The vast proliferation of data, faster computing and the need for continuous innovation to stay ahead of competition, has compelled organizations to rewind & look back in the past (hindsight), control the present (insight) and confidently embrace new opportunities in the future (foresight). Solving business problems and finding new areas of deliver increased value to the business stakeholders is crucial to the survival of any business in the ever-evolving marketplace today.
A recent benchmark research shows that business analytics is the top business technology innovation priority; 39% of organizations ranked it first on their agenda and have set aside a dedicated budget to make Analytics investments. Unsurprisingly, the rise of this so called Business Analytics phenomenon can be attributed to this detonation of new information sources, and new technologies in data processing, storage, networking, databases and analytics tools/platforms are combining to offer innovative capabilities for leveraging information in ways unimagined. With ever-increasing competition across industries, organizations are grappling with finding newer ways to erect barriers to entry and sustainable competitive advantage by making most of knowledge and data they possess. The applicability of analytics has grown many folds as the companies struggle to make meaning of the data at their disposal; and the hunger to demystify pricing, strategies, customers and competitors as much as possible. Within the organizations, the IT department and various other lines of business continue to mitigate issues around analytics talent crunch, information simplification, information governance and the defining of time-to-value metrics. Now that we’re half way through 2014, I’ve taken a stock of the key analytics trends that are brewing up and curated a list of the top business as well as IT trends which I believe shall carve out the future of analytics in the times to come, agnostic of industry, size or geography. Even if some of these consumer trends and technology innovations don’t realize their truest potential by 2014 end, but definitely are promising enough to enable new business delivery models in the near future and enforce companies to tread on the data-driven decision making route. Laggards, sooner or later shall trail behind the rest if they don’t hop on to the Analytics bandwagon soon enough. Analytics beholds the future of Leaders of tomorrow !
Data Visualization Goes Mainstream
In the mid-90’s, e-mail introduced the internet to consumers, made it more accessible, and catalyzed user adoption. Similarly, data visualization will make data analytics more accessible going forward. Visual analytics allows business users to ask interactive questions on their prepared data sets and get immediate visual responses (in real-time in most cases), which makes the whole process engaging. This trend will democratize access to data and foster a strong data analysis culture where business users across the organization (even beyond the IT organization) will look for data and perform visual analysis before making decisions. The quick wins that data visualization provides will lead to a changed mindset that will allow for future forays into more advanced analytics (statistical modeling, dealing with complex structured/unstructured data sets) and the ability to summarize and drill into massive datasets by making use of advanced data modeling tools. In 2014, we already see some further innovation around collaboration of business users in answering business questions. Soon, the business utility and future of a data visualization tools could be determined through social interactions (by how many “likes,” “shares,” and comments it receives from business users).
By leveraging contemporary, cloud-based data analytics solutions, and analysis tools that allow business users to absorb insights instantaneously and interpret information in a jiffy, risk managers and CMOs can assimilate legacy and on-premise, cloud-based and third-party data sources into a unified, single source of truth that helps them deftly anticipate and mitigate risks as they emerge, and keep on course in fulfilling the organization’s vision.
Mobile Data Detonation
Advent of smartphones and tablets has fundamentally changed consumer behavior and preferences. With the onset of 4G (or even 3G in some of the emerging economies) Mobile video is surprisingly the fastest growing segment of mobile data traffic. Brands today are leaving no stone unturned to tap onto this new channel of engagement, and are rethinking hyper-personalized, consistent, seamless mobile experience. According to Microsoft Tag, by 2014, mobile internet is predicted to take over desktop Internet usage. According to GSMA findings, consumer monthly spending on mobile content and services in emerging markets reaches almost $1 billion, which presents an additional significant marketing and data analytics opportunity.
All this means that the top priorities for companies will be defining mobile metrics that matter, understanding mobile technology and the data creation process, and collecting and analyzing mobile data. Mobile Analytics shall open up newer avenues for Analytics Service Providers to engage with their industry clients and deliver more bang for the buck.
Analytics in the Cloud gaining traction
Most organizations today, one with not so deep pockets, perceive analytics to be an expensive offering requiring substantial technology investments and skilled resources to build in-house dedicated teams. But that perception shall undergo major turnaround very soon.
Amazon Web Services (AWS), Microsoft Azure, and other cloud computing platforms have continued to gain significant ground in 2014. Big data analytics solutions that require a pay-as-you-go data storage and computing-intensive analysis infrastructure are leveraging these platforms effectively to bring down the upfront investments and ongoing capital costs substantially. Innovations such as the cloud data warehouse platform from Amazon, RedShift, have started gaining ground and set new standards in self-service BI, enabling scalable, fast, and secure solution at very affordable prices.
The robustness of this platform will allow businesses, especially the SME’s and the fledgling startups to save big on infrastructure design, setup, and management costs. It will free them up to focus on issues that matter most for their customers and focus on gaining and acting on business insights.
Predictive Analytics Takes Center Stage
For many years, companies have built data platforms and analytics infrastructure with a significant emphasis on hindsight: look-back reports that help businesses check their rear-view mirrors. However, in 2014 and beyond, there will be increased acknowledgement that enterprises need to start delving deeper into insights (present) and foresights (future). With better insights and a forward-looking predictive view, businesses are less reactive and are proactively able to uncover crucial nuggets of information that could shape their outcomes. Imagine IT product companies leveraging the social interactions to predict the next best feature for the subsequent build release which could be a potential blockbuster just because they read the market signs appropriately. Possibilities are limitless !
More importantly, CIOs have now started thinking about their predictive analytics needs even as they build today’s infrastructure and explore newer technologies such as Hadoop to manage their unstructured data and co-exist with their traditional data stores. The quick wins provided by data visualization so far has established credibility for analytics in the market has increased appetite for business users to venture into possibility of making of the past/present data for defining the contours of their future. Exciting days yet to come in the world of predictive analytics !
Internet of Things – It’s Everywhere
In 2013, we saw some of the early signs of the wearable computing revolution – Google Glass, Auto-driven cars, Smart watches, Activity monitors, etc. Although we are still some distance away from widespread adoption, we expect to see much more activity in this space in 2014. The early successes of Pebble, Fitibit, and others are leading to innovation and development of many more similar products. Companies that have made significant strides in product design and development will emerge as the early winners as they drive adoption through innovative marketing. Additionally, as more people use these technologies, companies will be able to monetize the data they collect through wearable devices. For example, makers of these devices have access to activity and demographic data that could prove valuable for health insurance companies. Imagine the sensors installed in your car signaling to the Smart energy circuit at your home to turn on the lights as soon as you park your car in the garage.
While the aforementioned trends look at the business side of analytics, there’s flipside to it; the talent gap and the rapid technological changes are affecting companies’ ability to derive value from analytics. Unarguably, Analytics is definitely an area where IT can have an unquestionably accelerated impact on the business by helping decision-makers (CMO’s, CRO’s, CSO’, Legal et al) with insights and information they need to act with confidence. While analytics has significant potential, the enabling technologies, along with the various methods for performing it, are evolving rapidly as well. In near future, we may see Analytics being the cornerstone of how businesses operate on an ongoing basis.
The Rise of the Chief Analytics Officer
Many companies have folded oversight of analytics initiatives into the responsibilities of existing executives—most often division heads, CFOs, or CIOs. In some cases, having a dedicated pool of Analytics resources/tools within the respective business function has worked well. In other cases, analytics efforts have been buried under those executives’ myriad other priorities. To give analytics the attention it merits, some companies have appointed chief analytics (or big data) officers in recent years. Today, a growing number of companies have dedicated chief analytics officers charged with leading the effort to derive new insights, products, and services from expanding troves of data. Most experts say that more companies are likely to create chief analytics officer or equivalent positions in the near term to bring more focus to analytics efforts, organization-wide, with all the data aggregated under one umbrella, and exposing the varied business users with appropriate views which align with their areas of interest; even if these roles eventually get subsumed under a specific function like IT, marketing, or finance.
The Data Scientist Crunch
Quite a few recent reports are highlighting out the challenges most organizations are facing in recruiting data scientists. The role of a data scientist traditionally calls for someone trained in math and statistics, who understands the business, knows how to design and test predictive models, can manipulate raw data, and can use that data to tell compelling stories.
Some organizations are addressing the talent shortage by creating teams made up of professionals with different strengths and skills, rather than trying to find that one elusive data scientist. Some respected members of the analytics community also believe the current talent crunch is a function of hoarding—companies that recruited more people than they needed in response to predictions about the impending staffing shortage. Hoarding has led to experienced data scientists being asked to carry out mundane activities that could be done with lower level talent.
Plethora of Analytics Service Providers have designed their own in-house training programs or formed Analytics Universities or partnered with some of the Analytics training vendors like Jigsaw Academy to train their resources appropriately on the requisite skill set. Some of them have partnered with academic institutions (T-schools & B-schools globally) to have industry learning’s infused as part of the business analytics programs or urging institutes to kick start a dedicated industry curriculum driven Analytics program.
The Proliferation of Data Products
It seems nearly every company these days realizes that they are sitting on a data goldmine & intends to make money from its data. They’ve witnessed leading social and professional networking sites rise to prominence by monetizing big data; now they want a piece of the action.
But companies should think critically before pinning their strategies to creating new data-based products and services. While the technology industry may be able to profit from this Model, the growth opportunity for other sectors may not be as significant.
Companies should size the market for data-based products in their sector and scope the required resources before executing. In the end, companies may decide to stick to their knitting—using analytics to improve internal decision-making and more effectively sell existing products.