Customer insight is the key to competitive advantage, and if you’re not an insight-driven business, you’re prey to those who are.
More specifically, according to Forrester, companies that are vigorously applying insight to decisions and customer engagements at every opportunity are—to extend the metaphor—predators at the top of the food chain. They include well-known companies such as Facebook, Amazon, Google and Netflix, but the research firm also touts some established, mature enterprises across many different verticals, including The Washington Post, Alaska Airlines, several retailers and even some European football clubs.
These insight-driven predators are eating your business, and Forrester predicts that by 2020, the combined annual revenue of insights-driven businesses will be US$1.2 trillion annually. Helmed by leaders who have a fundamental and emotional understanding of the value of customer insight, these organizations have built corporate strategies and cultures around leveraging data and analytics.
By 2020, the combined annual revenue of insights-driven businesses will be $1.2 trillion annually.
In The Insights-Driven Business Report, Forrester found that insight-driven businesses are built and operate differently, so if you want to be the predator rather than prey, there are several things you must do.
Elevate insight to the C-suite
Insight-driven businesses understand data and analytics are critical for competitive advantage and accelerating their business, so insight programs are discussed at the executive level and seen as strategic initiatives.
Because the role of insight is elevated in the organization, there is a clear mandate for data, analytics and customer insight. Forrester found organizations that have this executive buy-in allocate the necessary investment and resources for data and analytics quickly, rather than getting bogged down by slow procurement cycles and dwelling on business cases before investing in big data.
Small teams deliver cumulative insights
An insight-driven business requires an enterprise-wide mindset with C-suite buy-in, but at the same time, Forrester said these companies iterate around the insight loop much faster than their competition using small, agile insights teams and next-generation customer intelligence platforms. Ultimately, this has a cumulative effect of building up a “huge corpus” of data over time. It’s not about obsessing over more data, the research firm said. Rather, they add relevant data to systems of insight as they learn and optimize and build a large body of data over time accelerate competitive advantage.
These closed-loop processes continually learn. Insight-driven business use them to constantly measure decisions, actions and outcomes, and new insights are used to optimize future decisions, actions, and outcomes.
Insight is people-powered and integrated
Technology supports gathering the relevant data in the insights-driven business, but it’s not the silver bullet. Forrester said it’s critical to balance machine and human expertise. Not only is customer data valuable, but so is the insight residing in employees. People still play a vital role in the decision-making process. The machine is there to effectively scale the expertise of people in the organization by capturing human knowledge and feeding it back into algorithms. This loop continues and makes people smarter.
Even though cumulative insights are delivered by closed loops and small, agile teams, these islands must be connected. Various stakeholders including the CMO, CIO, COO and commerce teams all have their own insight needs, but a successful insight-driven organization is cross-functional in that it weaves insights together with an overarching corporate strategy.
Becoming an insight-driven business is not difficult, according to the Forrester report, but it is necessary. It improves digital interactions with customers through more frequent contact that increases knowledge about their preferences. An enterprise that can integrate insights at scale is better able to adapt to change, innovate and capitalize on new business opportunities more quickly than their competitors.
If you haven’t begun your transformation into an insight-driven business, those who have are already eating away your bottom line.
To explore the playbook of insight-driven businesses, watch How insight-driven businesses capitalize on customer intelligence, our webinar featuring Forrester.