It is difficult to read anything about Digital Transformation without encountering the topic of data. That’s for good reason: we require massive amounts of data just to function in our knowledge-driven world.
According to Forbes, by the year 2020, every human being on the planet will create about 1.7 megabytes of new information every second. That includes:
- 40,000 search queries (to Google alone) EVERY SECOND
- Facebook users sending, on average, 31 million messages and viewing over 2 million videos EVERY MINUTE
- 300 hours of video uploaded to YouTube EVERY MINUTE
While it is widely recognized that data is proliferating, we have only started scratching the surface of the available data. McKinsey’s Global Institute suggests that we are far from putting all this data to good use. The figure below shows that as of 2016, we are capturing very little.
In every industry, the barriers to capturing the full value of the data we create is nearly the same: Enterprises lack the right talent. Data is hopelessly locked away in silos. The enterprise is yet to be shown a convincing demonstration of the data’s potential.
Leading companies are using their capabilities not only to improve their core operations but also to launch entirely new business models. These companies can take advantage of their scale and data insights to add new business lines, and those expansions are increasingly blurring traditional sector boundaries.
As shown above, legacy companies suffer from having much of their data sequestered in silos and many times obscured by internal politics. That’s a problem today’s nimble companies don’t have; they were built for analytics. These agile companies are staking out large advantages today and hesitation by legacy companies increases the risk of being disrupted.
Disruption is already happening, and in multiple forms. Introducing new types of data sets (“orthogonal data”) can confer a competitive advantage, for instance, while massive integration capabilities can break through organizational silos, enabling new insights and models. Granular data can be used to personalize products and services—including healthcare. New analytical techniques can fuel discovery and innovation. Above all, businesses no longer have to go on gut instinct; they can use data and analytics to make faster decisions and more accurate forecasts supported by a mountain of evidence.