What proportion of a typical meeting in your organisation is dedicated to reviewing what’s already happened, and how much to figuring out what needs to be done next? In most businesses, the ratio is about 80:20 – (that same magic ratio that I wrote about in my last post). That means a lot of sitting round a table discussing old news and rehashing past performance: time and resource which could have been spent on driving the business forward.
This scenario could become at thing of the past with Big Data – a term I’m loathe to employ as it’s been hijacked, misrepresented and over-hyped to the extent that its significance has become as obscure and nebulous as “Cloud” before it.So let me clarify: running a “real time” business, by putting the ‘b’ word and the ‘d’ word to work, isn’t simply crunching millions of historical records in seconds or minutes, instead of hours or days – although admittedly, speed can be a major competitive advantage.
Big insight – by which I mean combining scale or diversity of data with rapid processing capability and analytics – can unlock significant value by making information available at much higher frequency. Being able to blend together torrents of live information from multiple sources and turn it into answers on the fly, instead of setting up a formal IT project or waiting on regular reporting schedules, can create a seismic shift in business processes and decision-making models.Think what you could do with the capability to expose variability, identify patterns and spot opportunities or risks based on data so fresh that the proverbial ink is still wet. This is the art of turning multi-dimensional data into business signals.
For example, imagine a store that traditionally relied on historical sales figures to anticipate demand for specific products. The conversion to real-time retail involves analysing the live electronic point of sale transactions, and triggering automatic stock replenishment when predetermined thresholds are approached to ensure continuous on-shelf availability. The likelihood of running out of stock and losing sales, or being lumbered with products that won’t shift, is dramatically reduced. At the same time, the amount of capital tied up in stock should be reduced helping improve the balance sheet.
It’s a simple illustration, but whether you’re at risk of running out of egg and cress sandwiches or component failure on industrial plant, the ability to take action based on what is happening in actuality could be a vital differentiator. At the very least, you might be able to spend less time in meetings.
For some useful tips on applying analytics to your challenges, keep checking the Top Tips over the next few weeks.