In the last decade or so, it became increasingly clear that organizations that have welcomed digital transformation are more likely to survive—even thrive—than organizations that are hesitant to make the leap.
Many were still not convinced. Then the pandemic happened.
The global workforce made a seamless transition from working in their office to working in their kitchen. As if nothing had happened. But such an extraordinarily large-scale disruption made businesses re-think everything about how a business ought to be run. At the center of this re-thinking was data—the most valuable commodity of today's economy.
In the future, data will be critical to business success, that is certain. But is data analytics-ready for the ‘new normal?’ Can the infrastructure keep up with the ever-advancing times? What about security?
Big changes are on the way. Here are four things we expect.
1. Technical knowledge takes a back seat
A McKinsey report found that enterprises that use data analytics to gain consumer insights are 23 times more likely to attract new customers. There is no question that data analytics tools that enable data analytics provide enterprises with a staggering competitive gain.
However, many businesses fail to integrate them in their workflows, given their steep learning curve. Inertia or the reluctance to make structural change is a deterrent to learning any new habit. But what if the habit offers the least resistance?
That is what we expect will happen to data analytics tools in 2022. On one side, data literacy is increasing steadily. While on the other, data analytics tools are becoming more accessible and easier to use.
According to MicroStrategy, 94% of companies believe that data analytics will be critical to taking their bottom line to the next level. In 2022, many of them will actually be able to do so.
2. The democratization of data
And as data analytics tools will become more accessible and easier to use in 2022, data will become democratized.
Just like the power of data analytics is used to forecast the weather, businesses in 2022 will use it to forecast sales, subscriber growth, customer needs and wants, and so much more. This will be true for industries across the spectrum. Think of healthcare. The rich health-related data pouring in from devices like ‘smartwatches and rings will allow healthcare and insurance companies to predict health problems—and concurrent precautionary measures—more accurately.
As IoT devices approach 13 billion, data will only increase in volume. But this time, thanks to the combination of easy access and use, it will be available to everyone. The technology sector will use it to build better products. The manufacturing industry will use it to improve processing. The banking sector will use it to optimize performance. According to a Forrester report, even a minor increase of 10% in data visibility could result in over $65 million of additional income for Fortune 1000 companies. As data becomes more democratized, we could see the same effect on smaller companies as well.
3. Infrastructure to nurture AI
The most exciting thing about data being for everyone is that the analytics of one vertical will inform the decision-making of others. Insights learned from sales analytics are as crucial to marketing as those learned from customer analytics to sales.
However, this exchange of data is most productive when it is seamless. And to ensure that, businesses are expected to invest in the right data architecture and the right data governance paradigms—in the infrastructure that governs the flow and quality of data.
New Data architecture paradigms like Data Mesh are going to see increased implementations as speedy and specialized generation of insights and AI assets become the need of the hour for businesses.
Data governance ensures that the exchange of data between processes—which is expected to be more frequent, cross-linked, and complex—is as efficient as possible. Bottlenecks cost money. Bottlenecks, at scale, cost a lot of money. Anywhere between $10 million and $14 million per year, according to an estimate.
There is another reason to invest big in infrastructure in 2022: Artificial Intelligence.
Yes, data analytics tools will become more accessible. But will they be able to keep up with the exponential increase in data? The digital universe is estimated to hold over 64 zettabytes of data. The figure is expected to increase threefold by 2025. We need tools to process that data—and quickly. It’s no surprise that over 90% of companies are considering investing in AI. The industry, in fact, is expected to grow at an annual CAGR of over 33% by 2028.
4. Breakneck Innovation
A trend that is clear, and is expected to continue, is that the rate of adopting new technologies is slower than the rate at which those technologies are invented. Adoption is slower than innovation. The problem is not new. What is new is the rate at which innovation is happening. It is incredible. Just refer to the three trends above. Devices are smaller and equipped with an ever-increasing number of sensors, measuring your pulse to productivity. Computers are faster than ever, being able to process massive data sets and simulations. In fact, processing now is faster thanks to leaps in software. The predictive analytics market, for example, is growing at a CAGR of 24.5%. That’s rapid.
Final thoughts
Worth over a staggering $420 billion and continuing to grow rapidly at a CAGR of over 23%, the data analytics industry is unstoppable.
