Chapter 3: The Next Big Thing is Big Data
Chapter 3 is titled, “The Next Big Thing is Big Data.” The last chapter discussed the importance of motivation, specifically intrinsic motivation in Loyalty 3.0. This chapter focuses on the second driving factor in this program, which is big data. The textbook defines big data as, “the explosion in the size, amount, and form of information available around any one individual, organization, or event.” In the past, companies would only have traditional information about customers such as their gender, age, address, and phone number or email. Now, as we are living in a digital age, information is being gathered about us every day as we interact on the internet. This information includes psychographics, buying habits, likes and dislikes, and the amount of information increases daily. You may not have heard of big data, but you have definitely seen it, as it is now used by companies everywhere. If you go on Amazon and order a dress you like, it will then show you more products like that dress. It uses your preferences and also matches up with other people’s preferences, providing you with other items bought by consumers who had also purchased that same dress. The book points out that each Amazon user has their own version of the website that is personalized for them. That is only possible through big data. Big data is also instrumental in optimizing supply chains and improving customer service. By analyzing vast amounts of data from various sources, businesses can forecast demand more accurately, reduce waste, and enhance the overall customer experience. In fact, a study by McKinsey found that companies using big data analytics are 5 times more likely to make faster decisions than their competitors (McKinsey & Company, 2016). Often, big data is only utilized with consumers; however, companies should also use it to help their employees. It can be used in the hiring process, as well as in giving consistent feedback to workers, which was traditionally only given annually. A statistic recorded from the text states that “64% of employees leave their jobs because they feel underappreciated.” Big data has the ability to change that. Big data can also provide a company with information on their employees' skillsets based on what they say, what coworkers say, and what the evidence has shown. It can motivate employees by revealing how the company is performing compared to others. In conclusion, big data is a really big deal! It has the power to transform the work environment for consumers but also for employees. Reference: McKinsey & Company. (2016). The age of analytics: Competing in a data-driven world. McKinsey Global Institute.