How Much ROI Can Data Analytics Deliver?

Submitted on: Tue, 04.25.2017 07:56pm - Annie Eissler |
How Much ROI Can Data Analytics Deliver?

We’re at a point where the hype surrounding data analytics has converted into real, documented returns for companies of all sizes and across all industries. But the truth is, leading companies have been achieving double-digit return on investment (ROI) from their analytics investments for several years now, according to Nucleus Research. A few years ago the research firm set out to learn just how much money firms are putting into their data analytics investments, and what they’re getting in return.
 
Nucleus Research found that analytics and business intelligence solutions deliver, on average, $13.01 for every dollar spent. These findings indicate organizations are indeed continuing to make investments in analytics, particularly to meet the growing demand for more robust and user-friendlier applications that easily tie into other core systems.
 
“Companies don’t have the luxury anymore to wait weeks for reports on the profitability of business decisions in increasingly fast paced markets,” said Nina Sandy, a Nucleus Research analyst, in a company press release. “New analytics solutions are being developed around this need where businesses can make better decisions, faster.”
 
The same rewards are being recorded on the big data front, where the most recent surveys found that on average, of the companies that are using big data, 92% of executives are satisfied with the results and 89% rate big data as “very” or “extremely” important. Similarly, Accenture researchers found that 89% of respondents who have implemented at least one big data project see it as a way to revolutionize business operations, and 85% believed big data would dramatically change the way business is done.
 
When data analytics are applied organization-wide and leveraged to the point where they start producing 13:1 returns, the benefits actually expand way past $13.01 for every dollar spent. According to the most recent Industrial Internet Insights Report from GE and Accenture, 84% of companies believe big data analytics will “shift the competitive landscape for my industry” within a year and 87% believe that will happen within three years. In addition, 89% believe a lack of big data adoption will create a risk of losing market share, and 75% see growth as the key value of analytics.
 
For small to midsized companies that lack the working capital and human resources to implement and manage their own data analytics, tapping into a larger ecosystem can help them achieve and accelerate their related ROI goals. For example, we’ve seen companies achieve 1:1 ROI within just a few months of using MITS’ technology, thus paying for their implementation costs within that short timeframe. And it’s all up from there as companies continue to see more and more ROI from their analytics investments.
 
Want to know the real secret to analytics ROI? You need the technology to enable analytics, but if you don’t understand the technology that enables the analytics—or the business application—then it won’t provide any value. The real value comes when you take the technological component of analytics and apply it to a business component that—once optimized—produces a solid ROI that continues to pay off over time.