A recent Economist article (Little things that mean a lot) on Big Data discussed that the use of data can actually help find many small changes that add up to large impacts over time. This is in contrast to the idea that Big Data will help you uncover a single insight which will change your business.
The article points out that this use of data no longer applies to just the Google, Netflix, and Amazons of the world. Operational companies are also applying these ideas:
Take, for instance, UPS’s 60,000 delivery vans in America: the company crunches the data on the 100 miles or so a day that each one covers, and uses its findings to perfect the software in the navigation devices installed on board the vehicles: it reckons that cutting each route by just one mile would save it $50m in fuel and other costs a year. Big Lots, a large American discount retailer, tried out numerous variations on its in-store financing offer, to identify the most profitable one to roll out. It altered such things as the size of the downpayments and the repayment schedules, and tried a variety of ways of marketing the scheme. Juggling all the permutations of these, it says, produced a combination that increased furniture sales by 9%.
This article reinforces one of the key ideas of the analytics movement– every company should be looking to better use data to help make decisions and find improvements. Most companies have more data than they realize. And, many companies are not yet taking advantage of the improvements in IT and open source software that that will allow you to better access and analyze this data.
With our clients, we are seeing the opportunity to re-imagine old data-intensive processes to create more efficient processes that lead to better decisions at a lower cost.