A new data paradigm for business and innovation

Data has become central to our increasingly digitised economies and societies. The five largest companies in the S&P500 index (Apple, Microsoft, Amazon, Facebook and Alphabet) all have data as the primary foundation underpinning their businesses. Together they account for approximately a quarter of the index's total capitalisation. This gives a clear picture of the weight of data in today's economy. The global volume of data is expected to grow from 33ZB (ZettaBytes - a 1 followed by 21 zeros) in 2018 to 175ZB in 2025. By then it is also expected that up to 75% of the world's population will be living with data on a daily basis, with an average of one data interaction per person every 18 seconds.

On the other hand, and due to the spread of the COVID-19 pandemic that started last year, we have witnessed a prolonged transition in our most day-to-day activities from physical to digital interactions in education, business, government and family settings - which will surely lead to this expected growth in the data universe taking hold, but also to an increasing societal demand for services that make respectful and responsible use of data. In addition, the European Commission's recovery plan in response to the pandemic will provide the largest financial investment ever made by the European Union, with nearly 2 trillion of investment over the next few years. Within this plan, the largest package of investment foreseen will be aimed at fostering innovation and digitisation in Europe. This, together with the strategic and regulatory framework that is being put in place, will only consolidate and even accelerate these trends in our continent.

Already a few months ago, in this particular and decisive context in which we find ourselves, the World Economic Forum (WEF) invited us to reflect on the new paradigms of innovation and business that are emerging around the way we relate and interact with technology and data. The idea is to also take this opportunity to rethink the current business models around information in order to experiment and start using data more fairly and creatively.

New areas of innovation

These new emerging opportunities would still be based primarily on creating value through data, but would also be characterised by being more respectful of consumer data, enabling more trusting relationships between all actors involved and where all would benefit from the end result. The WEF classifies these opportunities into four main groups:

1. New areas of value creation: using the knowledge gained through data and new technologies emerging in its environment to find new sources of revenue and to incorporate new products and services, as well as to provide richer information to a wider range of stakeholders, while ensuring privacy and security.

A good example of how these new value areas are emerging is how Airbus has been able to expand its market beyond its traditional customer base through the new geospatial product services it provides through its new subsidiary UP42, serving as an intermediary between its traditional geospatial data providers and new customers with their own geospatial data needs.

2. New business models: reinventing and proposing collaboration models that enable new use cases, always focusing on the consumer in order to respond to their basic needs while generating trust.

A nearby example in this field is BBVA's data-driven banking strategy. This strategy is based on the concept that data belongs to the customer and it is the customer who decides how to manage it. To this end, they have created a platform through which other external collaborators can access this data in a secure and consensual manner and thus offer a range of additional services that the bank could not provide on its own.

3. Enriched experiences: using data to better understand their own employees as well as their partners and customers, thus being able to offer more personalised products and services and a more complete and enriching experience.

This is the case of Digi.me, a platform where users can voluntarily collect their personal, financial and health data, and then share it according to their own interests. In this way, companies get a unique and reliable source of data and in return, users receive compensation in the form of products or services, while maintaining control over their own privacy at all times.

4. Improved decision making: identifying which business process optimisations can lead to better streamlining of internal processes to achieve further reductions in operating costs.

For example, Aera Technology is a company that combines big data, machine learning and artificial intelligence to develop supply chain automation. It provides real-time data on demand, supply, production and inventory performance through a simple search interface that directly asks questions in natural language.

Collaborative, respectful and sustainable

In this environment of increasing dependence on data, the world is preparing for a paradigm shift in the use of data by business. The new approaches that emerge must be responsible with the use of data, as well as respecting the baseline regulations on data protection, pursuing not only economic benefit but also the creation of value for individuals and society as a whole. Companies now have the opportunity and the imperative to rethink their current models, to start using data more creatively and to experiment with new forms of monetisation, thus becoming trusted custodians of data. The key to success will be the creation of collaborative ecosystems that enable the participation of all stakeholders and pursue a change in current systems for the co-creation of value through data in a sustainable and respectful way.

The WEF has already taken a first step in collaboration with more than 50 companies from 20 countries through its recent pioneering Data for Common Purpose Initiative (DCPI), focused on designing a flexible data governance framework to exploit the societal benefit of data.

Content prepared by Carlos Iglesias, Open data Researcher and consultan, World Wide Web Foundation.

Contents and points of view expressed in this publication are the exclusive responsibility of its author.