A comprehensive new study from data-driven business transformation advisors NewVantage Partners reveals that more than 9 in 10 leading companies (91.6 percent) are increasing the pace of their Big Data and AI investments, with 55 percent of firms investing more than $50 million. A full three quarters (75 percent) cite fear of disruption from data-driven digital competitors, and 87.8 percent are expressing an urgency to invest.
But according to the newly released Big Data and AI Executive Survey, companies are struggling with data-driven business transformation—many are investing in Big Data and AI, but they are not seeing commensurate results. Though 62.2 percent report measurable results from their Big Data and AI investments, less than half say they are competing on data and analytics (47.6 percent), have created a data-driven organization (31.0 percent), or have forged a data culture (28.3 percent).
The theme of the 2019 executive survey is Data and Innovation: Leveraging Big Data and AI to Accelerate Business Transformation. The study was first conducted in 2012 at the behest of a group of Fortune 1000 business and technology execs who sought to understand the potential impact of Big Data and its implications for their businesses.
“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,” said NewVantage Partners CEO and founder Randy Bean, in a news release. “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. For many, fear of disruption has been a motivating factor in fueling investment in Big Data and AI initiatives.”
Additional findings include:
Cultural challenges remain the biggest obstacle to business adoption
Companies report (77.1 percent) that business adoption of Big Data and AI initiatives remains a major challenge. Executives cite multiple factors (organizational alignment, agility, resistance), with 95.0 percent stemming from cultural challenges (people and process), and only 5.0 percent relating to technology.
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 percent of companies say they are data-driven. This number has declined from 37.1 percent in 2017 and 32.4 percent in 2018.
The Chief Data Officer role is evolving but ill-defined—CDOs may be ill-equipped
Chief Data Officers are in place at 67.9 percent of the companies surveyed, but the role remains ill-defined with the consequence that CDOs may be ill-equipped to address the challenges.
The survey found 38.2 percent of firms want an external change agent while 32.4 percent want a company insider; 48.1 percent see the CDO as having primary responsibility for data while 28.4 percent see no single point of accountability; 17.5 percent of executives view the CDO role as interim or unnecessary.
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.”
This is NewVantage Partners 7th annual survey of senior corporate c-executives on the topics of Big Data and AI business adoption. C-level executive decision makers comprise 97.5 percent 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.