The McKinsey report on Big Data outlines five ways in which companies can capture value from "big data" (see p.5 of reading). Select ONE of these ways and discuss how it could help an organisation become more competitive. (Give an example) (This reading is on Blackboard in the Week 10 resources)
In the McKinsey case, one of the five way in which companies could capture value from "big data" was by "Innovating new business models, products and services"
ReplyDeleteAn obvious services which as benefited from the use of "big data" is the wide range of search engines on the world wide web. The example I feel is best, is Google.
The way in which Google collect and organise their data help them stand out from the rest. Google have created an almost foolproof algorithm to search and retrieve information to provide services ranging from a simple free search engine to a cost effective advertising channel. From this they created a new business model based purely on advertising.
Organisation and businesses see the pin-point accuracy of Google searches and as a result see the benefits of using Google to advertise their business.
Another way of capturing value from big data is "segmenting populations to customize actions".
ReplyDeleteThis allows competitors to tsilor specific products to the needs of a niche market. By segmenting this data in to certain groups users are easily defined to meet customer demands. This is a more simplified way of segmenting data.
Other advantages of segmenting data can allow for user feedbacks of a organisation, which they may use to their advantage against other competitors. A good example of a organisation that would use this model is a restaurant who can get customer feedback, so they can perform better than its competitors.
In segmenting data this brings together the data of an organisation and overall they can have a focused sense of direction.
It’s very difficult for an organisation to focus solely on just one main customer base. By segmentation the data gathered it gives the organisation the option tailoring and providing services that can meet various customer segments as opposed to just one main customer base.
ReplyDeleteTools such as marketing can have different ways of targeting various customer bases. It gives the organisation the option of proper advertising of products. This is only possible if the data is segmented, it gives organisation an in depth knowledge of customer buying pattern.
Innovating new business models, products, and services.
ReplyDeleteBig data can help an organisation become more competitive by helping the organisation use that data obtained from the use of actual products and improve on those features for the next generation model.
An example of this is Apple. When they first introduced the iphone it was lacking many features. By as time progressed and Apple collected usage data of its many users, Apple became more innovative. With each subsequent iphone, more features are added to it based on consumer feedback and usage. The addition of these features add value to the iphone and helps Apple become more competitive in comparison to their competitors.
From the McKinsey report on Big Data, one of the five ways in which companies can capture value from ‘big data’ is creating transparency by simply making big data more easily accessible to relevant stakeholders in a timely manner which creates tremendous value. By having data transparency, the business operates much more effectively and efficiently because information is available for access across different departments. So with creating transparency, organizations can reduce search and process time to find the data, because it is already made available. Also data transparency can allow organisations to reduce time until their products are out into the market before its competitors.
ReplyDeleteAn example of data transparency is in healthcare, where Data transparency is among hospitals and a focus on the results of treatments. Data transparency would promote quality improvements as well as patient choice and empowerment. It leads to accurate, easily-accessible data would allow organizations and practitioners to compare their data, benchmark, and to learn and improve.
Innovating new business models, products, and services
ReplyDeleteThis involves big data enabling companies to create new products and services, enhance existing ones, and invent new business models.
Businesses are able to capture value from big data, the data has been gathered and built up over time. For example, the Internet search engine Google collects information on the WWW and makes it readily available for others to access and use.
Other companies can then access the information in order to keep up with technological trends and find out what's happening in the marketplace. The business can be better prepared to meet demand for products and services. Once the business has determined what products and services are in greatest demand, it can then move onto innovating business models and providing customers with increased value-added products/services that out-perform competitors' products/services.
An example of this could be the mobile phone application market, where most smartphones enable the user to install applications that are tailored for the user's preferences and particular needs. For example, geo-locational data from Google maps can be integrated into an app that allows information to be accessed by the user at a certain location. The applications that are chosen becomes valuable to the owner of that phone only, if someone else used the same phone, they may not get the same level of value out of it. So by creating applications that users actually desire, this can increase the level of competitive advantage for businesses that develop smartphones and applications that go with it.
Innovating new business models, products, and services can help an organisation become more competitive by using customer feedback from the masses of data gathered to improve the development of the next generation of products.
ReplyDeleteAn example of this is the personal laptop. Laptops from all manufacturers have evolved over the years with more and more features, hardware, and software added. Laptops now come with fingerprint & voice log-in, built-in webcams, quad core processors, etc. Whereas years ago these innovations were never thought of.
This is made through masses of data from R&D and customer feedback.
“Creating transparency” with big data is a key factor in producing a successful supply chain. The ‘kit-set’ housing market is an example that would benefit greatly from transparency between its R&D, engineering and manufacturing sectors. These houses are built from specific products of specific quantities. This means that on a large scale if they can increase the transparency between sectors it would create a more free-flowing production, hence, decreasing the time to market from the design to the final product.
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