Data analytics competency for improving firm decision making performance

This study develops and validates the concept of Data Analytics Competency as a five multidimensional formative index (i.e., data quality, bigness of data, analytical skills, domain knowledge, and tools sophistication) and empirically examines its impact on firm decision making performance (i.e., decision quality and decision efficiency). The findings based on an empirical analysis of survey data from 151 Information Technology managers and data analysts demonstrate a large, significant, positive relationship between data analytics competency and firm decision making performance. The results reveal that all dimensions of data analytics competency significantly improve decision quality. Furthermore, interestingly, all dimensions, except bigness of data, significantly increase decision efficiency. This is the first known empirical study to conceptualize, operationalize and validate the concept of data analytics competency and to study its impact on decision making performance. The validity of the data analytics competency construct as conceived and operationalized, suggests the potential for future research evaluating its relationships with possible antecedents and consequences. For practitioners, the results provide important guidelines for increasing firm decision making performance through the use of data analytics.