Most U.S. Companies Say Business Analytics Still Future Goal, Not Present Reality
Many companies still working to increase investment, use of business analytics
NEW YORK – Two-thirds of large U.S. companies believe they need to improve their analytical capabilities and only half believe they are spending enough on business analytics, according to findings of an Accenture (ACN: NYSE) survey released today. The survey of more than 250 executives is the basis of a report, “Competing Through Business Analytics,” which studied companies’ use of and investment in analytics to remain competitive.
While more than half (57 percent) of companies surveyed said they don’t have a beneficial, consistently updated enterprise-wide analytical capability, nearly three-quarters (72 percent) said they are working to increase their company’s business analytics usage.
“These findings show that business analytics prowess will be a high priority in the boardroom in 2009 and beyond,” said Royce Bell, chief executive officer of Accenture Information Management Services. “While executives understand that companies with enterprise-wide business analytics have an advantage over those still relying on nebulous sources to make decisions, they face institutional challenges to reforming their processes across the board. Leading organizations are moving from a siloed approach to more inclusive information management programs that work across the entire company.”
The survey also addressed the balance between using analytics and using judgment to make important business decisions, and found 60 percent of major decisions are based on analytics and 40 percent are not. The reasons executives cited most often as to why 40 percent of major decisions are based on judgment rather than business analytics were: because good data is not available (61 percent); there is no past data for the decisions and innovation they are addressing (61 percent); and their decisions rely on qualitative and subjective factors (55 percent).
The challenge to moving from “gut decisions” to employing data goes beyond just infrastructure investments. Large businesses also face a glaring human resources challenge, as 23 percent of respondents identified “insufficient quantitative skills in employees” as a main challenge to their company, and 36 percent said their company “faces a shortage of analytical talent.”
“There’s a strong concern over the future lack of analytical skilled resources,” said Bell. “The shortage in new talent adept at business analytics is stark and will pose a growing challenge as businesses remain committed to honing their analytical capabilities to enable them to make more well-informed decisions. Our findings indicate that some businesses have neither the systems nor the personnel in place yet, although their goal is to achieve this soon.”
The survey also found that institutional hindrances need to be addressed to improve business analytics capabilities. For instance, 39 percent of respondents said that IT capabilities restrictions were a major challenge and 27 percent said there was an inability to share information across organizations within their company.
A concurrent study of firms based in the United Kingdom found many similar results. For more information on this study and Accenture Information Management Services, please visit www.accenture.com/informationmanagement.
About the Survey
As part of a survey to gauge the challenges related to business analytics adoption and the anticipated future investments in information management systems to garner advanced data analysis capabilities, Accenture conducted a quantitative online survey in July of 2008 of 254 executives with the title of manager or higher at companies with reported revenue of more than $500 million in calendar year 2007. Respondents were from a variety of industries, with those working in education, government, or non-profit or trade associations excluded. The survey was part of the ongoing work of Accenture Information Management Services, which is focused on integrating and managing all the diverse information assets necessary to plan and run a high-performance organization.
Accenture is a global management consulting, technology services and outsourcing company. Combining unparalleled experience, comprehensive capabilities across all industries and business functions, and extensive research on the world’s most successful companies, Accenture collaborates with clients to help them become high-performance businesses and governments. With more than 186,000 people serving clients in over 120 countries, the company generated net revenues of US$23.39 billion for the fiscal year ended Aug. 31, 2008. Its home page is www.accenture.com.
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