7 areas in organizations about to be transformed by big data
Tom Davenport, professor at Babson College and author of the new book Big Data @ Work, says big analytics go well beyond the constraints of the more conventional analytics companies performed in the past. Davenport, also co-founder and research director of the International Institute for Analytics, and a senior advisor to Deloitte Analytics, says the term "big data" is imprecise and abused by vendors. However, it means a major shift in thinking for many decision-makers, as it means access to new data sources never before imaginable.
Here are key areas across enterprises about to feel the impact of big data, if they haven't already:
Strategy: "If you are simply relying on internal information and your own experience, you are going to come up short as a strategist," Davenport admonishes. "The big data that is probably most relevant to big decisions is Internet data -- addressing what people around the world are saying and doing."
Marketing: "Imagine the value of knowing not only what your customer is saying about you in social media, but exactly when he or she has entered your store," he says. Plus, big data analytics helps marketers see patterns within omni-channel relationships, as customers move from channel to channel.
Supply chain: "Radio frequency identification (RFID) devices -- long discussed as a means of monitoring supply chain movements -- are now actually becoming available at a reasonable cost," he writes. "The potential to identify supply chain problems in real time and take immediate correction action is greatly enhanced."
Manufacturing: "Manufactured products and manufacturing equipment increasingly contain data-producing sensors. Machining, welding, and robotic devices can report on their own performance and need for service."
Human resources: "This function could go a substantial step further in terms of analyzing employee location and communication data.... The best organizations of the future will be those that design and actively monitor the collaboration and communication activities of their people."
Finance: "In the near future, big data will find its way into corporate finance departments... With the greater availability of external data,they are likely to become more involved in assessing the risk of working with particular customers, suppliers and business partners."
Information technology: "The IT function, which often stores and crunches big data, could also rely much more on data in making its own decisions. Virtually all IT devices -- computers, network equipment, storage devices -- throw off data about their own performance that can be analyzed, explained, and predicted."
While these developments are promising, many executives are taking too complacent of an attitude on the changes big data is bringing, Davenport says. "To get out ahead with big data, you need to have extended discussions with your company about what this new tool might mean for your industry and business, and about what your response should be."
— By Joe McKendrick on February 13, 2014, 10:30 AM PST