Global survey: Analytics fuels data-driven culture, innovation
Harvard Business Review Analytic Services and SAS study reveals decision-making shift
Gut instinct just isn't enough anymore. Growing pressure to achieve business results faster has many managers adopting data-driven decision-making processes and technologies. In a recent survey sponsored by SAS, the leader in business analytics, Harvard Business Review Analytic Services found that at least 50 percent more organizations enjoyed improved financial performance from their analytics if they had widely distributed access to those tools. More widespread use of analytics also increased productivity, reduced risks and helped individuals make faster and better decisions. In data-driven companies, employees become more proactive and creative, generating a flow of new ideas; managers use analytics to test those ideas, deliver feedback, and encourage collaboration and innovation.
"In consumer products, you might think there isn't much reason to invest in another new laundry detergent, but consumers respond strongly to innovation," said Filippo Passerini, Group President of Global Business Services and Chief Information Officer of Procter & Gamble, in the report. He added, "What's different now is the tools allow me to see what was important last year, last quarter and last week so I can understand what will happen tomorrow, next month and next year. That is a huge conceptual shift in thinking. We've used data analysis for 50 years, but we're just beginning to develop predictive ability through business models to anticipate what's coming."
Organizations earlier in their use of analytics tools reported less agile response to changing markets and less innovation. Even while recognizing the need to step up analytical decision making, many lack processes to do so.
"As timely decision making becomes more important, analytics is improving and changing the way those decisions get made," said Angelia Herrin, Research and Special Projects Editor at Harvard Business Review. "This survey shows that analytics is not just a tool or a technology as much as a driver of a decision-making discipline that ushers in an era of cultural change – and improved performance."
Data-driven companies become wiser companies
The survey, sponsored by SAS, also found specific steps taken by organizations evolving their decision process:
- Executives and staff members enhance analytical skills.
- Analytics professionals become trusted internal consultants.
- Business users balance analytical insights with managerial instincts.
- Organizations create an "analytics ecosystem" that promotes transparent decision making.
"The point of becoming a data-driven company is to become a wiser company by making better decisions," said Jim Bander, National Manager of Decision Sciences in the Risk Management Department of Toyota Financial Services, in the report. "And that isn't simply a matter of data but of fitting analytics into your corporate culture. For example, Toyota has a culture of continuous improvement and respect for people, including consensus building. My job is to fit analytics and data-driven decision making into that kaizen framework. An organization with a different corporate culture – whether a mass-production manufacturer or a Silicon Valley startup or a government agency – would find a very different way to integrate analytics into its decision-making processes."
Analytics skills benefit individuals and organizations
Analytics can usher in cultural change and improved performance for individuals as well as organizations. Four in 10 surveyed said using analytics improved the importance of their functional areas within their organizations.
Decision makers can enhance their analytical skills by attending Analytics 2012 in Las Vegas, Oct. 8-9. Analytics 2012 offers broad and deep coverage of data mining and predictive analytics, forecasting, operations research, text analytics and high-performance analytics insights. In the same location on Oct. 10-11, The Premier Business Leadership Series, an invitation-only event, will feature industry thought leaders, SAS customers and executives discussing big data and information management, analytics and high-performance analytics.
What is the progression toward an analytics culture? Download the free October 2012 report The Evolution of Decision Making: How Leading Organizations Are Adopting a Data-Driven Culture , to learn about evolutionary stages and real-world examples from Macys.com, Procter & Gamble, J.P. Morgan Chase, Bosch Security Systems, The Standard, Monsanto, and Toyota Financial Services. The report presents insights from an online survey of 646 Harvard Business Review subscribers across industries and 10 in-depth subscriber interviews. Approximately 40 percent of respondents were from the Americas; 30 percent from Europe, the Middle East or Africa; and 30 percent from Asia.
About Harvard Business Review Analytic Services
Harvard Business Review Analytic Services is an independent sponsored research unit within Harvard Business Review Group, which conducts research and comparative analysis into timely business and management ideas. Harvard Business Review a leading destination for smart management thinking, publishes its flagship magazine, 11 translated licensed editions, books from Harvard Business Review Press, and digital content and tools
SAS is the leader in business analytics software and services, and the largest independent vendor in the business intelligence market. Through innovative solutions, SAS helps customers at more than 75,000 sites improve performance and deliver value by making better decisions faster. Since 1976 SAS has been giving customers around the world THE POWER TO KNOW®.