For almost a decade we have been hearing about this big data. About the way it would impact businesses, about the way it would transform businesses. For a while, the hyperbole was rather intense – “data is the new oil”, “an answer to all marketing challenges”, and so on. Many detractors thought it was a lot of fuss. The data was always there, they said, and people knew how to use it and analyze it. Now that data is captured from many sources and has big volume and complexity, we do have the hardware and software applications to deal with it and process it accordingly. So, is the Big Data just a lot of fuss, or is it really important for businesses and justifies the hype being created around it. Let’s take a look.
What is Big Data
Firstly, what’s so big about big data. Nothing big really, the experts say. Except that it differs from the structured databases, which we have been used to all along, starting from spreadsheets to the relational databases-RDBMS. What makes big data different are its three primary dimensions, which are volume, velocity, and variety. By velocity we mean the rate of receiving data. Variety means different data structures received from different sources, which makes data integration very complex. Lately, another dimension called variability has been added, which refers to consistency of data flow.
Big Data is, thus, a very large mix of structured and unstructured data that can’t be processed by conventional software. Even though it provides major challenges in capture, storage and analysis; it greatly enhances decision making, provides valuable insights and also helps optimize processes.
Traditional data sets are expanded to form Big Data, with data from social media, browser logs, and even real time data from sensors. This data is very complex and presents challenges to integrate and clean. It needs analytics to identify patterns, unknown correlations, market trends, preferences etc. It also needs analytics specialists, who use their knowledge and judgment to extract actionable information.
Importance of big data
Big data started out as a useful tool for market analysis. It has been expanded for use in almost all types of industry sectors, been adopted by government, and even used in sports. For instance, in Formula 1 car racing, real time data is received remotely from various sensors placed in the racing cars. This data is real time and is analyzed through parallel processing using high end processing hardware and specialized software, with an aim to provide important information on any impending part failure or to make strategic decisions during the race.
Consider marketing, and see what kind of information a marketer would need. Big data helps in determining customers’ buying behavior in terms of when, where, and why of what they buy. It can also suggest how to predict market trends, how to target promotion to the clients and prospects. It can also help improve supply chain efficiencies.
For Healthcare too, Big Data is offering multiple benefits. In the United States, the state run healthcare system has 4 major pools of data. These are clinical, activity and cost, pharmaceutical and medical products, and data on patient behavior. Big Data is helping in driving efficiencies and quality in the entire healthcare system. One of the major benefits of big data has been in analyzing health outcomes of pharmaceuticals in terms of benefits and risk. At another level, big data analysis has helped physicians identify treatment courses for best outcomes, at reduced cost and improved productivity.
Some examples of benefits drawn from big data –
Coca Cola: Some of the major benefits attributed to Big Data by the company –
- Identified ideal ingredient mix to produce juice products.
- Improved efficiency in retail supply chain and warehousing.
- Highly improved understanding of customer behavior by integrating and mining data from POS, social media, and relevant customer data.
- Helped create digital service centers for HR processes and procurements.
Netflix: This new age company has started using Big Data to identify key parameters about viewership, to help expand its business in different parts of the world. Some of the benefits it obtained from big data:
- Trends of content consumption by different viewers in different regions.
- Trends in program viewership in different regions.
- Devices used to watch Netflix.
- Analysis of content consumption by viewers over time, programs watched by viewers in terms of series, movies, etc at different times of the day during the week; also binge watching trends have been identified.
We can see that Big Data has been adapted by not just businesses, but by nation-wide systems and missions such as healthcare. When people say that Big Data has the potential to transform businesses by predicting trends and improving processes, there is credible evidence to support it. Declaring that Big Data is all fuss, is being rather harsh and skeptical. With continual improvements in machine algorithms and analytic tools, and with advent of cloud computing; benefits of Big Data would accrue to even smaller businesses in the not too distant future.