Oil has evolved the world into a better place by creating affluence. In recent years there’s been debate about data replacing oil as the world’s most important supply.
The basic argument is that in the digital economy, data and what we extract from data and process it “is similar to oil a century ago.” An unexploited asset can have vast benefits depending on how we use it.
“The value of crude comes from the refinement into a commodity. For oil, it is exploration and energy extraction”. Data possibly hold comparable potential, i.e., gathering information and knowledge extraction. “A key difference is that oil is finite, limited, and non-reusable, while data can be endless.” The value of data increases as it is shared, manipulated, and used. Businesses can make informed decisions and better understand their customers by leveraging data-driven insights. Data can be used for innovation, creating products and services, and developing new models to forecast potential trends and behaviors.
Oil has been one of the most expensive resources, and those who controlled it also ruled the world. Hence, in today’s digital economy, data and insight from it make it more precious. “Like unrefined oil, raw data is of no use of its own.” The value is enhanced upon collection and accuracy. When properly analyzed, data becomes a decision-making tool providing information to public sector organizations and companies to respond proactively. Oil requires resources and involves transportation, while data can go around in seconds.
With rapidly changing markets, political and economic uncertainty, and shifting consumer attitudes, businesses today are working with small margins of error. They collect actionable information as much as possible and then use it to make better decisions. This common-sense strategy applies to personal life, the public sector, and business. No one makes important decisions without first discovering what is imperative and the possible outcomes. Similarly, only companies that want to succeed make decisions based on good data. Organizations need information; they need data. This is where data analysis or data analytics proposes suitable actions or alternatives.
Understanding data is one of the growing industries in today’s day and age, where data is considered the ‘new oil’ in the market.
Governments, business enterprises, and marketers know or can infer an increasing number of data items about aspects of our daily lives that, in previous eras, we could assume were considered private (e.g., ethnicity, religion, gender, health information, income, credit rating, and history, travel history and spending habits). Devices to collect, store, and process data are becoming cheaper and faster; simultaneously, the computational power to handle these data is also increasing. “Digital technologies have made possible the ‘datafication’ of society, affecting all sectors and everyone’s daily life.”
Why data analysis is important?
Data analysis is the process of cleaning, amending, changing, and processing raw data and extracting information that helps businesses make proper and timely decisions. The procedure helps reduce inherent risks by providing valuable insights and statistics, often presented in images, tables, and graphs. An excellent example of data analysis can be seen when we decide on our daily lives by evaluating what has happened in the past or the consequences if we make that decision. This is the analysis of the past or future and making an appropriate decision based on that analysis.
Data-backed decision-making has a constructive impact on organizations. Companies that do well at integrating data into their plan, operations, and culture are outpacing their competitors in revenue and growth. Good data allows organizations to set up benchmarks and set performance goals.
For any country, one of the government’s most important responsibilities is to ensure people have access to water, sanitation, transportation, hospitals, and schools. The government needs to know the expected population levels at a given time to make a plan. The census provides a suitable database for analyzing a society’s demography and social and economic characteristics.
Big Data is recognized as an enabling feature that promises to change societies and industries. Extensive social changes enabled by data are gradually becoming part of our daily life, with benefits ranging from finance to medicine, meteorology to genomics, genetic or environmental research to statistics and business. Extensive data in government is the influx of information from different sources to govern better and manage the public sector.
Medical researchers and doctors also use big data to identify diseases and risk factors to help diagnose illnesses. Combining data from electronic health records and other sources allows healthcare organizations and government agencies to provide information on disease outbreaks.
Throughout the COVID-19 pandemic of recent years, the value placed on quality data exploded manifold. Organizations were forced to adjust their operations and follow digitally optimized models at record speed. And later, government agencies and media outlets frequently reported on the numbers of COVID-19 test results.
Data Usage by Companies
Big companies like Amazon, Apple, Facebook, Google, and Microsoft (but it can also imply other large technology firms such as Alibaba) have commoditized data. As we use their platforms, the business giants have access to and collect information about human behavior. That data gives them the power to influence, which is good for consumers. These companies can learn what we want and why we use their products.
E-commerce platforms use personal data frequently to drive sales. Shopping at Amazon or other sites indicates product suggestions. The companies formulate their recommendations based on what customers have bought in the past, the items in their virtual shopping list, what items the customer reviewed, and what products the customer has viewed when visiting the site. The company increases sales by integrating recommendations into nearly every aspect of the purchasing process.
Companies use data to provide better customer service, create marketing support and take other actions that can generate revenue and increase profits. Businesses that use it effectively hold a competitive advantage over those that don’t.
The information revolution has gained thrust. The growth of data is unstoppable. Big data assists government organizations, relevant stakeholders, and business enterprises enhance and transform their industries. And this is only possible by transforming unprocessed data into helpful information, mainly when a large amount of data and different sources are involved. This is where data operation comes into play. It translates data into the required arrangement that can be mapped for extracting insights.
In short, data is the key to improvement, effectiveness, and growth in the digital age. “Black gold” is no longer the world’s most valuable reserve. It has been surpassed by data in terms of value and money.