Value Chain Creation in Business Analytics

Abstract

Firms are awash in big data and analytical technology as part of deriving values in the turbulent environment. The literature has somewhat reached a consensus that investments in technology only may not reap benefits from business analytics (BA). The main purpose of BA is not about how to install technical capabilities, but about how to make a process whereby a firm builds a value chain converting data into insights, leading to quality decisions. Drawing upon the theory of the information value chain, this study develops a BA value chain model and tests it with 268 data scientists. Results show that organizational resilience, absorptive capacity, and analytical IT capabilities are critical antecedents to analytical decision-making quality which in turn influences BA net benefits. Particularly, results illustrate that organizational resilience is a more significant variable impacting analytical decision-making quality than the influence of people and technology. Theoretical and practical implications are also discussed.