Data analysis is new frontier for business competitiveness

ARE we there yet in Zimbabwe? Are private and public organisations using big data analysis to enable themselves to gain valuable insights, make informed decisions and drive strategic growth.

In today's data-driven world, businesses are increasingly turning to data analysis to gain insights, make informed decisions, and gain a distinct competitive advantage in the marketplace.

There is certainly no justification in thinking that the advances in database technology will not continue. If Zimbabwe’s organisations are lagging behind, for reasons best known by our policy makers, in addition to the private sector failing to lobby government, then let it be known that the world will keep going and will not wait for us to get our act together.

In this instalment, there is exploration of the concept of "Super Crunchers" - the use of advanced data analysis techniques to extract valuable insights from large datasets, and how this practice is reshaping business competitiveness.

This discussion further highlights the importance of data analysis in the modern business landscape, the benefits it offers, challenges faced, and the impact it has on business competitiveness.

Through case studies and examples, the discussion aims to demonstrate the significance of data analysis as the new frontier for business competitiveness.

What are super crunchers?

In the era of big data and advanced analytics, businesses are increasingly leveraging data analysis techniques to drive decisionmaking, gain insights, and enhance competitiveness. The term "Super Crunchers" refers to the use of sophisticated data analysis methods and tools to extract valuable insights from large datasets. This instalment explores how data analysis has become a new frontier for business competitiveness, enabling organisations to make informed decisions, optimise operations, and gain a strategic advantage in the market.

Importance of data analysis

Data analysis plays a crucial role in modern business operations by providing valuable insights that help organisations understand customer behaviour, market trends, and operational performance.

By analysing data, businesses can uncover patterns, correlations, and trends that can inform strategic decision-making and drive business growth. Data analysis also enables organisations to identify opportunities, mitigate risks, and optimise processes for improved efficiency and performance.

Benefits of data analysis

The adoption of data analysis offers numerous benefits to businesses seeking to enhance their competitiveness. By leveraging data analysis techniques, organisations can gain a deeper understanding of their customers, competitors, and market dynamics. This insight enables businesses to tailor their products and services to meet customer needs, anticipate market trends, and stay ahead of competitors.

Data analysis also helps businesses identify inefficiencies, optimise processes, and make data-driven decisions that lead to improved performance and profitability.

Challenges in data analysis

While data analysis offers significant benefits, businesses also face challenges in implementing and leveraging data analysis effectively. One of the key challenges is the volume and complexity of data generated by modern business operations.

Managing and analysing large datasets require advanced tools, technologies, and expertise, which can be costly and resource-intensive.

Additionally, businesses must ensure data quality, security, and compliance to derive accurate and reliable insights from data analysis.

Other organisations have resorted to outsourcing to data analysis specialists.

The inherent challenge of this strategy is confidentiality and security of customer information, which if not handled properly, ending in the hands of competitors, can ruin the organisation.

Impact of data analysis

The impact of data analysis on business competitiveness is profound, as organisations that effectively leverage data analysis gain a distinct strategic advantage in the market. By making data-driven decisions, businesses can anticipate market trends, identify new opportunities, and optimise operations for improved performance.

Data analysis also enables organisations to personalise their offerings, enhance customer experiences, and stay ahead of competitors in an increasingly competitive business landscape.

Case studies and examples

To illustrate the significance of data analysis in driving business competitiveness, here below are five case studies and examples of organisations that have successfully leveraged data analysis to achieve strategic goals.

Amazon

Without analysing big data and collecting around 1 exabyte (apparently the size of the sun, which is more than ten times bigger the size of earth) of purchase history data from their consumer base, Amazon would not have grown phenomenally to the level it is today. It assesses past purchases and recommends complementary products to customers.

Amazon uses advanced data analysis techniques to personalise product recommendations for customers, optimise pricing strategies, and enhance supply chain efficiency. By analysing customer data, Amazon can anticipate customer needs, improve customer satisfaction, and drive sales growth.

Netflix

Netflix leverages data analysis to personalise content recommendations for its users, improve content production decisions, and optimise its streaming platform.

By analysing viewer data, Netflix can tailor its content offerings to individual preferences, based on their viewing history, increase viewer engagement, and retain subscribers.

To achieve this, Netflix utilises data analytics to check the behaviour of their users, allowing them to provide recommendations that are tailored to an individual user’s preferences.

Uber

Uber uses data analysis to optimise its ride-sharing algorithms, predict demand patterns, and improve driver efficiency. By analysing location data, traffic patterns, and user behaviour, Uber can match drivers with riders more effectively, reduce wait times, and enhance the overall user experience.

Airbnb

By collecting and embracing data as the invaluable voice of the customer, Airbnb can continuously optimise its user experience and abundance of features. Airbnb’s experience offers valuable insights into the importance of leveraging big data as a tool for understanding customer needs and preferences giving it a distinct advantage over its competitors.

Jasmine Bilham blogging for raw.studio on March 10, 2023, shared how Airbnb conducted a study in 2014 and discovered that customers from certain Asian countries had a higher bounce rate when they landed on the home page, with many churning and leaving the website without making a booking.

Upon further data analysis, Airbnb determined that the “Neighbourhood” link and the accompanying photos were distracting users, who would then abandon the booking process and not return.

As a result, the data science team at Airbnb redesigned the algorithm, removing the “Neighbourhood” link for visitors from Asian countries and instead showcasing Top Traveling Destinations in Singapore, China, Japan, and Korea. This change had a significant impact, with Asian visitor conversion rates increasing by 10%.

Spotify

With a user base that has almost doubled since 2017, Spotify is no stranger to big data, utilising it as a means to create a meaningful, emotional experience for its users. Spotify is known for its personalised playlists, which are curated based on user preferences and listening habits. Some examples of personalised playlists that Spotify puts together include, Discover Weekly, Daily Mix, Release Radar, On Repeat and Radio. All these products are developed by Spotify based on insights gained from data analysis.

Conclusion

In conclusion, data analysis has emerged as a new frontier for business competitiveness, enabling organisations to gain valuable insights, make informed decisions, and drive strategic growth. By leveraging data analysis techniques, businesses can uncover hidden patterns, trends, and opportunities that help them stay ahead of competitors and succeed in the dynamic business landscape.

While challenges exist in implementing data analysis effectively, the benefits it offers in terms of improved decision-making, operational efficiency, and customer satisfaction make it a critical component of modern business strategy. As businesses continue to embrace data analysis as a core and distinctive competency, those that effectively harness the power of data will undoubtedly have a competitive edge in the market.

Ndoro-mukombachoto is a former academic and banker. She has consulted widely in strategy, entrepreneurship, and private sector development for organisations in Zimbabwe, the sub-region and overseas. As a writer and entrepreneur with interests in property, hospitality and manufacturing, she continues in strategy consulting, also sharing through her podcast @Heartfeltwithgloria. — +263 772 236 341.