In a world of seemingly infinite data, it’s easy to get caught up in the hype of ‘Big Data’ and all types of analysis. In fact I think many people do.
This topic sparked discussion yesterday with a good friend of mine who I have a lot of respect for. The guy is a seriously talented technologist and CTO so I tried to keep the dialogue in plain English so I could keep up …
Essentially the question/s I asked was this; “So we have all this data right? And we also have all types of people trying to conduct analysis on this data but what ‘genuine’ business value do we derive from these activities? What is it that we should be looking for to ensure we can maximise our investment in data and analysis?”
The first answer I got was simple; “We want insight.”
The good news is this has been something on my mind for quite a long time and I have also been thinking a lot about ‘insights that empower decision making.’
I went on; “So how do we turn data and analysis into insight that we can genuinely value from?“
Simple answer again; “Clear objectives and context.” (I must admit there was more to his explanation that this, however I’d unlikely do that explanation justice by trying to recite it…)
All data and analysis needs context. Typically the context will be set based on the objectives defined by the ‘decision maker.’ This seems like a really simple point but it’s something that we see lacking far too regularly.
So as an e.g. of contextual data – One of the primary factors that contributes to the purchase of consumer insurance is weather.
Is this an obvious set of data that we may look at? Perhaps, but of course that depends on the type of insurance and what other data sets we analyse and compare it with. If you knew that people were 24% more likely to buy a particular type of insurance on a very cold and blustery day would that affect some of the business decisions you make?
I dare to say it would.
My point is this; Collating the seemingly ‘obvious’ data and analysing it is critical and its importance shouldn’t be understated because without it, all the context in the world would leave us with nothing. However, if we really want to drive insights that give us the best chance to make good business decisions we need clearly defined objectives and additional data that provides context.
The big thing that feeds off of this is the fact that we can then potentially look at ‘what if’ scenarios that challenge our thinking and push us to make good decisions.
This is very ‘high level’ stuff but have a think about it and chat to me. I’d be really interested to get a dialogue started.
Thanks for reading.