In an increasingly data-driven business environment, many executives must make critical decisions
based on analyses that use data and statistical methods that they do not fully understand. How can
executives with limited analytics expertise become adept consumers of analytics under such conditions?
This question has become an important management issue as senior executives increasingly recognize
the importance of analytics to creating business value.
The authors’ research — based on a survey of 2,719 managers in organizations from around the
world — found that the foremost barrier to creating business value from analytics is not data management
or complex modeling skills. Instead, the number one barrier mentioned by survey respondents
involved translating analytics into business actions — in other words, making business decisions based
on the results, not producing the results themselves. With more access to useful data, companies are
increasingly using sophisticated analytical methods. That, the authors argue, means there’s often a gap
between an organization’s capacity to produce analytical results and its ability to apply them effectively
to business issues.
Much can be done to make analytics more consumable for managers. At the individual level, data
analysts can learn more about the business; in fact, about a third (34%) of the survey respondents
reported that their organizations train analytics professionals to understand business issues. Organizations can also systemically improve infrastructure and processes; improved data quality, for example,can make it easier to turn data into competitive advantage.
Managers can also take steps to become savvier at understanding analytical results. In fact, managers
and executives are working to become more knowledgeable about data and analytics: Many of the survey
respondents reported that their organizations develop analytical skills through on-the-job (58%) or
formal (23%) training. Almost half the respondents (49%) reported that their organizations train managers to make better use of analytics. Beyond training, other known steps include: identifying trustworthy analytics professionals within the organization, requiring straightforward explanations and asking detailed questions.
However, the authors’ research indicates that, despite their efforts, managers continue to find it difficult
to keep pace with their organization’s analysts for two reasons: burgeoning analytics sophistication
and competing demands for managerial attention. What’s more, when an organization’s capacity
to produce increasingly sophisticated analytics outpaces managers’ abilities to understand, discomfort
is created — managers find they must make decisions based on complex analytical insights that they
do not yet fully understand. But, despite this discomfort, these managerial decisions must be made.
The authors conclude by suggesting five ways that managers can increase their comfort in consuming
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