The term “data science” conjures images of supercomputers and processors, a seemingly technical endeavour that is only really applicable in the computing and information technology industries.
That image couldn’t be further from the truth. As the connected age expands data affects not just the traditionally tech-based industries but every single market – from real estate to education, from construction to hospitality.
When the potential of data-driven innovation is as much as $48 billion across all industries, it becomes clear all must be doing their part in order to create more value. While governments and other large organisations strive to understand the amount of information now in their hands, smaller SMEs across a huge range of industries now have the opportunity to create more value.
This is where some of the results could be the most significant, as small teams strive to find the best value they can with limited resources.
Which industries are primed for value?
As covered in PwC’s report, Deciding With Data, our data innovation index provides a relative sense of the industry that are poised for the highest gains – and those which may face bigger barriers in capturing data-driven innovation opportunities.
Each industry has been marked against two metrics – those which capture value, and those which create it. The results have been plotted on a matrix:
For instance, the education and training market ranks highly on the value creation index, but lower on the value capture index. This index provides a snapshot at which industries are best primed for delivering value through data, and which may face bigger barriers in capturing data-driven opportunities.
Some of the biggest opportunities are located in a small set of industries:
Health Care and Social Assistance
The PwC index puts health care at the top of a list of industries most able to garner benefits from data-driven innovation. With greater adoption of electronic health records, data could further transform health care through a number of ways:
- Identifying patients most likely to benefit from interventions
- Using predictive algorithms to foresee potential re-admissions
- Integrating triage algorithms into the clinical workflow to help manage rostering and patient transfers
- Evaluating multiple data streams from patient monitoring to predict whether a patient’s condition is likely to worsen.
Many businesses are already attempting this in their own ways. Queensland Health uses clinical dashboards which show real-time data on hospital utilisation and comparisons with State benchmarks to improve coordination of care. In Sydney, the Sydney Local Health District brings together large amounts of data across public hospitals and health care facilities in the Sydney metropolitan region to benchmark and optimise levels of care.
There are a range of opportunities here to increase innovation in the health space. Health care already contributes $97 billion to GDP – it stands to take a massive share of that extra $48 billion from data if innovation is given a boost.
Insurance and finance
Finance businesses have an incentive to mine their data for better and more accurate information, as doing so will in theory provide a better risk profile. Some businesses are innovating in this area – like QBE Insurance.
Auto insurance pricing is often not aligned with individual risk but rather with ?the average risk of a driver with their characteristics. For example, cautious young drivers may face the same insurance premium as risky young drivers.
Inexperienced and younger drivers can sometimes take 10 years or more to be recognised as safe drivers in order to receive reductions in their insurance premium. Furthermore, traditional risk categories and incentives such as no-claim bonuses are limited in the capability to improve driver safety and reduce accidents.
As a result, QBE developed Insurance Box, which collects data on driving behaviour and sets risk-adjusted insurance premiums accordingly. Drivers can avoid steep premiums by showing safe driving behaviours.
The small, self-installed telematics device plugs into the car underneath the dashboard and transmits data collected real-time via satellite and mobile networks. Insurance Box combines information on date, time, speed, longitude, latitude, acceleration or deceleration (G-force), cornering, sudden braking, and then transmits that data back to base via a SIM card.
The real-time data feed can also speed up responses to accidents and assist with vehicle recovery if theft occurs.
Whether business are large or small, the potential for data innovation is potentially limitless. As these examples have shown, companies of all industries are able to create new products and services by experimenting with data. As consumers adapt to a more data-rich environment, the top organisations will learn how to use this data in new and exciting ways.