Recommendation 1: Focus on the Biggest and Highest Value Opportunities

This is part 3 of 11 from “Analytics: The New Path to Value,” a report on the findings of the 2010 New Intelligent Enterprise Global Executive Study and Research Project.

Does attacking the biggest challenge carry the biggest risk of failure? Paradoxically, no — because big problems command attention and incite action. And as survey participants told us, management bandwidth is a top obstacle. When the stakes are high, the best talent will leap at the opportunity to get involved.

It’s extraordinarily hard for people to change from making decisions based on personal experience to making them from data — especially when that data counters the prevailing common wisdom. But upsetting the status quo is much easier when everyone can see how it could contribute to a major goal. With a potential big reward in sight, a significant effort is easier to justify, and people across functions and levels are better able to support it.

A sharp focus on major opportunities can excite an organization with new possibilities. “Where are the best places to advertise to get consumers into our store?” was the looming, time-critical challenge for Best Buy. “How can we reduce the fraud and abuse that are draining scarce money and resources?” is a common refrain among government agencies around the globe.

Conversely, don’t start doing analytics without strategic business direction, as these efforts are likely to stall. Not only does it waste resources, it risks creating widespread skepticism about the real value of analytics.

In our discussions with business executives, we have repeatedly heard that analytics aligned to a significant organizational challenge makes it easier to overcome a wide range of obstacles. Respondents cited many challenges, and none can be discounted or minimized: Executive sponsorship of analytics projects, data quality and access, governance, skills and culture all matter and need to be addressed in time. But when overtaken by the momentum of a single big idea and potentially game-changing insight, obstacles like these get swept into the wake of change rather than drowning the effort.

Figure 5

Introducing the PADIE Technique for Operationalizing Analytics

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A process for inspiring change Despite analytics opportunities that are as close as the nearest data warehouse, the inability to understand how analytics can solve business challenges is the most daunting obstacle to adoption. And with management attention focused on other priorities, valuable analytics opportunities can be crowded out by business as usual.

The single greatest opportunity — and challenge — to speed adoption of analytics is to embed them into daily operations. Organizations that use analytics to answer big, make-it-or-break-it challenges have the greatest opportunity to meet their business goals. The answer needs to be simple and unambiguous to work for time-pressed managers. Based on our analysis, we recommend the process-application-data-insight-embed technique. It is a simple means by which an organization can operationalize insights drawn from data. (See Figure 5.)

The PADIE technique helps users across the organization understand from the start the full initiative as it applies to a specific business challenge. This technique enables business and analytic teams to work together to create analytic models based on use cases that show analytics in action.

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2. R. Christenson, “N.C. and IBM Team up to Ferret out Medicaid Fraud,” March 25, 2010.

3. “Perdue Begins Medicaid Fraud, Waste Prevention Effort,” March 24, 2010.

4. B. Balfour, “Ten Recommendations for North Carolina’s Budget Reform and Advisory Commission (BRAC),” John W Pope Civitas Institute, February 10, 2010.

5. “Perdue Begins Medicaid Fraud, Waste Prevention Effort.”