Let’s stop the meaningless chatter about big data and start talking about results.
Everyone in the world of business is engrossed in the possibilities of big data and analytics. More often than ever, we’re seeing how these highly sophisticated tech-driven capabilities revolutionize customer service and marketing strategies. It’s apparent that data-driven insights are pushing us toward uncharted territories and innovative directions, even when they diverge from our traditionally accepted knowledge.
In our preoccupation and awe with data and analytics, are we straying from what really matters in business?
While the impacts of data analytics continue to astonish, organizations should be careful not to get lost in technologies and lose sight of the value of insights. In his article that uncovers costly statistical mistakes made by huge corporations like Google and Target, Financial Times writer and economist Tim Harford said:
“…big data do not solve the problem that has obsessed statisticians and scientists for centuries: the problem of insight, of inferring what is going on, and figuring out how we might intervene to change a system for the better.”
This triggers the question many business leaders and data workers across industries have avoided asking: In our preoccupation and awe with data and analytics, are we straying from what really matters in business?
How many organizations are drowning in data?
In the paper The Chief Data Officer: Bridging the gap between data and decision-making, data software provider Experian Data Quality said that 95% of the chief information officers (CIOs) interviewed believe that data changes the way their organization does business.
That’s not even remotely surprising, but the study also revealed alarming statistics. For instance, it said that 83% consider data as a valuable organizational asset that is not being fully utilized and that 64% think their organization is not maximizing the use of data to drive business growth.
If data is such a priceless asset, then why do many companies fail to leverage it or turn it into business strategies? According to the same report, there are two umbrella issues stunting big data utilization across organizations: practical and organizational.
Under practical issues, businesses are struggling to capture and analyze large volumes of data that often have highly variable attributes. In the end, therefore, what they get are poor-quality data, questionable results, and ill-informed decisions.
The second one—organizational issues—pertain to a massive skills gap, the need for a data-driven culture, and the lack of direction when it comes to data analytics. Basically, managers are clueless about who should oversee the individual processes and which departments must be involved. Without the right internal framework to support data-related processes, therefore, many organizations end up squandering their money, time, and material resources.
Next: Are we losing our human touch?
Personalizing customer experience is one of the most talked about applications of big data. Using an endless stream of information—such as email engagements, campaign responses, mobile usage, geolocation, customer service transactions, and many others—organizations will be able to target specific customer needs.
This is a lucrative opportunity for brands. An infographic by marketing services provider Monetate states that companies experience a 49% increase in revenue growth upon investing in data analytics. In addition, 35% of marketers say personalization aided by data and insights has improved the way they engage with customers.
In fact, approximately 85% of companies are now implementing some form of personalization. The sad thing is that 55% rate their own strategies with a grade of “C” or lower.
The struggle to turn data into actionable insights adds to the challenges that companies face as they aim to personalize their customer service and marketing strategies. And amid this too much focus on data-related processes, companies risk losing their ability to provide humanized services. Although personalization must be the end goal of analytics, organizations won’t be able to fulfill it if they don’t know exactly what they want to do with the technologies they’ve acquired.
It’s worth taking a step back from our preoccupation with big data and re-strategize. Business leaders need a solid understanding of the customer journey and experience so they can set specific personalization objectives. This way, when they approach the towering heaps of data they collect, they’d do so with a purpose. This would let them identify the data they need and the data they don’t.
There’s never been anything like the data revolution in our entire history. But entrepreneurs are facing a huge challenge, and that’s to put customers—not data—at the heart of all their business strategies. It sounds simple, but while organizations are too busy figuring out how data analytics works, they might keep forgetting the things that truly matter to them.