The Data and AI Habits of Future-Ready Companies
The future is coming. Are you ready for it? According to Accenture, only 7% of organizations today have made the necessary investments in data science and AI to be considered “future-ready,” and they will reap enormous rewards from the work they have put in (even with COVID-19). But the good news is the system integrator sees a rising tide of all boats thanks to data and AI in the future.
In its new report, titled “Fast Track to Future-Ready Performance,” Accenture surveyed 1,100 executives in 11 countries and 13 industries to gauge how their digital transformation journeys correlate with use of emerging technologies, like AI, analytics, cloud, blockchain, and robotic process automation (RPA).
Accenture found that, three years ago, about four in five organizations fell in the bottom half of the spectrum. About one in five organizations were stuck at the “Stable” level, which is marked by a use of foundational tools and technologies, little automation, and siloed data. These organizations focus on using tech to make core process and quality improvements; they are largely incapable of using data to look ahead.
More than 60% sat in the “Efficient” category three years ago, which meant they automated some aspects of their businesses, including augmenting human workers with machines and aggregating data at the organizational level. Some have even adopted Lean Six Sigma approaches. But they mostly lack the agility to move quickly with data.
Today, strategic and transformational uses of technology are growing more common. About one-third of organizations are still in the “Efficient” category, but nearly 60% have moved up to the “Predictive” category, which is marked by wider use of data science, machines helping with the majority of business processes, and widespread use of blended data. Companies here have teams that are more agile, and they’re gaining efficiency advantages at a higher rate.
Meanwhile, about 7% of organizations today have achieved the Holy Grail of Accenture’s rating system and achieved “Future-ready” status, which is marked by widespread use of technologies like AI, cloud, and blockchain. Processes are largely automated, end to end, and organizations coordinate to use data and analytics in a strategic manner, which makes them more resilient. In three years, about one-third of firms will be here, Accenture says, while 60% will be one step down in the Predictive phase. Six percent will be in the Efficient state, but, curiously, no firms will be left in the Stable category.
Moving up the data and AI ladder brings big benefits. According to Accenture, Future-ready organizations enjoy profits that are 2.8X higher, on average, than those in the other three categories. Their efficiency rating is 1.7X higher, too, Accenture found. All told, if all of the organizations in the world were to be operating at a Future-ready level, it would generate $5.4 trillion in additional value around the world.
One of the impacts of the COVID-19 pandemic is that it helped to shine a light on the value of digital transformation, says Manish Sharma, group CEO for Accenture Operations.
“While most businesses were unprepared for the impact of COVID-19, a strong digital foundation helped them mitigate risks and pivot quickly to keep their business running at pace,” Sharma tells Datanami. “What this also says is the remaining 93% are leaving money on the table.”
Having a strategy to embrace data-driven decision making is good. But without the right talent, infrastructure, and processes around it, an organization may not get all the benefits, Sharma says. “The combination of those factors is the defining characteristic of ‘future-ready,’” he says.
Breaking down data silos and embracing cross-organizational data collaboration is a key requirement to moving beyond a straight transactional approach and toward a strategic one, he adds.
“Once organizations make that leap to being future-ready, diverse data is being combined with analytics and AI capabilities in a holistic approach,” Sharma explains. “By using diverse data and elevating data quality, business leaders will be able to combine the best of both in a continuous feedback loop and inform better decision-making.”
Here are other interesting correlations that emerged from Accenture’s investigation into future-ready orgs:
- Future-ready organizations are 10 times more likely as other organizations (52% vs. 5%) to use analytics at scale;
- They are about 8 times more likely to use diverse data sets (45% vs. 6%) to generate insights;
- And 75% of future-ready organizations are expected to use analytics with diverse data by 2023.
Using diverse data is important to moving up the ladder. Accenture also found widespread use of cloud for crunching data among Future-ready organizations. Organizations on the cutting edge will also leverage their ecosystem partners to help get ahead of the game, especially with data and skills, Accenture found.
Aligning your own organization’s data strategy with what Accenture’s Future-ready organization are doing would seem like a good bet. But there are potential pitfalls in trying to match moves line for line. Every company is different, and every company has to craft its own path to the future.
On that topic, Sharma provided this bit of wisdom:
“Digital transformation on such a large scale can seem daunting. By aligning to the overall business strategy, companies should see technology as part of changing how work gets done. That may look like tech-savvy new ways to fulfill orders, enabling the development of new products and services, or using AI to streamline customer operations and improve satisfaction.”
The bottom line, Sharma says, is that “leaders think big and go beyond incremental to harnessing for reinvention.”