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It’s Not the Data, It’s What You Do With It

TooMuchDataMany companies are going after as much data as they can without a true concept of what they are doing. This is creating scenarios in which key decision makers are data-rich…but information poor.

Consider this article by Smart Data Collective: Big Data is Not Enough. It distinguished the difference between big data and something far more useful: predictive analysis. Predictive analysis is what organizations use to do something with all the data they’ve acquired.

The article also analyzed some of the common problems with big data.

Why is the data so big? Where does it come from?

…According to a 2012 IBM study, “Analytics: the Real World Use of Big Data,” 88% of big data comes from transactions, 73% from log data, and significant portions come from audio and video (still and motion). These are not structured data. Log files are often unstructured data containing nothing more than notes, sometimes freehand, sometimes machine-created, and therefore cannot be used without first processing the data using text mining techniques. For all of us who have built models and augmented with log files or other text data, we know how much work is involved in transforming text into useful attributes that can be used in predictive models.

Even the most structured of the big data sources, transactional data, are often nothing more than dates, IDs, and very simple information about the nature of the transaction (an amount, time period, and perhaps a label about the nature of the transaction).

Transactional data is rarely used directly; it is usually transformed into a form more useful for predictive modeling…The big data wave we are experiencing is therefore not helpful directly for improving predictive models, we need to first determine the level of analysis needed to build useful models…The unit of analysis is determined by the question the model is intended to answer, or put another way, the decision the model is intended to improve within an organization.

More data does not generate revenue. More data doesn’t help you make good decisions, the kinds that help you do a better job of serving a customer’s needs.

The only way that data helps your business is if you know what you need to know in order to draw real, valuable insights from that data. You can then use those insights to make proactive and profitable decisions.

The Modeling Agency’s courses help you do this by showing you how to transform your data into actionable results. You can launch a useful predictive analysis program in your organization by getting started with TMA’s free webinar.

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