Organizations are transforming business processes by integrating digital capabilities
This is part three in a series presenting, in small easily consumable bites, findings and insights from the IBM Institute for Business Value’s latest study and paper, “Analytics: The speed advantage - Why data-driven organizations are winning the race in today’s marketplace."
In part two, we had a closer look at the first two of four transformative shifts my colleagues Glenn Finch, Steven Davidson, Christian Kirschniak, Marcio Weikersheimer, Cathy Reese and Rebecca Shockley see as affecting the fast-paced digital marketplace:
- The fast ROI organizations are seeing from their investments in big data
- Customer centricity still dominates analytics activities, but organizations are increasingly solving operational challenges using big data
In part three, let’s look at what my colleagues say about shifts 3 and 4.
Shift 3: Integrating digital capabilities into business processes is transforming organizations
A near majority of organizations (46 percent) are reinventing business processes by integrating digital capabilities. By transforming processes, these organizations are creating the agility, flexibility and precision that enable new growth. And they are using digital capabilities (like social and mobile technologies) to change the way people connect, transact and engage with companies, institutions and governments, as well as how they create mutual value (see Figure 2 below).
In a digital transformation, organizations are focused on ways to better leverage the available data to either grow revenues or cut costs, although the majority of digital transformations are focused on customer-centric outcomes. Meanwhile, new forms of data and advanced analysis methods have opened up new avenues of cost reduction and agility within business processes. In a combined digital and process transformation, organizations examine the end-to-end process or experience and both integrate analytics into the business process and streamline its operations simultaneously.
Shift 4: The value driver for big data has shifted from volume to velocity
Big data’s initial impact on organizations came in 2012 as the deluge of data crossed its tipping point. Organizations initially aimed big data investments at managing the often overwhelming amount and types of data suddenly available. In our 2012 analytics study, “Analytics: The real-world use of big data,” we identified the characteristic that differentiates organizations the most as a scalable and extensible infrastructure. But just managing the volume and variety of data is no longer enough to outperform competitors.
Now we find the components that differentiate organizations most are those capable of creating an agile and flexible infrastructure, one designed to manage data efficiently and move it through the analytics process quickly. Organizations using big data technologies broadly throughout their business functions —capabilities that enable business functions to consume the data rather than just absorb it —are creating the greatest impacts on business performance.
And business executives are starting to take notice. In fact, we discovered that executives in India, North America and South America have been demanding delivery of action-oriented data-driven insights at an accelerating pace during the past 12 months, with the most significant acceleration in areas outside the United States.
This upsurge is just the beginning. Respondents from almost of all the 67 countries represented in our survey anticipate the demand for data-driven insights will accelerate in the next 12 to 18 months, with most expecting a significant increase in the pace of demand. Even the Nordics, the area along with Japan that reported a slower pace in the past 12 months, are expecting a significant increase in executive appetite for insights in the coming 18 months.
Given this shift toward speed, my colleagues sought to identify the organizations most capable of delivering and consuming insights quickly based on their survey responses. In part four, we will look at the capabilities required to enable speed to action, and introduce the four distinct clusters of organizations that were identified as a result of the study.