Companies are realizing the need to integrate analytics throughout their entire business to capture significant value. However, many struggle to achieve this goal. A survey by McKinsey Analytics identified a group of elite companies that have successfully implemented analytics at scale.
To replicate the achievements of the top 8% of companies in scaling analytics, organizations should focus on the nine key drivers of their success. These drivers can be categorized into three main areas: strategy, foundational capabilities, and activities that specifically target the integration of analytics throughout the organization.
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Driver #1: Achieving a robust and cohesive commitment from management at all levels
Breakaway companies, compared to their peers, demonstrate stronger alignment among their leadership team regarding the vision and strategy for analytics. These companies have a clear objective of integrating analytics throughout all operations, rather than limiting it to specific business units or functions. Consequently, breakaway companies are 3.5 times more likely than their peers to utilize analytics in three or more functional areas. Breakaway companies recognize the significance of obtaining buy-in from lower levels of the corporate hierarchy as well. In fact, 57% of the breakaway group’s middle management fully believes that becoming an analytics-driven organization is crucial for maintaining relevance and competitiveness.Driver #2: Enhancing investments in analytics, with a specific emphasis on the final stage of implementation and delivery
Breakaway companies allocate a higher proportion of their budgets to analytics compared to other organizations, and they have plans to further increase these investments. These expenditures cover various aspects such as data, technology, analytics talent, and integrating analytics into business workflows. Notably, breakaway companies prioritize addressing the key challenge of maximizing analytics value, focusing specifically on the “last mile” by embedding analytics into core workflows and decision-making processes. Almost 90 percent of breakaway organizations allocate more than half of their analytics budgets to this endeavor.Driver #3: Establishing a well-defined data strategy accompanied by robust data governance practices
Breakaway organizations are more likely than their peers to possess a clear data strategy and strong data governance practices for data identification and prioritization. Successful data strategies typically include four key elements:- Clear data ontology based on current and future use cases.
- Master data model across essential domains (e.g., customer, product, location, employees) with assigned business ownership.
- Governance plans determine accountability for data quality and maintenance, categorizing data sets hierarchically based on importance.
- Technical understanding and plans for data environments, including dynamic updates and flexible data classification.