Most business leaders realize they can use internal and external data and analytics to improve business operations and the bottom line. From improving planning processes to enhancing customer relationships and mitigating risk, there is an increased desire to operationalize insights gleaned from data. However, tapping into the potential of data insights comes with challenges as reported by the executives who completed the Prevedere and Microsoft 2019 Executive Survey.
To move toward a more data-centric culture, leadership’s high-level planning should consider uniting relevant data with the right software tools. Companies should be leveraging technology solutions that not only automatically collect, clean, and organize known data, but also identify external factors that may impact demand for their products and services into the future. Let’s turn to the survey findings to gain an accurate picture where today’s senior-level executives measure progress.
2019 Executive Survey Report: The State of Data and Analytics
The report analyzed findings from a 2019 survey commissioned by Prevedere to an independent third-party survey data collection company conducted over 200 C-Level executives and vice presidents. The results provide an inside view of what executives see as today’s data challenges, what forward-steps they are taking now within their business to address gaps, and what is on their future radar as their evolving data and analytics initiatives progress forward. Throughout the survey, three predominant recurrent themes:
- Lack of time for Executives to spend on strategic activity
- While recognized as critical for planning, external data was underutilized
- While a top priority, there is difficulty identifying the right software and data
“The speed of current breakthroughs and the exponential pace of disruptive innovation are rapidly evolving entire industries at once. This is characterized by unprecedented processing power, storage, access to knowledge and the blurring of lines between physical and digital spaces. Capitalizing on this phenomenon is the key to innovation and growth.”
– SHISH SHRIDHAR
Worldwide Director, Retail Business Strategy – Microsoft
Business Leaders Have Evolved In Their Understanding and Application of Data
In the not all too distant past, data collection was the focus or most businesses. Today the game has evolved to not only include best practices of effectively leveraging data but to look beyond known or expected data alone.
Microsoft has seen a dramatic increase in the use of external data across their entire connected network of partners, customers, and suppliers. In developing ‘The Four Steps to Digital Transformation,’ Microsoft was cognizant about the struggle for wholistic business-focused solutions. For example, if a company wants to be able to predict which new markets it should consider, that is no longer a question for any single business unit to determine. Instead, a core understanding and strategy should penetrate across multiple functions of the business. That is where data literacy has become invaluable to every organization.
Understanding the Power of External Data
It is clear the potential threat of not having the right data and analytics to make strategic decisions can quickly intensify in today’s rapidly changing data-driven world. External data provides business leaders with the ability to gain access to information and forward-looking perspectives about their business. Over 60% of executives surveyed felt that incorporating external data will result in significant improvement to financial forecasting. In fact, 90% of respondents feel that external data will provide some improvement overall. Yet companies are using some mix of external data less than 50% of the time.
Assessing the Data Gap
Closing the external data gap may be the key to transitioning data and analytics initiatives that address the true needs of executives for strategic, forward-looking insights. Companies have spent millions annually on internal data management, business intelligence, and reporting solutions to analyze their internal data.
However, a common question from leadership often involves explaining how external factors, such as global economic volatility or changing consumer behavior, can impact performance. Essentially data outside a company’s four walls continue to poses a major challenge. Yet, we are armed with the facts, and we know that external factors can influence up to 85% of a company’s performance. We also know that companies miss their projected forecast by 13% on average, and according to the Institute of business forecasting, companies lose up to $300M per year in profit for every 1% error in forecasting. In order to close the gap and create a data-driven culture, leadership’s high-level planning should be to bring together the right data and the right software.
Companies should be leveraging technology solutions that not only auto collect, clean, and organize data, but also identifies external factors that will impact demand for their unique products, solutions, and market needs. Over 40% of executives said that having a third-party partner to assist them with external data and analytics would be extremely/very important to their planning needs. Read the full 2019 Executive Survey Report >>