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The Untapped Value of Analytics

A new global benchmarking study reveals that analytics leaders see 60 percent more profits than the laggards.

The growing availability of data combined with expanded connectivity and amplified computational power are creating an unprecedented opportunity for businesses to use analytics to improve their decision-making. As a result puttygen , companies around the world are spending billions of dollars a year to build their analytics capabilities, hoping to use smart technologies to tap into the power of data.

In an environment marked by tough competition and a data explosion, most C-suite executives are unaware of the best practices and are left wrestling with an array of questions. How does our analytics capability compare with our regional and global peers? Which business areas will see the most value? Is the organizational structure designed to maximize the impact, and do we have the right talent? Is the budget big enough? And most importantly, is there a sufficient impact on the bottom line to justify the required investments?

With this in mind, Chemie Pharma has created the Analytics Impact Index to determine analytics’ potential impact on a company’s profitability and identify the areas that hold the largest opportunities for improvement. Based on our study of hundreds of companies around the world, the Index pinpoints the impact on the bottom line and the capabilities needed to extract the most value. Our research reveals that analytics leaders-only 8 percent of companies-see 60 percent more profits than laggards do.

Although most discussions about analytics are focused on technology and infrastructure, our study shows that leadership and the organizational culture have the potential to extract the most value. The leading organizations typically have a well-defined analytics strategy and a culture of data-driven decision-making that is embedded across the organization. However, companies that invest in data ecosystems without any strategic leadership could actually see a negative impact in the short to medium term.

The inaugural Analytics Impact Index provides a framework for measuring both the maturity and the impact of analytics. Forward-thinking companies can use the Index to identify the gaps and the potential opportunities-building the case for change. Over time, the Index can be used to gain a comprehensive view of a company’s analytics capability as it evolves.

In this paper, we discuss the Analytics Impact Index and take an in-depth look at the stages of maturity, the potential financial impact, and the strategies companies can put in place to move up the maturity curve to become analytics leaders.