“Sponge” firms

Enrique Dans. Professor. IE Business School

8 March 2012

Technology, particularly in the form of social networks, enables firms to access enormous quantities of information on their products. Those that manage to soak up this information will gain a priceless competitive advantage.

It is becoming more obvious by the day that we live in a world of information overload. Companies are increasingly surrounded by mechanisms designed to provided constant feedback. Years ago, the only indicator we had at our disposal were sales, and aggregate sales at that. Now, it is considered perfectly normal for a company that produces, say, consumer products, to be able to have a fairly precise picture of why customers use its product. It can see what customers think of their experiences with it, which of its key features are most appreciated, the most typical complaints, consumer demographics.etc. just by examining social networks in the right way.

There is, in fact, a whole new trend revolving around the idea of big data, a new buzzword that refers to technologies used to analyze massive quantities of data, often not very structured or very different in nature, and which in the case of business corporations are usually gleaned precisely from the interface between consumer and the so-called social web. Companies are having to become more and more like sponges, immersing themselves in the oceans of data that surround their activity – from sales to attitudes, including demographics, geo-location or what we want. They then have to be capable of converting said data into useful information that permits them to adapt to the environment better than their competitors.

Spain is a leader in Europe in the adoption of smartphones: the average Spaniard consults the internet more from his or her mobile than other Europeans, and these smartphones are typically used for social network purposes. Spanish businesses, however, appear to more reluctant to embrace smartphones, and they are missing out on a conversation that goes on regardless without them, and serves as a severe restriction to their capacity for analysis and innovation.

Do you want to be ready for this new scenario? Immerse your company in it, add value and soak up data. Because the future belongs to “sponge” firms.

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