As they begin to examine how decisions get made in their organizations, executives are increasingly adopting a more evidence-based and data-driven approach to decision making. As they assess the impact of past decisions made with incomplete or inaccurate information, executives are recognizing the need for a methodology and toolset to support decision making, This is the one of the driving forces behind the adoption of data analytic and business intelligence tools and methodologies in business units, which will ultimately converge into an enterprise-wide strategy. These findings from The ABC’s of Executive Analytics from the Aberdeen Group, confirm the conclusions of other research we’ve recently discussed in our blog.
The report analyzes survey feedback from 370 executives across all industries in January and February 2011. It classifies organizations into three categories with respect to the ability for executives to use analytics to improve business results:
- Best-In-Class companies have the ability to leverage the vast amounts of data available into usable business insight that directly impacts business performance.
- Average companies have the ability to supplement executive experience and knowledge with timely business insight that helps guide executives towards the best decisions.
- Laggard companies have limited ability to use information to influence executive decision making.
As you can see from this chart, when you compare the three types of organizations against four factors: Operating Profit Improvement, Organic Revenue Growth, Customer Retention and Employee Retention, there is a clear difference in performance among the three groups.
The Aberdeen report suggests a number of “Steps to Success” for companies at each of the three categories to improve their capabilities in this area.
- Start tracking human capital usage related to analytics. In order to increase ROI from business intelligence, organizations need to understand how their human resources are being leveraged in support of the successful analytical environment they created.
- Continue to foster analytical collaboration across business functions. Share data, gather different perspectives and collaborate in real time across business units to help arrive at the right questions and the right answers.
- Consider implementing predictive analytics. Help executives use predictive models for proactive vs. reactive decision making.
Editor’s Note: If you are considering implementing predictive analytics be sure to check out our complimentary webcast “Predictive Analytics with Spotfire”.
- Establish training/educational programs to build analytical skill sets. Exposing people at every level of an organization to the power of analytics will help create an analytic environment in which individuals devise creative uses not even previously considered.
- Dedicate an analytical leader or champion at line-of-business levels. The most successful companies have a clear hierarchy of ownership and accountability for business analytics at several levels.
- Automate the generation and delivery of standard reports. For standard ways of reporting and viewing data that remain constant and seldom change, automate these and reuse them across the organization.
- Build employee engagement in analytical methodology. Share data across organizational boundaries, build analytical skills sets and provide tools to decision makers.
- Create better linkages between operational data and strategic performance. Understand the organizational drivers behind high-level metrics and make the data available to drill-down to those drivers.
- Investigate technologies to improve data quality. Assess the usefulness and quality of data and use technology to more efficiently improve data quality.
The Aberdeen report is available free for a limited time.
Spotfire Blogging Team