The Value of Business Analytics: Identifying the Path to Profitability

CHALLENGES OF APPLYING BUSINESS ANALYTICS

Thus far we have covered the core intent of a business analytics team, the types of outputs it creates, the things it works with, and the core set of roles it needs to cover. However, this is obviously a very introspective view of the team; to understand the requirements for success, we also need to understand its context in the broader organization as well as the challenges it often faces.

Every business analytics team operates within a larger organization, regardless of whether the team is simply part of a large functional group or a center of excellence in its own right. The team itself faces a wide variety of complexities that present daily challenges. In turn, the organization faces a variety of competitive and regulatory challenges, many of which must be overcome in order for the organization to be successful.

Complicating matters somewhat is that often the business analytics team does not have ownership over the execution process. While the assets the team creates can be a critical input into the efficiency of these processes, it is often beyond the team’s control to act on the insights it creates.

Challenges to the team come from two locations:

1. Exogenous sources, such as the environment within which the team operates

2. Endogenous sources, such as the skills and capabilities of the team

The relationship between these and the business analytics team is shown in Figure 3.5.

Figure 3.5 Sources of Challenges

The exogenously ...