Have you seen any of those gold mining programs on television lately? It seems everyone has gold fever, and gold mining has become a booming business. I don’t know anything about mining gold, but I do know about mining data. And as far as I’m concerned, you can turn data into gold if you know where to find it and know what to do with it.
The good news for all of us using Nortridge Software is that we’re each sitting on a mountain of information. Every fact and figure is a critical data point that you can utilize to help you improve your business’s efficiency and profitability. If you’re still a little uncertain about using data, though, let me assure you that you’re not alone. We know that less than 20 percent of people in business today are true pioneers who routinely use data to make decisions. The rest of the population consists of the 10 to 20 percent of people who are total non-believers that don’t see any value in data whatsoever, and the 60 to 75 percent of people who are simply frozen. They’re unable to find their data or to put it to use once they’ve got their hands on it. So, for those of you who are non-believers or frozen, since I truly believe data is as good as gold -- and I want you to believe it, too -- let me help you figure out how to put your data to work.
What is data?
Data is information in its raw or unorganized form. It is literally everywhere, and it is so valuable that Craig Mundie, the Chief Strategy Officer at Microsoft, calls data the new raw material for businesses akin to land in the four factors of production. Imagine that! For almost 150 years, economists have accepted the four factors as land, labor, capital, and the entrepreneur. Now some thought leaders, like Mundie, say we may have a fifth factor: information.
He’s right! Data can tell you more about your customers than any subject matter expert and can do so consistently and without bias. This information can be used to track and predict behavior that can make any company more profitable. Again, it’s all about knowing how to find it and put it to work.
Where does all this data come from? It’s coming from transactions, surveys, doctor visits, website hits, mobile phone applications, traffic cameras, third-party data providers, and even your instance of Nortridge – it’s everywhere! Sometimes people don’t know they’re providing it, but most often people are actively trading in their data stock for nothing more than perceived convenience. They are freely giving up their gold – their personal information once thought to be private and sacred – merely for the sake of convenience. Let me give you a couple of examples.
There’s a mobile phone app I use every day on my commute. It’s called WAZE, and it helps me find the best route to and from work. I gladly provide it with my current location every time I use the app because I want to get where I’m going faster. Another tool I use is called NEST, and I use it to adjust the temperature of my home. When I want the house to heat or cool, I adjust the setting based on my temperature preferences – and at the same time, I’m likely conveying what times of the day I am home and what times I’m away. In both cases, I gladly give up personal information for convenience, and I never think twice about it.
Now, you may think you are unique and you don’t give up information so easily. You may even feel it’s better to stay off the grid. I can tell you that even if you’re not willingly providing personal data, data scientists still probably know enough about you to predict your behavior – in part because of all the data that’s out there from people who look and/or think and/or behave like you.
If you’re wondering just how much data exists for data scientists and businesses to use in making informed decisions, remember first that Moore’s Law says the amount of data in the world doubles every two years. In fact, today there are seven zettabytes of data in the world – that’s a 7 followed by 21 zeroes: 7,000,000,000,000,000,000,000. We can afford to have that much data because the cost of storing it has dropped to nearly nothing – meaning we never have to delete.
Accessing my data
Even knowing data is everywhere, there’s still the matter of being able to access and use it to benefit from it. So, I’ll let you in on the secret. Any good data scientist knows the best way to put data to work for your business and your borrowers is to make sure you’ve got the right tools and the right environment for using those tools effectively.
To create such an environment, you first need to adopt a data-driven culture throughout your organization. It’s not enough for you and few key leaders in the company to believe in this concept; it will work best if everyone makes it a point to operate based on facts instead of opinions. There’s still room for intuition in decision making, but a better place to start is to look at the data and think it through before going with your gut instinct.
Next, as you begin your search through your personal mountain of data to access info that matters, you need to know what you are looking for, or you will get lost. You must have an idea of what problems or challenges you want to address before you start digging. Not doing this is like walking into Costco without a list; you walk out with a lot of items you don’t really need.
To do your searching, you need the right people. Ideally, your data team will have the skill set of a programmer, the training of a mathematician, and the creativeness of an artist. Oh, and they should also have a keen understanding of your business. If you can find one person with all these skills, hire them immediately! You’ve found a unicorn. More likely, you’ll find those skills stretched across several people on a well-rounded team.
Once you’ve identified good people who can work in a data-driven environment, know what problems need to be solved and understand what they’re looking for, you need to invest in the proper technology to capture, store and analyze your data. You’ll also need to establish a way to incorporate your findings into your processes so you can turn one good finding into months and years of knowledge, efficiency and profitability.
It doesn’t surprise anyone to know that big companies like Starbucks and Target use data to help determine which products will sell better when and to whom. Now, though, you know enough to begin formulating your own such plans. You can take the data right out of your Nortridge System to learn about the behaviors and buying patterns of your customers so you can meet their needs and increase your net income. It’s truly a win-win for businesses and their consumers when you take the time to obtain, analyze and act on your data – and turn that wonderful, raw information into gold.