Businesses are planning on investing more and more in predictive analytics in the next few years, using their data as a crystal ball for the future, according to a new survey measuring U.S. and U.K. business-makers’ attitudes towards data analytics.
In a new survey from SAP AG and Loudhouse Consultancy, which polled 309 respondents, about 69 per cent of U.K. businesses and 78 per cent in the U.S. said they believed they’d be investing in predictive analytics in the next five years. About 61 per cent of all respondents said they were actually investing in it already, and that it was a priority within their organizations.
And for those who are currently harnessing predictive analytics, 85 per cent said their organizations saw benefits from using it. Sixty-one percent of the respondents surveyed said they feel predictive analytics help their organizations deliver a stronger performance, 50 per cent said it gives them more information about the dynamics of their business, and 49 per cent said it helped them make more use of the data they already have.
More specifically on the business side, about 69 per cent of respondents said predictive analytics allow them to take advantage of opportunities as they crop up, with 31 per cent saying they’re using it to cut down on their risk factors.
While the study didn’t provide any Canadian numbers, businesses increasingly seem to feel predictive analytics are a handy business tool, says James Fisher, SAP’s vice-president of marketing for analytics solutions. For Fisher, what all this means is that predictive analytics are gaining ground, even among businesses that weren’t looking at big data before. Many of the respondents in the study were involved in retail and financial services, he adds.
“If you look at the evolution of analytics, then historically, analytics really started around the business intelligence space and business intelligence platforms. Really, at the time, there was an awful lot of historical, backward looking information centred in fairly structured reports,” he says.
“And the predictive analytics space is kind of the extension, the next level of that … to get the type of data and insight into what will happen next, either in a more macro sense in terms of what will happen in the market as a whole, or right down to what might happen next in terms of an individual consumer’s buying behaviour.”
However, there are still some roadblocks to jumping into predictive analytics. The survey found about 47 per cent of U.K. respondents are under the strain of too few resources or too little time to tackle all their data. Thirty-seven per cent of U.S. respondents said the same thing. Other concerns were around having too much data to work with, not enough useful data, or a mass of unstructured content.
What it comes down to is helping average users drill down into the numbers, Fisher says. He adds that SAP is giving technically-savvy users a way to understand their data and make decisions based on it, rather than relying on data scientists to do it for them.
“There’s a real sense that organizations are really struggling with some of the traditional ways predictive analytics have been deployed – a kind of very highly manual type of process, very time-consuming, handcrafted, repetitive methods to build models, which require this very rich data design skills,” he says.
“And while we’re not advocating for one second that these data scientists are not important, we extend the value of predictive analytics to a much broader audience, and to organizations that perhaps don’t have that level of skill. And that’s where we think the technology needs to evolve in terms of the automation of a lot of this creation of predictive models.”
SAP has a number of solutions for enterprise organizations who want to make use of their data, but this doesn’t exclude SMBs, Fisher adds. The company has created a tool called Lumira, which includes a free version for individuals to cook up data visualizations without any real training required. Basically anyone can go download the tool and casually use it to try to answer a question, as long as they have the data, he says.
And with SAP’s recent acquisition of KXEN Inc., a U.S.-based building predictive analytics technology company, SAP will continue to build out more solutions in this space, Fisher says.