InsightaaS: Harvard Business Review (HBR) is recognized worldwide as a leading source of management insight and innovation. In this post, Michael Schrage, a research fellow at MIT Sloan School’s Center for Digital Business, reviews the results of analytics facilitation sessions and reviews with Fortune 1000 companies to determine that “Return on Analytics (ROA)” is determined primarily by “how analytics changed behaviors rather than solved problems.” His advice? Focus on using analytics to drive new behaviours, rather than incremental improvements to current processes: “Don’t fail your analytics.”
Many organizations investing millions in big data, analytics, and hiring quants appear frustrated. They undeniably have more and even better data. Their analysts and analytics are first-rate, too. But managers still seem to be having the same kinds of business arguments and debates – except with much better data and analytics. The ultimate decisions may be more data-driven but the organizational culture still feels the same. As one CIO recently told me, “We’re doing analytics in real-time that I couldn’t even have imagined five years ago but it’s not having anywhere near the impact I’d have thought.”
What gives? After facilitating several Big Data and analytics sessions with Fortune 1000 firms and spending serious time with organizations that appear quite happy with their returns on analytic investment, a clear “data heuristic” has emerged. Companies with mediocre to moderate outcomes use big data and analytics for decision support; successful ROA–Return on Analytics–firms use them to effect and support behavior change. Better data-driven analyses aren’t simply “plugged-in” to existing processes and reviews, they’re used to invent and encourage different kinds of conversations and interactions.
Read the entire post: http://blogs.hbr.org/2014/04/why-your-analytics-are-failing-you/
