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Data Crush
How the Information Tidal Wave is Driving New
Business Opportunities

Christopher Surdak
Copyright 2014 AMACOM, a division of American Management Association
280 pages
[@]

Rating
8
Applicability
10
Innovation
8
Style
9

Focus
Leadership & Management
Strategy
Sales & Marketing
Finance
Human Resources
IT, Production & Logistics
Career & Self-Development
Small Business
Economics & Politics
Industries
Global Business
Concepts & Trends

Take-Aways
The six main drivers of the data crush are mobility, virtual living, digital commerce,
online entertainment, cloud computing and Big Data.
Machines will produce the majority of mobile data traffic, not humans.
Social media create a revolution in communications and will define societys evolution.
Outsource any process that does not differentiate your business.
Successful outsourcing requires clear definitions of expected outcomes and processes.
The continuously increasing speed and volume of business operations render human
decision making impractical.
Smartphones and their apps 25 billion downloaded from Apple alone create and
consume vast amounts of data.
Businesses must focus on structured and unstructured data, and work from combined
analyses of internal and external data sources.
Turning work into play will be a strategic business goal in the decade starting in 2014.
Imperative big data strategies include : Mobilize everything, eliminate paper, automate,
use social networks, mine massive data blocks and focus on cloud solutions.
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Book: getab.li/20527
Data Crush getAbstract 2014 2of5
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Relevance
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What You Will Learn
In this summary, you will learn:r1) Where the new data in the data crush come from, 2) What forces drive new
data, 3) How it will affect your business and 4) What managers must do to profit from the deluge.
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Review
Christopher Surdak, a veteran technology analyst, takes on the business challenges of vast data volumes or data
crush including mobility, cloud computing and the rise of social networks. His solutions turn your customers into
your business partners, demolish accustomed infrastructures, send processes up to the cloud and consider human
decision making too slow to be effective. The sea change he promises in sales and marketing will test your imagination
and your determination to avoid business death by data. Surdak usefully ends each chapter with suggested actions, and
presents future scenarios of the brave new world. Despite the books occasional leaps into the unlikely, getAbstract
recommends Surdaks prescient prescriptions to business planners and decision makers seeking a functional glimpse
of the future and as a wake-up call to those hoping in vain for business-as-usual to endure.
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Summary
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Big Data is the
application of
mathematical,
statistical and scientific
principles to the
interpretation of
extremely large
amounts of data.
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Proactive
socialification means
that you are blending
the social media data
you obtain with your
operational data and
can start to engage
customers as they begin
each new experience
with your company.
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Data Crush?
The basic sources of data are mobile devices, primarily telephones which already
number more than 6.8 billion worldwide. Four drivers stimulate the production of data:
pervasiveness, connectedness, data enablement and context. In the US in 2012, people
spent 2.3 trillion minutes talking on mobile phones and sent 2.27 trillion text messages.
Smartphones and their apps 25 billion downloaded from Apple alone create and
consume vast amounts of data. Context refers to when and where people send messages.
Volumes of data that emerge from the Internet of Things, in which devices talk to
each other, will eclipse the amount of data human communication generates by 2020.
Google glasses alone promise to contribute massive data increases as users record and share
snippets of their lives.
Facebook and Twitter have become global, behemoth data generators. Facebook users
racked up 10.2 billion minutes daily in 2012. Twitter added 200 million members across
the globe. Mass social media participation transforms human interaction by creating greater
intimacy between buyers and sellers. Social media outlets sell detailed customer data to
businesses. Sellers can discern customers last purchase and mine their habits, movements
and emotions.
New Retail Reality
Amazon, Groupon and PriceGrabber are rewriting the retail rulebook with discounts, real-
time coupons, price comparisons and virtual fitting rooms. These new selling methods
increase data production as businesses add to their trove of customer information. In turn,
this information allows them to offer attractive deals to specific customers in specific places
at specific times.
Customers are polarized between ultrapremium brand names like Coach and
commodity products a can of pears. Businesses that find themselves caught between the
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Data Crush getAbstract 2014 3of5
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Contextification is the
trend by which people
will be addressed by
others based upon their
place in the world.
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The advancing
application of social
media into our lives,
our Socialification,
will define the next few
decades of our societys
evolution.
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In effect, thingification
is going to create entire
new value chains across
industries that were
traditionally built on
the sale of physical
objects.
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The processes of
making work seem like
play, or gamification,
will be a critical driver
of digital strategy over
the next 10 years.
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poles are in trouble. Defunct companies like Borders and Blockbuster litter the economic
beach. Others are at the edge of collapse. Retailers survive by changing their business
models. To thrive, retailers must participate in customer interactions. This requires deep
analysis of customer data.
Sales of physical entertainment media DVDs and CDs continue a 14-year decline.
Creative artists turn to YouTube with its audience of five billion people to showcase
their work. Teaming smart glasses with YouTube suggests a tidal wave an additional 200
exabytes of data yearly of this-was-my-day posts. Businesses must reach these actors
using the data their performances generate and find ways to draw audience members into
the entertainment itself.
Cloud Computing
The roughly $1.1 trillion cloud computing market sounds the death knell for businesses
traditional infrastructure. Individual business activities will take place in the cloud, not in
the office. The line between a service and a product will fade, necessitating redesign of the
business chain. This commoditization already exists to some extent, in that companies
routinely outsource payroll, human resources and IT functions. The cloud reduces business
costs, increases flexibility and improves data security. Start-ups can buy cloud-based, short-
term, limited computing capacity to test their profitability.
Paying to perform tasks in-house that do not differentiate your business makes no sense
when shifting them to the cloud is cheaper. This transfer of processes travels up the value
chain from relatively simple operations like payroll to entire marketing efforts. This is
cloudification. As this migration continues, middle-level management will erode. Ten
major banks laid off nearly 90,000 middle managers from 2011 to 2013. Some of these
dismissals were due to automation, which will accelerate as outsourcing eats in-house HR,
accounting or any processes managers can automate. Many processes do not improve your
bottom line, so outsourcing such operations, like payroll and customer service, is prudent.
The more you define and outsource higher-level processes, the lower your overhead.
Tomorrows manager will be a process steward.
Businesses will send more and bigger operational processes out to third parties. This will
lead to Outcomes as a Service, as businesses farm out the operation and management
of specific tasks with minimal risk. Successful companies will learn which operations add
value. Those will stay in-house. All others will become the responsibility of third parties.
Contextification
Now, GPS technology enables contextification, knowing the where and when of potential
customers communications. Contextification profoundly increases data crush. Customers
context constantly changes, as does their need for timely services. The next business
evolution will be to anticipate customer needs by mining data. The goal is to reach markets
of one, wherein the seller knows when and how to profit from effective micromarketing.
Social media enable people to gather as digital tribes. This socialification, marked by
participation and interaction, leads to engagement and interconnectedness with other tribe
members. Expect socialification to develop in business-generated societies tribes that
honor a certain product. The near future promises proximate markets, wherein sellers will
award a social-group member for encouraging another member to buy something. Since
16% of the worlds population already engages in social media, businesses must exploit the
potential of that booming engagement or fail.
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Data Crush getAbstract 2014 4of5
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In the near
future...nearly every
business outcome may
be achieved through the
use of a third partys
virtualized resources
and...entire virtual
industries may arise
with almost no capital
investment.
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Social media is
so much more than
that, and its not a
stretch to call it a
revolution in human
communications.
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The source of mobile
data traffic will soon
make a gigantic shift
away from humans
toward the objects in
our lives.
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Mobile consumption
of digital media, such
as videos, has been
growing at more than
70% year over year and
is accelerating.
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App World
Apps changed what users expect from software, and shortened their attention spans
and patience. Applification manifests when users accept beta-level software requiring
frequent updates. Users prefer simple apps over large software packages. Software
manufacturers are reluctantly issuing app-sized programs. Users need integrative
applications to manage proliferating apps. These concierge apps will deal with a growing
stream of marketing messages.
The volume of data originating from machine intelligence will soon eclipse data that
humans generate. Everything from refrigerators to traffic systems will speak over the
web in the language of data thats thingification. Firms will fire more redundant
workers. Machines will become more intelligent and interactive, and will give users the
pervasive instant gratification they will demand. As businesses digest and use data to
improve products, the marriage of socialification and thingification will create richer
functionalization and better customer service.
The Data Crush Wave
Big Data is the technical analysis of vast amounts of data. Businesses must focus on
structured and unstructured data, and work from combined analyses of internal and
external data sources. Your company will mine fresh knowledge from these connected data
groups. Data analytics will open the door to understanding customer behavior. Major
businesses already using these tools are making profits denied to tech laggards.
Your business can deal with the data crush, lessen its impact and harness it for your benefit.
Decide whether your products are commodity- or value-delivery based. Drop any processes
that cause strategic dementia: the loss of the ability to make rational business decisions
because you are not sure of your strategy.
Root out process bottlenecks, and outsource or engineer them away. Outsource functions
that dont align with your strategy. Assess your process efficiency by using statistical
analysis, exception handling and predictive monitoring. Try to reduce your process
turnarounds by 50% over the next 18 months, and then maintain a goal of further 50%
reductions in turnaround time over every 18-month span. Define your process metrics to
assure accurate evaluation.
Assemble data from a wide array of digital resources to evaluate your products and services.
Monitor your customers response to evaluate the effectiveness of this program. Publicize
these changes on all your digital media. Implement cloudification, quantification and
quantafication to make your business crowdsourceable. Find the best organizers among
your members of staff in order to manage your cloud-carried processes as you build and
increase them.
Five Not-So-Futuristic Scenarios
Consider how these five areas of commerce might work in the data-crush future:
1. Travel Bill travels to a new Las Vegas hotel holding a weekend mountain biking
convention, staying at a discounted rate. He stops at a gas station as directed by his
Gasfinder app. He buys Starbucks coffee using a coupon he received via email minutes
earlier, when Starbucks noted his location and preferences. At the Bikezilla booth, he
receives a coupon from the hotel, a discount for the bike model he wants and dinner
with other bike owners. He uses the checkout app to pay the hotel bill with his phone, to
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Data Crush getAbstract 2014 5of5
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An analysis by
Manchester University
in 2013 estimated
that companies that
embraced cloud
computing reduced
their IT costs an
average of 26%.
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While businesses are
focusing a great deal of
effort on understanding
this customer-derived
data, people as a source
of data will quickly be
eclipsed by a new data
source: things.
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Through social media,
a company is able to
tap into a customers
feelings, attitudes,
thoughts, fears and
desires.
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deactivate his key and to call to have his car brought to the door. All this worked because
Bill revealed on social media and on the Bikezilla site that he wanted to buy a certain
bike. Bikezilla mined that data to identify Bill as a likely buyer, and worked with the
convention hotel to offer him a low room rate. Bikezilla and the hotel split the cost of
the complimentary dinner they held for qualified Bikezilla customers.
2. Diet Tammy wants to lose 15 pounds to fit into a dress for a wedding in five months.
She downloads DietDefcon, posts her health panel and gives it access to her social
media sites. The next morning, her smartphone invites her to go for a run. Defcon
suggests a breakfast menu. Tammy tells Facebook she has started the first day of her
diet. That afternoon, she learns that 35 Facebook friends pledged a dollar for every
lost pound. Defcon provides coupons for her diet menu foods. After the second week,
she has lost four pounds, amounting to $140 cash, plus credits from local merchants.
After a dress fitting, Tammy ups the diet ante by as much as 10 pounds. Her connected
contributions and biggest loser participation total nearly $2,000. This happened due to
Defcon, a life event hub that captures new customers for other businesses. It contacted
her Facebook friends, and arranged the coupons, discounts and participations. It applied
all the resources it could muster through cloudification, crowdsourcing, socialification
and contextification.
3. Education Juan, a student at an online university, awaits his tutors critique on his
practice exam. His tutor responds; Juan uses his iGlasses to view the tutors video and
pays the tutor via Cashbot. He checks HelpMarket for small, local jobs. Finding one
related to Apple products, he makes a short video. The customer uploads it. Apple posts
$5 into Juans Cashbot balance. Thanks to little jobs like this, he earns enough money
to pay for the first semester of his MBA studies. HelpMarket is a forum of independent
experts who answer questions, sometimes for money. Cashbot is PayPal 2020. It deals
in international currencies and monetarily neutral points.
4. Taxes Dougs iGlasses displayed the tax forms hes already completed for the IRS. He
amends them with information that he retrieves from his accounting app. He forwards
the completed form to his accountant, who returns it unchanged. The next day, the
IRS deposits his refund and a bonus for early filing. These accomplishments, while
not yet entirely possible, suggest future configurations among them the prevalence
of iGlasses, prefilled electronic tax forms, auditing in real time and penalties for filing
on paper.
5. Genetics In 2020, Sarah has her babys genome mapped. She puts the data in a database
and stores her cord blood at a discount rate. Soon after, she learns that her daughter
Shelly carries risks of certain diseases. So Sarah enters her daughter in a long-term
study in exchange for reduced health care costs until Shelly turns 18. When Shelly
is 10, the study discovers she is likely to suffer kidney disease and gives her health-
monitoring apps. When Shelly becomes 45, the accumulated medical data suggest that
her kidneys are beginning to fail. Stem cells from Sarahs stored cord blood make
it possible to correct Shellys genetic anomalies. A company called BioSyn grows
Shelly new, replacement kidneys. All this results from advances in medical scheduling,
genome mapping, diagnosis and the accumulation of scientific information through
contextification and applification.
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About the Author
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Christopher Surdak is an information technology professional with decades of experience in formulating strategy
and enterprise-level information management systems.
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