A seismic shift toward data-driven decision-making will take place over the next decade. This shift or rebalancing between intuition and data is inevitable. Artificial intelligence (AI) and big data are no longer in their infancy or solutions looking for problems to solve. With predictive and cognitive analytic tools, the use of gut is on the decline and losing a constant battle with data.
As the state of AI and analytics mature, the days of making decisions without enough information may very well be dead. The future belongs to organizations that embrace a data mindset, create direct connections to understand their customers (and access their behavioural data) and turn information into insight to guide future decisions.
Disruption is everywhere
There are a number of factors moving us to a data-driven decision-making world. The first is digital disruption, and it’s affecting every sector of the economy.
Over three-quarters of Canadian business leaders believe that digital technologies will significantly disrupt their industries, propelling their companies toward major transformational initiatives. Disruption will make a company very data-driven very quickly. One or two missteps, not seeing the writing on the wall, being a late follower to shifting consumer trends, and a change in management or sell-off of your stock, will bring changes to decision making more quickly.
These lessons have left a trail in the news and media industries, retail, and entertainment. Traditional businesses in these sectors have, over time, become digital and data-driven. Others, start-ups, digitally native firms, and platform players such as Google and Facebook (which together now control over 30 per cent of the Canadian news media audience) and Airbnb started with a clean slate to build a technology, process, culture, and decision-making framework from scratch with the intent of disrupting the industry incumbents.
From EBs to ZBs
Another factor is the exploding data universe. There is little argument that technology is not only prevalent but taking a larger and larger place in business as well as our daily lives.
IDC’s seminal study The Digital Universe (now referenced as the IDC DataSphere) traces the growth of data from 130EB in 2005, 44ZB in 2020, and 120ZB by 2023 (or over 4GB of new data created every day for every man, woman, and child).
Data, information about what consumers buy, the 500 million tweets collected by the U.S. Library of Congress daily, the 1 billion emails sent every day, video surveillance, the routes we take to work, and the speed and flight path of a home run leaving Fenway Park, continues to grow with no real ceiling to the limits insight. The use of mobile devices, media-rich data such as voice and video, and big data itself is propelling the explosion of the digital universe right here in Canada. Corporations are quickly catching on to the value of analyzing the mountains of data they are creating at breakneck speeds to drive decisions.
A different mindset
A third factor is a digital mindset. Call it gen data, but the workforce of 5–10 years from now will be dramatically different than it is today. The class of 2021, for example, does not know a world without the internet or social media. They are digitally aware in the way they connect with friends, watch movies, and work. They expect to deal with businesses and public services in the same manner, and when ready to join the workforce, expect to be provided the tools they believe they need to do their jobs.
While there are other factors, the advances of digital technologies is worth noting. Recent advances such as processing power, reduction in the cost of technology, and the expansion of mobility and connected devices (Internet of Things [IoT]) that are enabled by platforms have really become game-changers for data-driven decision-makers. Significant focus has been dedicated to big data, business intelligence, and predictive and cognitive analytics. In the past year, AWS and Microsoft’s Azure have rolled out more than 1,000 new cloud products and services with over 20 per cent focused on data analytics. Angel investor sites track over 2,000 AI firms in a market that IDC projects to grow by close to 10 per cent over the next four years. These tech firms are bringing new solutions to the market that will not only make better use of the data businesses are collecting but advance the predictive capabilities that will drive improved decision making.
There is still a way to go before data-driven decision-making becomes the norm in every boardroom. As we have seen in the past, the advances of technologies will move at a much faster pace than our capabilities to understand and use them. This is the case with data and decision-making. It is a shift and a rebalance that will take a while. At times, the balance between intuition and data will seem more difficult to reach but is necessary to succeed in the disruptive digital economy.