Today’s never-ending proliferation of data can feel like an ocean: expansive and bountiful, but also unknown and untapped. Like water, data is a “natural resource,” as IBM CEO Ginni Rometty puts it, but one that we’ve yet to fully take advantage of. The key may lie not in the data but the roles that control it: chief data officers, chief analytics officers, and other forms of data leaders.
According to an IDC report, companies currently analyze a mere 0.5 percent of all data even though by 2020, 33 percent of the world’s data (a whopping 40 zetabytes) will be useful if analyzed. “Organizations know there is value in data and analytics, but struggle with understanding the different analytics capabilities they can leverage and when to use them,” suggests Gartner. Although organizations seek better analytical capabilities, many are still early in their journey to set up these dedicated teams with the necessary tools and education.
However, not all businesses are lost at sea. Forward-thinking organizations are investing in a certain class of professionals—chief data officers, chief analytics officers, and other executives acting in these roles—to implement and optimize their data functions. The IBM Center for Applied Insights recently interviewed ten such data leaders, who collectively distilled some of the hurdles facing businesses and the approaches and actions they are employing to work past them. The Center has compiled those challenges and solutions to form some guidelines for businesses dipping their toes into analytical waters.
This study is part of the body of research by the Center that investigates how businesses are capitalizing on data and analytics. In the last year, the Center published Inside the mind of Generation D, finding that analytically driven companies were reporting better results across a flurry of KPIs, and also Your Chief Data Officer, which gave members of the emerging role a trifecta of methods to employ in the early stages of their new missions.
This study, Teaching organizations to fish in a data-rich future, examines the analytics challenges that businesses face across industries and sectors, the thorns that impede their evolution into highly analytical enterprises. Problems ranged from not capitalizing on all the inherent value in new waves of data to not having the right talent within the business to establish an effective analytics function.
But by sticking to three principles—making data a priority, developing from within, and freeing all the data—companies were able to deliver outcomes that far outweighed their early struggles. Among these wins were a research institute that implemented a four-step analytics endorsement process that drove the success rate of clinical research up 30 percent and a manufacturing company that generated an extra $2 million in revenue through newfound tools that predict customer needs.
What’s the take-away message? This kind of initiative isn’t easy—revamping the data capabilities of your company isn’t like shooting fish in a barrel. It’s more like fishing in the ocean, where depth and unfamiliarity are both wonders and hindrances. However, with the guidance of data leaders and an understanding of key principles, companies can learn how to score the big catches.