New technology has made it easier and less expensive for companies to store and process massive amounts of data.
The data many traditional enterprises sit on offers incredibly valuable insights for improving their current operations, but more and more firms are realising this data also offers a foundation for market research and industry benchmarking that can help other businesses make decisions.
Data has the potential to be repackaged and “commercialised” as an alternative revenue stream. Just look at how Foursquare, with data from 50 million monthly users, recently predicted a precipitous drop in Chipotle’s sales ahead of an official earnings announcement.
This sort of data – gathered from check-ins – could be incredibly helpful for Chipotle and other retailers to see how their traffic is fluctuating, and react early.
However, we’re still in the beginnings of how data is being used to gain internal insights. Many companies want to build a data-driven culture to improve business practices or improve customer service, but they lack a standardised process and technology infrastructure that is able to collect and transform that data so it can be distributed downstream for broader use among various departments.
Many organisations still have tightly coupled applications and data in various formats that are not easily brought together into a single data lake or warehouse for analysis.
Every time a request is made, it turns into a custom process, with labour-intensive data extraction and transformation before it can be analysed.
Very few companies have the type of centralised data architecture that makes accessing data on demand a reality.
But new tools and technology are helping companies standardise data and bring it into a more agile environment for processing and distribution, enabling them to react quickly to timely requests.
What once took months can now be done in minutes with the right technology and process.
The first phase of the big data moment is being able to improve business practices through internal insights, and while it’s still not occurring everywhere, it’s becoming more common.
But it’s data’s usefulness for third parties that holds great potential for the future. Many traditional enterprises have an opportunity to commercialise their data and introduce a new revenue stream into their business model.
In fact, businesses like Comscore and GuildQuality have built extremely successful businesses on collecting and delivering highly targeting and incredibly powerful data sets. But what about the traditional enterprise?
Look at ATT, for example, which has three times as many users as Foursquare’s 50 million. Financial services is another industry this model makes sense for. Some financial institutions are already commercialising data in partnership with their customers.
A good example is State Street’s Global Exchange business. State Street is a 223-year-old custodian for $28 trillion in financial assets. As a result of its core business, it has access to the inner-workings of the global financial system.
Its global exchange business unit is delivering new data and investment products from State Streets data assets. Products such as the GX Private Equity benchmark which tracks the performance of the private equity asset class.
Banks like State Street store and process millions of transactions every day. Insurance companies have built their businesses around analysing data to predict risk.
This data can be extremely valuable to other business, such as retailers trying to gain insight into consumer spending and saving habits and possibly be used to make predictions about sales and market trends based on data and cyclical observations.
And with the advent of digital records, healthcare is another industry for which the commercialisation of data would be a natural fit.
While many companies sitting on these mountains of data aren’t yet fully exploiting it for internal decision-making, even fewer have begun to commercialise it.
Improved data collection and analytics technologies are changing the ability of many businesses to gain internal insights around the data they’ve collected.
As more organisations invest in the technology and develop strategies to collect, store, access and analyse data, they will quickly overcome existing hurdles in gaining access to data currently trapped in silos and difficult to reach in a timely and useful manner.
Beyond gaining internal insights, alternative or commercialised data is poised to emerge as a common and practical business practice.
Commercialisation of data is not easy – but done correctly, there will be rewards, both financially and potentially for society.
Data can open a new world in how we understand the impact of everything from markets to medicine on our daily lives.
As company’s mature in their ability to manage data for their own decision making, they should not miss the opportunity to understand how data can benefit their existing customers as well as expand their reach into new markets.
In the coming years, firms will look to their data not only as a source of insight for their existing business but as a strategic foundation upon which to build new businesses.
Sourced from Josh Rogers, CEO, Syncsort