Although most companies recognise the added value of big data analytics for their business, only a third have operations to ensure that big data is at the heart of every business decision, research by EY shows. This underlines, according to the firm, the divergence between these companies’ data ambition and current reality, which should be addressed by setting up the right data structures and governance.
Professional services firm EY, in collaboration with independent community Nimbus Ninety, recently released a new report, titled ‘Becoming an analytics driven organisation to create value’. This research provides new insight on big data trends and challenges and on how companies are using big data to measure, create and protect value across their businesses. The research is based on a survey conducted among 270 senior executives active in big data projects who responded to questions on all aspects of their data strategy.
The vast majority of respondents, 81%, believe that data should be at the heart of every business decision. The most cited drivers to implement big data analytics are ‘to understand customers better’, with 73% believing this will create value for their company, closely followed by ‘to improve products and services’ (72%).
“In essence, analytics can enable an organisation to effectively grow, optimise and protect value. Firstly, big data has become an invaluable tool for creating value in a business. Secondly, big data can help organisations protect value based on effective risk mitigation and compliance with ever-changing regulations. Thirdly, analytics can help organisations find and measure intangible sources of value more effectively, bringing together hard facts from the balance sheet with a range of qualitative evidence,” explains Herman Heyns, EY’s Head of Big Data and Analytics, UK & Ireland.
The research, however, also reveals that while almost all businesses now recognise the power of analytics to grow, optimise and protect value, the majority of these businesses still use data analytics in an ‘isolated way’. By addressing specific business issues, instead of as an overall strategy, the potential value to increase performance and efficiency is limited, the consulting firm states.
Strategic decision making
For companies to be able to collect and analyse data and deliver insight, the right organisational structures, processes and governance frameworks should be in place. Of the 81% that believe data analytics should be used strategically, only a third (31%) has restructured their operations to help big data be at the heart of every business decision. In addition, while the importance of ‘cross-functional working’ for delivering successful big data projects is recognised by 41%, just 23% of organisations have implemented an organisation-wide data strategy. According to EY, this shows a major gulf between companies’ big data ambitions and their current achievements.
“Data can be the lifeblood of an organisation if it is allowed to flow freely across the entire ecosystem. As our research shows, building the right organisational structure and governance framework to support value-driven decision making remains a challenge for many businesses out there. Businesses need to invest on the necessary skills, structure and data governance that will help them build a data strategy that is trusted, valued and supported by key stakeholders,” concludes Heyns.