FOR IMMEDIATE RELEASE
BIG DATA LINKED TO FINANCIAL PERFORMANCE, BUT LESS THAN FIVE PERCENT OF COMPANIES GETTING FULL VALUE FROM BIG DATA INVESTMENTS, FINDS BAIN & COMPANY
Top performers twice as likely to be a top quartile financial performer within their industries, three times more likely to execute decisions as intended and five times more likely to make decisions faster
New York—November 14, 2013—The vast majority of companies that have implemented big data solutions have not yet cracked the code of extracting big rewards, with only four percent of 400 global companies surveyed believing that they are converting their investments in big data tools into meaningful business insights that improve decision making and financial performance; this according to a new study “Big Data, Big Choices,” issued today by Bain & Company, the global business consulting firm. The key, says Bain, is less of a technological conundrum and more of an issue of companies not supporting big data investments with the right combinations of business and organizational capabilities.
In addition to “top performers,” one-third of the companies in the survey were dubbed “performance laggards” by Bain. Such companies remain at the stage of deploying or experimenting with big data and analytics tools, but said they are 40 percent less likely to achieve top financial performance and 80 percent less likely to excel in decision making.
Bain identifies the failure of businesses to drive broader organizational capabilities beyond the IT department as the core reason for the lack of tangible results from big data investments, with a clear minority of companies having critical business capabilities in place:
- 36 percent of companies surveyed said they have a dedicated data insights team
- 23 percent of companies believe they have a clear strategy for using analytics effectively
- 19 percent of companies said they have “high quality, consistent data” in their organization
“Top performers” agreed that they have all three of the above capabilities in place, while also agreeing that they have successfully implemented big data technology.
“Low cost, low complexity, and a high buzz factor makes big data a compelling proposition for many IT departments,” said Rasmus Wegener, a partner in Bain & Company’s Information Technology Practice and co-author of the study. “But few businesses are ready to make the leap to extracting data-driven insights they can act on.”
The study further finds that the lack of success by companies to demonstrate payback from their big data investments has not slowed adoption or increasing spend on the technology. Bain finds 38 percent of companies feel they have made progress in building state-of-the-art big data technical capabilities and additionally estimates that big data spending will increase by some 30 percent a year through the end of this decade. Among the global businesses studied, financial services and technology players have made the greatest strides. In financial services, the proportion of “top performers” rises to eight percent.
Finally, the study reveals a range of gaps in organizations that have resulted in underperformance to date:
- Between 70 and 80 percent of big data “top performers” reported that they employ staff in data science and statistics roles, and in business analysis and intelligence
- Just 20 to 30 percent of “performance laggards” in the survey have staff engaged in responsibilities that allow them to extract insights from complex data and use them to make better competitive decisions
- “Top performers” said they use data to make critical business decisions more than half of the time, compared to an average 28 percent across all companies and 19 percent among “performance laggards”
“Resolving to be data-driven requires fundamental change to teams and roles, business processes incentives, and even in leadership,” concluded Travis Pearson, head of Bain’s Technology Practice in the Americas and study co-author. “Unless you address these requirements, big data success is going to be elusive.”
Editor’s Note: For more information about Bain’s “Big Data, Big Choices” study or to schedule an interview with Travis Pearson or Rasmus Wegener, please contact Dan Pinkney at firstname.lastname@example.org or +1 646 562 8102.
# # #