When the financial crisis of 2008 hit, many businesses reflexively cut jobs in an effort to stay solvent and unemployment soared.
Today, confronted with similar economic challenges brought on by Covid-19, some of those same businesses are responding very differently. Why? What’s driving these changes?
For one, companies have more data available to them, and they’re able to use it in myriad ways. Rather than make costly decisions in the dark, organizations are increasingly finding creative ways to mine datasets as part of the decision-making process. Here are just a few examples.
FCRA Data is Helping to Open the Credit Spigot
When the pandemic struck, bars shuttered and restaurants emptied. Seeking to stay in business while complying with public health measures, a bistro owner might apply for a loan to expand outdoor seating. Not long ago, insufficient credit would have disqualified her. Today, data demonstrating her diligence in paying monthly bills could result in a happier ending.
By combining traditional credit data with Fair Credit Reporting Act (FCRA) compliant data (payments to landlords, streaming service providers, cell phone companies, etc.), credit bureaus can create a picture of creditworthiness that was not possible before now. As consumers meet their monthly obligations, their credit scores go up. This, in turn, makes additional financial services available.
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“We believe by using data for good, we can help people gain access to the credit they need while also protecting lenders from fraud and helping them mitigate risk,” said Alex Lintner, group president at Experian Consumer Information Services. As a result, as many as 40 million consumers previously viewed as “invisible” to credit reporting agencies could gain access to needed credit.
Data is Being Used to Save Local Music
Music discovery has changed a lot in the 21st century. Twenty years ago, the benchmark for success was selling a million records and getting a few hits onto the charts. Since that time, key inflection points have forced industry change.
Today, streaming sites such as Pandora and Spotify allow users to play music on any device, anywhere. Indexing, tagging, and preview protocols reduced the cost of finding new music to zero. As consumers have grown increasingly unwilling to pay to sample music, artists have come to depend more and more on live performances to earn a living. And then Covid-19 hit.
In response to the hurt put on musicians and venues by the pandemic, Hearby, a Boston-based startup, is helping amplify the return of live music globally. Using AI and machine learning, Hearby scans public datasets and maps live acts as they return to thousands of venues across North America and Europe.
“We had been concentrating right in the city centers, but most of that stuff has been wiped out at the moment,” Hearby co-founder Gary Halliwell noted. “So we re-tuned to discover where live music is happening—the suburban restaurants, the pop-ups and drive-ins.”
The company licenses its live show calendars to news media, local tourism organizations and other industry players. But the real goal of its music-loving co-founders is to encourage the safe return of live music, which will keep more venues open and more artists in work.
Education Platforms are Joining Forces to Lobby for Equity
When Covid-19 took hold, millions of students (and their parents) were suddenly stuck at home trying to salvage a difficult educational experience. Far too many of these homes were not set up to handle the increased tech demands of local school systems.
Watching from the sidelines as students fell off the grid proved to be too much to bear. In December 2020, Instructure, Zoom, and other connectivity companies issued a joint release calling on the Biden administration to address these digital deficits. From increasing state and local funding to reconceiving student assessments, the document spells out ways in which the incoming Biden administration can promote education equity and improve performance.
Publicly available data in Instructure’s State of Student Success Survey offers evidence that the best opportunity for creating equitable education opportunities lies in bridging the digital divide.
Companies are Finding Greener Pastures
The 2008 crisis caused many companies to make drastic cuts in staffing. In 2020, enhanced access to data caused many of those same companies to cut their real estate costs instead. The ongoing exodus from Silicon Valley gained considerable traction when database giant Oracle announced its departure.
Large corporations don’t just pick up and move operations on a whim. Business Insider recently made a strong case for Florida and Texas being the next business hubs thanks to their lower cost of doing business compared to Silicon Valley or New York.
Companies consider more than “lower cost of living” and “fewer crowds” when making strategic decisions about location, though. Public datasets on everything from transportation facilities to educational attainment by metro area empower corporations to find their optimal homes.
Organizations that persist in taking a hard pass on data mining are setting themselves up for problems. At best, they will be offering competitors clear sailing in the passing lane. Given the richness of public data coupled with increased ease of access, there’s no longer any need to check our gut when making decisions that affect jobs, education, or anything else.