Awash in data, firms struggle to develop and leverage insights—but getting them right can have tremendous upside
Data is everywhere. Insights? Not so much.
Looking for deep intel on customer or client needs? To target new markets? Understand performance? Any firm or company today pursuing profitable growth may ignore, at its own peril, the role of data in this strategy. If business transformation is the key to your growth model for tomorrow, leveraging your existing data for insights into key drivers should be a mandate.
The availability of data is set to increase at lightning pace. The volume of data created annually is expected to reach 44 trillion gigabytes by 2020, an increase of nearly ten times just since 2013. And yet only a fraction of that data is actually helpful—37% of that 44 trillion gigabytes is expected to be useful, and only after it is analyzed (1). Inundated by seemingly useless data, you may be wondering whether investing in your organization’s analytical capabilities was worth it.
And you wouldn’t be alone. The majority of big data and analytics-building efforts fail or are never completed. Just because the capabilities are built doesn’t mean they truly add value. One recent study (2) found that three-quarters of businesses extract little to no advantage from their data, including many that have invested heavily in building analytics capabilities.
The problem for most organizations and leadership teams is that simply having more data—or software or even data analysts—doesn’t directly lead to answers. The good news is that our experience shows that nearly any level of investment in analytics can generate surprisingly large value. Realizing that value often requires understanding what barriers leaders are encountering, and then addressing the (sometimes surprising) root causes.
Assessing Your Unique Challenges
Leaders understandably focus on dealing with the most obvious causes—bad data, bad analytics, or even bad analysts—but while these are the most obvious, they are not necessarily the most likely to be the real problem. You should also make sure the business processes that touch analytics are not getting in the way, that you manage the cultural challenges to acting on analytics, and that you align on what is needed, from the C-suite down to the analytics teams.
To fully realize the value from analytics, leaders must understand and activate all of the elements that support a data-driven firm.
Finding Value in Your Data
Unsurprisingly, we find that each organization has strengths and weaknesses among these elements, but few are capable of objectively identifying them or knowing what levers to pull to change the situation. Successful ones, however, do not become data-driven by throwing more data at the problem. Rather, they work to first understand their gaps related to these elements and find solutions to close them, leveraging the natural strengths of the organization.
Complacency around your data will ultimately impede business transformation. But eliminating company barriers, aligning critical elements and making investments in analytics is an assured route to future growth. Every organization today, regardless of size, has potentially game-changing insights sitting right in its very own data, and the value is significant. Understanding and delivering on client or customer needs you’re missing or that other organizations can’t “see” makes getting this equation right worth full percentage points to your firm’s bottom line, competitive advantage and continued livelihood.