Data-driven working a top priority for organisations

Only 10% of businesses are currently using advanced analytics such as machine learning or big data capabilities in production environments. However, one-third of businesses are aware they will need to expand into these areas to avoid being outflanked by competitors in the current decade, and are trialling a host of automation capabilities in response to this.

In late 2018, an apocalyptic white paper from DATAVLT predicted that as just 1% of the data companies collect and store is ever analysed, this will cause “as much as 96% that exist today to fail in 10 years.” Echoing this foreboding forecast, a new report from Coeus Consulting has similarly warned that organisations are missing opportunities to be empowered by great use of data.

According to a survey of 120 senior IT and data leaders, while 50% of companies are now widely using data warehousing and BI tools, most are still focusing on getting the basics right. At this point then, only 10% of firms are using advanced analytics such as machine learning or big data capabilities in production environments, and Coeus Consulting’s researchers suggested that this might demonstrate a disconnect with understanding the full benefits of a data-led strategy.

Too much emphasis is being placed on speed, cost, and competition, with too little consideration of data’s underlying value, the insights it offers, or decision-makers’ ability to develop new products and services from those learnings.

Further illustrating this, just 1% of respondents said that data was “not even on our radar”, compared to a vast 40% who said data was a “key priority,” or 34% who said it was “core to our business model. Meanwhile, more than a third of organisations believe they have ascended to the highest understanding of the data it holds – having centralised it into a seamless, enterprise-wide overview – while 48% have done the next best thing of enabling enterprise level visibility and control of data siloes. 

Despite this apparently advanced understanding of data, however, only 21% of firms said they expected to extract improved customer insights from their resources, while only 18% mentioned using it to identify new business models, and only 14% said it yielded opportunities for new products and services.

In contrast, the largest portions of respondents still think the biggest opportunities from their new technological capabilities will come in the form of speed and confidence in decision making (32%) or an amorphous “competitive advantage.”

What is clear from Coeus’ research is that many companies do not understand what the true potential of automation is then. Of those who have successfully deployed data initiatives, 43% cited improved customer insights – ahead of the 41% who had indeed enjoyed faster, more secure decision making.

According to Coeus, however, a growing number of firms are acknowledging the need for their data processing to go much further. Over 32% of businesses are currently trialling machine learning, AI, natural language processing (NLP), and/or automation capabilities, which is higher than the percentage of respondents who are merely collecting data in a data warehouse or data lake. 

While in theory this suggests progress, though, Coeus also cautioned that this seems contradictory to the fact just over half of respondents are rolling out or have a data warehouse, and only 31% a data lake. The researchers suggested that this pressing questions on the motivations for this type of investment pattern – which suggests a growing number of firms are simply throwing money at various solutions without a solid plan, just for fear of missing out. The perception that most organisations are more advanced than they really are could prove extremely damaging in this regard, with many companies rushing into investments to “catch-up to varying degrees.” 

Regarding the future of data-driven business solutions, the report noted, “Many organisations are looking at data tactically rather than strategically which leads to a focus on the technology enablement rather than the value proposition. This needs urgent redress if those organisations are to unlock real business advantage from their data, with a review and challenge of traditional operating models… Nearly as many are worried about the lack of a cohesive and holistic approach to compliance among different departments – potentially a by-product of fragmented systems and a lack of data insights.”