Everyone is talking about it. It’s a topic of conversation at almost every tech event or seminar this year. What is big data? Why is it important, and how will it affect your business?

Big Data

As a term, big data simply refers to a large volume of data collected by an entity and stored in both structured and unstructured databases. However large volumes of data alone do not qualify to be deemed big. Rather, the size of analysis performed to provide insights and guide decision-making is what determines it.

Background

Organizations have been collecting large sets of data for a long time. However, the concept is relatively new. It was first coined around 2001 and has since gained momentum as new data science techniques and technologies became available to crunch data held by businesses in ways never imagined before.

Three V’s of Big Data

Doug Laney an industry expert came up with the now widely accepted definition of big data by articulating it in the three Vs

1. Volume-The amount of data collected by organizations is huge. New storage technologies and databases have made it possible to hold even larger volumes of data safely and in a sustainable manner.
2. Velocity-The rate at which data is received and acted upon. Some organizations take advantage of incoming data to make real-time projections and guide decision making. A good example is how Financial traders integrate in-house trading algorithms with big data to make real-time trading decisions.
3. Variety-There are different forms of data being collected. In the previous example, Financial traders are able to collect data from several sources in addition to stock systems. These include real-time news, social media posts, stock tickers among others.

Business Importance

Organizations no longer operate in darkness; companies are employing complex data science algorithms to crunch large volumes of data. Data alone is not useful until it is put into good use. By asking the right questions and employing the right techniques, companies can turn their data into an asset.

Finally

Big data is in use in many areas of business and governance. Here are some examples where Big data is playing a big role in informing decision making and driving innovation.

• Developing new Products-Companies are learning a lot from data collected from their customers and using the knowledge to design better products.
• Manufacturing-Manufacturers can now streamline their production processes by analyzing data collected from sensors and equipment in factories.
• Customer care-By analyzing the interaction between agents and customers, companies are improving their approach towards solving problems facing their customers.