Responding to the Age of Big Data
Jinho Kim PhD.
Representative Swiss school of Management, Liaison Office in Seoul / www.ssmseoul.kr
“The future is already here. It’s just not very evenly distributed yet.” This statement was made by the novelist and futurist, William Gibson. The fact that “the future is already here” can be evidenced by terms like big data, artificial intelligence, and the Fourth Industrial Revolution no longer feeling foreign to us. But what does it mean when it’s said that the future is “not very evenly distributed”?
The forces bringing the future into our present are the explosion of data driven by mobile technology, sensors, and social media, leading to the advent of the age of big data and AI. Big data contains detailed information about customers and markets. Therefore, businesses that can utilize it will naturally have a competitive edge.
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However, to leverage big data, firstly, companies need the capability to extract insights about their customers and market from the plethora of data about who is doing what, when, where, how, and why. These insights aren’t magically bestowed, but rather, they arise when data is viewed strategically. Steve Jobs once said, “People don’t know what they want until you show it to them.” Companies now need to discover what consumers want through extensive data analysis. Relying on intuition is no longer a virtue for managers.
Secondly, businesses must have an infrastructure in place to use these insights for decision-making that will enhance customer satisfaction and company performance. By infrastructure, we’re referring to processes of business operations, decision-making, and organizational culture. The uneven distribution of the future implies that while some businesses are equipped with these capabilities, many are not. This disparity is expected to grow even starker. Hans Rosling, a statistician, mentioned, “The problem in business isn’t the lack of data, but failing to find the necessary data and not knowing how to handle it.”
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No matter what kind of organization you belong to, whether a conglomerate, SME, startup, nonprofit, or any industry like manufacturing, finance, distribution, healthcare, or IT, your world is already awash with data. Almost every sector and business function is undergoing changes due to big data. Companies that don’t adapt might not just lose their competitive edge but might fail to survive. Charles Darwin, the founder of the theory of evolution, stated that “It’s not the strongest species that survive, nor the most intelligent, but the most responsive to change.” Companies need to seriously ponder how to adapt effectively in the age of big data. “Change is not just essential for business; it’s the very nature of business.”
Technologies present around us as the future include social media, mobile technology, the Internet of Things, cloud computing, and AI. These technologies, when combined in various ways, have a profound impact on business strategies and outcomes. How can companies actively respond to these changes?
Firstly, businesses need to digitize their operations. This involves leveraging the five core technologies of the big data age: social media, mobile tech, IoT, cloud computing, and AI. Businesses must constantly evaluate how to innovate by incorporating combinations of these technologies into different areas of operation.
Secondly, business leaders need to adopt an analytical mindset. The success of digitized business heavily relies on data-driven leadership. This is because true potential is realized when leaders recognize the power of analytical management and actively drive it forward. Managing analytically means trying to solve most business issues based on data analysis. Specifically, this involves systematically collecting related data, analyzing it statistically to draw insights on why certain events occur, and actively using these insights for strategic decision-making. This approach relies on data and facts, not past experiences or intuitions.
Thirdly, under the guidance of data-driven leadership, a company culture where decisions are routinely based on data should be established. For a digitized business to succeed, attitudes, processes, behaviors, and technologies of many organizational members need to change. This shift won’t happen by chance. An analytical culture is cultivated when leaders emphasize decisions to be based on data. Leading global companies like Google, Apple, Amazon, eBay, and Netflix all have something in common: they harness their competitive edge through data-driven management, backed by leaders who have instilled and normalized an analytical organizational culture. A famous saying shared by these leaders is, “In God we trust, all others must bring data.” For instance, Gary Loveman, CEO of Caesars Entertainment, often asks his employees, “Do you think or do you know?” Every employee suggesting a strategy or plan must provide evidence to support it. He’s even known for saying, “There are three ways to get fired from this company: theft, sexual harassment, and making statements without backing them up with data.”
