The Power of Data and Digital Transformation
Data and its utilization have been around for quite some time, but it still remains a complex concept for many people. Terms like “the internet of things” (IoT) and “the cloud” are thrown around, leading to confusion even among intelligent individuals. Moreover, the abundance and rapid flow of information only add to the challenge. Software is everywhere, collecting data from devices like coffee makers and watches every second. The real question is: how can we harness the potential insights and analytics offered by new technologies?
Abel Sanchez, the executive director and research director of MIT’s Geospatial Data Center, helps industries and executives navigate through this complexity. His work involves assisting them in adapting their operations to effectively analyze and utilize their data, leading to improved bottom lines.
Handling the Pace of Data
We all know that data can drive better business decisions, but many still rely on intuition. The problem lies in not knowing what to do with the enormous amount of available data. As soon as we wake up and use our phones or start our cars, software begins collecting information at a remarkable speed. This deluge of data is so complex that it surpasses human capabilities.
Take Uber as an example. Once we request a ride through the app, predictive models start firing at a rate of one million per second. These models consider various factors, such as school schedules, traffic conditions, and driver availability, to optimize our trip. It’s a task that no human could handle.
Successfully managing data requires a new approach, starting with reimagining data storage. The traditional method of creating a “perfect library” with structured data has proven ineffective. The alternative, known as a “data lake,” where all information is dumped with the hope of making sense of it later, is also a flawed solution. Sanchez suggests that data storage must become more accessible, allowing a greater number of employees to work with the data directly. This means moving away from the centralized resource and queuing system prevalent in most corporations. By democratizing the information and adopting a modern data stack, dormant data can be transformed into active data, leading to better decision-making.
Nevertheless, making this transformation requires more than just financial investment—it demands a shift in corporate culture. Many companies resist such changes because they have always done things a certain way. However, with the rapid pace of technology, clinging to old practices is impractical and inefficient. According to Sanchez, technology allows us to accomplish tasks in days that would have taken years in the past.
Introducing Blockchain Technology
Coordinating data involves four intertwined components: IoT, AI, the cloud, and security. These components generate and store information, but without robust security, their efforts are in vain. However, one relatively new player has entered the field: blockchain technology. Although the term is often thrown around, its true potential remains widely misunderstood.
Sanchez explains that the World Wide Web has shaped the way we handle and organize information. Blockchain presents an opportunity to be more adaptable and productive on a global scale. This technology offers a framework for establishing an accepted identity, currency, and logic, breaking the barriers that have hindered progress in these areas. The lack of a globally agreed-upon framework results in inefficiency, exclusion, and lost business opportunities.
One example of blockchain’s potential is its application in hospitals. In the United States, hospitals are private entities that must constantly integrate and exchange information from various sources, such as doctors, insurance companies, regulators, and pharmaceutical companies. This often leads to repeated steps and disagreements regarding a patient’s identity. Blockchain can potentially solve this issue by allowing these entities to form a consortium using open-source code. This would enable them to quickly and easily identify a patient, eliminating unnecessary efforts and reducing costs and risks.
Another compelling example comes from Indonesia, where blockchain technology was used to gather information about smallholder farms cultivating rice, corn, and wheat. These farmers lacked state-issued identities and credit records, making it difficult for banks to assess the risk of providing loans. By using blockchain, local individuals collected farm information on their smartphones. Banks then compensated these individuals with tokens, incentivizing their efforts. Consequently, banks gained insights into the creditworthiness of these farms, allowing them to provide fair loans to deserving farmers. This initiative not only benefited the banks and farmers but also the entire community, showcasing the potential of digital transformation to optimize processes, enable better decision-making, and drive profitability.
“Blockchain is a tremendous new platform,” emphasizes Sanchez. “This is the promise.”