(Article also available here)
Business Analytics has now attracted attention as never before. Together with Mobility, Cloud, and Social, Analytics is now trending the IT world.
Business Analytics in itself is not new. But the unprecedented flow of data is. This has engendered a new breed of technology that has produced immense scalability and processing power. This has arguably been responsible for the new surge in quest for analytics to provide new business insights. This marriage between technology and the quest for insights promises to radically change the way business is conducted. This is already being witnessed with companies making large investments to keep up with these new changes.
Business Analytics is a big and fast growing market segment and global IT majors have fallen over each other get their fair share. IT majors may have dominated execution and delivery, but are often surprised by the intense competition they face from boutique firms which offer highly specialized services in this space. Round one appears to have gone to the smaller firms since they seem to have a better game plan, the correct skill mix, albeit limited and clever targeting. But it is only a matter of time before the biggies catch up.
But what does it take to succeed in this business? This piece identifies five areas which are critical for success in the analytics business.
Have a focus area approach: Analytics pervades every sphere of the business. It is important to have a focus area approach to analytics. Deep analytical talent in focus area gives the customer greater confidence in the relationship. For example building expertise and depth in banking loan portfolio analytics – from generating periodic KPIs to using predictive analytics to optimize customer engagement strategies is a great way to deepen relationships with banks. This not only helps get the foot in the door but also build a sustainable relationship with customers. What areas to offer specialized services and how to build the skills is where domain and subject matter experts can contribute. It is important not to spread the resources thin by offering solution/ services where there is no depth of talent.
Target business leadership: The business leadership in the company is charged with making the right decisions to steer the company forward. They have always relied on number-crunchers to help support their decisions. Hence they not only consume the end product, but also are the key drivers of analytics in the organization. A successful strategy for analytics companies must be woven around winning the business leadership.
Solicit emerging market segments: According to IBM’s Rob Ashe, mid-sized companies comprise the fastest growing segment in analytics business. This is because these companies are realizing that they need an analytics strategy of their own, outside of the capabilities in the tools they have invested in. These companies face intense competition and are seeking help to make the right and informed decisions. This is where business analytics helps. However, many global IT companies are pushing business analytics solutions only to their captive relationship base. They must enlarge their strategy to include the middle tier businesses to stay relevant in business analytics space.
Does the client have top Information Infrastructure: A top rated data infrastructure is a must-have since it helps client companies to quickly deploy analytics. In a broad sense, analytics sits on top of the Information food chain, above the reporting / business intelligence layer, which in turn sits on top of the underlying data layer. Good data begets good insights. It is obvious that customers can derive powerful benefits of business analytics when sophisticated data layers are successfully in place. Customers typically tend to seek repeat engagements in their attempts to solve several related or unrelated business problems once they start getting insights from their investments in data infrastructure. Many companies are investing to shore up their data warehousing and BI capabilities so that they continue to maintain their competitive edge.
Build top analytical skill base: The sudden focus and demand for analytics has logically led to a shortage of trained skillsets. The problem only compounds because skilled analytical talent has limited or no exposure to the technical side. Even more limited are crossover skills where technical and analytical expertise coexists. Given the growth potential for this sector, IT majors must focus on developing and nurturing business analytics skill sets – more specifically the cross-over skill sets.
As companies compete and build top class analytical skills, competition will take on a new meaning as the battle focuses on capturing customer’s insightspace; hopefully will prove insightful for both clients and global IT majors. It won’t be a long wait to find out.