Innovation driven by the use of data contributed the equivalent of the entire retail sector to the Australian economy in 2013, according to research published today by PwC.
Data-driven innovation added an estimated $67 billion in new value to the Australian economy last year, which equates to 4.4% of Australia’s gross domestic product.
In the research, which was commissioned by Google, PwC says data-driven innovation involves using insights from data to solve problems, boost efficiency and create better products.
And all sectors of the economy are using data to innovate their business practices, from agriculture business using weather patterns to improve harvesting to health practitioners using data to improve how they treat patients.
But the report also found significant room for improvement, with an estimated $48 billion available in potential value to the economy if data is used to drive further innovation in Australia.
PwC found the health sector presents the biggest opportunity for data-driven innovation, but using data to improve your business is not just the domain of big business, says PwC innovation partner Trent Lund.
“We often talk about big data and complex data … but if we want to talk about unlocking value, we must talk about small businesses,” Lund told PrivateMedia.
Lund says “little data” can be as simple as data that small businesses already have access to, such as through their accounting software or how many people are visiting their website.
A tool such as Google Analytics can give SMEs a wealth of information about whether or not their value proposition is resonating with a chosen audience, says Lund.
“It’s an untapped opportunity,” he says. “We all put websites up because they are a necessary piece of real estate but do we know how to drive traffic?”
Lund says accessing data does not have to be a costly exercise, with data from a wealth of free or low-cost sources already available.
He gives the example of the data the federal government has accumulated through its health and aged care services about Australian’s health care needs and geographical trends in health care.
In the hospitality sector, cafes looking to grow their businesses could make use of government data to analyse which suburbs or locations are emerging, or for an ice-creamery, making use of data about weather trends could mean the difference between a profitable weekend or a non-profitable weekend.
Lund says SMEs could also look at partnering with the growing number of “digital natives” launching startups based on the use of data and these businesses are often looking for other companies to help them “test their models”.
While Lund says the current federal government has already begun to re-shape the public debate about the use of data in the Australian economy, he believes it’s a debate all members of the community should participate in, including small business.
“The idea of a social license is about how we debate what’s private and what’s not,” he says.
“It comes down to how we provide utility.”
This article originally appeared on SmartCompany.
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