Due in large part to the easy sharing of information between connected devices, companies worldwide have already amassed more data than they can manage. There is an ongoing struggle to figure out what to do with it all, and the rate at which we produce and collect data is accelerating.
This is the data explosion.
Most businesses today already possess more data than they know what to do with. In fact, according to Forbes, “On average, companies only use a fraction of the data they collect and store.”
So what should this mean for the future of data management, and the future of business?
What Does the Data Explosion Mean for Business?
Many businesses recognize the inherent value in their data, but few have the resources or expertise to make use of it all - so they store it away. It collects dust on a server or in the cloud somewhere, waiting for the day that it can be harnessed and put to use. However, the risk for companies that are already struggling to store and analyze their data now is that they will collapse under their weight of it all within the next few years. Not to mention that most data has a limited lifespan, after which it loses relevancy and/or accuracy. Finally, businesses incur costs for holding data, ranging from the energy to store it to security and compliance measures that may be required. In fact, only 1% of the world’s data is currently being analyzed, while at the same time, 100% of the data is costing companies CapEx and OpEx on a daily basis.
Yet for businesses that can create and execute on a data strategy, there are significant opportunities for new revenue and business models, competitive advantage, and customer development and growth. To achieve this, the IDC predicts that “over the next three to five years, companies will have to commit to digital transformation on a massive scale.”
The Importance of Quality – In Addition to Quantity
While the massive quantity of data now available to businesses can be thrilling, it is important to be cautious about the data quality. Decisions based on inaccurate or unreliable data are worthless, or worse. One of the questions that will become increasingly critical is how to assess and improve data quality.
How Can We Make the Most of All This Data?
Data has the potential to solve business problems or answer important questions. The key to making use of data is to develop a strategy for it that first identifies the problem or need to be addressed, and then establishes a path for collecting and analyzing data that will solve that need.
To make revenue from your data, you first need to consider three important things:
- A data revenue strategy
- Technology to store and analyze data
- Business processes to create efficiencies and ensure high quality data
We will address all three of these in upcoming posts within this blog series about the Data Explosion. Read more on our blog about how to assess your current data quality.