How will Big Data change financial analysis and valuation processes?

Abstract

The emergence of Big Data (BD) is seen in particular as an economic opportunity, but due to the abstract nature of BD, its emergence, processing, and inherent unstructured nature often do not seem to fit together. Against the background of the financial industry, which is driven by the increasing burden of data, this short article attempts to question whether financial valuation processes could be influenced by BD in the future or whether changes might have already occurred. Based on the theoretical V-approach, as well as the technical possibilities such as text or video analysis, it seems to be possible to align business processes based on social perspectives. Business processes are thus becoming increasingly complex and require many different perspectives, and the need to obtain the "right" data in the required quality is increasing. Particularly concerning the process of company valuation, it must, therefore, be questioned whether additional benefit potential is raised, concealed or even contains a value advantage due to a large amount of data and its renewal. We are however certain in our view that companies in their role as social constructs are exposed to major fluctuations both internally and vis-à-vis their stakeholders, which cannot be explained by financial considerations alone.