According to the Capgemini report1, only a small minority of consumer products (16%) and retail companies (6%) use data analytics to gain an edge from data. Such companies are data masters as they have the ability to understand the importance of storytelling skills. A data-powered company embeds the insights into the core business process and recognizes the value of data for competitive advantage.
A data-powered enterprise leads in all of the below aspects (Source: The Age of Insight Report by Capgemini)
Collecting data is not cheap, so data comes at a cost. If the data is not used to drive business decisions, then a company can achieve no competitive advantage from the data. 2Dell is a great example of how they used advanced analytics to define a product line of preconfigured PCs. At Dell, almost three-quarters of Dell’s notebook and desktop sales were pre-configured PCs. Today, with innovations in the supply chain and personalization of products, these configurations make up about half of the Dell sales.
Data enables making decisions at speed. Further, data insights instill confidence that such decisions will drive tangible business value. Let’s look at two examples1 of how data helped in launching innovative products and services.
Unilever launched matcha tea by driving insights using AI that uses consumer data from social media, searches, and online reviews. The company launched the product in nine months, whereas traditional research methods would not have picked up the opportunity in time.
A Chilean startup, NotCo, launched a plant-based milk substitute product for lactose intolerant using AI. The company identified food molecules and generated combinations that match the taste and texture of cow’s milk. The AI came up with an innovative combination of cabbage and pineapple for the product, and this would not have been possible by human intuition.
According to report4 , data is harnessed to introduce new products and services by 31% of consumer products and 38% of retail organizations. Such companies heavily relied on both consumer data and product data to identify patterns in consumer behavior to quickly optimize their operations to launch successful products.
Every business is a data business. 3Executives need to use master the business analytics to identify future opportunities and pitfalls. Managers need to be aware that analytics can power their decision-making and help manage business processes, for example, analytics can help in hotel pricing decisions. Therefore, organizations will require new structures with leaders that are data-savvy to develop and maintain a competitive advantage.
#DigitalTransformation #CDO #BigData #Analytics #ProductDevelopment #AI #Innovation
Image credit: Cover Photo by GR Stocks on Unsplash
1https://www.capgemini.com/research/the-age-of-insight/
2Source: “Dell’s Channel Transformation – Leveraging Operations research to Unleash Potential across the Value Chain,” Franz Edelman Award presentation, INFORMS Business Analytics Conference, San Antonio, 2013.
3Creating Competitive Advantage using Big Data | Ivey Business Journal