All the data flying at us everyday makes us want to just bury our head in the sand and ignore it! As we all know, this isn’t the best business strategy or approach but all to many organizations are operating this way. In fact, Forrester estimates that only 12% of the data collected by most organizations is ever actually analyzed – that means that your organization can be missing out on insights from a whopping 88% of your data! In today’s analytics driven environment, this just seems crazy!
Why is this happening? Most organizations fall into this trap by not having the right Business Intelligence and Analytics tools in place and the data needed is hard for various users in the organization to actually get to.
How do you take full advantage of all your data? Start by looking at what type or types of analytics tools you are currently using.
Traditional BI and analytics tools behave like a report card, telling you what happened in the past. Predictive analytics (PA) tools can instead provide you with a roadmap into the future. They allow you to apply real world “what/if” analysis to your data. The evolution of analytics solutions into intelligent, predictive tools is truly exciting.
It is easy to see why there is a lot of buzz around predictive analytics. Marketing and sales are obvious early adopters to anticipate customer and marketplace behaviors. It has extended into all areas of the organization.
HR is looking to improve talent acquisition, reduce turnover, and understand the most effective compensation strategies. Operations can use PA to increase efficiencies, improve resource utilization, and intelligently manage procurement and inventory.
So how do you get started with a predictive analytics project? There are several keys that can ensure its success.
- Predictive Analytics Is Not JUST a Technology Solution
While it is built on technology and can be used to solve some technology challenges, predictive analytics is first and foremost a business solution. You need to have a solid understanding of the business problem that you are trying to solve.
For a PA project to be a success, it must generate business value. That business value has to align with the overall objectives of your organization. This is critical to get buy-in from executive leaders that can provide the support you need.
- Analytics Is Now a Team Sport
Predictive analytics can generate more valuable insight when you have assembled a team with skill sets across the organization. Depending on the goals, you might need representatives from finance, operations, and marketing. Their collective insight will help boost the project forward.
You will also need the involvement of IT departments. While this is a business solution, it is built on technology. And IT will ultimately be called upon to support the solution, helping move the project forward from its beginning.
- Know and Understand Your Data
Another reason to involve IT early is they are the ultimate keepers of the data. You will need to conduct a complete data inventory so you understand what data you have, where it is stored, and who owns it. Once you understand your internal data, you might find gaps that need to be filled.
Your PA project is only as good as the data that it is built upon. So you might find areas that need improvement. This can include more structured data governance or heightened data security so that your information does not become corrupt or stolen.
- Have the Finish Line in View
If you are just getting started with predictive analytics in your organization, you will want to demonstrate business value as quickly as possible. It is much better to proceed with small steps that keep you moving forward than to take a giant leap where you fall on your face.
You might find many more ways you would like to analyze data during the project. However, be careful not to overextend yourself. A common problem is that the project keeps growing and the deadlines keep getting pushed back. Sometimes resulting in a loss of confidence in the project itself.
- Be Lean and Be Agile
The idea behind implementing predictive analytics is to anticipate factors that can affect your business. Today, the pace of business is constantly moving, an analytics solution needs to be able to adapt to change rapidly.
Although this point might seem contradictory to number 4, they actually work together. You want to achieve your business objectives as quickly as possible. This forces you to keep the project lean. What we mean about staying lean is avoiding the urge to boil the ocean. Stick to the data critical to the project. Keeping the project lean will also allow you to be agile and adapt to business needs quickly.
Predictive analytics can have an amazing impact on your organization. It can help you identify business opportunities in time to take advantage of them. It can help you save money by shedding light on ways your business can be more efficient. It can also help in acquiring quality talent to your organization.
Like any project, the right steps need to be taken in order to provide the greatest opportunity for success. In addition to the 5 keys above, you will also want to make sure that you select the right analytics tools along with a solution provider that can help you get the most out of your investment.
If you are ready to take the next step or would like to discuss how to select a data analytics tool that is the right fit for your organization, give us a shout. We would love to work with you to get you started.