While companies have attempted to treat data as an important asset, several leading corporations seem to be failing in their efforts to become data-driven. This is a central and alarming finding of NewVantage Partners’ 2019 Big Data and AI Executive Survey, published earlier this month.
The findings of the study is indeed surprising. According to the survey, firms are ramping up investment in Big Data and AI to accelerate business agility Leading companies (91.6%) are increasing the pace of their Big Data and AI investments – 75.0% citing fear of disruption from data-driven digital competitors; 91.7% saying investment is required to transform into agile and competitive businesses; 87.8% expressing urgency to invest. Investment in Big Data and AI is increasing, with 55% of firms investing greater than $50MM.
Leading companies are struggling with data-driven business transformation Companies are investing in Big Data and AI, but they are not seeing commensurate results. Though 62.2% report measurable results from their Big Data and AI investments, less than half say they are competing on data and analytics (47.6%), have created a data-driven organization (31.0%), or have forged a data culture (28.3%). The implications are significant.
Cultural challenges remain the biggest obstacle to business adoption Companies report (77.1%) that business adoption of Big Data and AI initiatives remains a major challenge.
Executives cite multiple factors such as organizational alignment, agility, resistance, with 95.0% stemming from cultural challenges due to people and process, and only 5.0% relating to technology. If companies hope to transform, they must begin to address the cultural obstacles.
The Chief Data Officer role is evolving but ill-defined; CDO’s may be ill-equipped Chief Data Officers are in place at 67.9% of the companies surveyed, but the role remains illdefined with the consequence that CDO’s may be ill-equipped to address the challenges – 38.2% of firms want an external change agent while 32.4% want a company insider; 48.1% see the CDO as having primary responsibility for data while 28.4% see no single point of accountability; 17.5% of executives view the CDO role as interim or unnecessary. Most companies are still not data-driven, and won’t be anytime soon Business adoption of Big Data and AI initiatives must be viewed through a long-term lens – as a process and a journey. Only 31.0% of companies say they are data-driven.
This number has declined from 37.1% in 2017 and 32.4% in 2018. We are headed the wrong direction. Firms need to adopt a long-term approach, focusing on the complex cultural challenges as a starting point.
Despite the failure to achieve transformational results from data initiatives, the amount of data continues to rise in business and society, with more companies investing in big data and analytics. However, firms need to take a hard look at why these initiatives are failing to gain business traction, and what actions must be taken to reduce the cultural barriers to business adoption.
Many companies have invested heavily in technology as a first step toward becoming data-oriented, but this alone clearly isn’t enough. Firms must become much more serious and creative about addressing the human side of data if they truly expect to derive meaningful business benefits.