Senior executives are no longer trusting their business instinct and are instead looking at their Big Data to make major decisions, according to research from the Economist Intelligence Unit (EIU).
The research, based on a survey of more than 600 C-level executives and senior management and IT leaders worldwide, indicates the use of Big Data has improved businesses' performance, on average, by 26 percent and that the impact will grow to 41 percent over the next three years.
Two-thirds of executives consider their organisations are "data-driven", reporting that data collection and analysis underpins their firm’s business strategy and day-to-day decision-making.
Leaders who base their judgement on a combination of experience and instinct are becoming increasingly rare. Over half (54 percent) say that management decisions based purely on intuition or experience are increasingly regarded as "suspect", and 65 percent assert that more and more management decisions are based on “hard analytic information”.
That figure rises to 73 percent for the financial services sector, 75 percent for healthcare, pharmaceuticals and biotechnology and 76 percent for energy and natural resources companies.
The report, “The Deciding Factor: Big Data & Decision Making”, commissioned by IT outsourcer Capgemini, reveals that nine out of 10 business leaders believe data is now "the fourth factor of production", as fundamental to business as land, labour and capital.
The majority of companies (58 percent) said they would make a bigger investment in Big Data over the next three years.
The majority of executives (58 percent) rely on unstructured data analysis including text, voice messages, images and video content while over 40 percent say that social media data in particular has become increasingly important for decision-making.
Although 42 percent of executives say that data analysis has slowed down decision-making, the vast majority (85 percent) believe that the growing volume of data isn’t the main challenge, but rather being able to analyse and act on it in real time.
As organisations increasingly look to the output from analytics to automate decision making, data quality is seen as a major hurdle to this with two-thirds (67 percent) claiming they struggle with data inaccuracy on a daily basis.
“The exploitation of Big Data fuels a step change in the quality of business decision-making,” said Paul Nannetti, global sales and portfolio director at Capgemini.
"Genuinely data-driven companies are able to monitor customer behaviours and market conditions with greater certainty, and react with speed and effectiveness to differentiate from the competition.”
In other Big Data research, the UK government was recently told that it should simplify the forms it asks citizens to fill in to enable the public sector to more easily manage and take advantage of Big Data warehouses.
A poll of 2,200 UK adults conducted by YouGov found the public sector was in a "prime position to collect a central repository of reliable and valuable ‘big data’”.