Why firms must look closer to home for data innovation

Paul_AlexanderIn an era where digital footprints are the norm and personal information is shared freely online, concerns about data privacy have surged to the forefront of public discourse.

Addressing these concerns, the Information Commissioner’s Office and eleven other global data protection and privacy authorities recently issued a joint statement emphasising the urgency of safeguarding personal data against unlawful data scraping on social media platforms.

This announcement not only underscores the significance of trust and permissions in the digital age but also seeks to demystify data usage, highlighting the potential impact on organisations and the larger societal landscape.

The growing importance of trust and permissions
Trust is, and will always be, the cornerstone of any successful relationship, and the digital realm is no exception. Social media platforms have become integral to modern life, acting as conduits for personal expression, connection, and information dissemination.

However, with the benefits come inherent risks. The joint statement makes it very clear that data protection bodies place the responsibility firmly at the door of the social media platforms.

The call for protection against unlawful data scraping underscores the necessity of transparent permissions and ethical data practices. Users must have a clear understanding of how their data is collected, used, and potentially exposed, with platforms implementing strict guidelines to prevent misuse, cyberattacks, and identity fraud.

From dark art to empowerment
Data scraping, often viewed with suspicion due to its potential misuse, can be demystified and harnessed for positive outcomes. Rather than a dark art wielded by malicious actors, it can be wielded as a powerful tool for innovation and insight.

Organisations can leverage social data to derive valuable insights, understand customer preferences, and refine their services. However, the responsibility to ensure the ethical and legal collection of such data doesn’t just sit with social media platforms, but with data specialists and the organisations using the information, too.

This alignment could stimulate a broader conversation around the responsible use of data across industries and encourage more organisations to adopt ethical data practices.

Hidden potential of organisational data and advanced analytics
While social media data presents a wealth of insights, organisations often underestimate the value of their internal data. Buried within operational records, customer interactions, and supply chain logistics lies a trove of untapped potential.

Using a retail company, for example; every transaction, every click on their website, and every interaction with customer service generates data that can reveal trends in purchasing behaviour, popular products, and peak shopping times.

Similarly, a manufacturing company can leverage data from production processes to optimise efficiency, predict maintenance needs, and reduce downtime, whilst a financial institution can leverage transactional data and market trends to predict investment opportunities, manage risks, and enhance portfolio performance, highlighting the versatile applications of advanced analytics across diverse sectors.

This hidden potential can be harnessed through advanced analytics techniques. Machine learning algorithms can analyse historical sales data to predict future demand patterns, enabling companies to optimise inventory management and reduce waste.

Natural language processing (NLP) algorithms can interrogate customer feedback and service interactions to identify common pain points, informing improvements in products and customer support strategies. Likewise, image recognition algorithms can analyse visual data from quality control processes, identifying defects with remarkable precision.

In the realm of environmental, social, and governance (ESG), organisational data holds immense promise. Energy consumption data, for example, can be transformed from a simple metric of operational efficiency to a driver of revenue-generating opportunities. By employing advanced analytics, companies can identify patterns in energy usage and recognise opportunities both for cost reduction but also for innovation, which is a project we are currently working on with one of our retail clients.

What is clear is that advanced analytics allows for the exploration of data relationships that might not be immediately apparent. For instance, analysing the correlation between weather patterns and consumer behaviour data could reveal how weather impacts shopping trends, enabling retailers to tailor marketing strategies accordingly.

Additionally, predictive analytics can foresee market shifts and customer preferences, empowering organisations to make proactive decisions in a rapidly changing landscape. Ultimately, businesses don’t know what they don’t know, and data helps to solve this conundrum.

The true value of organisational data lies not only in its volume but in the actionable insights it can yield. The application of advanced analytics techniques can transform raw data into a strategic asset.

Organisations should not be alarmed by this joint statement. Social media has its place and provides a wealth of insight. But so too does proprietary organisational data. The path forward requires a collective commitment to safeguarding personal data while unlocking the potential of responsible data usage.

Paul Alexander is chief executive of Beyond: Putting Data to Work

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