Hype continues to surround big data analytics. But hype or not, data-driven decision-making is becoming central to management decisions at most enterprises. They are taking inspiration from Billy Beane, the general manager of the Oakland Athletics baseball team that turned to data analytics (known as Sabermetrics in baseball and made popular in the movie "Moneyball") to assemble a competitive baseball team despite the organization's limited financial resources.
Today, enterprises are no longer merely trying to get their heads around what the term big data means; the overwhelming number of enterprises are now seeking to leverage data insights and adopt data-driven processes.
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A recent study by the Economist Intelligence Unit, commissioned by Capgemini, found that two-thirds of respondents -- 607 executives (43 percent of them C-level and board executives) hailing from 20 different industries across the globe -- say that the collection and analysis of data underpins their firm's business strategy and day-to-day decision making. In fact, just more than half say that management decisions based purely on intuition or experience are regarded as suspect.
Another recent study by IT consulting firm Avanade, a subsidiary of Accenture, backs up those findings. Avanade's study of 569 C-level executives, business unit leaders, and IT decision-makers in 18 countries found that 91 percent of companies are already using tools to manage and analyze data, beginning with data storage, reporting, data integration, and enterprise search. A majority of companies (73 percent) have leveraged data to increase revenue. Fifty-seven percent of that subset used data to increase an existing revenue stream, while the remaining 43 percent used data to create entirely new sources of revenue.
Move to a data-driven culture is underway
Avanade's study also shows a cultural shift occurring. Data management and analysis were once considered IT jobs. But that's changing quickly. Today, 58 percent of respondents say that data management is now embedded throughout business operations. And 95 percent of businesses with dedicated business analysts do not consider data analysts a part of their IT staff. Instead, enterprises are distributing that expertise to line-of-business groups throughout the company. And 59 percent of global companies also say that more employees than ever before are involved in making decisions as a result of more widely available company data.
Companies that focus on data analysis skills are having the most success transforming their data into revenue: 88 percent of enterprises with dedicated data analysts have turned data into revenue, compared with 49 percent of companies without dedicated data analysts.
Do big data analytics mean a competitive edge?
In "Moneyball: The Art of Winning an Unfair Game," author Michael Lewis lays out how Billy Beane used statistics and analytics to turn the Oakland Athletics around. But that's just one data point. The elephant in the room when it comes to big data analytics has always been: Do companies that base their decisions on data and analytics actually perform better than their competitors?
The answer appears to be yes.