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Advanced analytics becoming a must in SA


Johannesburg, 02 Sep 2015

Forward-thinking South African organisations are quickly moving to benefit from advanced analytics, but the journey to optimal analytics use is far from over, says SAS Institute.

Craig Stephens, Principle Solution manager - Information Management Practice at SAS Institute South Africa, says in the past few years, awareness around advanced analytics has heightened, thanks to the growing media focus on big data analytics, and lower barriers to entry to advanced analytics technologies.

Globally, advanced analytics is seeing significant uptake. Gartner reports that advanced analytics is a top priority, with 68% of survey respondents using big data to enhance their customer experience. MarketsandMarkets forecasts the worldwide advanced analytics market will grow from $7.04 billion in 2014 to $29.53 billion in 2019. South Africa is starting to follow global trends.

"In South Africa, we are actively engaging in a lot more opportunities, where organisations are discussing how they will use analytics to make better business decisions, increase revenue or even save money by optimising processes," he says.

The increased local interest in advanced analytics covers a broad range of verticals, both in the private and public sector, he says. The drivers for adoption of advanced analytics differ by vertical. In the financial services sector, regulatory compliance might drive uptake, while in retail the focus is more on customer retention and marketing. Public sector entities are looking to advanced analytics for customer segmentation or to understand factors influencing education failure rates.

Across all verticals, driving revenue growth, controlling costs and making informed business decisions faster are high on the agenda. "Businesses today operate in a highly competitive environment, and generally on very low margins. They can't afford to delay and they can't afford inefficient processes. This is where advanced analytics comes in."

However, while awareness has heightened, even SA's advanced analytics pioneers are not yet realising the full potential of advanced analytics, says Stephens. "Some are using advanced analytics end-to-end, but usually, we see it focused in only one or two priority areas of the organisation." Those who lag in adoption typically don't fully understand the distinction between analytics and advanced analytics, says Stephens. "One challenge we face is helping organisations understand that there are multiple degrees of analytical techniques, and simple decision trees or historical reporting are not advanced analytics. It's one thing to understand past behaviour, but quite another to be able to predict trends and forecast what will happen as a result of those trends."

Stephens believes more active engagement by consulting firms and the introduction of a large-scale innovation lab could help local organisations understand the potential business benefits and returns on advanced analytics. "To optimise advanced analytics, organisations need to understand what it can achieve. SAS is looking into bringing the innovation lab concept to South Africa, to allow local enterprises to test analytics models and determine their potential value to the business.

"We want to enable customers to make better business decisions and become more profitable. The only way to do that is to operationalise advanced analytics within their core business processes. Every company has a different core focus at some point, be it compliance, optimising marketing spend or improving risk management. In all aspects of business, there is room to improve on the use of analytics. Many think they are using advanced analytics, but they may just be scratching the surface of what is possible," he says.

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Tracy Burrows
ITWeb