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Top Columbus Companies Bet On Big Data
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Seven of Columbus’s biggest firms are making a big bet on big data. They have joined together to form a new company to collect and share information.
It’s called the Columbus Collaboratory. And leaders say it will create 100 new jobs.
But it also has the potential to cause disruption in the workforces of some of the city’s largest private employers.
L Brands and Battelle don’t do a lot of business together. Nationwide, Cardinal Health, Huntington Bank, Ohio Health and American Electric Power also tend to operate in their own spheres.
But they all have two things in common – customers and the data trail those customers leave behind.
The companies have pledged at least $28 million to set up a company to follow that data trail.
Ohio State University professor Randy Moses says the companies see business opportunity in exploiting consumer data that’s already being collected and stored.
“The number of digital sensors that appear on just about everything you can think of from your coffee pot to your automobile is growing phenomenally. There are hundreds or thousands of sensors on each automobile alone. If you just think about the amount of data that’s coming off of that it’s huge,” Moses said.
So huge that the amount of data collected is difficult to organize and tease out valuable insights. So the seven firms will pool their data and analyze it. The goal is to better serve customers and cut costs.
Case in point: Nationwide Insurance with more than 11,000 employees in Central Ohio. Enterprise Chief Information Officer, Mike Keller, explains how data analytics can hone in on the most efficient way Nationwide employees can do their jobs.
“We use analytics in marketing for example to gear our advertising to try to attract the right people. We can use analytics so that if we attract somebody to our website and they start to learn about us we can try to come back and offer them things more effectively than we could in the past. So there’s clearly a growth and retention dimension to it. So there’s a customer upside. There’s also clearly an operational efficiency side,” Keller said.
That operational efficiency side means big data could mean staff reductions in those companies which employ a total of 54,000 people
“Some of what’s happening in data analytics will actually take away jobs,” Kenny McDonald said.
McDonald is head of Columbus 2020, a jobs advocacy group affiliated with the Columbus Chamber of Commerce.
He explains as data is processed companies will find ways to use technology to take the place of what people do now. Some jobs will be lost. Online banking will cause banks to reduce the number of tellers. Online sales mean retailers need store clerks.
And data-driven job shifts won’t be limited to the insurance, banking, or retail industries. Ken Mayland of Clearview Economics in Cleveland says data-mining and utilization is the latest tool companies are using to boost profits.
“There could be a specific loss of jobs at particular companies but the net result of productivity increases. The income gains is that those income gains are spent in other areas of the economy producing a general increase in jobs elsewhere,” says Mayland.
That’s what McDonald at Columbus 2020 is banking on.
“We do think that the net effect will be a gain,” says McDonald.
The project is an offshoot of the new IBM data analytics center on the city’s northwest side which officials predict will create 500 new jobs.
McDonald says the focus on the big data industry is part of an effort to capture some of the anticipated job growth in emerging technology fields.
“You have to have people who help to gather the data, store the data, manage the data, secure the data, analyze the data,” McDonald said.
So some of the newer job descriptions in Central Ohio could include data architects, data stewards, or even data change agents. OSU’s Moses says that could lead to another problem – an actual shortage of workers for some data technology fields.
Keller says more precise data analytics could effect a variety of jobs at Nationwide.
“Sales people and claims people and service people beyond just the technology base,” says Keller.
Together, the seven companies currently employ nearly 54,000 workers in industries as diverse as insurance, retailing and health care. But, as new data is collected and mined for usable information those job numbers could change.