Data: The New Green
The Economist recently ran a special report on managing information that prompted some thinking. First, some big numbers from the report: Wal-Mart handles over 1 million sales transactions per hour. Facebook houses some 40 billion photos (after only 4 years of operation). Cisco estimates that Internet traffic will reach 667 exabytes by 2013.
With some 60 million people on Twitter, according to comScore data (November 2009), there are roughly 10 million tweets a day. This doesn’t account for the content – characters, photos, articles and video content. I also found that YouTube has generated more video content than all of the television networks combined have ever generated. The current upload rate is equivalent to about 100,000 Hollywood movies being made on a monthly basis. Finally, almost 100 trillion e-mails were sent in 2009.
Bringing this a bit closer to home, consider the number of daily transactions that take place for banking, air travel, credit card processing, phone calls and e-commerce. You end up with some very large numbers indeed. This data also says a lot about how we behave. Most intriguing perhaps is what it can tell us, through the use of complex algorithms, how we might behave at some future point in time – and where new business opportunity may dwell.
This growth in the information industry is not reflective of recessionary times. It points to a shift in investment, new business models, the laying of new infrastructure (servers, storage, cloud computing, software) and global workforce expansion in business information. It’s also transformational as the CIO’s role is increasingly one of contributing directly to business growth in contrast to the dogmatic notion of keeping the lights on in the boiler rooms of Enterprise Resource Planning and Supply Chain Management.
It’s the effect of the peta, exa and yottabyte world that is most intriguing. Conventional ways to sense and understand consumer behaviour will be challenged by the new wave of business analytics. Marketing research is but one example. If predictive analytics can do a better job of identifying which category of SKU’s is trending upward or which meal combo is gaining favour, what will marketing research be used for? Data analytics can also be used to generate new ideas for services, products and as importantly, help companies shed under-performing assets and balance inventories. By implication, there is a clear line of sight to the financial payback as firms like Amazon and Marriott have learned.
This point from the Economist is worth noting:
“…all these data are turning the social sciences upside down, he [Sinan Aral, NYU] explains. Researchers are now able to understand human behaviour at the population level rather than the individual level.”
It’s no wonder Big Tech (IBM, Microsoft, Oracle, SAP etc.) is loading up on search, storage and processing capability. In exchange they will reap new profits from the digital age, largely unnoticed from behind the curtain of social networks and online store fronts.
– Ted Morris, 4ScreensCRM