According to a study sponsored by German business software vendor SAP AG, 90 per cent of organizations agree that employing predictive analytic software has given their business a competitive advantage.
The study, conducted by LoadHouse in the U.K. and the U.S., concluded that respondents have identified predictive analytics software as a key investment. More than 60 per cent of responding organizations said predictive analytics was already an investment priority, and 80 per cent said it will become a crucial investment within five years. What’s driving it? Nearly 95 per cent of respondents said they’ve seen an increase in the volume of data they have to deal with over the last year.
According to SAP, what it calls the “explosion of data” is pressuring businesses to make sense of all this information and use it to predict future trends, which is why they’re turning to predictive analytics and looking for ways to bring it out of the realm of the data scientist and put it in the hands of front-line workers with tools that make it consumable.
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Among other findings from the study, investing in predictive analytics appears to have a short ROI period, with 30 per cent reporting a “major positive impact” within six months and more than 50 per cent reporting positive impact within six to nine months. The finance, sales and marketing departments were singled-out as having been successful with predictive analytics, and finding ways to minimize risk and predict customer needs and market trends have been the most valuable scenarios for use.
“Despite some of the skills and resource challenges, there is a real sense from the research that the emphasis on advanced predictive analytics has moved from minimizing risk to maximizing future growth potential in areas like next best activity for customer relationship management,” said James Fisher, vice-president, marketing for analytics at SAP, in a statement. “If businesses can put the right investment into developing a data-driven workforce, alongside data-driven decisions, processes and applications, they can accelerate their performance, reduce decision latency, unlock new global markets and uncover new revenue opportunities.”
