Are you prepared to make the most far-reaching decisions in your business?
PwC’s Global Data and Analytics Survey 2014 shows that 66% of banking and capital market executives have changed the way they approached big decisions in their organizations. The reason?
Yes. Data analytics is increasingly changing the way banking and capital market executives approach big decision-making. The fact that it makes decision-making much more accurate, effective and faster is reason enough for this trend. Put together with cost-effectiveness, there is no reason why it shouldn’t influence big decisions.
Is your senior management prepared to take big decisions
According to the survey up to 52% of the most important decisions in the next 12 months among banking and capital market executives, is likely to be aimed at growth of an existing business. 45% is likely to be made with regard to corporate restructuring and another 42% is likely to be made in making a major investment in the business. Entering a new industry, changing an existing business model, collaborating with competitors etc. are other likely goals for big business decisions.
This just shows how important it is for the senior management of an enterprise to be fully prepared to make these decisions. Being fully prepared means being equipped with all the necessary data and analytical tools. Surprisingly, very few executives, that is, only 17%, believe that their management is fully prepared. The rest believe that their management is more or less unprepared. This could only mean that most of the senior decision makers refrain from using data analysis tools. They rely mainly on experience and intuition, either of their own or others.
Why this hesitation?
Now, what keeps managers and capital market executives from using data analysis more often for making big decisions?
42% of the executives found that the accuracy and quality of the data isn’t high enough. They found information overload to be a major problem as there was just too much data. This makes data analysis difficult and time-consuming. They felt the need for a more reliable data collection method to streamline data analysis.
Another 21% felt that their senior management lacks the necessary skills and expertise to use analytical tools. They felt the need to make them aware and convince them of its benefits.
No room for indecisiveness and intuitions
Using advanced analytical tools can make them better prepared for big business decisions. As a matter of fact, it is high time that they were. Almost 22% of executives in the survey estimated the value of their most important decisions in the next 12 months to be US$1 billion or more in future profitability. 38% expect to make such big decisions at least once in a month. That leaves almost no room for being indecisive or relying on intuitions alone.
Big decisions involve changes in the business strategy as such and hence, changes in the long-term course of the business. The bigger the decision, the more there is at stake and the more profoundly, analytical tools can help. There are various enhanced analytics that have come into use in the last 24 months like simulation, optimization and predictive analytics. The executives have also changed the way they presented these analytics to the management. These along with specialized analytical tools are what have brought the change in the approach of managers towards decision-making.
Who is in the dark
There is still a 22% of banking and capital market executives who haven’t made any kind of change yet, but plan to do so in the near future. Another 12% are still in the dark in this context.
Data analysis can essentially be said to be the lifeline of every business. It helps you make the right moves in your business. It helps you accurately analyze the various possibilities available for you to make those moves. Without analytics, you really cannot make any decision in business, let alone the big decisions.
Source : https://www.pwc.com/gx/en/issues/data-and-analytics/big-decisions-survey/industry/banking-capital-markets.jhtml