67% of executives believe that business analytics creates a competitive advantage in their organization, finds MIT Sloan Management Review in a survey conducted in partnership with SAS Institute in 2012. That represents a 16% rise from 58% who shared that sentiment a year earlier, and is almost double the proportion (37%) from the year before that. The survey, of more than 2,500 executives, managers, and analysts from 121 countries and more than 30 industries, identified and examined a subset, termed “Analytical Innovators,” who rely on analytics for both competitive advantage and innovation.
This group of analytical leaders, who represented 11% of the survey sample, demonstrate varied openness and behaviors when compared to those deemed “Analytical Practitioners” (60%) and “Analytically Challenged” (29%). For example, they’re far more likely to agree that their organization is open to ideas and approaches that challenge curent practices. They also tend to focus their analytics use more on increasing customer understanding, making real-time decisions, identifying new markets, and accelerating development of new products and services, while paying relatively less attention to reducing enterprise costs and improving resource allocations.
Given that these innovators are far more likely to say they’re very effective at capturing, aggregating, and analyzing information, it’s not surprising to see that they are almost 3 times more likely to use a great deal or all of their internal data than the “Analytically Challenged.”
The researchers note that a majority of innovators report that analytics has shifted the power structure within their organization, presumably giving those with the requisite authority and talent greater influence within the organization.
The study suggests that to become “Analytical Innovators,” the “Analytically Challenged” need to focus on improving 4 of their characteristics:
- “Data deficiency” (the state of the underlying data);
- “Weak information value chain” (ineffectiveness at analytics tasks, such as information capture and dissemination);
- “Lack of collaboration” (silos as a barrier to use and management of information); and
- “No burning platform” (the lack of a driver to use analytics).
About the Data: Participating organizations in the survey ranged widely in size, from those organizations reporting under $250 million in revenues to those with $20 billion and over in revenues. Respondents included MIT alumni and MIT Sloan Management Re- view subscribers, SAS clients and other interested parties.
In the report, the term “analytics” refers to the use of data and related business insights developed through applied analytical disciplines (e.g., statistical, contextual, quantitative, predictive, cognitive and other models) to drive fact-based planning, decisions, execution, management, measurement and learning.