How Big Data and AI Are Accelerating Business Transformation
NewVantage Partners, strategic advisors in data-driven business transformation to Fortune 1000 companies and industry leaders, has released the results of its annual Big Data and AI Executive Survey. The theme of the 2019 executive survey is Data and Innovation: Leveraging Big Data and AI to Accelerate Business Transformation.
“For many, fear of disruption has been a motivating factor in fueling investment in Big Data and AI initiatives”
This is NewVantage Partners 7th annual survey of senior corporate c-executives on the topics of Big Data and Artificial Intelligence (AI) business adoption. C-executive decision-makers comprise 97.5% of the survey participants. Nearly 65 Fortune 1000 or industry leading firms are represented in this year’s survey, including American Express, Capital One, Ford Motors, General Motors, Johnson & Johnson, Mastercard, and Met Life. The survey was first conducted in 2012 at the behest of a group of Fortune 1000 business and technology c-executives who sought to understand the potential impact of Big Data, and its implications for their businesses.
According to NewVantage Partners CEO and Founder Randy Bean, “Fortune 1000 companies have come to increasingly recognize that they must become more adept at leveraging their data assets if they are to compete successfully against highly-agile data-driven competitors. As data volumes and data sources proliferate at greater and greater rates, Fortune 1000 companies have accelerated their investment in Big Data and AI initiatives”. Bean continues, “For many, fear of disruption has been a motivating factor in fueling investment in Big Data and AI initiatives”.
Key findings of the 2019 NewVantage Partners Big Data and AI Executive Survey are:
Firms are ramping up investment in Big Data and AI to accelerate business agility
Leading companies (91.6%) are increasing the pace of their Big Data and AI investments — 75.0% citing fear of disruption from data-driven digital competitors; 91.7% saying investment is required to transform into agile and competitive businesses; 87.8% expressing urgency to invest. Investment in Big Data and AI is increasing, with 55% of firms investing greater than $50MM.
Leading companies are struggling with data-driven business transformation
Companies are investing in Big Data and AI, but they are not seeing commensurate results. Though 62.2% report measurable results from their Big Data and AI investments, less than half say they are competing on data and analytics (47.6%), have created a data-driven organization (31.0%), or have forged a data culture (28.3%).
Cultural challenges remain the biggest obstacle to business adoption
Companies report (77.1%) that business adoption of Big Data and AI initiatives remains a major challenge. Executives cite multiple factors (organizational alignment, agility, resistance), with 95.0% stemming from cultural challenges (people and process), and only 5.0% relating to technology.
The Chief Data Officer role is evolving but ill-defined; CDO’s may be ill-equipped
Chief Data Officers are in place at 67.9% of the companies surveyed, but the role remains ill-defined with the consequence that CDO’s may be ill-equipped to address the challenges – 38.2% of firms want an external change agent while 32.4% want a company insider; 48.1% see the CDO as having primary responsibility for data while 28.4% see no single point of accountability; 17.5% of executives view the CDO role as interim or unnecessary.
Most companies are still not data-driven, and won’t be anytime soon
Business adoption of Big Data and AI initiatives must be viewed through a long-term lens – as a process and a journey. Only 31.0% of companies say they are data-driven. This number has declined from 37.1% in 2017 and 32.4% in 2018.
In the Foreword to this year’s survey, Bean and NewVantage Partners Fellow Thomas H. Davenport, author of the landmark study Competing on Analytics, write “Is the glass for data, analytics, and AI in large organizations half empty or half full? While there are still signs of emptiness, over all we see a glass that is half full and filling up slowly. Compared to, say, a decade ago, an impressive number of enterprises are data-driven today”. Yet they warn, “We should not fail to recognize that we live in a highly dynamic time when digital companies have with speed and force disrupted longstanding business models and traditional competitors. For this reason, these survey findings may be considered a call to action. In critical respects, one could argue that the glass remains half full — that progress has been slow, and that many companies still lack commitment to data-driven organizational processes and cultures”.