going beyond the data 2014

Going beyond the data KPMG Capital www.kpmg.com/kpmgcapital

KPMG International D&A Survey January 2014

© 2014 KPMG International Cooperative ("KPMG International"), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

KPMG Capital Limited and KPMG Capital Holding Limited comprise an investment fund for KPMG member firms. The investment fund is not open to third-party investment and will not, itself, provide professional services to clients. KPMG Capital Limited and KPMG Capital Holding Limited are legally distinct and separate from KPMG International Cooperative and each KPMG member firm.

About the survey

Long before the term ‘big’ was first applied to data, organizations were struggling to make sense of all the information they had. Over the past 5 years, that focus on data has started to shift.

Today, the issue is no longer about owning the most data but rather about how to gain the most insight from it. In short, how to turn data into insights, and insights into real business advantage.

To gain a more concrete understanding of the opportunities and challenges that data and analytics (D&A) presents, KPMG International commissioned FT Remark to survey 144 CFOs and CIOs from major corporations around the world (those with more than US$1 billion in annual turnover).

All interviews were conducted in August 2013, with the responses aggregated and analyzed for use in this report.



Key findings

Businesses are aware of the value that lies within their data

The majority of our respondents view data and analytics as important to their growth strategy, with more than half (56 percent) saying that they have changed their business strategy to meet the challenges of D&A.

But they may not fully comprehend its true potential

A staggering 96 percent of respondents agree to varying extents that they could be better utilizing D&A.

Integrating data and analytics into existing systems is a challenge

Integrating data technology into existing systems and/or business models is one of the biggest challenges their companies have faced regarding data capture.

And investing in the right solution is not as easy as it may seem

The vast majority of interviewees (85 percent) said that one of their biggest challenges is implementing the right solutions to accurately analyze and interpret the data.



D&A - a boardroom issue

Q. 1: How important is the use of data and analytics to your company’s current growth strategy?

26%

29%

21%

28%

43%

31%

51%

48%

17%

15%

21%

16%

13%

25%

5%

8%

1%

3%

0% 20% 40% 60% 80% 100%

Overall

EMEA

Asia-Pacific

Americas

Crucially important

Very important

Important

Somewhat important

Not at all important

Note: Regional results are provided for illustrative purposes only. Overall results include data from respondents outside of these regions.



D&A has been on the agenda for a while

Q. 2: For how many years would you say your company has been utilizing data and analytics?

35%

31%

33%

36%

41%

38%

46%

42%

19%

25%

18%

18%

1%

2%

2%

3%

4%

3%

2%

0% 20% 40% 60% 80% 100%

Overall

EMEA

Asia-Pacific

Americas

>5 years

2-5 years

1-2 years

<1 year

My company does not utilize data and analytics




Q. 3: Given the rapid pace at which technology and analytics develops, how difficult is it for your company to make decisions around analyzing data?

But most companies experience difficulties analyzing data

Not at all difficult Very difficult Difficult Somewhat difficult

26%

12% 60%

2%

27%

26%

45%

2%

21%

16% 63%

Americas Asia-Pacific EMEA




Q. 4: What are the biggest challenges your company has faced regarding data capture specifically?

Knowing what data to collect – and how to integrate it – is a headache for executives

Biggest challenges

42% Integrating data technology into existing systems/business models

36% Capacity to capture all data from all areas of the business

26% Identifying what data to collect



Achieving insights - and knowing what to do with them - is a challenge Q. 5: What are the biggest challenges your company has faced regarding data analytics

specifically?

Implementing the right solutions to accurately analyze and interpret

the data

Identifying the right risk indicators/risk parameters

Reacting in a timely fashion to insights as they arise

1 Rank 2

Rank 3

Rank



Many businesses are changing their strategy to rise to the challenge of D&A

Q. 6A: Has your business strategy changed to exploit the opportunities and meet the challenges posed by big data over the past 12-24 months?

No Yes

38%

63%

42%

58%

44%

56% 50% 50% Americas Asia-Pacific EMEA Overall




Respondents are focusing on increasing the capacity to analyze – and action on the results Q. 6B: If yes, in what capacity has your business strategy changed?


Increase the capacity (either

hardware or personnel) to

analyze big data

Attaining management buy-

in for big data collection and

analysis

Honing the parameters for data collection

Putting insights garnered from big data into practice in a timely way

Americas

Asia-Pacific

EMEA

Overall



Q. 7A: Over the past 5 years, approximately how much additional revenue and/or cost savings do you estimate your company has achieved as a result of insights gained from data and analytics and/or IT?

Businesses see cost savings and revenue growth through improved D&A technology

10%

35%

11%

25%

9%

6% 4% 13%

19%

12%

13%

14%

15%

13%

Additional Revenue Cost Savings

None

1-10m

11-25m

26-100m

101-250m

251-500m

>500m

Past five years

All figures in US$



Q. 7B: Over the past year, approximately how much additional revenue and/or cost savings do you estimate your company has achieved as a result of insights gained from data and analytics and/or IT?


0.10%

0.35%

0.09%

0.18%

0.21%

0.03% 0.03%

0.06%

0.50%

0.10%

0.27%

0.03% 0.01% 0.03%


None

1-10m

11-25m

26-100m

101-250m

251-500m

>500m

Past year

All figures in US$



Q. 7C: Over the next year, approximately how much additional revenue and/or cost savings do you estimate your company has achieved as a result of insights gained from data and analytics and/or IT?


5%

20%

24%

16%

15%

17%

5% 3%

44%

13%

21%

15%

5%

None

1-10m

11-25m

26-100m

101-250m

251-500m

>500m


Next year

All figures in US$



Q. 8: What percentage of sales do you plan to spend on data and analytics and/or IT in the next two years?

Significant future investment in D&A and/or IT

14%

14%

30%

27%

14%

1%

0 % 5 % 10 % 15 % 20 % 25 % 30 %

0%

1-5%

6-10%

11-20%

21-40%

Over 40%

Perc

enta

ge o

f sal

es




a

Businesses are already seeing the value from their D&A strategy Q. 9: What has your business gained from data and analytics?

(Highlights of comments from respondents below)

• A more stream-lined, efficient business model • Deeper insights in the trends that are hitting the market • Savings in costs and revenues, less time • Efficiency • Streamlined operations • It has helped us to gain profit margin

• Forecast demand accurately, helping to predict the new trends and changing requirements by the customers

• To outperform competition • Keeping our business on track with customer demand,

keeping a tab on the competitors and thus contributing significantly towards R&D and enhancing growth in key areas

• Find insights that drive smarter decisions



Clients want insights

Q. 10: What do you feel are the key benefits of using data and analytics?

Identifying insights that would otherwise have been missed

62% 69% 71% 65%

Analyzing with greater speed 73% 87% 82% 79%

More sophisticated/ granular insights 38% 77% 76% 59%

Cost savings due to improved efficiency 62% 51% 63% 58%


EMEA Americas Asia-Pacific Overall



Businesses are looking to innovation – but realize they also need to improve existing operations Q. 11: What has your business’s use of data and analytics focused on?

37%

32%

30%

2%

A combination of the above

Innovations (e.g. identifying new business opportunities or customer retention

Operational improvements (e.g. process or performance efficiencies)

Other/None



Q. 12: From your perspective, how much more benefit do you feel your organization could reap from better utilizing D&A?

Almost all executives believe they could be doing it better

56%

42%

79%

47%

40%

49%

18%

51%

4%

9%

3%

2%

0 % 20 % 40 % 60 % 80 % 100 %

Overall

EMEA

Asia-Pacific

Americas

We could benefit more from better utilizing data and analytics

We could benefit somewhat from better utilizing data and analytics

We could not benefit any more from better utilizing data and analytics




But they feel they have integrated D&A their business quite successfully already Q. 13: How effectively do you feel you have integrated data and analytics into the following

areas of your business? (Rated on a scale of 1 to 6, where 6 is very effective)

4.18

4.33

4.47

4.49

4.65

4.65

4.65

4.72

1 2 3 4 5 6

Operations

Customer service

Research & development

IT

Sales & marketing

Finance

Regulatory, compliance, and/or legal

Human resources

Least effective Very effective



There are some major barriers to overcome

Q. 14: What do you perceive to be the biggest barriers to implementing a data and analytics strategy across the business?

Identifying what data to collect

Capacity to capture and analyze all data from all areas of the business

Implementing the right solution to accurately analyze and

interpret the data

1 Rank

2 Rank 3

Rank



Many companies are already integrating D&A into their business Q. 15: Have you taken any of the following steps to help integrate data and analytics into your

business? Chart shows 'yes' responses only.




Q. 16A: Have customer analytics helped to increase sales?

Customer analytics is driving sales

19%

16%

32%

14%

45%

40%

32%

56%

28%

36%

30%

20%

8%

9%

5%

10%

0 % 10 % 20 % 30 % 40 % 50 % 60 % 70 % 80 % 90 % 100 %

Overall

EMEA

Asia-Pacific

Americas

Greatly increase

Increase

Somewhat increase

No increase




Q. 16B: Have customer analytics helped to increase your understanding of your customers?

Largely because it is helping them target their customers more effectively

38%

41%

38%

38%

39%

30%

43%

40%

16%

22%

11%

14%

7%

7%

8%

8%

0 % 10 % 20 % 30 % 40 % 50 % 60 % 70 % 80 % 90 % 100 %

Overall

EMEA

Asia-Pacific

Americas

Greatly increase

Increase

Somewhat increase

No increase




D&A is also improving the back office

Q. 17: In what areas has your business used data and analytics to improve internal operations?



Q. 18: How greatly have predictive analytics helped to improve risk management across the following areas? (Please rate on a scale of 6 to 1, where 6 is the most effective)

And predictive analytics are proving to be effective at addressing risk issues

4.33

4.32

4.35

4.36

4.46

4.45

4.51

4.52

4.38

4.39

4.39

4.42

4.27

4.28

4.28

4.42

4.59

4.59

4.61

4.68

Overall

EMEA

Asia-Pacific

Americas

Strategic risk Operational risk Financial risk Compliance risk Overall risk


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KPMG Capital Limited and KPMG Capital Holding Limited comprise an investment fund for KPMG member firms. The investment fund is not open to third-party investment and will not, itself, provide professional services to clients. KPMG Capital Limited and KPMG Capital Holding Limited are legally distinct and separate from KPMG International Cooperative and each KPMG member firm. Like every member firm in the KPMG global network, KPMG Capital, and the entities it invests in, is subject to the same rules and regulations promulgated by the regulatory bodies responsible for establishing standards for auditor Independence (for example ,the US SEC, PCAOB, AICPA, IESBA and those established by the various countries in which the investments reside). These rules apply to member firms, the individuals at such member firms and the targets for potential joint venture, alliance or acquisition related to the activities of KPMG Capital. All existing Independence protocols apply to KPMG Capital. © 2014 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. The KPMG name, logo and “cutting through complexity” are registered trademarks or trademarks of KPMG International.

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