HIGH STAKES, HIGH REWARDS

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1 DATA & ADVANCED ANALYTICS HIGH STAKES, HIGH REWARDS INDIAN ENTERPRISES OUTPERFORM GLOBAL PEERS OPERATING MODEL COMPETITIVE DIFFERENTIATION STRATEGY INITIATIVES INITIATIVE DESIGN MARKET ANALYTICS LINKAGES ANALYTICS PRODUCTION OUTCOMES INTERVENTION DESIGN MEASUREMENT & LEARNING ANALYTICS CONSUMPTION

2 TABLE OF CONTENTS FOREWORD EXECUTIVE SUMMARY COMPETITIVE DIFFERENTIATION OPERATING MODEL INITIATIVE DESIGN INTERVENTION DESIGN MEASUREMENT AND LEARNING CONCLUSION EYGM LIMITED. ALL RIGHTS RESERVED.

3 FOREWORD It gives me immense pleasure to share compelling insights on how Indian enterprises have outperformed global peers in their commitment to use advanced analytics for critical business decisions. According to the study, jointly conducted by Forbes Insights and EY, there is an increasing trend of companies, proficiently using data and analytics for new business initiatives, to register high growth in revenues and profits hitting 15% or more, with significant improvement in their risk profile. The study is based on a C-suite survey of nearly 200 Indian companies, with annual revenues ranging between $500 million and $50 billion, approached by Forbes Insights between August and September of Clearly, Indian enterprises are setting an example for the world to follow, while also learning from global counterparts who see competitive advantage in the use of advanced analytics more effectively. Already, there is a growing impetus on Analytics services and organisations worldwide are now realising their direct impact on business performance, but Indian companies are proving to be the frontrunners in this area. It is heartening to find that more than a third of Indian executives vouch for having a well-established analytics strategy, which forms the core of their overall business strategy. Therefore, as no surprise, this puts them ahead of leaders from all parts of the world only 23% of enterprises overall have reached a similar level of analytics evolution. I am overwhelmed to discover that executives in India are targeting resources to better understand the business opportunities, as well as the risks, associated with the five Synapses i.e. competitive differentiation, operating model, initiative design, intervention design and measurement and learning, as identified in the report. The report has also brought forth interesting insights on Indian firms excelling at having wellestablished analytics strategies that are key to the overall business growth. However, the management committee needs to ensure a smooth flow of collaboration and alignment across the enterprise and departments which has currently been one of the biggest reasons for the analytics projects to succeed or fail. I encourage each one of you to read the complete report and ask EY about what leading organizations in India are doing to create a competitive advantage through analytics, and how we can help yours. Gautam Bhattacharya Partner and National Analytics Leader, EY India Gautam.Bhattacharya@in.ey.com HIGH STAKES, HIGH REWARDS: FOREWORD 3

4 EXECUTIVE SUMMARY A recent survey of global enterprises shows direct linkage between proficiency in data and advanced analytics and business performance. Companies that are most adept at using data for new business initiatives are more likely to register high growth in revenues and profits hitting 15% or more--while also seeing significant improvement in their risk profile. The research conducted by Forbes Insights and EY found significant regional trends, as well, including analytics as one of the key pillars of organizational maturity. For example, Indian firms by far outperformed their global peers in the use of advanced analytics by senior executives. But while Indian enterprises are leading in some areas, as a group they also struggle with other important elements of advanced analytics strategies, such as fostering closer collaboration among technical and business stakeholders. Clearly, executives in the Indian subcontinent have much to teach and learn from counterparts throughout the world who see a competitive advantage in using advanced analytics most effectively. A top priority for enterprises in India and elsewhere is overcoming problems that arise between the crucial steps organizations take as they move from identifying new business opportunities, acting on insights and then measuring the outcomes of their data-driven strategies. We liken them to synapses in the brain, where communications pass from one cell to another. The difference is that, in the brain, these communications pass naturally from cell to cell, while in large enterprises the smooth flow of information isn t automatic. The EY- Forbes Insights research shows that the way global enterprises handle these junctures translates into business success and defines clear stratifications in analytics maturity. For example, the top performers in the overall survey who have translated analytics strategy into well-designed initiatives are considerably more likely to enjoy growth in operating margins and revenues of 15% or more, respectively, along with significant improvement in their risk profile EYGM LIMITED. ALL RIGHTS RESERVED.

5 OPERATING MODEL Building the underlying models that govern analytics activities, such as organizational structures that allow collaboration, chain of command, etc. STRATEGY INITIATIVES INITIATIVE DESIGN Defining the specific activities and projects that will achieve desired business outcomes MARKET COMPETITIVE DIFFERENTIATION Defining the role that data and analytics plays in the company strategy and business model. OUTCOMES ANALYTICS LINKAGES ANALYTICS PRODUCTION ANALYTICS CONSUMPTION MEASUREMENT AND LEARNING Quantifying and learning from data-driven business outcomes. INTERVENTION DESIGN Translating all the upfront goal-setting, modeling, and methodology into action making analytics insights an integral part of business operations. Findings from the global survey also show sophisticated users of advanced analytics experience additional benefits: 70% 75% of these leaders have used advanced analytics to overhaul business strategies and update how they compete in their respective markets operate a full range of enterprise, departmental, and line-of-business analytics groups that operate within a well-aligned framework They can capitalize on artificial intelligence and other forms of predictive and prescriptive modeling for insights about possible future outcomes and ways to address them Because leaders incorporate advanced analytics early in the business development processes, they can deliver better outcomes by shaping initiatives based on actual data rather than gut instinct Leaders can accurately measure business value to demonstrate the impact and validity of their investments in advanced analytics HIGH STAKES, HIGH REWARDS: EXECUTIVE SUMMARY 5

6 However, the global study also found stumbling blocks that inhibit a more sophisticated use of advanced analytics. For example, one common pain point is a lack of collaboration among business units and analytics specialists when defining desired outcomes, designing operational models, and measuring the results. Without this crossdepartment cooperation, the goal of turning analytical insights into action can break down at any stage of the process. To overcome these hurdles, executives in India are targeting resources to better understand the business opportunities, as well as the risks, associated with each of these five synapses. For example, an issue common to each of the synapses is a lack of collaboration among business units and analytics specialists. This can derail attempts to define desired outcomes, design operational models, and measure the results of analytics strategies. METHODOLOGY This report is based on a survey of nearly 200 Indian companies conducted in August and September 2016 by Forbes Insights. Respondents are C-level executives, including chief executives, presidents, and CIOs. Industries represented include banking, healthcare, technology, and telecommunications. Organizations surveyed had at least $500 million in annual revenues, and 28% had revenues of more than $50 billion. The survey results highlight best practices specific to each synapse to help executives avoid common stumbling blocks and derive long-term value from data initiatives. In addition, we present insights from Indian executives who explain the unique challenges of competing in this dynamic market and why analytics success is vital to their ongoing success EYGM LIMITED. ALL RIGHTS RESERVED.

7 COMPETITIVE DIFFERENTIATION MARKET STRATEGY KEY FINDINGS Indian firms excel at having wellestablished analytics strategies that are central to the overall business strategy Many executives in India view advanced analytics as a strategic resource But the lack of collaboration and alignment within the management committee blocks success ahead of the global pace, with only 17% of enterprises saying they already have completely changed business strategies while 33% are seeing significant elements being impacted. Having a mature advanced analytics strategy has a direct link to business performance, and Indian companies as a group are distinguishing themselves in this area. More than a third of Indian executives say their company s analytics strategy is well established and central to the overall business strategy. As a group, this puts them ahead of leaders from all parts of the world, wherein only 23% of enterprises overall have reached a similar level of analytics evolution. Furthermore, 34% of Indian organizations report that their advanced analytics strategy is starting to be viewed as a key strategic priority, edging out the 30% of global peers that share this viewpoint. Analytics maturity has ripple effects. More than a quarter (26%) of Indian executives say advanced analytics have completely changed their business strategy and how they compete, with another 39% only slightly behind they report changes to significant elements of their strategy. Again, this put them Data and analytics are like the headlights of a car, not the taillights, says Rajesh Mishra, vice president of finance and supply chain for Pernod Ricard Travel Retail Americas. Using analytics for competitive differentiation isn t about analyzing past performance, its value is in giving you a direction for the future. Across organizations worldwide, advanced analytics proficiency is making the biggest changes in how firms target and segment customers, something that is also playing out in India. Thirty-five percent of Indian executives have seen complete changes in this area, which is 10% more than at organizations worldwide. Similarly, nearly a third of Indian companies are also using analytics to stay ahead of rapidly changing customer taste. But not all the news coming from India is positive. Problems arise over how people perform their respective roles and interact with corporate peers. Some of the biggest challenges which each impact more than a third HIGH STAKES, HIGH REWARDS: COMPETITIVE DIFFERENTIATION 7

8 WHAT BEST DESCRIBES THE ROLE OF DATA AND ANALYTICS IN THE BUSINESS STRATEGY IN YOUR ORGANIZATION? 37% 34% Analytics strategy is well established and central to the overall business strategy Analytics strategy is established and starting to be viewed as a key strategic priority 15% Analytics strategy is established for the enterprise, but not fully aligned across the business 182 TOTAL Note: Due to rounding, numbers presented may not total % 1% Some analytics strategy exists for functions or lines of business No analytics vision or strategy exists at this time WHAT ARE YOUR TOP PAIN POINTS WHEN IT COMES TO DEVELOPING OR REFINING THE BUSINESS STRATEGY TO ACCOUNT FOR DATA AND ANALYTICS? Regulatory constraints prevent us from acting 51% Organization, culture and decision-making based more on intuition than data 48% Lack of collaboration/alignment among members of the management committee 46% Lack of budget and other forms of organization commitment 43% Lack of senior leadership support 38% No appetite for a major transformation that would result from data and analytics-driven strategies 27% We have not had the right leader to serve as a catalyst for change 26% Data and analytics is not changing our business strategy 7% EYGM LIMITED. ALL RIGHTS RESERVED.

9 OVER THE NEXT TWO YEARS, NEARLY THREE-QUARTERS OF THEM PLAN TO INVEST $10 MILLION OR MORE FOR DATA AND ANALYTICS RESOURCES. of Indian organizations are lack of commitment to data-based decision-making or organizational support for data-driven cultures, which impair the competitive differentiation and operating model synapses. This problem illustrates how companies still struggle with intuition-based decision-making, where executives favor gut feel more than fact-based decisions. "WE HAVE SPONSORSHIP FROM TOP-LEVEL EXECUTIVES, AND THAT IS A SIGNIFICANT REASON WHY WE RE SUCCESSFUL." KRISHNAKUMAR RAMASUBRAMANIAN HEAD OF BUSINESS INTELLIGENCE AND ANALYTICS, MAX LIFE INSURANCE Ramasubramanian, head of business intelligence and analytics at Max Life Insurance, a large carrier based in India. Looking beyond cultural considerations, Indian business leaders appear to understand the financial commitments needed to successfully infuse business initiatives with data and analytics. Over the next two years, nearly three-quarters of them plan to invest $10 million or more for data and analytics resources. This shows a growing financial commitment to data and analytics--in the past two years, only about half of the companies spent similar amounts. Indian companies still have work to do when it comes to advancing their data and analytics strategies. But recognizing lingering cultural and collaboration issues and making appropriate financial investments will keep firms moving in the right direction. RECOMMENDATIONS Related to this is a widespread lack of collaboration and alignment within the management committee, which also impedes the smooth flow of information during each of the synapse transition points. To better utilize data and advanced analytics for strategic gain, enterprises must foster a cultural shift designed to promote collaboration and data analytics skills. Collaboration between analytics specialists and business people also overcomes traditional cultures where there s overreliance on gut-feel decision making. Data leaders point to one other vital element for promoting collaboration. We have sponsorship from top-level executives, and that is a significant reason why we re successful, says Krishnakumar 1 Create a data and advanced analytics strategy that balances enterprise goals with the needs of each business unit, including any unique regulatory and business requirements. 2 Create a compelling business case that demonstrates the key role advanced analytics plays for competitive differentiation in today s digital marketplace. 3 Show the direct link between advanced analytics and business value and use this to convince the C-Suite and Board to make analytics a top priority for the enterprise. 4 To identify new business opportunities and how they can be supported with advanced analytics, foster closer collaboration among stakeholders from all departments. HIGH STAKES, HIGH REWARDS: COMPETITIVE DIFFERENTIATION 9

10 OPERATING MODEL KEY FINDINGS Nearly half of Indian firms already have an enterprise-wide advanced analytics strategy STRATEGY INITIATIVES But many Indian companies struggle with advanced analytics governance policies A priority in India is expanding training to improve the creation of operating models Smooth collaboration among stakeholders is also essential for effective operating models, which provide frameworks for enabling enterprise, departmental, and line-of-business analytics to work together. Unfortunately, only a little more than a quarter of Indian enterprises see this level of governance in their organizations. Most see progress only within certain departments and business lines or say enterprise-level data and advanced analytics groups are still emerging. Related to this is the ability of organizations to implement enterprise-wide data governance standards, something that s being accomplished by 40% of the leaders in India. This is important for fostering greater trust in the accuracy and security of corporate data. In the past, most of our decisions were based on gut feeling, but as we re maturing, we re moving to a point where we are relying more and more on data to inform our decisions, says Chetan Agarwal, executive vice president of IT at Lodha, a real-estate developer based in Mumbai. WHICH BEST DESCRIBES YOUR ORGANIZATION'S CURRENT STATUS REGARDING THE ORGANIZATION AND GOVERNANCE OF DATA ANALYTICS? Data and analytics groups are well-established in departmentsor lines of business Enterprise-level data and analytics group are emerging No organization exists 1% 36% 28% 22% 13% Enterprise, department and lines-of-business data and analytics groups exist and are well-aligned Some informal data analytics groups exist in departments or lines of business EYGM LIMITED. ALL RIGHTS RESERVED.

11 ENTERPRISE ANALYTICS If your organization uses some form of enterprise-level analytics team (in addition to capabilities that exist within business units), what is the primary purpose of this team? Technology Advanced Analytics Data Strategy Development 74% 49% 51% Measurement Portfolio Management 40% 40% 17% 12% Putting in place standards for value measurement, Management Selecting projects, making investment allocation decisions Analytics Working on use cases that require skills not resident in the businesses Implementing data governance/standards used across the organization Setting the overall firm-level data and analytics strategy and plan Building models and other assets that can be leveraged across the business Selecting, implementing, managing common technology platform and tools He adds that reliance on analytics increases as people become more confident in the quality of corporate data, which comes from having solid policies around data management. The close alignment of data and analytics teams is a foundation for effective operating models. Forty-nine percent of Indian companies use their enterprise analytics teams to create an organization-wide strategy for data and analytics. This is important for many reasons, including because it demonstrates a commitment by senior executives to having data-driven approaches that underlie business initiatives going forward. The research shows that to improve operating models going forward, Indian leaders must expand training and make data and advanced analytics a part of operating models. To do this, organizations should focus more closely on recruiting, developing and retaining individuals who can serve as analytics leaders in various parts of the business. Executives should also define what it means to the organization to have more of an analytics mindset and culture. No operating model will succeed long term without corresponding focus on creating a culture where analytics practitioners can apply their craft and thrive. Increasing adoption rates among employees is another top priority for enhancing analytics maturity. To promote wide acceptance and adoption of advanced analytics among business people, the resource must be accessible and easy to use. This means offering tools that present findings in highly visual formats that are well integrated within the primary applications business people use to perform their jobs. After all, if a solution is difficult to navigate and presents information that s not clear to a business user, they ll be less likely to adopt it. HIGH STAKES, HIGH REWARDS: OPERATING MODEL 11

12 WHAT ARE YOUR TOP PAIN POINTS WHEN CREATING A DATA AND ANALYTICS OPERATING MODEL? Lack of training across functions 31% Data and analytics has not historically been part of an operating model 30% Lack of adoption/engagement by employees 29% RECOMMENDATIONS 1 Clearly define an operating model that brings advanced analytics resources close to each line of business and function. 2 Support the model with an enterprise-level analytics team charged with setting the overall strategy for data and advanced analytics. 3 The team should also implement enterprise-wide data governance standards to foster greater trust in the accuracy and security of corporate data. Lack of change management acumen 28% Lack of alignment/collaboration across functions 27% Lack of data and analytics proficiency within many functions 27% Lack of data/knowledge management sharing 26% A data and analytics operating model would disrupt existing models too much 24% Lack of data and analytics leaders at the business-unit level 24% Lack of vision/buy-in from top levels of management 20% Technology is not integrated 20% We do not have mature data and analytics 15% EYGM LIMITED. ALL RIGHTS RESERVED.

13 INITIATIVE DESIGN INITIATIVES KEY FINDINGS Improving partner and vendor relationships are top goals for advanced analytics initiatives in India Executives must better align the IT department, the data and advanced analytics team, and business people to improve data strategies developing new products and services with the aid of advanced analytics. ANALYTICS PRODUCTION When executives reach the point of designing the specifics of business initiatives, they must make a series of critical decisions that will guide their use of data and advanced analytics and ultimately determine the success of the project. This starts with defining the specific business outcomes leaders hope to achieve. The goals that ranked highest among Indian respondents were increased quality and more targeted interactions with partners and vendors. Indian executives cited this area in greater numbers than their global peers, showing partner and vendor relationships is a clear regional concern in the subcontinent. Other goals show a bias toward practical matters, such as the desire for increased sales or revenues and higher rates of customer satisfaction. The high rankings aren t surprising, after all, they re the main focus of business executives everywhere. But progressive leaders are also looking to employ advanced analytics in strategic ways, too. Twenty-eight percent see opportunities for It will take more than just an attitudinal change to move these companies forward. Behind the scenes, they must also significantly improve their methods for developing initiative designs. However, this is another area where Indian firms appear to be ahead. An impressive 71% of the respondents say they always or very often use consistent methods for data and analytics initiative designs. Globally, just 47% of executives report this level of consistency. Indian respondents have another advantage 36% say their data and analytics and business groups work together highly effectively. Only 16% globally share this status. But Indian companies have work to do in other areas. Nearly half of them say a top pain point is the lack of alignment among the IT department, the data and analytics team, and business people. A similar number report trouble from a lack of people with analytics skill sets to define an appropriate approach to designing analytics initiatives. In addition, many say problems arise because desired business outcomes are not well defined at the start. HIGH STAKES, HIGH REWARDS: INITIATIVE DESIGN 13

14 WHAT SPECIFIC BUSINESS OUTCOMES IS YOUR ORGANIZATION TRYING TO ACHIEVE THROUGH THE APPLICATION OF DATA AND ANALYTICS? Increase quality and more targeted interactions with partners and vendors Increase sales or revenues Develop new products/services Increase customer satisfaction/retention Improve current products/services Improve and streamline internal operations/cut costs Deeper market insights Transform business models 21% 21% 23% 19% 19% 19% 15% 14% 26% 27% 28% 30% 33% Enable common enterprise view of customers Encourage rapid and constant innovation More effectively deploy our people Accelerate decision-making Transform operating models HOW OFTEN DO YOU USE CONSISTENT METHODS/APPROACHES FOR DATA AND ANALYTICS INITIATIVE DESIGN (PROJECTS TARGETING A SPECIFIC USE CASE)? 50% 44% VERY OFTEN FAIRLY OFTEN 22% 27% ALWAYS % NEVER SOMETIMES 5% Note: Due to rounding, numbers presented may not total EYGM LIMITED. ALL RIGHTS RESERVED.

15 WHAT ARE YOUR TOP PAIN POINTS WHEN DESIGNING DATA ANALYTICS INITIATIVES? Lack of collaboration between IT, data and analytics team and the business team 46% Lack of people with analytics skill sets to define an appropriate to approach the problem 46% Desired business outcomes not well defined at the start 40% Technology needs not considered early enough 38% Lack of clear and engaged sponsorship 36% Lack of consistent methods/processes 35% Unclear responsibilities across functions 33% Not enough focus on who the user will be and how the analytics will change what they do 25% Other 1% RECOMMENDATIONS 1 Develop and apply consistent processes and a common nomenclature for designing advanced analytics initiatives. This should be balanced with creating an environment for cost effective experimentation and investigation, which allows teams to ultimately choose the best use cases. 2 Ensure that stakeholders define strategic objectives and desired business outcomes and closely align proposed initiatives to these goals. Focus on a better definition of a strategic outcome such as driving better engagement with customers. That goal should then translate into initiatives that evaluate, streamline, improve or otherwise reimagine customer engagement across all channels. 3 Carefully think through the competencies and roles that are needed across analytics, IT and business teams ensure there is joint responsibility and accountability for addressing a specific initiative. Assess the current skills across these teams to ensure that the right mix actually exists to drive initiatives in a way consistent with industry-leading practices. HIGH STAKES, HIGH REWARDS: INITIATIVE DESIGN 15

16 INTERVENTION DESIGN ANALYTICS PRODUCTION KEY FINDINGS Earlier is better when applying advanced analytics to business development Indian executives are ahead of their global peers in the use of advanced analytics among senior business leaders Lack of skills is a significant roadblock to activating analytical insights ANALYTICS CONSUMPTION Intervention design is when stakeholders translate goal-setting, modeling, and methodology development into new business decisions or processes. Critical for success at this stage is determining when in the development process companies design how to apply analytics to best realize the value of their efforts. Doing so as early in the process as possible is ideal since this allows the most time for validating initiatives based on available data, rather than simply relying on gut feel. However, only 29% of Indian executives claim this level of early intervention, while about a quarter of respondents say deciding how to apply analytics comes after starting data collection and knowing what s possible. Another 28% say they make this decision only after they know what type of analytics will be applied. Sixteen percent overall still wait until after they ve built their models, indicating an area that requires further attention. On the plus side, Indian firms are ahead of those in other regions in the use of data and analytics among senior business leaders. Fifty-seven percent of top executives in India turn to data and analytics for more than half of their decision-making. This contrasts with international results, where only 45% of senior executives show a similar commitment to analytics. The bottom line: executives in India are more likely to capitalize on advanced analytics for decision-making than their counterparts in other countries. When senior executives see the competitive advantages of analytics and lead by example, it encourages people throughout the organization to use analytics more extensively, says Rahul Shandilya, senior vice president of IT and analytics for the automotive and farm equipment sectors at Mahindra and Mahindra in Mumbai EYGM LIMITED. ALL RIGHTS RESERVED.

17 WHEN IN THE PROCESS DO YOU TYPICALLY DESIGN HOW THE ANALYTICS WILL BE APPLIED (WHAT ACTIONS WILL BE TAKEN TO REALIZE VALUE)? SOONER LATER 29% 28% 26% 16% When we are designing the use case at a high level After we have determined what type of analytics will be applied Note: Due to rounding, numbers presented may not total 100 After we have started data collection and know what is possible After we have built models and determined what insights can be generated WHAT PERCENTAGE OF THE TIME DO SENIOR BUSINESS LEADERS INCLUDE DATA ANALYTICS IN THEIR DECISION-MAKING ABOUT DESIGNING AND EXECUTING STRATEGIES? 0-25% 8% 26%-50% 36% 51%-75% 38% More than 75% 19% Note: Due to rounding, numbers presented may not total 100 However, companies in India still face structural challenges that impair intervention design. For example, 45% say the biggest roadblock to greater adoption and consumption of analytics insights is poor integration of this resource within current processes. The firms also face personnel problems. More than a third of the Indian respondents say that the people who need to take the action do not have the required skills. Indian firms have an advantage in how extensively senior leaders embrace advanced analytics. But to further capitalize on this and other strengths, Indian firms must make adopting analytics and improving the skills of people throughout the organization top priorities in the months ahead. HIGH STAKES, HIGH REWARDS: INTERVENTION DESIGN 17

18 WHAT ARE THE BIGGEST CHALLENGES WITH DRIVING ADOPTION/CONSUMPTION OF ANALYTICS INSIGHTS? Business Process Skills 45% Organization Design User Design Data Incentives 36% 31% 31% 30% 24% The analytics insights are not well integrated into current processes People who need to take the action to not have the required skills Interaction between various people/groups does not function well How the individual interfaces with the analytics is not well designed Data used for analytics is not of high quality or not trusted Actions the analytics suggest are not aligned to current employee incentives RECOMMENDATIONS 1 When business initiatives are being developed, apply advanced analytics as early as possible preferably when designing use cases at a high level. This enables stakeholders to shape and test the validity of initiatives based on available data rather than pure instinct. 2 Closely integrate the output of advanced analytics into business processes. Otherwise, organizations risk wasting time and resources developing insights without any assurance of realizing their value. 3 While the growth of predictive analytics and machine learning may increase reliance on automated decisions, human insights will remain a vital element when making strategic and operational decisions. Continue to invest in resources that support both the art and science of using analytics effectively EYGM LIMITED. ALL RIGHTS RESERVED.

19 MEASUREMENT AND LEARNING KEY FINDINGS Less than a third of Indian firms use well-defined metrics to gauge enterprise-wide performance of advanced analytics Indian companies struggle with communicating business outcomes to the stakeholders OUTCOMES ANALYTICS CONSUMPTION In the end, the value of resource investments devoted to devising and activating advanced analytics strategies must be evaluated for how well they support desired business outcomes. But many companies still struggle to quantify the benefits of data-driven business initiatives. For Addressing measurement and communication challenges remains a high priority example, only 31% of Indian executives say the enterprisewide performance of advanced analytics is managed consistently and use a well-defined set of financial and non-financial measures. A significant percentage of the others struggle with delivering consistent performance measurements across functions and lines of business. Successfully aligning measurements to the definitions of business outcomes that were developed during the early WHICH BEST DESCRIBES HOW VALUE IS MEASURED WHEN DEMONSTRATING THE IMPACT OF DATA ANALYTICS ON YOUR ORGANIZATION? Performance of analytics is managed consistently globally using a well-defined set of financial and non-financial measurest 31% Performance of analytics is measured and managed, but inconsistent across functions and lines of business Analytics initiatives are managed as a portfolio with risk weighted value assessments impacting resource allocation decisions 26% 25% Definition of business outcomes is typically established up front, but measurement is often difficult 16% No visibility into the value created from analytics initiatives 2% HIGH STAKES, HIGH REWARDS: MEASUREMENT AND LEARNING 19

20 HOW EFFECTIVE IS YOUR ORGANIZATION AT IMPLEMENTING TEST AND LEARN PROCESSES THAT THEN IMPACT ANALYTICS MODELS AND SUGGESTED ACTIONS? 43% 35% 8% 5% 9% Highly Ineffective Ineffective Neither Ineffective Effective Highly Effective or Effective WHAT ARE THE BIGGEST CHALLENGES TO MEASURING VALUE REALIZATION? Communication of business outcomes to the stakeholders 36% Too many factors influence the business outcome (cannot isolate the actions from analytics) 34% Capturing required data is difficult/too costly 32% Lack of clear responsibility for business outcomes 30% Expected performance outcomes are not well defined 27% Lack of trust in the data 20% Lack of trust in the measurement process 20% Don t know/unsure 1% Other 0% EYGM LIMITED. ALL RIGHTS RESERVED.

21 stages of projects is another trouble spot. Thirty-five percent of Indian executives say they re highly effective at implementing test and learning processes that then impact analytics models and suggested actions. But nearly a quarter of their peers admit to being ineffective or at best say their effectiveness is a wash. The underlying reasons for these breakdowns are varied, and cut across technical and cultural issues. Indian companies struggle with communicating business outcomes to the stakeholders. Complexity is a problem more than a third say too many factors influence the business outcome. Financial constraints are another concern 32% say capturing required data is difficult or too costly. RECOMMENDATIONS 1 Create a strategy for measuring performance that defines a common language and processes for collecting and analyzing outcome data. 2 Develop detailed metrics that measure the tangible results of data-driven business initiatives. 3 Set specific targets for business growth, gains in revenues and profits, and other important goals, such as reducing risk. Then continuously track progress toward reaching these goals. Leaders who are responsible for guiding their organizations to more data-driven cultures must make addressing measurement and communication challenges a high priority. HIGH STAKES, HIGH REWARDS: MEASUREMENT AND LEARNING 21

22 A FOUNDATION FOR FUTURE SUCCESS To stay competitive and remain market leaders in their respective markets, enterprises everywhere are increasing their commitments and investments in advanced analytics. Indian leaders are seeing a pay-off from these efforts. In particular, senior executives in India are more likely than others to replace gutfeel decision-making with insights gained from their rich data reserves. However, problems with stakeholder collaboration and corporate-wide governance policies are holding back the further maturing of advanced analytics initiatives in the subcontinent. Addressing these shortcomings must be a top priority for Indian executives going forward to stay ahead of competitors globally and use advanced analytics as a strategic advantage for developing tomorrow s successful business initiatives EYGM LIMITED. ALL RIGHTS RESERVED.

23 ABOUT EY EY is a global leader in assurance, tax, transaction and advisory services. The insights and quality services we deliver help build trust and confidence in the capital markets and in economies the world over. We develop outstanding leaders who team to deliver on our promises to all of our stakeholders. In so doing, we play a critical role in building a better working world for our people, for our clients and for our communities. EY refers to the global organization, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients. For more information about our organization, please visit ey.com EYGM Limited. All Rights Reserved. EYG no GBL This material has been prepared for general informational purposes only and is not intended to be relied upon as accounting, tax, or other professional advice. Please refer to your advisors for specific advice. The views of third parties set out in this publication are not necessarily the views of the global EY organization or its member firms. Moreover, they should be viewed in the context of the time they were made. HIGH STAKES, HIGH REWARDS: CONCLUSION 23

24 ABOUT FORBES INSIGHTS Forbes Insights is the strategic research and thought leadership practice of Forbes Media, publisher of Forbes magazine and Forbes.com, whose combined media properties reach nearly 75 million business decision makers worldwide on a monthly basis. Taking advantage of a proprietary database of senior-level executives in the Forbes community, Forbes Insights conducts research on a host of topics of interest to C-level executives, senior marketing professionals, small business owners and those who aspire to positions of leadership, as well as providing deep insights into issues and trends surrounding wealth creation and wealth management. Bruce Rogers CHIEF INSIGHTS OFFICER Erika Maguire PROGRAM DIRECTOR Andrea Nishi PROJECT MANAGER EDITORIAL Kasia Wandycz Moreno DIRECTOR Hugo S. Moreno DIRECTOR Alan Joch and Kasia Wandycz Moreno REPORT AUTHORS DDD Infographic DESIGNER RESEARCH Ross Gagnon DIRECTOR Kimberly Kurata SENIOR RESEARCH ANALYST Sara Chin RESEARCH ANALYST SALES North America Brian McLeod EXECUTIVE DIRECTOR bmcleod@forbes.com Matthew Muszala MANAGER mmuszala@forbes.com William Thompson MANAGER wthompson@forbes.com EMEA Tibor Fuchsel MANAGER tfuchsel@forbes.com 499 Washington Blvd. Jersey City, NJ