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Using advanced
analytics to make
Big Decisions

PwC‘s Global Data and

Analytics Survey 2016:
Big Decisions™
India insights
Towards a data-driven future

Over the last few years, digital acceleration, Our most recent Global Data and Analytics Survey
coupled with global shifts in economic power, has (2016)1 involved the participation of more than
DOWHUHGWKHSOD\LQJğHOGIRUFRPSDQLHVDURXQGWKH 2,100 global executives (globally) and more than 100
world. Advanced analytics and machine learning— Indian executives, ranging from C-suite leaders and
technologies that once seemed like beacons from departmental heads to managers and analysts.
a distant future—are increasingly available and The survey aimed to understand the extent to which
accessible to businesses. executives and managers view their organisations as
The ability to make intelligent decisions that drive data-driven, how mature their current usage of analytics
growth, disrupt the market and capitalise on emerging is, and the key challenges they face in employing data
opportunities is now linked less to gut feeling and to drive the next big decision, including the need for
PRUHWRSUHGLFWLYHDQGSUHVFULSWLYHDQDO\WLFVDUWLğFLDO improvement in the speed and sophistication of the
intelligence and data-driven insights. Gaining a decision-making process itself.
competitive advantage is no longer about accepting the The results suggest that Indian organisations are more
status quo or relying on age-old traditions. It’s about FRQğGHQWDERXWWKHIXWXUHDVRIWKHUHVSRQGHQWV
mustering the courage and commitment to harness felt that the changes would be gradual, as opposed to the
both mind and machine. JOREDOğJXUHVRI

Drivers of big decisions

Creative Incremental Intermediating Radical

(stable core activities but new core (status quo preserved; (core activities threatened; (game changing;
assets; playing fields evolving) incremental progress) relationship fragile) everything up in the air)

56% India 27% India 6% India 11% India

43% Global 23% Global 23% Global 14% Global
Source: PwC analysis

1 PwC. (2016). Global Data and Analytics Survey 2016. Retrieved from http://www.pwc.com/us/en/advisory-services/data-
possibilities/big-decision-survey.html

Using advanced analytics to make Big Decisions 3

The recurring themes that emerged from the global services and entering previously untapped markets. Their
survey results were general anticipation of industry motivation is to bring out more innovative products,
changes within the next 5 years—predominantly the improve customer acquisition, increase market share and
RSHQLQJXSRIQHZSOD\LQJğHOGVIRUFRPSDQLHVWR ğQDOO\FUHDWHVKDUHKROGHUYDOXH
venture into while maintaining their core activities. We have explored the Big Decision Survey results
)XUWKHURIWKH,QGLDQH[HFXWLYHVFRQVLGHUHGWKHLU and technology advancements across the following
next big decisions to be developing new products and six themes.

Speed and Data-driven Type of Mix of mind Driving functions for The road
sophistication decision making analytics and machine analytics adoption ahead

Some of key the highlights of the survey are as follows. +RZHYHUWKH\DQWLFLSDWHGRQDQDYHUDJHDŋ

1HDUO\RIWKH,QGLDQUHVSRQGHQWVZHUHIRXQGWR improvement in the sophistication and speed of decision
EHOLHYHWKDWWKHLURUJDQLVDWLRQVZHUHKLJKO\  RU making to be necessary in order to draw insights and
DWOHDVWVRPHZKDW  GDWDGULYHQDQGLQGLFDWHG drive decisions from data within the next 5 years.
that descriptive and predictive analytics were currently Moreover, they realised the need to cover the gap
employed in their organisations to drive decisions. between the current and future levels.

Usage of advanced analytics such as predictive and

prescriptive analytics in organisations to support
A data-driven culture decisions was associated with greater certainty and
and forward-looking optimism among company leaders regarding their
QH[WELJGHFLVLRQDQGLWVOLNHO\LPSDFW1HDUO\RI
analytics generate certainty WKHUHVSRQGHQWVZKRVDZOHDGHUVKLSFRQğGHQFHDVD
and optimism about taking likely challenge to decision making—as opposed to
big decisions. other factors such as policy regulations and budgetary
FRQVWUDLQWVŌDOVRSHUFHLYHGWKHLUğUPVWREHSXUHO\
dependent on descriptive and diagnostic analytics.

Analytics usage vs leadership courage

as a limitation on decisions

100%
80%
60%
40%
20%
0%
Leadership courage Other limitations
Descriptive and diagnostic Predictive and prescriptive
Source: PwC analysis

4 PwC
)XUWKHU,QGLDQH[HFXWLYHVZKRVWDWHGWKDWWKHLUğUPV those using basic analytics. This group also indicated
used predictive and prescriptive analytics were more a higher potential for shareholder value creation from
strongly optimistic about their next big decision than their decisions.

Analytics usage vs optimism Analytics usage vs expected gain

about decision in shareholder value

100% 100%

50% 50%

0% 0%
Strongly Positive Neutral 5-50% increase in 100-200% increase in
positive value value
Descriptive and diagnostic Predictive and prescriptive Descriptive and diagnostic Predictive and prescriptive
Source: PwC analysis Source: PwC analysis

Using advanced analytics to make Big Decisions 5

 Cost reduction and market Companies that rank high on usage of
predictive and prescriptive analytics envisioned
share gains are the big FRVWUHGXFWLRQ RIWKHUHVSRQGHQWV 
GPDVT
BSFBT
GPS
*OEJBO
æSNT
DQGLQFUHDVHLQPDUNHWVKDUH RIWKH
respondents) as the likely positive outcomes
while leveraging advanced from the next big decision.
analytics solutions.

Advanced analytics share of usage vs impact of big decision

100%
80%
60%
40%
20%
0%
Reduced cost Increased More innovative Increased Improved Reduced risk Increased
market share products or customer business or regulatory customer
services acquisition processes exposure retention

Predictive and prescriptive as % of analytics used

Source: PwC analysis

C-level executives are more &OHYHOH[HFXWLYHVFRQVLGHUHGWKHLUğUPVWREHKLJKO\

data-driven and users of predictive or prescriptive
DPOæEFOU
PG
UIFJS
æSNnT
DQDO\WLFV  $PRQJWKHQH[WWLHURIPDQDJHPHQWŌ
data and analytics maturity namely business unit and department heads—the
SHUFHQWDJHIDOOVWRVXJJHVWLQJDJDSLQWKHH[WHQWWR
as compared to mid-level which analytics is actually being leveraged for decision
executives. making across different levels.

Advanced analytics share of usage vs respondent role

100%
80%
60%
40%
20%
0%
C-level executive Heads of business Manager
units and departments
Predictive and prescriptive as % of analytics used
Source: PwC analysis

6 PwC
 /FX
BHF
æSNT
BOE
TUBSUVQT
Company size (by revenue) does not necessarily correlate
to greater investment in advanced analytics capabilities.
are better equipped than Companies with relatively smaller revenues and, in
established players in their particular, start-ups indicated predictive and prescriptive
analytics to be deeply embedded in their operating model
usage of advanced analytics DQGSURFHVVHV  ZLWKPRUHUHVSRQGHQWVVWDWLQJ
for decision making. WKDWWKHLUğUPVXVHGDGYDQFHGDQDO\WLFVFRPSDUHGWR
PRUHHVWDEOLVKHGğUPVLQWKHLULQGXVWU\

Advanced analytics share of usage vs company growth phase

100%

80%

60%

40%

20%

0%
Start-up Established Inorganic expansion Organic growth
Predictive and prescriptive as % of analytics use
Source: PwC analysis

This result may be attributed to the fact that many data infrastructure to capture, store and draw insights
UHFHQWVWDUWXSVDVZHOODVIDVWJURZLQJğUPVKDYH from comprehensive and accurate data; access to a
built their business and operating model around skilled workforce; and smaller size—which translates
leveraging advanced analytics—examples being into more uniform adoption of analytical tools and
e-commerce players, app-based cab services, and algorithms across the organisation—have facilitated
payment banks and portals. An emphasis on the rapid growth.

Advanced analytics share of usage vs firm revenue

100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
100 million 100 million 250 million 500 million 1 billion USD 5 billion USD 10 billion USD
USD or less USD to 250 USD to 500 USD to 1 to 5 billion to 10 billion or more
million USD million USD billion USD USD USD

Predictive and prescriptive as % of analytics use

Source: PwC analysis

The challenges to effective strategic decision making are shortcomings need to be addressed in order to respond
rooted in leadership concerns, budgetary considerations, quickly and effectively in an environment of uncertainty,
and lack of manpower and resources. These change and opportunity.

Using advanced analytics to make Big Decisions 7

Type of analytics used by organisations

A comprehensive analytical programme needs to have • Predictive analytics anticipates future behaviour or
the right mix of descriptive, diagnostic, predictive and estimates unknown outcomes. It discovers hidden
prescriptive capabilities. The complexity and maturity relationships among various factors in order to predict
of analytics modelling techniques also move in the same the outcome of future events.
order, starting with descriptive analytics and moving • Prescriptive analytics helps to specify a preferred course
towards prescriptive techniques. RIDFWLRQ,WRSWLPLVHVGHFLVLRQVE\HIğFLHQWO\DOORFDWLQJ
• 'HVFULSWLYHDQDO\WLFVğQGVZKDWLVFXUUHQWO\ UHVRXUFHVRUğQGLQJWKHPRVWVXLWDEOHZD\IRUZDUG
happening or has happened. It improves the The Big Decisions Survey highlights that the use of
XQGHUVWDQGLQJRISDVWSHUIRUPDQFHLGHQWLğHV analytics is mostly restricted to descriptive and predictive,
historical trends and monitors the performance with relatively limited use of prescriptive analytics as yet.
of actions. +RZHYHU,QGLDQOHDGHUVVFRUHKLJKHU  WKDQWKHLU
• 'LDJQRVWLFDQDO\WLFVLGHQWLğHVZK\RXWFRPHVHYHQWV JOREDOFRXQWHUSDUWV  LQWHUPVRIGHSOR\LQJSUHGLFWLYH
or trends occurred. It provides greater visualisation modelling techniques for decision making. Similarly, Indian
RIWKHGDWDLGHQWLğHVUHODWLRQVKLSVDQGH[SODLQV leaders have shown greater preference for prescriptive
the outcome. DQDO\WLFV  DVFRPSDUHGWRJOREDOOHDGHUV  

%
19 3% Ind
dia, bal, 1 i
Gl a,
In Glo o
23 27%
ba

Prescriptive: Descriptive:
l,

What should What happened?

happen now?
1%
bal, 3

Indi
Glo

Predictive: Diagnostics:
a, 1

What will/could Why did it happen?

8%
0%

G
happen? lob
,4

al,
ia 29%
Ind

8 PwC
Speed and sophistication

In the swirl of clickstreams and sensor streams, the VRSKLVWLFDWLRQRIWKHWHFKQLTXHVXVHGWRğQGLQVLJKWV

speed at which businesses make decisions and the matter a lot.

Speed is measured based on the time taken to

answer questions, time to decide action and time to
implement measures.
Sophistication of decisions is decided by analytics
maturity, data breadth and depth, and decision-
making approach.

Source: ‘The power of analytics for better and faster decisions’ – WEF Annual Meeting presentation

Improving both speed and sophistication will help with multi-format data and analytical skills to perform
increase the return on investment for data and insightful analyses.
analytics. With the cycle of innovation narrowing, The survey results show the current level of speed and
organisations cannot take months, or even weeks, to sophistication in orange, while magenta indicates the
analyse an opportunity. They must increase the speed level that companies aim to reach by 2020. This survey
at which they make decisions while applying the right also reveals that Indian organisations are currently at
insight to their problems using more sophisticated higher levels of speed and sophistication as compared
data analytics. The key challenges that need to be WRJOREDORUJDQLVDWLRQVZKLFKGLVSOD\DVLJQLğFDQWJDS
overcome are data quality, readiness of systems to deal between their current state and future expectations.

Using advanced analytics to make Big Decisions 9

 Global India

Source: PwC analysis Source: PwC analysis

7KHJDSIRU,QGLDQğUPVLQWHUPVRIVSHHGDQG While the gap is low for India, Indian organisations

VRSKLVWLFDWLRQRIGHFLVLRQPDNLQJ JDSLQ have considerable room for improvement in terms of
VRSKLVWLFDWLRQDQGJDSLQVSHHG LVORZHUWKDQWKDW speed and sophistication compared to some of their
RIWKHLUJOREDOFRXQWHUSDUWV JDSLQVRSKLVWLFDWLRQ global counterparts.
DQGJDSLQVSHHGUHVSHFWLYHO\ 

10 PwC
Data-driven decision making

To retain their positions as market leaders, companies 7KHVXUYH\UHYHDOHGWKDWRI,QGLDQOHDGHUV

must establish a data-driven innovation culture. The believe that their organisational decisions were
availability of data is not a new thing; however, the highly data-driven compared to the global benchmark
number of sources has risen exponentially. Moreover, RIDSSUR[LPDWHO\%XVLQHVVOHDGHUVLQ,QGLD
the volume of data available is set to increase further have recognised the critical importance of data and
in both structured and unstructured formats. This will analytics for successful modern business. They feel that
expand the already sizeable group of executives who analytics can transform their ability to access and use
believe it is critical to generate data insights from their information from their customers, suppliers, employees
companies’ products or services. and other stakeholders.

Global India
Rarely data-driven, Rarely data-driven,
7.9% 2.6%

Highly Highly Somewhat

data-driven, data-driven, data-driven,
39.8% Somewhat 60.5% 36.8%
data-driven,
52.3%

Source: PwC analysis

For companies that already have a head start in data-

driven decision making, the most popular initiatives are
to make greater use of specialised analytical tools and
techniques, to employ a dedicated data insights team to
inform strategic decisions, and to rely on enhanced data Decision required data to be …
analysis—each of which has been started by over one-
half of these companies. Global, 33%
Accurate
India, 23%
Indian respondents place high importance on
comprehensive data as a facilitator for decision making
 DVFRPSDUHGWRDFFXUDF\DQGWLPHOLQHVV*OREDOO\ Timely
Global, 28%
respondents consider comprehensive and accurate data India, 29%
to be a pre-requisite for decision making.
Over time, more people have become involved, and a Comprehensive Global, 39%
PDMRULW\RIğUPVKDYHLQFRUSRUDWHGDPRUHGDWDGULYHQ India, 48%
decision-making process. 0% 10% 20% 30% 40% 50% 60%
Establishing clear decision rights and accountability is
crucial, and a similar discipline must be applied to the
amount and type of data being collected and analysed to
avoid overload.

Using advanced analytics to make Big Decisions 11

Mix of mind and machine

Strategic decisions are often based on human instincts. Respondents were asked to rate their organisation on
To gain a competitive edge, advanced machine learning two parameters. First, on how analysis is performed—
techniques should be used to complement experience whether it is human judgement driven or based on
and intuition, and support the volume and frequency machine algorithms. Second, on how they perceive the
of decisions. The use of data analytics and emerging future risks to be—whether they will be known and
technologies can help an organisation uncover patterns manageable or unknown and uncertain.
that lead to new predictions. 7KH%LJ'HFLVLRQV6XUYH\UHVXOWVVKRZWKDW
At the same time, it’s important for all organisations of Indian leaders use machine analysis/algorithms
to understand and manage risk in their day-to-day DVFRPSDUHGWRRIJOREDOOHDGHUV2QWKHKXPDQ
operations and strategic decisions. Analytics makes MXGJHPHQWSDUDPHWHU,QGLDQOHDGHUVKDGDVFRUH
it possible to assess risks that were previously seen DVFRPSDUHGWRIRUJOREDOOHDGHUV7KHVHVWDWLVWLFV
DVXQTXDQWLğDEOH7KLVFUHDWHVDQRSSRUWXQLW\IRU clearly demonstrate that Indian leaders trust analytical
organisations to better manage their risk and make sure tools and techniques while taking important decisions as
that an appropriate return is being achieved. against relying on their instincts.

Global India

Source: PwC analysis Source: PwC analysis

A wide variety of machine algorithms are being used Factor analysis: Used to analyse large numbers of
for developing analytical models for solving different dependent variables to detect certain aspects of
business issues: the independent variables (factors) affecting those
Cluster analysis: The task of grouping a set of objects in dependent variables
such a way that objects in the same group (cluster) are Machines won’t replace human judgment, but the right
more similar, in one sense or another, to each other than mix of mind and machine can reduce the impact of
to those in other groups (clusters) human bias, yield more accurate answers and de-risk
Regression analysis: A statistical process for estimating decisions—even for complex problems.
relationships between a dependent variable and one or The cost of technology is falling, opening up many
more independent variables more sources of data, synthesised from both internal
Decision tree analysis: A decision support tool that and external sources and a variety of machine learning
uses a tree-like graph of decisions and their possible algorithms. This gives company executives real-time
consequences, including chance event outcomes and FRQğGHQFHDURXQGWKHKDSSHQLQJVRIWKHLURUJDQLVDWLRQ
resource costs and utility Individuals can use data to connect the grass roots of
an organisation to the boardroom in a quick, effective
Time Series analysis: Comprises methods for analysing DQGFRQğGHQWZD\7KLVHQKDQFHGYLVLELOLW\PHDQVWKDW
time series data to extract meaningful statistics and other strategic decision making becomes more proactive and
characteristics of the data less reactive.

12 PwC
Functions driving analytics adoption

The survey reveals that the leading functions in terms which show a high usage of predictive and prescriptive
of analytics adoption in organizations are IT, Strategy DQDO\WLFV RYHUUHVSRQGHQWV DORQJVLGHWKHGHVFULSWLYH
& business development and General Management and diagnostic forms.

Analytics usage by Function

100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
General IT Strategy and Operations R&D Finance Marketing and
management business and sales
development production

Descriptive and diagnostic Predictive and predictive Don't know

Source: PwC analysis

Overall, it can therefore be said that over the short requisites and developing the right skills and insights in
term, an IT department will have a major role to order to institutionalise data-driven decision making
play in establishing the infrastructure and data pre- in organisations.

Using advanced analytics to make Big Decisions 13

The road ahead

Big decision making is changing. Many business they’d like to take their company. That being said, they need
leaders now have enriched information to draw upon WRFRQVLGHUWKHIROORZLQJğYHVWHSVEHIRUHDUULYLQJDWWKHLU
before making a choice about the direction in which next big decision:

Five steps to consider before your next big decision

1
Keep an open mind
Data analysis is not limited to recurring decisions. Some executives already rely on it
for one-off decisions, such as identifying a potential mergers and acquisitions target.

2
Unlock existing insights
Data does not have to be ‘big’ to be useful. Analysing databases previously
mothballed or kept in silos can lead to fresh insights.

Understand inherent bias

Important decisions have already been taken before data analysis is presented
to senior executives. Get to know what lies behind your dashboard. 3
4
Invest in talent
Before recruiting new data scientists to staff your data insight teams,
consider providing existing employees with a foundation in data analysis.

5
Take the lead on accountability
Being clear about who has decision-making rights can improve outcomes.
Opening up access to data and analysis can allow decisions to be challenged.

The reshaping of businesses kicked off by the global introduces analytics in a phase-wise approach.
recession is set to continue. Although this should offer +RZHYHUWKLVLVDVORZSURFHVVDQGWKHWLPHWRğUVW
up plenty of opportunities, these decisions will be taken insight increases drastically.
in an uncertain economic environment, often as a • Inorganic in-house: In this case, an organisation
reaction to changes beyond the decision maker’s control. buys an analytics company which can start
More people have become involved, and a majority working on various analytics projects across the
RIğUPVKDYHLQFRUSRUDWHGGDWDDQGDQDO\VLVLQWKHLU enterprise. This approach can improve the time to
decision-making process. This has mostly been for the value. However, integration issues might cause the
better; however, potential pitfalls remain. Establishing analytics resources to take some time to understand
clear decision rights and accountability is crucial, and the organisation’s processes and culture.
similar discipline must be applied to the amount and • Primarily outsourced: In this case, the entire
type of data being collected and analysed to avoid analytics work is completely outsourced to an
overload. external vendor who ingests the various data feeds
While many organisations have started their analytics from the retailer, performs the analysis and sends
journey and are at various stages of maturity, they are the results and insights back to the retailer. This
still struggling to identify the most appropriate model for approach can deliver quick results, but in the long
sustainable analytics implementation. They can adopt run, it can prove to be an expensive proposition
analytics across their enterprise using various options: for the organisation due to reliance on the
• Organic in-house: An organisation augments its external vendor, along with loss of control on
in-house analytics team over a period of time and analytics operations.

14 PwC
• Hybrid model (recommended): This model is a Organic Inorganic Primarily Hybrid
combination of in-house and outsourcing approaches. in-house in-house outsourced Model
It helps the organisation in countering the challenges
in terms of availability of skilled resources and Time to value 8 Ù 9 9
investing a huge amount of money upfront. An Total cost of
external consultant works with the organisation to set ownership Ù 9 Ù 9
up an analytics centre of excellence and to co-create
Access to
various analytics models on its premises. This not latest best 8 Ù 9 9
only helps in gaining access to the latest best practices practices
prevalent in the market but also keeps the retailer in
control at all times. Control of
9 9 8 9
operations
Whatever the business issue or industry sector,
organisations need to draw upon a number of core building Suggested
Source: PwC analysis approach
blocks to capture and manage data, analyse it to release
insight and ensure it drives business change going forward.

Using advanced analytics to make Big Decisions 15

Our Data and Analytics practice

Our Data and Analytics practice has been working with the retail and consumer, insurance, banking, private
leading organisations across the globe, helping them equity, manufacturing, mining and utilities, telecom,
with strategy and needs assessment, benchmarking, automotive, healthcare, pharma and government sectors.
process management, vendor and tool evaluation, We are experts in implementing analytics solutions
PRGHOLPSOHPHQWDWLRQğQDQFLDOPRGHOOLQJDQDO\WLFV through leading market tools, by aligning them to the
competency centre set-up as well as support and change client’s technology landscape.
management. We have executed multiple projects across
Contact us

For a deeper conversation on how technology can help with your big decisions, please contact:

Pawan Kumar S Sudipta Ghosh

Partner and Leader Partner and Leader
Technology Consulting Data and Analytics
[email protected] [email protected]

Vivek Belgavi Raman Bhushan

Partner and Leader Partner and Leader
Financial Technology Retail and Consumer Analytics
[email protected] [email protected]

Ram Periyagaram Vivek Shrivastava

Partner Executive Director
Financial Services and Captives Consumer and Industrial Products
[email protected] [email protected]

Contributors

Saurabh Bansal Deboprio Dutta

Associate Director Senior Consultant
Data and Analytics Data and Analytics
[email protected] [email protected]
About PwC

At PwC, our purpose is to build trust in society and solve important problems. We’re a
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delivering quality in assurance, advisory and tax services. Find out more and tell us what
matters to you by visiting us at www.pwc.com

,Q,QGLD3Z&KDVRIğFHVLQWKHVHFLWLHV$KPHGDEDG%HQJDOXUX&KHQQDL'HOKL1&5
Hyderabad, Kolkata, Mumbai and Pune. For more information about PwC India’s service
offerings, visit www.pwc.com/in

3Z&UHIHUVWRWKH3Z&,QWHUQDWLRQDOQHWZRUNDQGRURQHRUPRUHRILWVPHPEHUğUPV
each of which is a separate, independent and distinct legal entity in separate lines of
service. Please see www.pwc.com/structure for further details.

©2016 PwC. All rights reserved

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This document does not constitute professional advice. The information in this document has been obtained or derived from sources believed
by PricewaterhouseCoopers Private Limited (PwCPL) to be reliable but PwCPL does not represent that this information is accurate or complete.
Any opinions or estimates contained in this document represent the judgment of PwCPL at this time and are subject to change without notice.
Readers of this publication are advised to seek their own professional advice before taking any course of action or decision, for which they are
entirely responsible, based on the contents of this publication. PwCPL neither accepts or assumes any responsibility or liability to any reader of
this publication in respect of the information contained within it or for any decisions readers may take or decide not to or fail to take.
© 2016 PricewaterhouseCoopers Private Limited. All rights reserved. In this document, “PwC” refers to PricewaterhouseCoopers Private
Limited (a limited liability company in India having Corporate Identity Number or CIN : U74140WB1983PTC036093), which is a member firm of
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