Analytics is widely regarded as the systematic computational analysis of data or statistics. The new economy that is emerging currently is based on data, and much of the innovation occurring throughout the technology landscape is geared towards using this data to generate business value. With advances in technologies such as connected devices incorporating sensors combined with the massive compute and storage capabilities within the cloud, also known as Internet of Things (IoT), data can now be gathered, stored and analyzed from thousands of nodes, at much faster rates than ever before. While businesses and governments have been collecting data for years, what has changed the landscape is the advancement in technology has increased the types of data that is collected and enabled the speed at which this data is gathered. Most companies today use some form of analytics tool to use data to evaluate their key metrics. This data is largely historical in nature and is usually presented in a dashboard or other visual format. The most impactful change in this ecosystem is that businesses can now leverage newer statistical methods and technologies to create predictive models that help analyze their existing data to enable changes in business practices that would help drive more efficient operations, increase sales, and improve customer service, among other important activities – what is termed as “advanced analytics”.
The new economy that is emerging currently is based on data, and much of the innovation occurring throughout the technology landscape is geared towards using this data to generate business value.
Even though advanced analytics are improving, there remains a continued skepticism within the corporate environment about using data driven sources to make critical business decisions. According to a study conducted by PwC in 2014, while 64% of large companies have made the shift to using some sort of analytics tool, only 32% of executives actually rely on advanced analytics to make critical decisions, while, according to another study by McKinsey & Co., only 28% of senior executives believe the quality of their strategic decisions was generally good. The good news is recent innovations in technology are making advanced analytics easier to use, more available to the masses, and a hot bed of innovation. As such, we believe we are at the cusp of a sea change in the use of this exciting technology, driven by 7 key forces:
- Ease of use: predictive analytics tools are becoming easier to use, and, combined with the massive amount of compute and storage horsepower that exists in cloud providers, analytics tools are being made available to more end users.
- Open Source software: technologies like “R” and Hadoop are enabling a wide community to further innovate and participate in this segment.
- Innovation from startups: there are currently at least 100 analytics startups that have raised over $7B. This pace of growth and investment in innovation should ultimately lead to new and useful analytics solutions.
- Integrated analytics tools: advanced analytics tools are increasingly becoming integrated with other tools, and, combined with newer technologies such as in-memory computing (IMC) and hybrid transaction/analytical processing (HTAP), are enabling a new generation of business applications that include analytics.
- Democratization and Consumerization: There is an emerging class of employees called “Citizen Data Scientists” that are driving the end use of these analytics tools.
- Social media and mobile: More consumers are using social media sites, applying analytics to mainstream usage and moving it beyond just the major Internet players.
- Cloud based solutions: The availability of predictive analytics in the cloud is allowing more end-user organizations to attempt to use predictive analytics.
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BitNavi is a blog conceived by Karl Motey in the heart of Silicon Valley, dedicated to emerging technologies and strategic business issues challenging the industry.
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David Darrough has over 30 years of experience in high technology products, services and education.
Follow David on Twitter: @DarroughDavid and his OpenStack website daviddarrough.com