Companies are struggling to make decisions based on solid data, according to a recent study from PricewaterhouseCoopers (PwC) into the way corporations formulate their strategy.
Among the executives surveyed by PwC, only a third reported that data and analytics featured heavily in the last strategic decision they made. Instead, 58 per cent of company executives are formulating based solely on their gut instinct.
This gap suggests that many companies are struggling to develop strategies based on solid research and feedback, both from within their company and externally.
One way to introduce more information into your decision making is to choose the right systems and processes to bring greater levels of data into a C-suite level. Investing in strategic management software for example, can provide executives with a range of information from within the organisation and that offers detailed data to guide future decisions.
Dan DiFilippo, PwC's global & US data and analytics leader, suggested that data and gut instinct shouldn't be treated as mutually exclusive either.
"Experience and intuition and the use of data and analytics are not mutually exclusive. The challenge for business is how best to marry the two. Executives know the right questions to ask. Now they need to know how to get the right answers from external and internal data they've used over the last two years," said Mr DiFilippo.
For companies that can incorporate data into their strategic decision-making, there are considerable benefits. Over the last two years, CEOs that have effectively incorporated data into their decision-making have reported the biggest improvements in the quality of choices that the they have made.
Company executives also reported that their main motivation for making big business decisions is an opportunity that they couldn't ignore. Almost a third (30 per cent) of respondents put this as their top reason for making a big decision, compared to only 18 per cent of decisions that were made because they were a strategic fit for the business.