According to Innosight research, the average company tenure on the S&P 500 Index in 1977 was 37 years. By 2027, it’s forecast to be just 12. At the current churn rate, about half of the companies now on the S&P 500 will be replaced over the next ten years.
Innosight says that “a complex combination of technology shifts and economic shocks” are accelerating this turnover, but more often, companies are simply missing opportunities to adapt or change. For enterprise organizations wanting to be disruptors rather than the disrupted, data and analytics is becoming a key investment. In the 2018 Global State of Enterprise Analytics Report, 90% of respondents note that analytics is key to their organization’s digital transformation initiatives—with 64% saying that they plan to invest more in analytics in the coming year, and 71% planning to invest more over the next five years. (click to tweet)
But Innosight notes that traditional methods for leveraging data and analytics may not be enough to ensure success, or even survival, in an era of digital darwinism. Whereas many businesses are using past and present data to try and predict the future, Innosight says that organizations might do better with a “future-back strategy” that begins with the assumption that tomorrow may not resemble today and therefore looks at powerful trends that hold transformational power.
As data-driven organizations look to achieve that future-forward vision, for now, most are building the foundations to get there. In the 2018 Global State of Enterprise Analytics Report, respondents report that cloud computing, big data, and artificial intelligence are the trends that have the biggest impact on their organization. In terms of cloud computing, 41% are considering moving their analytics to the cloud within the best year (with 39% already there).
AI and automation are also top-of-mind trends, as the World Economic Foundation reports that machines are going to begin sharing more and more of the workload. The WEF’s 2018 Future of Jobs Report notes that today, an average of 71% of total task hours are performed by humans, compared to 29% by machines. By 2022, however, this average is expected to shift to 58% of task hours performed by humans and 42% by machines.
As organizations face the future and assess the additional costs associated with accelerated innovation and transformation, the price of waiting and inaction should also weigh heavily on decision makers’ minds.
To read more about investment priorities and timelines for data-driven organizations, download the 2018 Global State of Enterprise Analytics Report. To learn more about how data and analytics can accelerate growth, change, and new business model creation, get MicroStrategy’s 18-page Q&A eBook featuring key insights and advice from analyst, Global 2000 adviser, and Disrupting Digital Business author Ray Wang: The Role of Data in Digital Transformation.