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Big Data: Challenges, Changes, and Benefits

Posted By Prucia Buscell, Thursday, April 17, 2014

Big data, the combined billions of pieces of information available electronically, can be expected to change the whole realm of managerial decision making, according to Tom Davenport, a business analyst and the President's Distinguished Professor in Management and Information Technology at Babson College.

Davenport, the author of Big Data at Work: Dispelling the Myths, Uncovering the Opportunities, describes the challenges and changes he anticipates in an interview with Strategy+Business. For starters, much of the data used in big data analysis is unstructured, which means it takes considerable time and effort to get it into a format that allows for analysis, and even then it's not always easy to get shades of meaning. Another problem, he says, the sheer speed and volume of data makes it hard for businesses to use it for decision making.

Companies that can develop high speed decision making capabilities in response to the speed of big data will be taking a big step forward, he told the magazine. He notes that Peter Drucker warned 20 years ago that corporate IT's reliance on internal data created a dangerous focus on inward costs and efforts. But big data will create a healthier focus, Davenport says, because so much of it comes from external sources-from social media, data gathered from macro economics, science, politics and weather. Companies that learn how to include this external data in their models for decision making will have better ideas on how successful particular products and marketing campaigns might be.

For example, Davenport cites the company Recorded Future, which scans vast amounts of information on the Internet-news publications, government web sites, financial data bases, trade publications and blogs-and analyzes content to forecast future events.

Davenport notes intelligence agencies use Recorded Future data to assess potential for terrorism, and private companies use it to evaluate their competition, their present and potential markets, and changes among customers or suppliers that might impact their success.

Big data may produce surprising changes in healthcare. Technology experts expect that wearable devices that record and monitor people's bodily functions will increase quantity and potential uses of data in health data bases. Social media is already a rich source of new heath information. In a recent New York Times column, economist Eduardo Porter described research indicating analysis of the way a woman used the first person singular in her Twitter posts provided an uncannily accurate prediction of her odds of suffering post partum depression. Researchers from Georgia Institute of Technology and Microsoft analyzed two years Twitter posts from four cities in Mexico and identified numbness and other mental health issues among bystanders who had witnessed violence resulting from activities of drug cartels. They said the findings had potential to provide mental health resources and other aid to impacted groups and communities.

Tags:  buscell  community  complexity matters  health  scaling 

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