Organized analytics: Who runs the practice?
Where you locate an analytics practice may be as critical a success factor as the teams skills, experts say. Should you embed it within the IT organization, establish it as an independent group or embed the function within each business unit? Here are the tradeoffs.
Option 1: Run analytics as an IT operation. IT has the data expertise. Making the analytics team part of IT helps foster a common sense of purpose, and that collaborative relationship may foster faster integration of analytics with other enterprise applications. But without a close working relationship with stakeholders, such groups risk producing great models that no one uses. Analytics groups may also disappear into the IT fabric, says John Elder, principal at consultancy Elder Research. "I wouldn't embed them in IT because other priorities might take over."
Option 2: Let each business unit operate its own analytics group. Keeping data analysts embedded in the individual businesses ensures alignment with business needs and facilitates collaboration. However, the relationship with IT, which manages the data, may be more distant. While analysts want to innovate, IT may be more concerned about system availability and performance demands. Some members of the IT group may view analytics as an annoyance, says Dean Abbot, president of consultancy Abbott Analytics Inc., "because it means more hours in their day dedicated to things they don't care about."
Option 3: Create a shared services group. This approach allows for standardization of a common set of models and methods, eliminating redundancy and increasing productivity. But being outside of the business team can reduce buy-in by the business, as Bryan Jones, director at the USPS Office of Inspector Generals countermeasures and performance evaluation unit discovered. "We couldnt get much traction because we were an outside entity," he says, so he moved analysts into the business groups. Today, however, the organizations send auditors and investigators to his services group to help develop new models. "Were an organizational support group again," he says.
Procter & Gamble has a shared services group that reports to the CIO, but embeds some 300 analysts in the individual businesses to act as "trusted advisor" to the company's presidents and general managers, says director of business intelligence Guy Peri. Using an agile development model, the group can tweak an existing model within 24 hours, deploy new ones within 30 days and scale a good one out to other business units within 90 days.
Ultimately, the right decision depends on the existing structure of the organization, says Gartner Inc. analyst Gareth Herschel. "If youre IT-centric, put them in IT. If you have business units all doing different things, embed the groups in the business. If the businesses share customers and suppliers and have product overlap, use a shared services group."
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