Align your business strategy to a value-driven analytics framework

In 2007, Tom Davenport’s book Competing on Analytics: New Science of Winning spawned a discussion across boardrooms all over the world. With the growing volumes of data and the desire to leverage this data to derive insights – which skeptics thought could never be known – businesses all over the world were sold on the power of analytics.

Time-warp to 2017, exactly a decade later. In a recent discussion, MIT researchers polled 150 data-sciences experts and asked, “How many of you have deployed and/or used an analytics model to generate value, and evaluated it?” the response was NONE !

• Does it mean that the analytics bubble has burst?
• How do we derive measurable and impactful value out of analytics investments?
• Is there a guiding framework which can help organizations derive transformational business value using analytics?

Let's try to ponder a bit on all these basic but extremely important questions.

• Has the analytics bubble burst ?

Not at all, far from it. The potential and instances of how analytics is transforming the way we live and do business are all around us. However, most businesses are able to leverage only a fraction of the potential value from data and analytics. The biggest barriers they face in extracting value are organizational. Many businesses struggle to incorporate data-driven insights into day-to-day business processes and most struggle to derive a measurable ROI from analytics initiatives. What is required is to put business value before analytics and start with the premise – What problem do I want to solve? Or as a corollary to this question - What business value will I derive out of analytics?

To that end, let us define business value from analytics.

Business Value Transformation

Business value from analytics can be envisioned across four key dimensions:

• Value of data : Transforming and monetizing data from raw data to insights to the decision and finally actions.
• Business process transformation : From a business process centered to an analytics centered process, analytics is embedded into everything.
• Event driven action : From reactive action to customer, risk and operational business imperatives to intelligence driven proactive actions.
• Customer expectation : Anytime, anywhere interaction that is personalized, contextual, and omni-channel.

Organizations have to delve into all these dimensions to:

• Define VALUE
• Implement ANALYTICS
• Measure OUTCOMES

Now coming to next key question.

• How do we derive value out of analytics investments?

The Value-Analytics-Outcomes approach into analytics and business transformation initiatives will provide measurable outcomes. In the following example, let’s illustrate how this approach plays out in deriving business value transformation in a customer engagement initiative.

With this coming to the last and probably the most important question.

• Is there a guiding framework to help organizations derive transformational business value?

An effective analytics driven business transformation strategy needs to be viewed through the prism of our VALUE driven ANALYTICS framework. This framework breaks down the transformation strategy into 6 key components:

If you want to learn more about VALUE driven ANALYTICS Framework visit here.

Weaving analytics into the fabric of an organization and leveraging it to transform business processes, is a journey. Every organization is on its own unique stage and will progress at its own pace - from a fragmented beginning to that of emerging influence to a world class corporate entity.

Several organizations delve into analytics with a silo-ed approach where analytics initiatives and capabilities are not aligned to a definitive business value. In the absence of a guiding metrics to measure the outcomes, many of these initiatives end up building bridges to nowhere and result in poor ROI.

Implementing the VALUE driven ANALYTICS framework helps create a clear definition of business value. It also helps organizations assess their current level of maturity and define a metrics driven path to achieve business value realization and sustainable competitive advantage.

I (Ashish Gupta) am driven by my passion for Analytics and the impact it is/can make to our world. I love to share my thoughts around this topic and look forward to your inputs/ideas. Please do share your enriching thoughts.