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Forrester: Decentralized approach to customer data analytics the norm

Most companies decentralize customer data analytics teams, but a centralized approach better ensures that analytics expertise is shared company-wide, according to Forrester Research.

Companies that view customer data analytics as a strategic asset tend to favor a centralized approach to customer...

intelligence. But most companies don’t fit that criterion.

Just three in 10 companies have a single, centralized organization responsible for collecting, analyzing and disseminating customer data, according to a recent survey of customer intelligence professionals by Forrester Research.

The main benefits of a centralized approach to customer data analytics, according to respondents, is that “it ensures that functional expertise is shared across the company and that it provides efficiencies of scale,” according to an accompanying report by the Cambridge, Mass.-based research firm.

Of those respondents whose companies have achieved “a strategic [customer] intelligence level,” more than 54% employ a centralized approach, wrote Forrester analyst Dave Frankland.

“We used to have multiple teams capturing and analyzing customer data. By bringing them together onto the same team, we cut down on the replication of tasks and ensure each task is performed by the specialists in each function,” one respondent, head of customer intelligence at an insurance company, told Frankland. “As a result, all of our business units benefit from a higher standard of intelligence.”

A majority – 55% -- of respondents said, however, that customer data analytics teams are fanned out across their enterprises, with many reporting to line-of-business managers and department heads. While respondents recognized the benefits of a centralized approach, they also reported that a decentralized corporate culture prevented it.

Another of the 300+ survey respondents said: “Regardless of my appetite for the centralization to drive cost savings and efficiency, our broader corporate culture encouraged decentralization. Selling the centralization of critical insight functions is an insurmountable task.”

Forrester includes marketing analytics, Web analytics, and customer feedback analytics among the disciplines that make up customer intelligence.

That’s not to say that a decentralized customer intelligence approach lacks benefits of its own. A majority of respondents that employ a decentralized approach agreed it “provides business unit(s) with control over the function” and “ensures functional expertise is delivered where it is most likely to be acted upon.”

It is also easier to align decentralized or departmental analytics teams with business-unit goals, according to 46% of respondents that sport a decentralized approach.

Still, “firms demonstrating a strategic intelligence level share some common tendencies,” Frankland concluded. “Customer [i]ntelligence teams in these firms tend to be larger and more centralized and wield far more influence across the firm.”

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