Having the right data, and analytical skills to analyze that data, are amongst the top challenges companies face when it comes to their data and analytics initiatives, according to the Bridging the Data Divide report released recently by Prevedere. In uncertain times, it is critical that senior-level executives can anticipate changes in market demand and consumer preferences. Data-driven insights provide a necessary view of the future, but it appears many organizations are lacking.
Many businesses are investing in data and analytics that will help them plan ahead to improve operations and increase profits. The global market for business intelligence and analytics software will reach $22.8 billion by 2020, says Gartner. Further, IDC points out that companies that analyze all relevant data to deliver actionable insights will earn an extra $430 billion in productivity benefits.
To assess the overall satisfaction of their data and analytics program and whether they have the right data and analytical skills to help their business leaders make the best decisions, Prevedere, along with Prosper Insights & Analytics, conducted an online survey of industry leaders from across the U.S.
The findings of this survey show that a majority of analytics teams feel they have the necessary data and insights to make critical short-term decisions but not necessarily the right resources to address strategic issues. Closing this gap is essential in evolving data and analytics initiatives and addressing the needs of executives with strategic, forward-looking insights.
While the majority of companies think they do a good job of using data to drive decision-making, the irony is that 60% of the respondents say that locating the right data is their organization’s biggest challenge. 62% stated that their company’s collective data analytics skills are at or below average. Moreover, more than two-thirds of respondents said that they are dissatisfied with their company’s ability to understand the impact of external factors on business performance.
Data Divide Survey Takeaways
1) In the world of “Big Data,” finding the right data is a challenge for many.
With a seemingly endless amount of data available to businesses today, it is not surprising that 60% of respondents say the number one challenge for data and analytics initiatives is finding the right data for their organization. Sifting, cleansing and organizing data are time-intensive tasks. This effort often drains a data team’s ability to identify the best internal and external factors that explain past or future business performance. Read the full report here.
2) Finding employees with high-quality data and analytics skills is a concern.
Only 37.7% of respondents feel their company has the best data skills required to answer critical business problems. According to Fortune, data science job postings have risen 75% from 2015 to 2018. The shortage of high-quality talent can affect some industries more than others, which is why an increasing number of companies are opting to either elevate talent from within or hire vendors to augment existing analytics teams.
3) A skill gap exists between business and IT leaders regarding their team’s ability to address critical issues.
IT/data professionals are more likely to believe that their employees’ analytics skills are above average (45.8%) when it comes to addressing critical business problems than business professionals (32.4%). The opportunity exists for companies to break down potential silos between the IT and business departments and allow more collaboration and disseminate any insights more effectively.
4) Respondents are not satisfied with their company’s ability to understand the impact of external factors.
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 economic volatility or changing consumer behavior) impact performance. The survey results show that understanding data outside a company’s four walls poses a significant challenge.
Due to a volatile economy and changing consumer preferences, companies are challenged with not having the right information to keep pace with changing markets. While analyzing historical performance is valuable, CEOs, CFOs, and shareholders are most concerned about unexpected headwinds to performance. Transforming existing analytics to be more forward-looking can be done by prioritizing solutions that are predictive, strategic and external.
Predictive Analytics Cloud Can Help Bridge the Data Divide: Right Data, and Analytical Skills
To help bridge the gap, executives should prioritize external data that is predictive and strategic, like that incorporated into the ERIN Predictive Analytics Cloud. By doing so, businesses can uncover insights that:
- Enable them to see upcoming headwinds that can hinder performance
- Help them understand if a weak quarter was just a seasonal slump or a sign of worse things to come
- Increase return on investment (ROI) for marketing spend
To read the full complimentary report, visit Bridging the Data Divide.