Analytics-Driven Companies See Competitive Advantage: IBM-MIT Study

How often to I go on about value from data – so this is a little self-justification post based on a report that backs my opinion, so I must be right!  :)

Source: MIT SMR or IBM  2011 Analytics Study of 4,500 executives

The global survey of executives, managers and analysts, released by MIT Sloan Management Review and the IBM Institute for Business Value, finds the information ‘haves’ — companies with in-depth experience with analytics technologies and methodologies — increasingly saw competitive advantage, and were more than twice as likely to have outperformed their analytically challenged peers over the past year.

However, there is still much, much work to be done. The study found that the majority of organizations are using analytics to manage financial and operational activities, but are less likely to rely on analytics-based insights for decisions in other key areas.  Tellingly, only about half of the advanced analytics companies rely on data and analytics outside finance, to make decisions involving customers, business strategy and human resources. Fewer than 25% of the less-developed companies are using analytics in this way.

The report also provides guidelines on building a more analytics-capable operation, starting with an assessment of  current analytic capabilities; focusing on improving competencies via information foundation, analysis skills and tools, and creating a culture that acts on analytics; and  having an overall information agenda to make analytics part of the day-to-day enterprise.  As the survey finds, 44% of respondents say their organizations aren’t receptive to becoming a more analytical culture. Only 24% say they don’t have access to the right technology to make it happen.