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Competing on Analytics: The New Science of Winning, by Thomas H. Davenport, Jeanne G. Harris
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You have more information at hand about your business environment than ever before. But are you using it to “out-think” your rivals? If not, you may be missing out on a potent competitive tool.
In Competing on Analytics: The New Science of Winning, Thomas H. Davenport and Jeanne G. Harris argue that the frontier for using data to make decisions has shifted dramatically. Certain high-performing enterprises are now building their competitive strategies around data-driven insights that in turn generate impressive business results. Their secret weapon? Analytics: sophisticated quantitative and statistical analysis and predictive modeling.
Exemplars of analytics are using new tools to identify their most profitable customers and offer them the right price, to accelerate product innovation, to optimize supply chains, and to identify the true drivers of financial performance. A wealth of examples—from organizations as diverse as Amazon, Barclay’s, Capital One, Harrah’s, Procter & Gamble, Wachovia, and the Boston Red Sox—illuminate how to leverage the power of analytics.
- Sales Rank: #73440 in Books
- Brand: Harvard Business Review Press
- Published on: 2007-03-06
- Released on: 2007-03-06
- Original language: English
- Number of items: 1
- Dimensions: 9.50" h x 6.50" w x 1.00" l, 1.17 pounds
- Binding: Hardcover
- 240 pages
Features
Review
“[the] seminal work, Competing on Analytics, helped shape the evolution of the discipline of business analytics.” — Health Data Management
“Harvard Business School Press, Davenport in particular, has produced some excellent books on competitive analytics and the like, with good case studies…” - ZD Net
From the Back Cover
In a world where traditional bases of competitive advantage have largely evaporated, how do you separate your company's performance from the pack? Use analytics to make better decisions and extract maximum value from your business process.
In Competing on Analytics: the New Science of Winning,Thomas H. Davenport and Jeanne G. Harris argue that the frontier of using data has shifted dramatically. Leading companies are doing more than just collecting and storing information in large quantities. They’re now building their competitive strategies around data-driven insights that are, in turn, generating impressive business results. Their secret weapon? Analytics: sophisticated quantitative and statistical analysis and predictive modeling supported by data-savvy senior leaders and powerful information technology.
Why compete on analytics? At a time when companies in many industries offer similar products and use similar technology, distinctive business processes count among the last remaining points of differentiation. Many previous bases for competition—such as geographical advantage or protective regulation—have been eroded by globalization. Proprietary technologies are rapidly copied, and breakthrough innovations in products or services are increasingly difficult to achieve.
That leaves three things as the basis for competition: efficient and effective execution, smart decision making, and the ability to wring every last drop of value from business processes—all of which can be gained through sophisticated use of analytics.
Davenport and Harris show how exemplars—organizations as diverse as the Boston Red Sox, Netflix, Amazon.com, CEMEX, Capital One, Harrah’s Entertainment, Procter & Gamble, and Best Buy—are using new tools to trump rivals. Through analytics, these companies identify their most profitable customers, accelerate product innovation, optimize supply chains and pricing, and leverage the true drivers of financial performance.
A timely, much needed resource, Competing on Analytics promises to rewrite the rules of competition.
About the Author
Thomas H. Davenport is the President's Distinguished Chair at Babson College and a research fellow at the MIT Center for Digital Business. Jeanne G. Harris is Executive Research Fellow and Director of Research for the Accenture Institute for High Performance Business.
Most helpful customer reviews
143 of 158 people found the following review helpful.
Analytics for beginners
By Peter Lorenzi
This is the glib, anecdotal book built around a basic, almost stereotypic Harvard Business Review five-level model, this one focusing on various levels of use of analytical methods, systems and processes. At the lowest level, there is almost nothing going on in terms of analytics and, at the highest level, analytics are systematic, widespread and strategic. You can figure the middle three levels. In my experience, there would be some use in providing a zero-level or even negative-level use of analytics, those firms operating in the "data free" zone. They would provide some humor and color, not just useful references.
As to the subtitle, "The new science of winning," to be clear, "competing" and "winning" are not synonymous or even necessarily linked. Competing is not necessarily about winning and winning isn't as important as remaining competitive in the long run. Winning isn't everything and it is not the only thing.
The anecdotes tend towards Harrah's, the Boston Red Sox and several less-than-mainstream firms, along with a few data-crazed firms, e.g., Google. More and more detailed examples of the first-rate use of analytics by top competitors in the corporate world would have been welcome. Personally, Harrah's use of analytics to maximize gambling revenues strikes me as exploiting people's addictions. As to the Red Sox, at least they finally won a Series. As to data, the authors seem to think that 'data' is a singular noun, which leaves me somewhat perplexed as to the analytics applied to editing the text.
The book is shorter than the listed 240 pages. The anecdotes tend to be repetitive, the analytics more descriptive than analytic, and the five-level model gets driven home right away and then driven in repeatedly. We can probably all agree that the information age provides the capacity to mine data, to analyze it thoroughly, to disseminate it approporiately and widely, to use it strategically, and to provide the essential leadership to hire the people, structure the organization, and put the entire system in place in the first place.
"Competing" was not as boring as I expected it to be and not as informative as a I wanted it to be.
1 of 1 people found the following review helpful.
Not-so-new consulting speak
By NoVAReader
In spite of its alluring title, this book is mediocre at best. The authors rehash a bunch of consulting speak that has been around the data warehousing and business intelligence space for a decade or more. After finding Davenport's Thinking for a Living: How to Get Better Performances And Results from Knowledge Workers to be pretty thought provoking, I was disappointed with this work. Unless you are brand new to data warehousing and business intelligence, don't waste your time.
The authors promote analytics as the sound way to make decisions that ultimately make a company more competitive. There is some obvious truth in that concept, I guess. However, they fail to acknowledge that first movers (those companies that usually have competitive advantage) often have to make decisions without the benefit of clean, historical data. In fact, the authors go so far as to say that clean data is a prerequisite to good analysis which is in turn a prerequisite to good decision making which, only then, leads to competitiveness.
As a two-decade veteran of the business intelligence space, I do agree with much of what the authors have suggested. The formula they propose works well for established companies with large, historical data stores to draw upon. The trouble is, they imply that analysis-driven decision making is the secret to competitiveness. Making good decisions, especially when you don't have all (or very much) of the data -- a very typical scenario in first-mover environments -- is the real secret to competitiveness.
1 of 1 people found the following review helpful.
"Going by the Gut" may be going by the wayside
By Eric Kassan
This book shows how several companies are effectively "competing on analytics" - defined as having the following four characteristics:
1. Analytics supports a strategic, distinctive capability
2. Approach to and management of analytics is enterprise-wide
3. Senior management is committed to the use of analytics
4. The company makes a significant, strategic bet on Analytics
In my opinion, the fourth item is really redundant, as the investment in obtaining and implementing the first criteria would satisfy the fourth. But the other three are critical. Included in both #2 and #3 is the requirement of an evidence-based decision making criteria. This is what I expect most companies will have an issue with. While the book mentions the difficulty in changing the culture and the potential for a virtual war between the "quants" and the "old guard", there are not really any good suggestions for overcoming it. The one suggestion given, proving it on a smaller scale won't work, because "proof" is not relevant for those who believe the gut is better than evidence.
That said, for those who can appreciate the value of evidence, this book provides much of it. Perhaps the best is the fact how the book describes Capital One carefully targeting sub-prime risks using analytics. Since the book was published, that market in general has collapsed, but Capital one is doing fairly well. The chapters on how to build the technical and people aspects raise good points, but are far from thorough.
In short, this book is a great overview, and provides many good ideas to consider, but it should not be confused as a how-to book.
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