Companies that use data analytics typically have more revenue growth and a higher return on capital investment. To overcome the obstacles to widespread analytics adoption, here are some steps your organization can take to realize these business benefits.
Top-performing companies typically are the ones embracing data analytics. According to an IBM study that surveyed 1,900 CFOs, analytics-driven organizations had 33 percent more revenue growth and 32 percent more return on capital investment.
With such significant benefits, it is not surprising that there is increased interest in business analytics today. This point rang true in an IBM Institute for Business Value and MIT Sloan Management Review study, which surveyed 3,000 business leaders in 108 countries. Fifty percent of those surveyed said that improving their analytics capabilities was a top priority.
The survey also found that several organizational issues are holding most companies back from using business analytics. The primary obstacle was that most companies did not know how to use analytics to improve their business.
To overcome the obstacles to widespread analytics adoption, the IBM and MIT study offers up some insightful steps organizations can take to get such a valuable IT-business focus up and running. They are:
1) Take Big Steps: Focus analytics efforts on the biggest and highest-value opportunities. One point to remember is that business analytics is much more than simply gathering and analyzing data. It’s about maximizing the value of data throughout the organization.
That was the case with the Cincinnati Zoo. It had data residing on four systems with information about the number of visitors, purchases made in the gift shop, money spent on concessions and membership information.
Leveraging business analytics software, the Zoo can now see who its 1.2 million annual visitors are, and where they were spending their money. With this insight, the Zoo anticipates an additional 50,000 visitors this year and a $350,000 increase in revenue. (Read more about the Cincinnati Zoo analytics effort here.)
2) Identify Needs: Don’t take the traditional—and usual—approach in gathering data and extracting insights. First, identify what insights you need, and then, you’ll know what data you need to focus on. This keeps the data deluge as low as possible and provides an efficient way to start moving forward and making decisions based on analysis.
3) Make use of Technology That Works for Your Users: A wide variety of business analytics technologies and tools are available today. Explore the various alternatives and keep the learning curve low. Techniques such as data visualization and simulation tools don’t require niche skill sets, so they can be put to use right away. The study says that organizations that use this type of “selective” approach can focus resources and efforts narrowly.
Taking these steps allows an organization to hurdle the perceived obstacles to the more widespread deployment of business analytics. And this in turn generates insights that will put an organization ahead of its competitors.