Big data and analytics have become top agenda items for a growing number of retail executives. Yet many retailers do not yet have mature BDA competencies across five critical dimensions — intent, people, process, technology and data.
This is one of the findings from IDC Retail Insights’ new report, Business Strategy: IDC Maturity Model Benchmark – Big Data and Analytics in Retail in North America, which presents the results of the first IDC Retail Insights big data and analytics (BDA) Maturity Benchmark based on a study of 701 organisations including 100 non-food retailers and 100 food retailers and CPG companies.
The study presents benchmark data on the maturity of BDA capabilities of North American retailers, identifies the key capabilities that characterise retailers whose BDA programs have met or exceeded their expectations, and offers detailed guidance for achieving BDA success.
In particular:
* In the broader societal and economic context of data-driven organisational cultures and emerging BDA-enabled business models, BDA will remain one of retail’s top investment priorities for the foreseeable future. No stranger to massive, time-sensitive data volumes, retail is at the epicentre of emerging BDA opportunities in enterprise data, social media, digital and mobile advertising, mobile metadata, instrumented store operations, and item-level RFID.
* Two classes of retailers are emerging, “BDA haves” and “BDA have nots,” each comprising about 20% of the industry, immediately making BDA a defining basis of retail competitive advantage. With 60% falling in the middle, the structure of the retail industry will swing on the BDA capabilities.
* Retailers should invest in their BDA competencies as there is a positive correlation between BDA maturity and successful outcomes of BDA initiatives. High achievers “skew right” on the maturity curve, while low achievers “skew left.” On average, higher levels of BDA maturity lead to better chances of achieving expected or greater-than-expected benefits.
* Obtaining BDA maturity is a multifaceted endeavour across five core dimensions — intent, people, process, technology, and data. Success depends on the absolute level of maturity in each dimension and on aligning the five dimensions at or near the same level of maturity.
* The top 10 traits that most distinguish high achievers extend beyond data and technology capabilities, areas that can garner inordinate priority, to include all five dimensions: mature BDA process management, executive leadership, line-of-business (LOB) utilisation of BDA insights, collaborative cultures among lines-of-business and analytics groups, and skills in advanced analytics, data and content management, and management of BDA IT hardware.
Today’s hype around big data ignores real challenges retailers face. IT and LOB managers in many retailers — some mistakenly — believe they have what it takes to harness the power of big data for improving data-driven decision making.
However, the plethora of technology choices; the range of analytics, technology, and management skills; and the amount of hype make it difficult for retailers to prioritise resource allocations toward BDA projects and coordinate all the moving parts to successfully implement a cohesive BDA strategy.
Retailers lacking mature BDA capabilities or well-conceived plans for acquiring these capabilities stand to lose ground to competitors with more mature capabilities able to deploy analytics pervasively to optimise operational, tactical, and strategic decisions.
“Many retailers today do not yet have the big data and analytics maturity to address the range of technology, staffing, data, process, and strategic intent requirements needed to capitalise on their data assets.
“IDC developed a BDA maturity framework to assist retailers in assessing their current capabilities and to evaluate gaps in reaching higher levels of BDA maturity,” says Greg Girard, programme director, IDC Retail Insights Worldwide Omni-Channel Retail Analytics.