Competing on Analytics: The New Science of Winning

This book is incredibly useful, and some of the hard-core propellerheads who have criticized it for not being rigorous enough are missing the point. It is not intended to be a highly analytical proof of the value of any particular analytical technique. It's a clear, persuasive discussion of how to establish a broad analytical capability within a company, and some of the benefits that might accrue from having that capability. It shows that there is a correlation (no causation is argued) between being analytical, and being successful from a financial standpoint. I have used it to convince other managers in my company that we need to take a more analytical perspective on our business and industry. They have found it just as compelling as I did. The stories about the Red Sox (who seem to be doing pretty well again this year--surely in part because of their analytical orientation) and other sports teams only add to its appeal.

The best thing about this book is the inspiration it can provide business leaders who are still skeptical about the value of analytics and business intelligence. In working with customers trying to implement these solutions, far too many cite lack of executive level interest and understanding as a cause for failure. Competing on Analytics gives case after case of how businesses have differentiated themselves on their use of data, delivering better customer service and improved financial performance. The cases range from the innovators like Netflix to traditional such as BankCo and airlines (here, the authors highlight both the successes and the analytic failures). This book should be on the must read list for business people looking for ways to perform better and for analytic and BI experts charged with supporting the business in leveraging these capabilities.

Davenport and Harris have followed up their influential HBR article with a well thought out, clearly communicated and detailed analysis of how companies will really compete in the future -- by using what they know to take the right actions throughout their companies. Davenport and Harris call these types of companies analytical competitors and they look at the world differently and produce significantly different results. Analytics is becoming a requirement in every industry as customers have choice and companies face increased competition. They define analytics as "the extensive use of data, statistical and quantitative analysis, explanatory and predictive models and fact based management to drive decision and actions" This may sound like an academic book. But Davenport and Harris go well beyond hyping a new idea to provide dozens of practical examples from companies we all know. This blend of explaining a new way of competition using practical examples from proven companies makes this book a must read for business people. The book breaks down into chapters that discuss each aspect of becoming an analytical competitor. Chpt 1: The Nature of Analytical Competition describes how companies can consistently beat the market by knowing more and doing more with what they know. This chapter ties analytics with competitive strategy in a way that goes well beyond traditional market-ese. Chpt 2: What makes an Analytic Competitor provides a detailed description and checklist of attributes that these leading companies share. The interesting point is that the examples range across industries demonstrating that Chpt 3: Analytics and Business Performance looks at how this technique drives top and bottom line growth. This chapter demonstrates that analytics is more than just a good idea it's a good idea that business professionals should get their heads around. Chpt 4: Competing on Analytics with Internal Processes connects information with the capabilities that form the basis for competitive advantage. This chapter dispels the myth that analytics is purely a marketing tool for customer segmentation and messaging. Chpt 5: Competing on Analytics with External Processes focused on how companies use information for partnering and collaboration with suppliers. This is particularly critical to companies as many outsource and create relatively `uninformed' partners. Chpt 6: A Road Map to Enhanced Analytic Capabilities connects these benefits with specific stages and actions required to become an analytic competitor Chpt 7: Managing Analytical People proves that Davenport and Harris have investigated, thought through and are providing practical advice as they address key leadership and management issues that arise when information becomes an integral part of operations. Chpt 8: The Architecture of Business Intelligence clarifies a stumbling block for many who think of analytics as just something they can buy as part of their BI solution. Its not

Tom and Jeanne have written an excellent new book (building on a paper they wrote some time ago) about what they call "analytic competitors", that is to say companies that use their analytic prowess not just to enhance their operations but as their lead competitive differentiator. The book discusses a number of these analytic competitors and gives an overview of how analytics can be used in different areas of the business and how you can move up the analytic sophistication scale. The book has two parts - one on the nature of analytical competition and one on building an analytic competency. The first describes an analytical competitor and how this approach can be used in both internal and external processes. The second lays out a roadmap for becoming an analytical competitor, how to manage analytical people, a quick overview of a business intelligence architecture and some predictions for the future. They define an analytical competitor as an organization that uses analytics extensively and systematically to outthink and outexecute the competition. The analytics are in support of a strategic distinctive competency and they argue, persuasively, that without a distinctive capability you cannot be an analytic competitor. The book outlines what they call four pillars of analytical competition- a distinctiive capability, enterprise-wide analytics, senior management commitment and large scale ambition. They lay out 5 stages of analytic competition from "analytically impaired" to "analytic competitor". The importance of experimentation is made clear and the book repeatedly emphasizes the need for companies and executives to be willing to run the business "by the numbers". The book is full of stories about how companies compete analytically and this is one of the book's strengths. It also has a great list of questions to ask about a new initiative and outlines a number of ways to get a competitive advantage from your data. Regardless of the competitive approach, the need for analytical executives to be willing to act on the results of analyses is made clear. The book ends with a great list of changes coming. This is a very interesting book both for those interested in competing on analytics and those interested simply in making more use of their data.