Are you using Advanced Analytics for your next big decision?
Sudipta Ghosh, Leader, Data and Analytics, PwC India
‘Big Decisions’ are getting increasingly complex for organisations. Are organisations using data or are they mostly relying on their experience for taking these big decisions? More importantly, even if CXOs are taking data driven decisions, are they using advanced analytics for getting more confident about the decision making process. How does Indian organisations fare against their global counterparts?
In our recent global Data & Analytics research survey themed Big Decisions, we surveyed more than 2,100 global executives spanning 50 plus countries with over 100 executives from India to understand their perspective on the next big decision that their organisations would need to make within the next 4-5 years.
PwC report titled ‘Using advanced analytics for Big Decisions’ explores themes of drivers of big decisions, types of decision making, data driven culture and optimism about decision along business outcomes sought for taking big decisions. The report explores some interesting subjects around speed and sophistication of the decision making process and the role of man vs. machine in big decisions. It also outlines how Indian organisations fare on the above parameters vis-à-vis their global counterparts as perceived by their executives. While the survey results picture Indian firms to fare better in some areas, there are indications for the need to improve upon them in the near term to effectively support strategic decisions.
61% of C-suite executives of Indian enterprises believe their organisations to be highly data driven. Some of the key findings are as follows:
- Cost reduction and market share gains are the big focus areas for Indian firms while leveraging advanced analytics solutions: Companies that rank high on usage of predictive & prescriptive analytics envision cost reduction and increase in market shares as likely positive outcomes from the next big decision. 80% of respondents anticipating cost reduction as an outcome perceive their firms to make use of advanced analytics. The percentage stands at 71% for an increased market share as a likely outcome.
- C- Level Executives are more confident of their firm’s Data & Analytics maturity as compared to mid-level executives: While C-Level Executives consider their firms to be highly data-driven and users of Predictive or Prescriptive analytics (59%), among the next tiers of management such as Business Unit & department heads the percentage falls to 46% suggesting a gap in the extent to which analytics is actually being leveraged for decision making across different levels
- A significant role for machine learning algorithms is emerging: Indian leaders score 43.65% for using machine learning algorithms as compared to 41% to global leaders. These statistics clearly demonstrate that the faith that Indian leaders prefer using analytical tools and techniques while taking important decisions rather than simply relying on their instincts.
- New age & start-ups are better equipped than established players in their usage of advanced analytics for decision-making: Companies with relatively smaller revenues and start-ups in particular indicate predictive and prescriptive analytics to be deeply embedded in their operating model & processes (75%) with 15% more respondents believing their firms to be using advanced analytics than more established firms in their industry.
Adoption of Analytics in the decision making process is easier said than done. It requires focus on structure, governance and the right executive sponsorship in order to institutionalize the data driven culture in the organisation. The report describes a step by step structured approach and suggests some operating models which can be adopted by organisations.