Most companies today have initiated some type of big data project. The challenge is that most of those projects are about data-lakes, yet another repository of big data. Yet still, less than 20% of enterprises deploying big data analytics are measuring the business value from these projects.
CIO Magazine recently published a study to ask CIOs and business executives about their big data analytics projects that are delivering measurable business value. The survey results indicated that “operational analytics” is the number one use case driving business value from big data analytics. Nearly two-thirds of the respondents are using big data analytics for operational purposes, far exceeding the second-most-common use case, customer analytics. In fact, four of the five top use cases relate to operational improvements.
When asked where analytics projects are currently implemented, CIOs responded that 57% of their big data implementations focus on reducing costs or increasing productivity versus 31% that seek revenue growth.
At Maana, we work with some of the largest industrial companies in the world to help them increase asset profitability. A 1% improvement in asset or process optimization translates into millions of dollars in cost savings or production increases for major industrial and IoT companies. For example, if you can reduce offshore platform downtime by 1% you are reducing revenue loss by $22 million per year, per platform. Maana has multiple use cases in big data analytics for improving operations.
Who funds the big data analytics projects?
The survey results align with Maana’s experience working with Fortune 500 companies regarding the organizations that fund big data projects as well as budget priorities. Line-of-business organizations write checks for revenue-generating initiatives 52% of the time and 50% of their analytics budget is allocated to reducing costs and improving productivity.
CFOs and finance departments are the biggest funders of projects that increase working capital. It is not surprising that nearly half of the data analytics projects funded by the CFO are undertaken to boost working capital. In fact, in one case study, Maana has improved the accounts receivable collections for a division of a major Fortune 50 company, accelerating cash collections by $540 million per year. This project has been so successful in increasing working capital it is under consideration to be implemented across all divisions of this global enterprise company.
At Maana, our highest priority has been to work with general managers and line-of-business executives to help them with their most challenging projects and always with a specific pre-defined business value in mind. These projects almost always involve leveraging data from multiple silos to get a holistic view of the asset or business process that they would like to optimize. Collaborating closely with our customers has enabled Maana to develop the most advanced analytics software platform available, with sophisticated machine learning algorithms that enable our customers to go through years of historical data and quickly identify patterns.
We are delighted to see that the CIO survey is shedding light on the importance of deriving business value from big data projects vs. a sandbox project for a few IT or data scientists. It is a testament to the fact that leading organizations of the future are those companies that leverage their data to drive profitability.
Download the full CIO report here.
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