Research Library Article


Analytics: The New Path to Value

David Earle

How the smartest organizations are embedding analytics to transform insights into action.

The study finds that companies fall into three groups based on their analytics capability—aspirational, experienced and transformed—each distinct from the others. No stage is without meaningful business advantages, but those advantages increase as experience and investment increases. For example, Stage Three organizations (transformed) are three times more likely than Stage One organizations (aspirational) to say that they substantially outperform their competitors.


Other findings:

  • The most frequent barriers to analytics initiatives are related to culture and management attitudes. The leading obstacles are lack of understanding, followed by lack of management bandwidth and lack of skills.
  • Executives are not data analysts. They need reports that transform numbers into information and insights they can readily use.
  • The study identifies 5 principles, constituting a “path to value,” that raise the chances of a making a new analytics program successful.

Linking specific human capital programs and activities to concrete business results is the central HR issue of our time. The ability to do this elevates the HR function from a mid-level administrative role to a board-level strategic one. Extended, large scale gathering and analysis of data are essential to that task.

Potent “big data” initiatives cannot be strictly departmental exercises. They must be whole company endeavors. Very large organizations may have sufficient resources within individual departments to make large scale data management meaningful, but in most organizations those projects will have to compete for corporate funding and therefore need support from executives outside of HR.

Company wide understanding and approval of HR’s data related projects is also critical because the primary economic value of that work lies not within the HR department itself, but in productivity, efficiency, and other benefits to those external departments (think sales, operations, customer service, product development, and R&D) that generate growth, profitability and other kinds of business value.  


  • Overall business challenges
  • Performance and analytics
  • Aspirational vs. experienced vs. transformed organizations
  • Data is not the biggest obstacle
  • What leaders can do
  • Biggest and highest value opportunities
  • How to operationalize insights
  • Start with questions, not data
  • Speeding insights into operations
  • Driving actions and delivering value
  • New techniques and approaches
  • Adding new capabilities
  • Creating an information agenda

“At organizations in every industry, in every part of the world, senior leaders wonder whether they are getting full value from the massive amounts of information they already have within their organizations. New technologies are collecting more data than ever before, yet many organizations are still looking for better ways to obtain value from their data and compete in the marketplace. Their questions about how to best achieve value persist.”

IBM_ MIT Report Info