Companies are finding great value in business analytics, but high-performing companies have a better handle on turning data into instant insight.
That’s according to an IBM report, which also found that 70% of organisations overall and 75% of leading businesses see innovation and revenue growth as a chief value of applying analytics.
IBM surveyed 900 business and IT executives in 70 countries and came up with nine levers of differentiation between leading companies (the top 19%) and others in their use of analytics. Cathy Reese, business analytics leader with IBM Global Business Services and one of the report’s authors, listed three levers in particular that are seen as opportunities for companies to get more value from analytics:
Executive sponsorship and advocacy: In organisations with low levels of executive support, “analytics implementations are hampered by lack of funding, resources and follow through,” the report says. In contrast, leading organisations have executives “who believe in the power of analytics and are passionate about instilling a data-driven culture.”
Trust: Reese said this component goes beyond trusting the data. “It’s trust between people,” she said. The report recommends face-to-face interaction to build trust. Leading organisations “[r]ecognize trust is a key ingredient to value creation through analytics,” according to the report.
Expertise: Companies are hard-pressed to find analysts comfortable with the nuances of the business and the mastery of technology. In the IBM report, 36% of survey respondents cited the business/technology understanding as their “most pressing” skills gap. Analytics skills were next at 24%, followed by data management skills (21%) and business skills (19%).
The other six levers in the IBM report are culture, data, funding, measurement, platform and source of value.
The finance function is well-positioned to take the lead in creating value from company data, according to a recent CGMA survey. Additionally, finance is seen as adding clarity to the information overload that often accompanies a company’s dive into business analytics.
The IBM survey found that companies have a splintered view of which executive should be the chief advocate for the use of analytics insight. The chief information officer was viewed as chief advocate the most (15%), followed by the CEO (14%) and a combination of officers at 10% each. The CFO was seen as the chief advocate by 8%.
CFOs are seen as being in charge of a company’s data, said Bill Fuessler, financial transformation executive with IBM Global Business Services.
“When you ask the question, ‘Who do you look to as the keeper of the information, the owner of the truth?’ I think it is the CFO,” Fuessler said.
Related CGMA Magazine content:
“Five Ways to Exploit Big Data Without Compromising Privacy”: Big Data is revealing itself to be an extremely powerful tool that can deliver growth, efficiency and competitive advantage for organisations.
“Five Strategies to Use Analytics for Competitive Advantage”: Organisations are building momentum for the use of Big Data by integrating data analytics into their strategy in small projects that deliver substantial results, according a recent report.
“Why More Data Does Not Guarantee Better Decisions”: While the amount of data that companies collect can be good for business, the numbers themselves are not a guarantee of success. Human expertise is needed to parse the data.
—Neil Amato (firstname.lastname@example.org) is a CGMA Magazine senior editor.