Properly harnessing analytics is crucial to the enterprise’s success

Published: 07 August 2019

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An increasing number of organisations are beginning to undertake digital transformation journeys, and the success of such an approach depends to a large extent on the role played by big data and analytics. Remember that today, data has essentially become the new business currency, and effectively storing, analysing and using it will be key to the transformation and growth of enterprises.

 

The fact that data is viewed in this manner today is unsurprising, considering the sheer amount of information that is being generated in today’s world. In fact, Cisco has predicted that annual global IP traffic should reach some 3.3 ZB per annum by 2021. Moreover, the company also indicates that the number of devices connected to IP networks will be more than three times the global population by that period, while Gartner suggests that some $2.5 million per minute will be spent on the Internet of Things (IoT) and some one million new IoT devices will be sold every hour by 2021.

When one considers the validity of these predictions, it appears as though the ability to utilise and analyse data is going to be one of the biggest drivers of business in the digital world. This is unsurprising, as effective analysis thereof will afford the enterprise a far clearer understanding of one’s business and customer requirements. Remember that truly effective analytics will allow for not only an improved understanding of what is happening within the business, but more pertinently, how to improve its performance by taking cognisance of both the internal and external factors that could impact it. 

Any business that can effectively analyse its data to achieve this will obviously have a significant advantage over the competition, since it will be in a position to rapidly adapt to new trends and shifting customer demands, placing it streets ahead of those that do not have the same insights. This is because correctly harnessing analytics will lead to the organisation achieving better, fact-based decision-making and improved customer experience.

 

Making a difference

Think about how positive the impact will be on a business that is able to answer questions in seconds rather than days, and in days rather than months. This type of accelerated decision-making and reaction time allows businesses to build competitive advantage and improve performance, while also providing answers to complex problems or questions that have previously resisted analysis. In other words, the combination of data and analytics will be the chief accelerator of an enterprise’s digitisation and transformation efforts.

The trouble is that in these early days of digital transformation, less than half of documented corporate strategies even mention data and analytics as core components in the delivery of enterprise value. Of course, it is expected this will change in the very near future, with Gartner again predicting that by 2022, some 90% of corporate strategies will explicitly mention information as a critical enterprise asset and analytics as an essential competency.

What this means, essentially, is that if your business is not already focusing on its data and what can be done with it, this is something you clearly need to consider sooner, rather than later. In the emerging digital economy, a company’s ability to compete will boil down to its ability to deliver faster-paced, forward-looking decisions. The most successful organisations will be those that ensure that data and analytics competencies are incorporated within the highest-level public-facing enterprise plans.

So what does data analytics offer in this respect? Data analytics can be defined as being the ability to look at the past and present in order to gain insights that will allow you to make the right decision not only for now, but the future. Remember that the more clearly you are able to understand your customers, the greater insight this will provide into the direction of your business and what products and services you should be designing and implementing.

For some time already, industry players have been touting the promise of the data-driven economy and the benefits this offers to society. These benefits may be industry-specific ones, but equally may be larger, societal benefits, such as smarter, safer and more efficient cities.

Analytics is thus the key enabler for this proposed data-driven economy. Properly used, analytics has the potential to help those making use of it to manage the shift from using data as a passive asset to gather insights, to one where they are instead using their data as an active asset to enable immediate and better informed reactions.

For example, if one considers the retail environment, which is characterised by enormous competitive pressure, businesses are constantly on the lookout for new opportunities to transform or streamline their operations. By turning data into an active asset, retailers can use the information gleaned from analytics to – for example – optimise delivery schedules, implement on-demand logistics and ultimately deliver goods more quickly, save on costs associated with fuel and labour, reduce waste and boost customer satisfaction.

 

Getting it right

As more companies turn to data as a critical asset for innovation and future-proofing their businesses across the various vertical markets, so analytics needs to be insisted upon as the foundation on which such a strategy is built. Remember too that once the enterprise has utilised analytics to improve its current situation, the next step is to use it to predict the future.

Externally, the company will want to predict things like customer churn — before it happens – as well as predicting what products customers are likely to buy or what they are most likely to seek out next. On the other hand, analytics can also improve internal operations, by identifying issues that may impact the business further down the line and predicting things like maintenance requirements, enabling repairs to be undertaken before the equipment in question breaks down.

One thing that is crucial to note is that the correct framework needs to be in place before implementing these analytics. Most notably, the enterprise must ask itself whether its existing business model remains valid and is the correct model to apply in the fourth industrial revolution.

Only once it has the business model right will it be able to correctly identify both the key challenges and the key use cases for data and analytics. This is a pitfall that many organisations fall into: by failing to revise their existing business model, they end up applying data analytics to what is in effect an outdated model, meaning insights derived from this are unlikely to have the significant impact on the business that is desired – or worse, incorrect insights could negatively impact on the business bottom line.

The other important thing to remember about analytics is that no two companies will have the same data requirements or the same end results in mind. It is imperative that these enterprises begin by identifying what they want to achieve with their data, after which they can implement the systems and technologies that will deliver the best insights for their purposes. Gaining such insights will give them an edge over the competition, by enabling better customer experiences, thanks to quicker decision-making and faster supply of services and goods.

Ultimately, if an enterprise wants to create a data-driven digital enterprise, focused on unlocking endless digital possibilities, it simply cannot adopt a ‘copy-cat’ approach. Companies will need bespoke solutions that speak to their own existing clients, as well as to potential clients and revenue streams in the future.

It is important that the corporate decision-makers realise not only the importance of analytics in this digitally transforming future we are entering, but more critically, that they also realise how vital it is to find the right partner to assist them. They need an entity that has the skills and expertise to help them implement analytics in a way that best suits their business, and which can help them to digitally transform while improving their competitiveness, boosting their customer relations, and future-proofing the business.