This is a great report from Mckinsey & Company on Analytics and competing in a data driven world. At the moment, location based data is realizing 50-60% of it’s value driven primarily by smart phone usage and applications while the following industries are all realizing less than 40%:
% Value Realized From Data & Analytics
- Location Based Data ~ 50-60%
- US Retail ~ 30-40%
- Manufacturing ~ 20-30%
- Public ~ 10-20%
With the exception of Location Based Data, many organizations across various industries have an uphill battle integrating and developing data driven cultures. (click link below to read full article).
Here are the Top 3 Reasons why companies aren’t yet realizing value from data and analytics:
- Lack Of Analytical Talent
- Siloed organizational structures
- Plain Skepticism of the real value
Regarding the issue of analytical talent, I believe it’s available and sometimes even already exists in many companies but they are simply unsure of how to identify the key characteristics and/or channel it’s use. One thing I know for sure is that Google, Amazon and Facebook dominate their industries because of data and analytics and have access to the same talent pool as many other organizations.
Companies that are siloed will always have difficulty successfully implementing programs that require participation from multiple groups within the organization and stand permanently challenged at being successful as the competitive landscape changes and data becomes more widely utilized. And that I can say about skepticism is…..no risk, no reward!
Finally, here are 2 keys to success as identified by Mckinsey & Company:
a) Incorporate data & analytics into the company’s strategic vision
b) Develop business processes around infrastructure and talent
The above are simple, but powerful mechanisms to changing corporate culture around data and anlaytics. Once incorporated, companies can begin to seriously unlock the value of their data and perhaps create new channels and raise the competitive landscape.