inside the mind of generation d: what it means to be data-rich and analytically driven

© 2014 IBM Corporation

October 2014

Inside the mind of Generation D:What it means to be data-rich and analytically driven

© 2014 IBM Corporation2

NOTE: Surveyed 1,089 respondents across 5 industries (i.e., Telco, Finance, T&T, Consumer Packaged Goods and Retail), all major geographies, and 70% large

enterprise /30% medium enterprises; Additionally, 50 in-depth qualitative interviews were conducted. Data is weighted according to by GMV opportunity. © 2014 IBM Corporation


The majority of enterprises recognize that data and analytics are transforming their industry and professions

3 © 2014 IBM Corporation


There are four distinct approaches to data and analytics… and one group of enterprises uses insights, cloud, and engagement very differently

5

Generation D enterprises are:

3x more likely to excel at

developing insights regarding their

customers and marketplace1

Data

an

d a

naly

tics

1 How effective is your enterprise in doing the following today where 1 is 'not effective at all' and 5 is 'extremely effective.‘? 2 Please rate each of the following

statements to the degree that they describe your enterprise where 5 is 'describes your enterprise completely' and 1 is 'does not describe your enterprise at all.'

3 To what extent do you agree or disagree that each of the following statements describes your enterprise where 1 is ‘do not agree at all’ and 5 is ‘agree

completely’? 4 To what extent are you using digital channels in the following ways: ‘already using’, ‘plan on using’, ‘not using’

2x more likely to automate

processes and decisions based on

insights from analytics2

2x more likely to believe cloud is

transforming their business model3Clo

ud

2x more likely to engage customers

via digital channels (mobile and social)4

En

gag

em

en

t

Analy

tic m

atu

rity

Data breadth and sophistication

Traditional

Analytically

ambitious

Data-rich,

analytically enabled

Generation D:Data-rich,

analytically driven

19%

31%

21%

29%


The Generation D approach correlates with better than average performance across a variety of key performance indicators (KPIs)

6 1 For each measure… please indicate approximately how your business performs on that measure

Generation D reports improved performance over peers on KPIs1

+10%

+6%

+17%

+13%

+6%

+13%

points

points

points

points

points

points


More Generation D enterprises are extremely effective at addressing business challenges1

7 1 How effective is your enterprise in doing the following today? Please rate on a scale of 1 to 5, where 1 is 'not effective at all' and 5 is 'extremely effective.

Generation D All others

Generation D

versus all

others

34%

37%

43%

42%

33%

Developing new revenue streams

Penetrating new markets

Improving interactions with customers

Operating efficiently

Managing risk

Responding to security threats

Faster time to market

3.7x

2.5x

2.9x

2.4x

3.0x

9%

13%

18%

14%

14%

46% 18%

2.6x36% 14%

2.5x


Generation D enterprises are more likely to combine advanced data with sophisticated analytics

8

Analytical maturity

1 To what extent are you using each of the following as input to your company's analytic process? ‘already using’, ‘plan on using’, ‘not using’. 2 Please indicate how each of the

following types of analytics is used in your business where 1 is ‘not used at all’ and 5 is ‘deeply embedded into most, if not all processes and strategic decisions’.

Data breadth and sophistication

2.2x more likely to use advanced

data sources such as, unstructured text,

location data, audio, video and mobile

application data1

1.5x more likely to use traditional

data sources such as transactional,

CRM, supplier, log, publicly available

and purchased data1

2.9x more likely to use

predictive analytics, and

4x more likely to use

prescriptive analytics

to inform most processes and strategic decisions within

the enterprise 2


Generation D enterprises use a wider variety of more-sophisticated analytic skills and capabilities

9 1 Please indicate which of the following capabilities and skill sets are being utilized in your business today


Generation D

versus all

others

67%

Engage in video/audio analytics

Use natural language text analytics

Conduct next best action modeling

Use simulations

3.2x

1.8x

3.9x

1.5x

29%

23%

42%

44%

93%

89%

74%


Data and analytics examples

10 50 qualitative interviews were conducted in addition to the 1089 quantitative surveys. The use-cases on 10, 13, and 16 come from those qualitative interviews.

Optimizing high cost

inventory through

gamification and simulation

Pricing insurance policies

faster by combining

traditional and advanced data

Improving the customer

experience with real-time data

• A jewelry retailer sought an

alternative to in-store testing as

a way to minimize carrying costs

and quickly gauge demand for

new products.

• The company runs online

gamifications with their existing

customers to understand product

preferences and price sensitivity.

• Better able to time new market

entries and reduce inventory costs.

A 60% increase in new product

success rate.

• An insurance company needed

to make home inspections

more efficient.

• By gathering aerial property images

from external data sources, they

can calculate the square footage of

a house without a physical home

inspection.

• Home inspections have been

reduced from almost 100% of new

policies to 40%.

• A trucking company wanted to

revamp their communication with

drivers on the road.

• It equips all of the company’s trucks

with a telematics system that logs

GPS, engine use, and

speed/braking data.

• The real-time information allows the

company to provide updated quotes

and delivery status while optimizing

fuel costs and reducing its mobile

units by 60%.


Generation D enterprises view cloud as key to enabling transformation

12

1 To what extent do you agree or disagree that each of the following statements describes your enterprise where 1 is ‘do not agree at all’ and 5 is ‘agree

completely’? 2 To what extent is your business deploying each of the following solutions in a cloud environment? ‘already using’, ‘plan on using’, ‘not using’ 3

Does your enterprise use API-based services offered by other companies?


Generation D

versus all

others

60%

56%

54%

53%

Believe cloud is transforming their business model1

Use cloud for analytics2

Use cloud for data management2

Use API-based services3

1.9x

1.8x

2.5x

1.8x

31%

23%

30%

29%


Cloud examples

13

Competing faster on

the cloud

Building an optimized

schedule by combining data in

the cloud

Using APIs to

speed performance

• A real estate company desired to

collect and distribute property

information between employees

faster.

• Through a cloud database, the

company gives employees the

ability to sort through existing data

and upload their own, such as

photographs of properties and

location information, while in the

field.

• It now has a competitive advantage

during time-sensitive biddings and

can predict imminent vacancies.

• A restaurant chain sought

collaborative opportunities between

its siloed data sources.

• It hosts its previously disparate

databases on the cloud, allowing for

a unified view of all its information,

most importantly the customer

loyalty program and the scheduling

program.

• The company is now able to assign

their best-selling servers to the

busiest shifts, driving a 2% increase

in revenue.

• A bank wanted to give their

institutional clients access to some

of its efficient, in-house capabilities.

• The bank offers API services over

the cloud which provide access to

proprietary platforms and stream

real-time data.

• Institutional clients can now view

real-time information (e.g.,

exchange rates) and perform

actions such as foreign exchange

transactions more easily.


Generation D enterprises are embracing new ways to engage customers, employees and partners

15

1 Which communication type does your business primarily use for customers? ‘personalized’, ‘customized by segment’, ‘non-customized 2 To what extent are

you using digital channels in the following ways? ‘already using’, ‘plan on using’, ‘not using’ 3 Please rate each of the following statements to the degree that

they describe your enterprise where 5 is 'describes your enterprise completely' and 1 is 'does not describe your enterprise at all.‘ 4 To what extent do you

agree or disagree that each of the following statements describes your enterprise where 1 is ‘do not agree at all’ and 5 is ‘agree completely’?


Generation D

versus all

others

59%

70%

Personalize interactions with customers

Engage customers via mobile and social

Use mobile and social to drive business processes

Extensively share data and analytics internally3

Link customers, employees, and partners to better

engage the market4

1.7x

1.8x

2.0x

1.6x

35%

39%

40%

43%

2.1x70% 34%

79%

74%


Engagement examples

16

Reducing churn through

social media and audio

analytics

Harnessing mobile and

analytics to better engage

customers

Using social to evolve

enterprise collaboration

• A telecom company wanted to

better forecast individual customer

defections before they happened.

• The company analyzes social

media comments, call center audio,

contract expiration dates, network

data and other factors responsible

for turnover.

• Customers are assigned a

“propensity to churn” score and are

targeted with offers designed to

increase the likelihood of retention.

• A retail giant needed an improved

mobile app to counter competitive

digital channels.

• The company compiles and

analyzes purchasing histories and

consumer feedback from individual

customers.

• The new mobile app sends

personalized coupons, reminds

buyers of price-matching offers on

relevant goods, and can direct in-

store customers to nearby sites for

out-of-stock items.

• A financial services firm with a

dispersed workforce sought to

increase collaboration beyond

traditional e-mail and phone

communication.

• It has created a web portal that

allows employees to upload, view

and edit projects in real-time.

• The portal cuts down on travel costs

and increases the speed and flow of

information.


Generation D is clearly adopting a more systematic approach to data and analytics, cloud and engagement

18

Have a coordinated cross-functional

or centrally owned strategy for:


Generation D

versus all

others

68%

59%

1.5x

1.4x

1.6x

1.5x

45%

38%

47%

40%

59%

65%


Generation D enterprises infuse data and analytics throughout the business

19


Generation D

versus all

others

Educate employees on the use of data and analytics1

Provide data and analytics in real time2

Extensively share data and analytics internally3

2.7x

1.6x

1.5x

31%

40%

43%

85%

1 Please indicate which of the following capabilities and skill sets are being utilized in your business today. 2 Please indicate how each of the following types of

analytics is used in your business where 1 is ‘not used at all’ and 5 is ‘deeply embedded into most, if not all processes and strategic decisions’. 3 Please rate

each of the following statements to the degree that they describe your enterprise where 5 is 'describes your enterprise completely' and 1 is 'does not describe

your enterprise at all.‘

60%

70%


Is your enterprise part of Generation D? What are they doing differently?

20

Traditional

Analytically

ambitious

Data-rich,

analytically enabled

Generation D:Data-rich,

analytically driven


Infusing the majority of processes and decisions with

analytics

Tackling complex data sources and applying more

predictive and prescriptive analytics

Managing more of their data and analytics on

the cloud

Moving toward mobile and social as their primary

methods of engaging customers

Changing their culture, not just their technology

Generation D is:


To learn more about the study, please visit

21

ibm.com/ibmcai/gen_d


http://www.ibm.com/ibmcai/gen_d

© 2014 IBM Corporation22

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October 2014

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Notes and sources:

Inside the mind of Generation D: What it means to be data-rich and

analytically driven. IBM Center for Applied Insights. October 2014.

http://ibm.com/ibmcai/gen_d.

http://www.ibm.com/ibmcai/gen_d

inside the mind of generation d: what it means to be data-rich and analytically driven

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