Future of Foresight Analytics – Making Organizations Smarter About Corporate Decision Making
This guest post examines Insight and Analytic functions and what they need to effectively evolve by addressing key elements of the Insight and Analytics Value Chain(tm).
Guest blog by Eugene Roytburg (Managing Partner, 4i), Nov 15, 2013.
In the era of 'Big Data,' corporations are getting smarter about how they utilize data and analytics to create insights that further competitive advantage. However, a paradox has emerged as companies are simultaneously encountering an increasingly complex marketplace, and at the same time coping with the practical realities of dwindling budgets and management expectations of doing more with less.
Further, 'Insight and Analytic' functions are still relatively immature compared to other corporate divisions such as manufacturing and operations, which means they often operate with a higher degree of waste and inefficiency. Given the confluence of these elements, it's of paramount importance that these 'Insight and Analytic' functions quickly 'grow up' in order for them to meet their potential as the future stewards of corporate value creation.
In order for 'Insight and Analytic' functions to effectively evolve, they often require a comprehensive overhaul on everything from how they are designed, how they focus their energies, the processes they use to uncover insights, and how they engage with management to properly influence insight activation.
'Insights & Analytic' functions have the opportunity to become as impactful as their brethren in other functional areas, and the good news is companies can enable this evolution by properly addressing key elements of the Insight and Analytics Value Chain™, which is anchored is the development of a strong and process oriented 'Analytical IQ' (AIQ) as well as realization of the value analytics can provide - see figure below.
Over the past two years, 4i, Inc. has conducted an extensive benchmarking study of over three dozen companies in multiple verticals to identify the critical pain points facing companies in how effectively they leverage their 'Insight and Analytic' functions.
The findings have been compelling. 4i determined that poor market performance is most often attributed to ineffective decision making (decision success rate is 35%) that is either not driven by actionable insight (insight activation is 38%) or based on insights that are not compelling (insight quality is 12%), and exacerbated by lack of a, or ineffective, insight and analytic development process. Furthermore, 4i determined that a 10 point change in insight quality will drive 5% increase in decision success translating into $13B in collective incremental revenue opportunities for the companies profiled.
In addition to the benchmarking studies, 4i has engaged with nearly a dozen large and well-known Global companies over the past three years to put the theory into practice. By following the objective and critical steps of 'Insight and Analytic Transformation,' any company can become smarter about how they focus their resources on critical competitive questions, design and apply the optimal approach to ensure actionable results, and properly align with the executive agenda.
Dr. Eugene Roytburg, managing partner of 4i, is a leader in bringing Science, Advanced Analytics, and Consulting to business problem solving and decision-making, and has over 20 years of corporate, academic, and consulting experience, including positions at CNH, SPSS, Nielsen, and Moldova Academy. For more information on 4i, please visit www.4iconsult.com/ or contact Eugene Roytburg at (630) 799-8155.