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Why we need big data

Until recent years, the common usage of information systems in business has been as a support function. They have provided an electronic equivalent to existing paper processes, automating forms and workflow. Though providing tremendous efficiencies, these systems have largely remained a digital exoskeleton, the inputs and outputs of which are mediated by physical realities – a phone call, a storefront, a factory floor.

The arrival of the web began an important transition. Information systems are no longer just support systems in the middle of a business. They have become the business interface – the storefront, the marketing, the customer service. For many products and services that are digital in nature, information systems also form the means of delivery. The streams of log and user data generated from these systems give insight not only into the operation of a system itself, but into the proclivities and behaviour patterns of users.

Thus, the whole operation of an organisation, from beginning to end, can be one digital system. It can be analysed in unprecedented depth and, furthermore, insights from analysis can be fed right back into the organisation and its products and services, adapting it to customer use.

For a while, organisations outside of the web world might understandably have found it hard to imagine how such practices might be applied in their own environments. However, two trends are rendering this position increasingly obsolete and herald the importance of big data to business at large.

Firstly, the ubiquity of mobile phones has brought computing out into the physical world, untethering it from the desktop PC and extending the internet away from cables. There is opportunity to engage with people in any place and at any time, and encourage them to interact with you in both the real and virtual worlds. Businesses become software vendors through their engagement on the web and on the smartphone, and then, from software vendors, they also become data collectors. This is not just a retail-oriented phenomenon. Cities and governments are able to better serve their citizens through mobile applications; the lot of farmers in developing countries has been improved through data collection effected over basic text messaging.

Secondly, advances in physical instrumentation, from sensors to robotics, have broadened the reach of the algorithm. A computer might detect temperature fluctuation and make a suitable adjustment to a heater or reroute a taxi cab due to excessive traffic. Advances in miniaturisation make it possible to consider computers virtually disposable and so make them ubiquitous. The rapid march of low-cost, three-dimensional printing means that computers are now able to instantiate artifacts in the physical world.

In short, it is no longer just web businesses that can monitor and affect the entire cycle of their operation digitally. For many today, the digital exoskeleton has gone. Instead, we have a digital nervous system.

We are only beginning to realise the consequences of the digital nervous system. The line between the virtual world of computing and our physical, organic world is blurring. Any parent of today’s hyper-connected teenagers will testify to this, but it runs deeper still. Computer systems can no longer be considered deterministic machines, made tractable by measured logic. Thanks to network interconnectivity and scale, software systems themselves exhibit unpredictable and complex behavior, and might be better understood by techniques borrowed from biology. Looking at the world from the other side of the blurring line, the physical world is becoming computable. Sensing, custom manufacture and robotics mean that in a very real sense, algorithms can respond to and affect their environments.

Big data provides the tools that business needs to benefit from this networked, rapidly changing world. It’s not just about technology, but about strategy and how you change your company to take advantage of the opportunity.

At the Strata Conference in London (November 11-13), we’ll be examining all these issues and helping business, government and individuals make best use of data.

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