The amount of data in the business world has been rapidly growing over the past few years particularly with the development of technology. This data is often collectively and commonly termed ‘Big Data’. When used effectively, it has the potential to become the next frontier for innovation, operational excellence, competition and profit.
Undoubtedly the explosion in the volume of data organisations are capturing about their customers, suppliers, employees, operations and competitors, both directly and indirectly, can generate tremendous insight. In their 2011 study the McKinsey Global Institute identified potential benefits of this insight across many sectors; from billions of dollars per annum benefits for health care and public sector administrations and increases of up to 60% in operating margins for retailers. Furthermore, in today’s consumer driven environment, business decisions can no longer be based on what has previously been successful. With the shift in power towards the consumer, there is now a requirement for highly personalised services, recommendations and communication. Consumers want to receive the right message at the right time through the right channel. If organisations fail utilise their data effectively to surpass these customer expectations, their competitors will leave them behind.
Despite this, a recent study conducted on behalf of Total System Services Inc. (TSYS) has shown that over 30% of organisations are not utilising their data to drive business decisions. With evidence suggesting that utilising customer data effectively can lead to improved customer relations, customer loyalty and advocacy – why would organisations choose to ignore this important resource?
The issue may stem from the organisational culture – perhaps there is not a customer centric culture, or the decision makers do not understand the value of customer data? Some organisations may argue that they are not equipped to deal with customer data or changes that may stem from customer insight. Or do organisations believe that in simply gathering ‘big data’ they are doing enough?