Cashing in on the value of business data

Exploiting data, whether behind a company firewall or with an open approach, can create value and transform business fortunes

The risk posed by disruption has created a new gold rush. Senior executives see the impact of data-savvy startups, such as Uber and Airbnb on traditional sectors like transport and accommodation, and recognise the need for affirmative action. In an attempt to avoid being disrupted, business leaders are seeking insight from their data stockpiles.Researcher IDC confirms this trend, forecasting $187 billion (£152 billion) will be spent on big data and analytics technology by 2019, which is a 50 per cent rise from the $122 billion (£99.2 billion) invested in 2015. Yet executives should note that the introduction of a software tool is no guarantee of success. Technology can only transform business performance if the organisational culture changes, too.Lisa Heneghan, global head of KPMG’s CIO advisory practice, says this change in culture represents a significant challenge for many companies. A large proportion of the history of IT management, she says, has been focused on operational service rather than business enablement.“People say technology is creating a fourth industrial revolution, but it’s only recently that business has been really ready to exploit the tools at its disposal. And that exploitation is creating an exponential shift,” says Ms Heneghan. 

Business transformation

The success of Uber and Airbnb suggests the biggest transformation comes when businesses embrace data and take an open approach to change. Yet an open attitude to the game-changing power of technology is not confined to Silicon Valley. Across all areas of business IT, executives are looking beyond the enterprise firewall, and connecting to external partners and customers.Just as the public cloud has reached a tipping point in terms of business acceptance, so too more executives are willing to share knowledge in the hope of creating new opportunities. Take Omid Shiraji, interim chief information officer (CIO) at Camden Council, who is a big believer in openness. “Expose your data and you’ll get more value than you’ll ever imagine,” he says.Camden uses its open data platform to publish information on publicly funded parking spaces across the London borough. A startup called Appy Parking has built a business using that data. The app uses geo-location data to tell users when and where they can park.“By releasing our data we’ve enabled a business to be created and have improved the lives of citizens,” says Mr Shiraji. More developments could come soon. He says Camden is keen to explore the internet of things and is trialling parking bay sensors. “CIOs must look for ways to change customer experiences for the better – and you can create new value from exposing your data,” says Mr Shiraji.Not all business leaders, however, will find it as easy to take an open approach to data. Decisions about openness are often closely related to sectors and business models. Market-leading technology firms, such as Apple and Google, have maintained a market edge by keeping their intellectual property and details surrounding product releases a closely guarded secret.Research from Russell Reynolds Associates suggests industries that are least disrupted often have perceived higher barriers to entry. In other sectors, a closed approach simply makes good business sense. Executives in heavily governed sectors, such as finance and law, are often unable to embrace openness. However, a sea change is taking place even here.Chris White, CIO at global law firm Clyde & Co, recognises the crucial role of data in his business. The firm runs eight different case management systems, yet the proliferation of information means it can be difficult to create a single view of the customer across a number of lines of business.

Camden Council publishes data on publicly funded parking spaces enabling companies such as Appy Parking to tell users where they can park

 

Value for customers

Big data technology is helping Clyde & Co turn a manually intensive task into a competitive advantage. The firm is using analytics to create case reports automatically and encourages clients to come and see the results in real time. Mr White says an open approach to information can add value for customers.

“If you can mine the data you have, you create something really valuable”

He envisages a situation where quantitative data bolsters qualitative opinion. Rather than simply relying on experiences, lawyers at the firm would be able to look at management information and present a factual answer on the chances of winning a case.“If you can mine the data you have, you create something really valuable,” says Mr White. “Being able to look back on hundreds of cases and tell a client their chance of winning is potentially huge. We can then start to advise, rather than just represent, our clients.”IT leaders at large firms, therefore, are keen to find ways to make use of information that might otherwise stay stuck in data silos. Rob Harding, European CIO at finance firm Capital One, says the key to success is using technology to shorten the time between data collection and the generation of insight.“In Capital One, we used to talk about big data – now we talk about big and fast data,” he says. “I can’t get excited about huge data lakes; I can get excited about being able to generate interesting insight from the data we collect. Using information to improve our product set is for me the essence of big data.”Mr Harding points to QuickCheck, a service-based solution designed by the IT team that allows customers to test their suitability for credit. The firm continues to invest in new analytics tools. Many of the firm’s 30 data science specialists are now focused on using Amazon Redshift to help fine-tune score modelling for the credit risk management of customers.“There’s no end-point to your work around big data,” concludes Mr Harding. “CIOs must think about how quickly they can capture, analyse and generate insight, and then incorporate that knowledge back into something the customer actually finds valuable.”

Source: Raconteur