Last week I blogged about a new report hailing from the CFOW exploring all things to do with analytics. Basically, we wanted to understand the actual value that firms get from investing in analytics technologies rather than just, you know, shouting that everyone should do it. We wanted the figures/moola/cash/returns that an investment in analytics provides. And boy, did we get it. Go and read The Value of Signal (and the Cost of Noise) on Cognizant—it’s thought provoking, insightful and provides a useful framework to guide decision making and critically, the talent you’re going to need. My first post was really a warm up on the subject and the 300 survey responses that we got; This post looks to explore what the European cut of the data actually tells us and why “Meaning Making” is, and will, dominate your talent pipeline.
So where do firms in Europe see value from analytics? We asked survey respondents to tell us. Right now, demand focuses on mitigating risk. The ability to predict risk and manage risk inside and outside the business, from critical business systems and processes, to how employees do their work, or trade (remember France’s Jérôme Kerviel or our very own Nick Leeson, the man who broke the UK’s oldest merchant bank Barings?). Risk also extends into the complicated network of partnerships that global companies run with their suppliers. Using analytics to mitigate risk is top of mind for European firms and by quite a margin compared with their US peers (11 clear percentage points) and who can blame them? The Euro was clearly (still?) wobbling when this survey was done. However, where European firms see value flowing over the next 24 months tells an altogether different and exciting story…. (See graph)
European firms expect analytics to strengthen the product development process and drive strategic service development. Enhanced product and service development really is the life blood of any organization, and even more so in the digital world. The ability to improve the types of products and services brought to market and then sustain the innovation around them will clearly separate the next generation of winners and losers. Actively listening to customers, connecting with your suppliers, and using valuable data to shape a better customer experience or streamline and accelerate your R&D processes. Expect to see analytics processes not just measuring and calculating how your customers feel about a product but how they will react to its next release, or even in the moment when it’s actually working and being useful for the owner. “Want to make this product look/feel/work better? Tell us.” Look at what Denmark’s greatest export Lego does. Lego’s product development process is genius because it puts an active customer voice at the center of what it does and what it designs. Lego “listens” to suggestions from its social community and markets new products to a captive audience. Any idea submitted through Lego’s social media channel that gets more than 100,000 likes moves automatically into product development. If successful then Lego pays the originator 1% of net sales (see my post on Co-Creation). The other key area Europeans expect to see value flow is the ability to apply analytic technologies across the supply chain. Over 30% of surveyed companies see analytics monitoring, adjusting and strengthening the eco-system that surround a physical product, machine or process—like a physical car or a medical device. But analytics will also flow around virtual solutions like an insurance policy or pension. And that snazzy infographic on all this? It’s very nearly done.