Why weather insights are key to unlocking business intelligence
In my role, I talk to businesses on a regular basis, working with sectors as diverse as rail, retail, infrastructure, aviation and energy. So I wasn’t surprised to learn that in the World Economic Forum’s 2019 Global Risk Report, Business and Government leaders once again identified environment-based risks as being at the top of their agenda. In fact, extreme weather events and climate change inaction were two of the standout risks in terms of both likelihood and impact.
Many business leaders are acutely aware of the impact extreme weather events can have on safety, efficiency and, ultimately, on their bottom line. They know their industry can be impacted by extreme weather events. What they really need to know is how they can better understand and manage the opportunities and risks associated with the weather today, and how to make their businesses more resilient in the future.
From trouble-shooting to forward-planning
My team’s role, in a nutshell, is to get to grips with customers’ problems and work through how our scientific capabilities can assist them. When we start working with a new customer, the first thing we do is to discuss their critical challenges and uncover their priority business needs. We then look at their data, analysing anything that may be dependent on the weather – for example, summer water demand or product availability for Retail.
Once we’ve defined the relationship between weather conditions and their particular business, we can create a tailored forecast service. One that doesn’t just predict the weather, but looks at just how that weather impacts business performance – helping them make plans to meet any challenges on the horizon. For instance, our water demand forecast quantifies the high levels of peak demand during heatwaves. As another example, we’ve also worked with call centres to predict demand on their lines during severe weather. For every customer, it’s about identifying, interpreting and integrating weather into their business processes.
Thinking further ahead
Looking further ahead, longer-range forecasts could offer huge value to businesses. Interpreting longer-range forecast probabilities in a way that makes the information useful to businesses is critical. For example, marine engineering and construction requires suitable weather windows to be identified weeks in advance. Past climate can help considerably, but confidence and success can be enhanced by including seasonal forecast information, leading to the eradication of unplanned downtime resulting in significant savings. If companies can put a rigorous and consistent framework in place for using longer-range forecasts in decision-making, businesses can improve profitability and efficiency – and stay compliant with regulations, too.
Weather insight, beyond face value
Looking even further ahead to climate timescales, the relationships between weather and business outcomes that we have identified using past data, can provide useful insights when driven by climate model output. The past relationships can be used to quantify how business outcomes would be affected by a warmer/cooler, or wetter/drier climate. A warmer climate might point to a 10% increase in water consumption for example, or a 5% increase in ice-cream sales. This means businesses can think ahead about the ways in which they may need to flex their operations to suit the changing climate. And that could help to shape their forward strategy, give them an early competitive advantage and build long-term resilience.
The fourth industrial revolution
For a lot of businesses there is now an opportunity to use new technology to handle and analyse big data. A benefit of digital transformation is that they can incorporate weather data, even multiple weather scenarios, into business processes.
This ‘fourth industrial revolution’ is helping businesses to consume weather data in new, interesting and incredibly valuable ways. Smart tools, analytics and AI technologies are increasingly supporting a whole range of industries to see and exploit patterns in their data that they couldn’t see before. When it comes to weather- and climate-related impacts, the benefits could be considerable.
Striking a balance
For businesses, building understanding from weather and climate has a two-fold benefit. It’s being prepared to be reactive when weather events occur and proactive to manage potential future issues. Using day-to-day intelligence to inform operations as well as longer-range forecasts to shape strategy. By harnessing technological advances, and using data in both day-to-day decision-making and to inform future strategy, businesses can unlock huge value from weather insights.
Hear more from Tom Butcher at Future of Infrastructure 2019 – Click here to view full session details