Hard data or virtual reality? 13 Jun 2017

If this decade ought to be remembered for anything in business, it’s data. Big Data. Data Analytics. Data privacy and data security. Fuzzy data, unstructured data, data mining. We’re at the point when every senior job demands you to have some kind of facility with analytics, at the very least a passing interest in how well your database is structured.

The obsession is well founded. From understanding customers to projecting financials, the application of granular data to (increasingly self-taught algorithms) can reveal insights and support decisions that not even the more intuitive business leader could arrive at.

No wonder half of companies made big investments in big data in 2016, according to Gartner. According to the UK government, “the UK has one of the world’s strongest and most developed data analytics sectors, and it’s growing. Predictions have put growth over the next 5 years at 177%, with 'big data' user numbers increasing to around 644,000. The industry is forecast to create 58,000 new jobs by 2017 and generate £241bn GBP by 2020.”

Some of the hottest growth businesses are working in the space on a new round of disruption – much of it driven by machine learning. This brand of artificial intelligence allows computers to use large data sets to set-teach about the optimal decisions to take towards a defined goal. Now that the whole world is quantified – that is, generating data about itself – the opportunities are seemingly limitless.

(That has profound implications for the finance function of 2025, incidentally. For FDs and FCs planning on being in-post by then, it’s going to pay to sharpen up your “soft” skills. Data won’t eat leadership just yet – but the biggest issues aren’t related to the tech, they’re around the way people fail to interpret and communicate what it tells them…)

But while the evolution of data might define this decade what’s starting to look like defining next year is something entirely different: virtual reality (VR).

VR has had so many false dawns, it was starting to looking like cabaret night at a French & Saunders fan convention. But a combination advances in graphics processing and screen technology; the ubiquity of really quite powerful computers in most people’s pockets; and the emergence of augmented reality (AR), as a sibling technology, has made VR the hot ticket in town.

Take a look at Improbable. This Cambridge-based VR business recent won a $500m injection from investor Softbank, giving it a valuation of $1bn – making it the UK’s latest unicorn. (And latest to be owned by Softbank, too, after it bought ARM Holdings.) Also note, the Japanese investment fund pumped $4bn into graphics chipmaker Nvidia in May – also set to be a key player in VR.

But for all the potential of truly virtual worlds and the power that simulators will bring to a host of business, industrial and leisure applications in the future, it’s AR that’s really interesting right now.

AR uses cameras – in your phone, or worn on the face or body – to capture and relay the real world, but with extra elements overlaid on top. Right now, like with VR, those are mostly games – like Pokemon Go. But the potential for overlaying all that data we were talking about onto your world, in real-time – well, that’s not only a game-changer, it’s within our grasp in the medium term.

Two companies will be critical here. Apple, which has made an ARkit development platform available to programmers already, which will see AR apps coming to iPhone later this year. And Google, which was roundly mocked for Google Glass a few years back, but which has already learned a huge amount about wearables, unobtrusive screens and built-in cameras.

For now, expect phone-based solutions. Imagine your IT team being able to wonder the building and tell, by looking at their phone screen, which computers have which software installed; or an internal audit team scanning documents on a desk, and bringing up related information in real time.

Heck, even Google Glass didn’t just disappear – it’s being used by workers on factory floors, productivity that could be further boosted by a truly AR version.

So here’s a bold prediction: just as data analytics is now a hard skills that every FC ad FD should have, we’re going to predict that a facility with augmented reality systems is going to be as important by 2025 as being able to use Microsoft Word is now. The push for more refined and more up-to-date soft skills in the finance function, it seems, is a never ending journey.