Big Data: Does Your Company Have Intelligent Operations?
A recent study from Accenture and HFS Research points to the need to have “intelligent operations” to drive business outcomes. So what is a winning approach for “intelligent operations?”
The study surveyed nearly 500 executives to analyze the opportunities and challenges in using data-driven insight to improve operations and business outcomes. The study concluded that a combination of innovative talent, diverse data, and applied intelligence is needed to drive business and customer value.
Inside the study
A recent study from Accenture and HFS Research, a research firm analyzing innovations impacting business operations, said that organizations that leverage “intelligent operations” to make decisions and act in real-time will be best placed to thrive in the future. The report found that organizations that use the combination of innovative talent, diverse data, and applied intelligence will be in the best position to overcome digital disruption and use data-driven insights to drive improved business outcomes and enhance the customer experience.
The research is based on the responses of 460 participants from Accenture enterprise clients involved in buying decisions related to technology and services. The respondents were all director level or above and working for organizations with more than $3 billion global annual revenue in diverse geographic locations, including North America, Europe, Latin America, and Asia Pacific.
The report points to several key results. Eighty-percent of respondents are concerned with disruption and competitive threats, especially from new digital entrants. The report said that most organizations are currently unable to make data-driven decisions due to a lack of skills and technology to process data. In nearly 80% of respondent organizations, 50% to 90% of data is reported as unstructured and largely inaccessible with data coming from a wide range of sources, including owned first-party data, second-party cooperatives, and subscribed third-party data. For purposes of the study, unstructured data, refers to digital pictures, videos, social media feeds, web content, handwriting, sketches, and voice memos. Half of the organizations surveyed also say their back office is not keeping pace with front-office requirements to support digital capabilities and meet evolving customer expectations.
“To win in today’s market and ensure future viability, it is essential that organizations capture value quickly, change direction at pace, and shape and deliver new products and services,” said Debbie Polishook, group chief executive, Accenture Operations, in commenting on the study. “Organization also need to maximize the use of ‘always on’ intelligence to sense, predict, and act on changing customer and market developments.”
The study points out the need to align technology with other changes in business operations. “Our research suggests technology alone is not a magic bullet,” Polishook said. “To successfully transform their operations, organizations must take a holistic approach that integrates business process and industry expertise, human ingenuity, and intelligent technologies. This enables the agility, flexibility and responsiveness needed to drive superior decision-making, business outcomes and customer experiences. It’s about responding swiftly to change and how to steer a new course with confidence.”
The report identifies the business drivers that respondents feel will have a major impact on their business. The report shows that predictive decisions based on real-time data are the number one and number two drivers impacting business. Fifty-one percent of respondents identified their organization’s interest in and ability to make data-driven decisions as a business driver having a major impact. Forty-eight percent of respondents identified making more predictive decisions based on rapidly accessible real-time data across the organization as a key business driver.
Drivers related to customer experience (hyper-personalization and digital experience) are ranked number three and number five as drivers having a major impact. When it comes to digital disruption, 42% of executives report that they see more opportunities than threats now compared with two years ago. A robust customer experience strategy is identified as the most significant driver of operational agility. Driving out costs through automation is ranked number seven still important but lower than data-based decisions, digital disruption, and customer experience. Thirty-six percent of respondents said that driving out costs through automation was a business drivers that will have a major impact on their business.
“Breaking down the silos between the front and back office is now essential to delivering a modern customer experience,” said Phil Fersht, CEO and chief analyst at HFS Research, in commenting on the study. “More than half of survey respondents state that it takes months or even years for their business functions to make changes to evolving business needs.”
Components of intelligent operations
The research points to organizations with so-called “intelligent operation” that enable them to have a 360-degree view of their operations to enable quicker, insight-led decision making. The study points to five components of intelligent operations as outlined below.
Innovative talent. The study says that talent of the future will need to bring creative problem-solving in addition to digital expertise. “Organizations will need a more agile human resources function and a recruiting approach that heavily leverages an open talent marketplace,” according to the study. To underscore that need, the study showed that 59% of respondents cite lack of adaptability as a key barrier to achieving business goals, and 56% of respondents cite “lack of talent that understands digital” as a key barrier. Fifty-five percent of respondents mention lack of relevant data analytics, artificial intelligence, and machine-learning skills, and 54% of respondents mention lack of relevant cloud and automation skills.
Data-driven backbone. The study said that organizations need to capitalize on the vast amount of structured and unstructured data from multiple sources to gain new insights for the innovative talent to use in order to achieve stronger outcomes. Over 90% of organizations believe that data-driven decisions will help them generate breakthrough customer insights, according to the study. The study showed that 85% of enterprises are developing a data strategy around data aggregation, data lakes, or data curation, as well as mechanisms to turn data into insights and then actions.
Applied intelligence. The research points out that using integrated automation, analytics, and artificial intelligence-based solutions requires that organizations develop innovative talent who can understand the business problem and then apply the right combination of tools to find the answer. Nearly 90% of organizations said that the combination of automation, analytics, and artificial intelligence will lead business and process transformation.
Leveraging the cloud. The report says that the cloud will enable the plug-and-play digital services with better integration of diverse data, can scale up and down, and help organizations move toward an as-a-service environment. Over 90% of enterprises researched expect plug-and-play digital services with enterprise-grade holistic security, which is possible through the cloud infrastructure. Using the cloud, however, requires replacement or modernizing legacy systems. Twenty-five percent of respondents indicated they have completed legacy replacement or modernization, and another 42% have concrete plans to do so.
Smart partnership ecosystem. More than 90% of enterprises feel they need to partner closely across the ecosystem to realize market opportunities. The research concludes that organizations of the future will develop symbiotic relationships with start-ups, academia, technology providers, and platform players to achieve their goals. The report says that similarly, traditional business service providers are increasingly collaborating with enterprises in a true partnership model that maximizes co-innovation.
The report concludes that a C-level directive to drive growth is most likely to trigger the organizational transformation. The report said that enterprises expect an average of nearly 21% revenue growth in three years, but they also want to reduce operations costs by around 22% in the same period. “This means enterprises must walk a tightrope: balancing the priorities to enhance the customer experience and keeping up with disruptors while improving productivity,” according to the report. “Achieving those multiple objectives requires a fundamental shift in how business operations support companies’ growth agenda—the shift to ‘intelligent operations.”