Written by Ameya Keertikar
A mere 32 years ago, we were watching blockbuster hit Terminator 2, crashing our screens with epic visuals and explosions. And while Arnold Schwarzenegger’s film may have been a fun watch, there were a couple things wrong with the film’s predictions of the future. Although we might not have punk, killer humanlike robots surrounding our entire world, we have gone digital in an otherwise unpredicted fashion: data. In the recent few decades, our world has hit an otherworldly speed of data consumption. Just simply peering into your pocket, you can see a hand-sized marvel of tech, integrating cutting-edge hardware and software to enable a vast array of functionalities, from communication and entertainment to productivity and education. From our media, to our food and our finances, statistics runs the world around us and it’s nearly impossible to avoid seeing some implementation of data on any given day. While companies in the past have been able to thrive using their typical methods, if they are to survive in the modern day, business must place a higher emphasis on data analytics to aid their success.
For those who are unfamiliar, data analytics is the process of collecting, filtering and analyzing vast amounts of data to extract insights that could be used for evaluation. For companies of all sizes, not only has it become a helpful tool, but almost a requirement to manage all operations within a corporation. Businesses can use data analytics to improve their operations by evaluating data faster than previously. Almost 100 years ago, processing data involved hiring an entire team specialized in marking down stats and facts on various diaries, lab reports and other paper based journals. With the transition to bulky computers in the latter half of the 20th century, data management became a daunting task, as these new computers took substantial space and time for very little storage. However, the recent bloom of the internet and advancement of computers and software in the 21st century has made computer based data analysis the cutting edge for any business to stand out and thrive (Novotech, 2022).
Additionally, this new tool can let businesses make better decisions as they can get a better understanding of their audience and operations scope, and use that to gain a competitive advantage. According to the Harvard Business Review article “The Business Case for Data Analytics,” data analytics can help businesses to increase revenue by identifying new opportunities for the company to take and improving marketing campaigns by analyzing data from already existing marketing campaigns and implementing that info (Bean, 2023). Furthermore, data analytics can reduce costs by identifying inefficiencies and streamlining processes. A final use of data analytics is that it can improve decision-making by providing insights into customer behavior, market trends, and financial performance. A successful implementation of using data would be the colossal streaming platform, Netflix. In this example, Netflix used data analytics to recommend movies and TV shows to its subscribers based on consumer preferences. Another major company is the shipping behemoth, Amazon, which has used data analytics to personalize product recommendations and improve its supply chain management.
In the article titled, “The Top 10 Data Analytics Trends for 2023”, there are various current and prevalent trends mentioned that are shaping the future of data analytics as the real world sees it (Bean, 2023). One of these would be the rise of artificial intelligence (AI) and machine learning (ML) in our society. One major instance of this is Walmart’s major implementation of AI in recent years. With this new breakthrough, Walmart can use this technology to predict demand, optimize delivery routes, reduce waste, and identify new product opportunities (Torres, 2022). With how complex these two are, AI and ML are being used to automate data analytics tasks usually done by humans. With this new approach, it allows companies to develop conclusions from data that would be nearly impossible to make with otherwise traditional methods. Another important focus is the emphasis on real-time data analytics. Business decisions are being made and determined on around-the-clock factors and moments. As a result, it becomes ever more important that businesses use real-time insights from their data so that they can make decisions in a timely fashion and respond to constant changes in the market. One more thing this source outlines is the growing importance of data governance. As businesses start to collect and store more data, it is important to implement systems to manage and protect that data so it can be referred back to and utilized down the line. In the article by The Customer Success Platform titled “How Businesses Are Using Data Analytics to Improve Customer Experience”, the author explains how businesses also use data to improve their customer experience (Patel, 2022). One instance of this is businesses using data analytics to identify customer preferences, personalize communications to every client, and resolve customer issues more quickly than previously done. Improving in these aspects is so important as business because it means being able to spend less resources- like manpower, time, and money- into data analytics and instead being able to invest these resources into other areas of the business, working on improving company image and maintaining operational efficiency.
In the McKinsey Quarterly article, “How Data Analytics Is Helping Businesses to Navigate Uncertainty”, it discusses how businesses use data analytics to navigate uncertainty in today’s volatile market environment (QuantumBlack, 2019). For example, businesses are using data analytics to identify new market opportunities. Additionally, implementing this new resource can help assess the risks of new initiatives, as well as better decisions about how to allocate resources. Oftentimes, stakeholders must make multi-million dollar decisions that could potentially determine the future of their businesses. Any wrong decisions can result in at minimum millions lost, and at worst the downfall of the entire business. With data analytics, businesses can minimize their chances at losses while also optimizing their opportunities.
Data analytics is the most powerful tool that businesses can use in this day and age to improve their operations, make better decisions, and gain an important competitive advantage. As the world becomes increasingly data-driven and increasingly more digital, now is more important than ever for businesses to turn digital and invest in data analytics capabilities to stay ahead of the competition.
Works Cited
Bean, R. (2023, January 30). Has Progress on Data, Analytics, and AI Stalled at Your Company? Harvard Business Review. Retrieved November 1, 2023, from https://hbr.org/2023/01/has-progress-on-data-analytics-and-ai-stalled-at-your-company
Novotech. (2022, November 16). Clinical Data Management: Past, Present and Future. Novotech CRO. Retrieved November 1, 2023, from https://novotech-cro.com/faq/clinical-data-management-past-present-and-future
Patel, J. (2022, June 3). Importance of Data in Customer Success Management. CustomerSuccessBox. Retrieved November 1, 2023, from https://customersuccessbox.com/blog/data-analytics-and-customer-success-management/
QuantumBlack. (2019, September 19). Catch them if you can: How leaders in data and analytics have pulled ahead. McKinsey. Retrieved November 1, 2023, from https://www.mckinsey.com/capabilities/quantumblack/our-insights/catch-them-if-you-can-how-leaders-in-data-and-analytics-have-pulled-ahead
Torres, R. (2022, December 13). How Walmart enhances its inventory, supply chain through AI. CIO Dive. Retrieved November 1, 2023, from https://www.ciodive.com/news/walmart-AI-ML-retail/638582/