Technology can be intimidating. At the same time, it’s important to understand the concepts that impact your business. Technology-related concepts can be difficult to understand without concrete explanations and examples. With them, though, they can become powerful tools to grow your business.
Consider the concept of big data as an example. It sounds and undoubtedly is an incredibly complex topic that has filled studies, books, and research articles. And yet, at its most basic, it’s also a core business driver. Only understanding it as both – jargon that can be difficult to unlock and a potentially powerful tool to propel your business forward – allows you to leverage its opportunities.
Big data and cloud computing are both related, and both terms that have disproportionately benefited large enterprise corporations in recent years. It’s time to change that perception. Increasingly, these are tools available even to small and mid-sized businesses, allowing you to leverage technology, gain valuable insights, and scale your organization. Let’s examine each of them, as well as their connection to each other, in more detail.
What is Big Data?
At its core, big data is an umbrella term that describes any set of information too large to be analyzed manually. That data can be structured or unstructured, meaning it’s either already in a form that makes it easy to analyze or simply collected in a pool that needs sorted through first.
Here’s the way Forbes.com frames the concept:
Big data is a collection of data from traditional and digital sources inside and outside your company that represents a source for ongoing discovery and analysis.
Whether you actively leverage that discovery and analysis is actually not that relevant. Whether you know it or not, your business is actively collecting the data. It might come from the behavior of visitors to your website, your customer database, or any other interaction between your business and its surroundings (both audiences and environment) that can be collected in some way.
That data is growing exponentially. In fact, 90% of the data in the world has been generated in the last two years alone. The advent of smartphones and the increasing ability to collect those numbers have played a major role.
Granted, these types of numbers can be intimidating. The key is to see them not as a challenge, but as an opportunity. If you know how to collect and analyze it, you can gain significant insights that help you grow your business. That’s where cloud computing comes into play.
What is Cloud Computing?
You might have heard of cloud computing in connection to one (or more) of the software packages you use. It’s one of those business buzzwords that’s everywhere right now. Still, it’s important to consider its actual, abstract meaning before diving into specific applications. At its core, cloud computing is
the delivery of computing services—servers, storage, databases, networking, software, analytics, intelligence and more—over the Internet (“the cloud”) to offer faster innovation, flexible resources, and economies of scale.
In other words, it takes what was traditionally done on a company-owned, physical network or server, and moves it to a virtual solution. The most common application is storage, which has almost entirely removed the need for large organizational-specific hard drive on company premises.
The same concept, though, is everywhere around us. If your business uses any type of software that doesn’t require physical installation on one of your computers – a web-based accounting system or customer relationship management platform, perhaps – you’re already using cloud computing. The simple premise of distributing and decentralizing computing services is what makes cloud computing such a perfect companion to big data.
The Connected Nature of Big Data and Cloud Computing
Big data is a description for immense amounts of information that need both stored and analyzed. Cloud computing offers a solution to store that data, but also analyze it at scale.
You likely don’t have the resources for massive server farms and computing power required to store terabytes of data about your business, its customers, and its environment. It’s even less likely that you have the software capabilities to run constant analysis required to draw actionable insights from that data. With cloud computing, you don’t have to worry about those details.
Instead, the storage and analysis components are assumed. Services like Amazon Web Services, for instance, offer almost limited business storage along with integrated applications to analyze that data on an ongoing basis. Microsoft Azure, Oracle, and IBM offer similar advantages. All are based on the premise that if you take storage and analysis complexities out of the equation, big data becomes less scary and more actionable.
5 Examples of Enterprises Leveraging Big Data and Cloud Computing
Granted, the above scenario is still a bit complex. Perhaps it’s no surprise, then, that big enterprise corporations have been at the forefront of implementing cloud and data solutions. Consider these five examples, which show the depth and breadth of the possibilities when both of these complex get combined efficiently.
1) Fraud Detection Through Big Data Analytics
Credit card fraud costs companies billions of dollars every year. That includes banks, insurance companies, and a range of other industries, which have taken increasingly sophisticated steps to combat it. Among these steps: implementing big data analytics designed to stop fraud.
Each user’s information is constantly collected and analyzed for patterns. if any action or credit card transaction falls outside that pattern, it gets flagged as potential fraud. All of it happens instantaneously, within the cloud. The result is a significant reduction in fraud with hardly any human touch or groundwork required.
2) Customer Insights and Targeted Insights Through Big Data
The more you know about your audience, the better. That theoretical concept becomes real once you realize how much information you can gather and leverage about your audience. Take Netflix, which – by analyzing watch patterns – can recommend incredibly accurate predictions on what shows its users may want to watch next. That keeps customers on the platform, watching more and extending their subscriptions.
3) Risk Management to Make More Prudent Strategic Choices
Every company, regardless of size, can benefit from risk management efforts. Every strategic decision needs to come with a cost-benefit analysis that evaluates the risks against potential returns. Of course, you never have all the information, which makes this step difficult to achieve on an everyday basis.
Large enterprises have begun to leverage big data specifically to fill in these informational gaps. Consider UOB Bank in Singapore, which has implemented a complex data analytics structure that allows it to comprehensively analyze each potential customer according to their past and current financial pattern. Each investment (or loan) decision becomes more informed, with a better understanding of the risk involved. Through cloud computing, it all happens in the background, in real-time.
4) Using Big Data to Influence and Drive Product Development
Naturally, you want to put out products your audience actually wants. But if Apple’s philosophy holds true, your customers can’t tell you what they want if they haven’t actually seen anything like it yet. Big data, used right, helps to bridge that gap through extensive analytics.
You might not think about McDonalds as a technology giant. In reality, its product development choices are all influenced by big data and cloud analytics. For instance, the company is currently testing digital menus that automatically change menu options based on the weather, the area in which they reside, and past purchasing patterns.
5) Better Supply Chain and Warehousing Logistics
Amazon is not just a cloud solution provider. It also takes doses of its own medicine, leveraging big data to improve its supply chain and warehousing opportunities. Through data collection and pattern analysis, it has actually begun to implement an anticipatory shipping model in which products are packaged and go on the move before a customer has actually ordered them. That’s how confident the e-commerce giant is in the information it collects and its abilities to analyze it.
How Can You Use Big Data and Cloud Computing in Your Business
The above examples show just how beneficial big data can be in improving enterprise corporations on an everyday level. At the same time, especially for small and medium-sized businesses, they can also seem far beyond the capabilities and opportunities available within the given resources, budgets and expertise.
But here’s a secret: big data and cloud computing, above all, level the playing field. Yes, you might not be able to immediately implement solutions on that large of a scale. However, you can take a number of steps to see similar improvements through these concepts. Consider:
- Collecting information about your customers, then using simple analytics software like Google Analytics to detect patterns, find common interests, and predict behavior.
- Testing your messaging and business efforts through real-time data analysis of customer responses. A number of software options, many of them designed for low budgets, can help you get there.
- Implementing risk management opportunities simply by increasing the amount of data you can analyze.
- Reduce the risk of cyber security threats by storing your data on distributed servers within protected cloud hosting servers.
These are just a few of the countless examples in which even a small business without a dedicated IT staff can leverage big data. Countless solutions now vie for the opportunity to help you achieve just that, even incorporating machine learning technology that doesn’t just analyze patterns but also uses these patterns to predict future events.
What you might need, of course, is a partner who can help you determine which of these solutions makes sense for your business goals, and how you can leverage big data without making it more complex than it has to be. With the right expertise in place, you can turn these technology buzzword from confusing, foreign terms into real business opportunities that help your company grow.