intelligence tools will help you in gathering the information while the data analytics will analyze the collected information.
Analyzing the data collected will allow you to attract customers proactively. As mentioned before, you now have access to information regarding potential customers, their behaviors, and their possible reactions. The whole process makes it easier for you to develop a strategy for cross-selling products.
Before you navigate the area of cross-selling, you need to be aware of the expectations and demands. Holders of B2B businesses need to consider customer reviews while discussing the points that attract their existing customers.
The process, however, is slightly different in case of B2C companies. These companies have a direct connection with retail customers using options such as social listening, programs of customer reviews, and campaigns on social media.
The whole process of cross-selling is to offer the customers a better service so that the fruitful business relationship continues. You can also use the help of special services to maintain the relationship. These services apply to both B2B and B2C companies.
Efficiency and Costs
One of the major problems that ventures struggle with is decreasing efficiency. This is the Achilles Heel of millions of businesses around the world. Experts believe that using data can help solve the efficiency problems plaguing the industry.
Using big data means that now you are recording each process and product as it moves through the different stages. Industrial engineers analyze the data to come up with a solution for the efficiency problems your business faces.
The theory of constraints works perfectly well alongside big data. The method involves the identification of the most critical limiting factor which stands in the way of achieving a target.
Using data makes it easier for you to identify the constraints limiting productivity. Identifying the constraints and then getting rid can lead to a significant increase in the efficiency levels of a business.
Just as big data analytics helps in reviewing the production channel, it also helps in assessing the cost of production. The use of big data highlights the areas that need a reduction in business costs.
Since the use of big data allows you to predict the future, it puts you in a position where you can plan and control the production limits. It is easier to control the inventory and manage costs when you are aware of the customers’ needs and predicted behavior.
An inventory expense is an excellent example of how big data analytics helps you in reducing the cost. It is expensive to carry inventory, as the costs of tending to the inventory are significantly high businesses need to know periods of high sales. Using big data analytics means that you are now aware of the right time to purchase inventory and keep it in hand. This reduces the cost of keeping the inventory and ensures efficiency in the production line.
Rise of Data Departments and CDO
Not only is big data changing the way we deal with customers, but it is also changing internal operations. During the 80s, Information Technology came to the forefront of business operations. It was the driving force behind the increase in productivity.
In addition to the IT department, it was the chief information officer that was responsible for creating new opportunities for a company. However, things have changed today as it is the data departments that are replacing the IT departments.
Today Chief Data Officers are replacing the Chief Information Officers and ensuring the smooth incorporation of data with the digital.
Much of the changes are due to the rising significance of data. The absence of data today costs significantly higher, which is why businesses are absorbing big data in organizations.
Knowing the main advantages does not explain how the data-driven revolution is stamping its authority in the corporate world today. With companies becoming increasingly data specific, the following reasons explain why the change is evident.
Purpose-Driven
One of the major advantages of using big data analytics is that it gives companies the luxury of being purpose-driven in their approach. Companies can now review the statistics in a multidimensional manner, meaning that you can hold variables independently and study their effect on your business.
The data points can be hard to find, but they offer great rewards for companies. This was not possible before and is changing the market to be more specific in their target approach. The data points help you in choosing a particular target and purpose for the business. It is now much easier for you to identify factors that are limiting the business and focus on improving them.
Big Data Analytics and Data Science
A field of study that is becoming increasingly important today is data science. The study deals with the accurate interpretation of information obtained from different sources for the purpose. Big data is available in high volume and velocity. The data set is available from various online networks, which include social media, logs, audio, and video devices, and web pages.
Machine learning, natural language processing, statistics, and data mining are a part of data science. Large Corporations use these techniques for big data analytics, which helps provide analysis for the business. The use of these data sources is not limited to a specific domain.
The researchers using the tools of big data analytics can efficiently access data. It uses the help of unique data analytic tools to structure the data and analyze it.
The use of data science and the growing significance of data mean that companies are now pursuing a strategy of keeping the consumer the focus. With consumer habits now available in the form of data, companies are now becoming more strategic in their operations. Businesses are now becoming more aggressive in their pursuit of profits as they believe data has their back.
Using the latest analytic tools can help increase the efficiency of carrying out operations. Tools such as Hadoop are a great way to analyze data and reduce the cost of storage.
Industries that are witnessing a Change Due to Data
The enormous growth in the field of big data analytics is visible by the change the following sectors have gone through over the past 5 years.
- Healthcare
- Banking
- Technology
- Energy
- Manufacturing
These are some industries that have witnessed rapid changes over the past few years. Big data analytics is revolutionizing operations in the industries and is leading to more automation.
The rapid digitization of the banking sector and the automation of the account opening process is an example of changes the industry has gone through.
Automation of Customer due diligence (CDD) and Enhanced Due Diligence (EDD) and making the account opening process more data-driven are steps that indicate the change.
Attaching risk to an account has become easier for banks, so it has targeting finance products to specific customers. Both the operations require customer data and past records, which is now easily accessible thanks to the data revolution.
Healthcare analytics is a method that health experts are using to ensure the supply of the best healthcare facilities to their customers. Hospitals are using healthcare analytics for improving their performance and efficiency; they are also using it to reduce the waiting times.
The revolutionary big data analytics has changed the healthcare industry by being more personal when tending to the sick. Doctors can use data to improve the patient’s overall experience. It is also leading to a better health environment by reducing the rate of readmission and leveraging the population health data against the patients’ personal data.
Many insurance claims and concerns of health are a result of a human error. A physician prescribing the wrong medicine to a patient increases risks while also increasing the cost of insurance. Businesses can now create a platform for business intelligence to prescribe medication according to the data. This is particularly helpful for a hospital that is host to numerous patients suffering from various diseases daily.
States and governing bodies can use the information to provide better healthcare facilities to the population. This is particularly helpful for developing economies that are home to a huge population. The governments of these economies are using predictive analytics to prevent the outbreak of a virus and provide areas with a cure for chronic illnesses.
Companies Embracing Data Analytics
With big data and the Internet of Things, the future is upon us. These are exciting times for the business world as predicting customer behavior and preferences are now becoming much easier.
Companies are making sharper conclusions with the help of big data analytics. Companies that were smart enough to get a lead by joining the bandwagon are reaping their rewards. Companies hesitant to adapt to the change stand the risk of being left behind.
However, intelligent companies with creative minds will not take long to regain the lead by improving their performance. Organizations are now systematically combining minute improvements across different sectors to multiple processes so that the payoff is exponentially is higher.
This sounds challenging than it actually is because you can divide each and every business process into smaller components. Improving efficiency levels of the smaller components allow you to reap high rewards for your business.
Decoupling a severe business for analysis can lead to great results for a business. A manufacturer, for example, can now use different techniques of business analytics to study the various stages of the model.
With the help of big data analytics, manufacturers and companies are rationalizing their end to end operations. They are linking it all the way through stock management, transforming their business on the road. Using the approach has allowed manufacturers and business owners to get savings that approach 50 percent.
Business needs to embrace a change such as big data. Failure to do so will leave you with very little time to find ways to tackle your competitors and provide quality products to your customers.
Chris Giorgio is the President of Fully Accountable. Fully Accountable is an outsourced accounting firm specializing in eCommerce and digital businesses. Chris has served as a CPA, CFO and has over 14 years of experience in the accounting and finance industry. Chris has dedicated his career towards helping entrepreneurs and high-level business owners achieve greater profitability through specialized outsource accounting functions.
