The 2021 analytics trends reflect the unique nature of the analytics function. Both data and analytics sit at the intersection of business and technology, where new drivers, trends, or developments in either area can cause a shift in how businesses use, manage, and optimize data and analytics.
In 2021, many businesses will seek to advance or maintain market positioning and growth through data and analytics. Data strategy, partner data, the role of data in diversity, equity, and inclusion, and the democratization of analytical knowledge will all drive significant change in the new year, among other emerging analytics trends.
Trend #1: Data Strategy as a Competitive Advantage
Moving into 2021, firms should view their data strategy as a way to gain competitive advantage. Looking ahead for strategic moves and acting on them with speed can help businesses leverage data to push past competitors into a top position. However, those planning to formulate their data strategy need to understand the time investment that executing on that roadmap will take.
Some organizations may struggle to turn the abstract idea of being a data-centered company into measurable goals with actionable steps. However, time spent building that roadmap will pay dividends in the ability to incorporate insights and can help make it more difficult for competitors to catch up. Establishing a steady growth pace and understanding the business units where data strategy can have the highest impact can greatly increase buy-in, adoption, and implementation of new methods.
Additionally, a recent growth in cloud usage means that for businesses, understanding vendor partners and selecting the best options to fit your organizational needs is crucial for successful implementation. 76% of firms use multiple cloud vendors, including public, private, and on-premise options. Using more data requires establishing data governance processes and procedures, keeping firm goals in mind and on a path to achievement. It’s also still important to remember that a great data strategy isn’t managed by “fire and forget” – it requires regular maintenance and tuning just like any good model.
Public cloud services are going to be an essential element of 90% of data and analytics innovation by 2022.
Trend #2: Proliferation of Business Partner Data
How businesses use in-house data in conjunction with third-party data will be one of the key 2021 analytics trends. The exponential growth of available data from a variety of touch points is only creating a greater need for an organizational approach to leveraging and optimizing data from disparate sources to draw out unique insights that drive business improvement.
Examples of third-party data could include supply chain and logistics data, delivery apps data, and point of sale data. Utilizing data on weather, foot traffic, historical demography, or economic trends can add another layer to insights as well. In 2020, this access to shared third-party data has played an important role in combating the COVID-19 pandemic.
The combination of external source data with internal data can lead to unique insights which can then be transformed into levers that drive results for your company. It is important for organizations to work on defining the processes that can be used to bring these data sets in, reviewing them to understand any required cleansing or transformation, creating dictionaries for them, and sharing them with analyst teams.
It can also be beneficial to communicate use cases for this data across teams to best set up success for all functions across an organization with potential to benefit. In some cases, improvements in data access and engineering may be needed to realize the largest benefits; these findings should be added to the discussion around the organization’s overall data and analytics strategy.
In the next year, more large organizations are getting involved in buying and selling data on online marketplaces, rising from 25% to 35% involved.
Download the full 2021 Analytics Trends here.
Contributions by Brandon Regnerus and Courtney Loughran