In today’s capricious business climate, it’s more important than ever for firms to be able to make quick strategic and tactical changes. Yet, many firms struggle to gain insight into the accurate and complete data needed for nimble decision making.
That’s according to new research from Aberdeen Group that finds 43% of respondents say that the top pressure facing their organizations as they aim for forecast accuracy is market volatility.
However, 30% of respondents say that too many of their business decisions are based on inaccurate or incomplete data. This was the top pressure influencing them to add big data analytics into their budgeting and forecasting tools arsenals.
“Accuracy and agility are essential in planning, budgeting and forecasting,” according to the report. “When forecasts are consistently accurate, business leaders can have more confidence when making decisions and investments to guide the organization, as they have a good idea of how the organization will perform in the coming months.”
Additionally, 50% of the top performing organizations have put enterprise-level business intelligence (BI) solutions into place compared to 28% of all others, according to Aberdeen. Moreover, the top performers were more than twice as likely as all others to have put predictive analytics into place.
Additional research highlights include:
- The top performing companies report that 94% of financial reports are delivered in the time needed for decision making, while the lowest performing companies report that only 58% of financial reports are delivered in the time needed to affect decisions.
- Sixty-eight percent of companies with business intelligence tools can identify performance by product line, sales person or business unit.
- Organizations with BI are 49% more likely than those without to have alerts based on internal events that can be used to trigger changes in the forecast.
- Organizations with business intelligence are 51% more likely than those without to have the ability to perform “what if” scenarios.
“These organizations can mix and match different potentialities and include them with forecasts,” the report notes. “For example, are certain products more profitable than others? Organizations that have implemented BI may be more likely to know the answer to this questions because seventy-eight percent of them have the ability to perform a profitability analysis.”
The allure of big data and analytics is ratcheting up to the C-suite in companies, according to a recent survey from McKinsey & Co.
“The analytic systems are coming to a level of maturity where these sorts of uses are becoming more commonplace within companies,” says Johnson Sikes, a consultant at McKinsey and co-author of the report. “Companies are looking for ways to improve these processes and the tools and the data are becoming more available. So you’re just seeing this continue to ratchet up.”
Companies report they are mainly using big data to grow revenue.
“They’re looking to analytics to figure out ‘how do we target new customers?’ ‘how do we actually improve the amount that we sell to existing customers?’ and ‘how do we use it to better manage our supply chain and improve our efficiency that way?’” according to Sikes.
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