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Business will make money from their data, says IDC
Data scientists may soon find that their skills will be more directly linked to generating a revenue stream within their organisations
The organisations which will thrive in the digital economy will be those that can turn their information assets into a competitive advantage, according to analyst IDC.
A recent IDC study of European companies reported that 80% believe they need to transform digitally.
IDC’s research also found that analytics is key to the success of digital transformation.
Within two years, 70% of businesses surveyed said they would have analytics at the heart of their digital strategy.
However, analytics needs to change. Speaking at the Microstrategy Symposium in London, Philip Carnelly, associate vice-president at IDC, said people are using new metrics, expanding analytics techniques and tools such as artificial intelligence (AI), all based around the information assets they collect.
“AI will be necessary to move from backwards-looking reporting to prescriptive functionality in our analytics systems,” he said, adding that such AI-powered analytics engines would have the ability to make suggestions, such as telling an ice cream maker to make more ice cream if the weather will be warm.
“We think there will be AI everywhere, enabling people to make better decisions with thanks to the help of AI algorithms.”
Looking at how some organisations are using data analytics to drive digitisation, Carnelly said Heathrow runs at 96% capacity and is now using analytics to help it optimise the flow of passengers through the various bottlenecks in the airport.
“To optimise throughput in the airport, Heathrow has to share information with border control, baggage handling and airlines,” he added.
He said the airport operator decided to rearchitect its data analytics, creating a cloud-based data lake covering the major airport operations such as car-parking, baggage handling, customs and security. The operator then “does modelling and analytics to predict what is happening in the airport in order to reduce passenger queues”.
Tapping into IoT
According to IDC, internet of things (IoT) data is rising in importance. IoT streaming data will be crucial, particularly in energy and utilities.
Carnelly said such organisations need IoT data to understand how their plants and machines are performing. He said they will be looking at how to use IoT data to optimise production through predictive analytics.
As an example of the use of IoT with analytics, Carnelly discussed how UK health insurer, Vitality, was providing free or heavily discounted offerings on devices such as the Apple Watch and Amazon Alexa smart speaker.
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“These are being used to drive to people’s fitness regime. Vitality thinks that if their clients are fitter, they will make few health claims,” said Carnelly.
He said thanks to big data analytics, data collected by these devices can be fed back to an analytics engine to help Vitality assess the wellbeing of a customer, and the likelihood that a health claim will be made.
Companies are also beginning to monetise their data. “You can treat data as a revenue earner and you can think about selling your data,” said Carnelly.
While some organisations are using analytics to build data into the services they offer, Carnelly predicted information will be a profit centre.
He said this is already occurring in the telecommunications sector, where the telcos sell data to retailers about where people are walking inside a shopping centre. For a given retailer in the shopping centre, this data can then be used to optimise window displays to improve the chance that people will visit its shop.
Tyre manufacturer Pirelli is an example of one company beginning to make a data business. “All truck tyres from Pirelli have sensors which can be fed back to corporate clients so that fleet managers can understand if the tyres are failing. Also, if a tyre is properly inflated, trucks use less fuel. This is a new business, all driven by analytics,” said Carnelly.
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