There is no doubt that the digital age has transformed the way businesses and governments operate. But at what risk?
As technologies develop, masses of data are being generated – sometimes unintentionally – bringing to the fore a new technological trend that is believed to be helping businesses gain greater competitive advantage in a way that has never been seen before. It comes in the form of what is known as ‘Big Data’.
According to global IT and technology provider IBM, the world emits 2.5 quintillion bytes of data on a daily basis – so much that 90% of the data in the world today has been created in the past two years alone. It comes from everywhere and anywhere, and takes the form of instant Google search results, mobile satellite navigation, and real-time news through social media streams.
There are varying interpretations as to what constitutes Big Data. Analysts generally talk about it in terms of the three Vs: volume; velocity; and variety regarding structured or unstructured data. For many businesses, Big Data also lies in company records. Fundamentally, it is a means to make accurate predictions about risks and opportunities. It is now possible to assess large volumes of data, identify patterns and infer probabilities with much greater speed and precision. The supermarket loyalty card is a good example: retailers have been able to track their customers’ shopping habits, so that they can better target their marketing materials and increase sales.
A key risk for businesses is not knowing what data they have and where it is.
Christian Toon, head of information risk, Iron Mountain
Data is there to be used and monetised. But some companies may be missing out on profit-making opportunities. The term Big Data has been used more and more recently, but is often associated with negative issues such as security or data protection lapses. As a result, companies may have overlooked its strategic potential by dismissing Big Data as simply the latest buzzphrase.
Taking control of your data is crucial. “So many people have spoken about Big Data, and it’s been the subject of quite a few recent keynote speeches. As a result, it has lost its meaning along the way,” says Christian Toon, head of information risk at US-based information management firm Iron Mountain. “A key risk for businesses is not knowing what data they have and where it is.
“Managing Big Data is no different to managing records around your business. It’s these principles that companies need to take through with them when they approach Big Data. It is fundamental to know what data you have and where it is.”
“Similarly, being unaware opens the gateway to possible security attacks because businesses remain oblivious to the data assets that they may need to protect,” Toon says. However, given the sheer volume of data a business must handle, it may not be easy to draw conclusions from the information. It is for this reason that firms are advised to approach the management of Big Data with a single vision.
IBM associate partner and security services delivery leader Brendan Byrne says: “Businesses have to be clear about what they are trying to achieve. Big Data is not something organisations should fear – it is something to be embraced, as there are numerous business benefits. If you have a vision you can focus on specific streams of data that will be most valuable to your organisation. “It’s not easy to start because some companies will have vast amounts of data. Big Data is not a quick win; it’s something that needs to be factored into business plans.”
The outcomes for some businesses have been groundbreaking, with many putting Big Data to radical new uses. Working towards a single vision has helped one US healthcare organisation to save thousands of lives. In a project involving 157 hospitals, Premier Alliance – which serves more than 2,600 US hospitals and about 84,000 otherhealthcare sites – claimed it saved an estimated 24,800 lives and reduced healthcare spending by $2.85bn (€2.13bn).
It achieved this by developing an integrated set of data models with IBM, from which it could analyse clinical and operational data, as well as logistics around medication. As a result, the firm was able to identify the treatments that worked best in responding to particular illnesses, helping healthcare practitioners to deliver quicker and more efficient treatment.
Other firms have also been using data analytics to address key risks affecting their organisations. One such issue, absenteeism, was ranked among the top 50 most critical risk areas for organisations across the globe, according to Aon’s latest Global Risk Management Survey.
One of the company’s clients, an international hotel chain, made headway in using employee data to improve its attendance levels. Aon Global Risk Consulting chairman Stephen Cross said the system is still in its infancy, but the hotel chain has been looking at records to identify factors such as where employees live, how they get to work, and length of tenure. “It’s quite extraordinary what you can predict from that,” he says, citing that one of the uses of the data gathered by the hotel group was to help it profile the ideal employee.
Making the most of social media
Unstructured data in the form of information on public forums has also been shown to help brand reputation. Starbucks, for instance, is often touted as leading the way with social media strategy, boasting more than 34 million ‘likes’, and displaying high consumer engagement with campaigns to attract feedback and draw product ideas.
The rise in social media has opened the gateway for businesses to manage their brand. US sports nutrition organisation Gatorade is doing well with this, says Cross. The company’s management of unstructured data has helped it gain competitive advantage.
He adds that investing the time and money into assessing these data streams could help businesses respond to a crisis that might be surfacing in the company’s brand or respond to negative comments. “You’ll be surprised how quickly you can pick that up from an open-sourced unstructured forum,” he says. “So there is a lot to be done there – it’s expensive and time-consuming and it’s not the core competency of most firms.”
The benefits to storing and managing Big Data are clear. With the right approach and understanding, profits can be made, new opportunities created and risks managed more easily. However, there is still some way to go before significant numbers of businesses take to the concept of Big Data. Getting to grips with the data available is a major challenge, and it will involve investing time and money.
As Mark Walton-Hayfield, principal at US-based technology solutions provider CSC, said at an Institute of Risk Management seminar on Big Data in May: “Companies need a strategy on Big Data to compete at the levels that are required today. The challenge is to get ahead of that opportunity and capitalise on the ability to make money from the Big Data that exists.”
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