Monthly Archives: July 2013

Key Takeaway Points from Prof. Davenport and Deloitte Survey – 2013 Analytics Advantage Survey

This is the latest (guess in the last few months) from Deloitte and Davenport. 

We will bring out only top two answers as an interpretive meta analysis. For detailed results you should read the full report, which is given at the bottom.

What is the greatest benefit of using data analytics?
– Better decision-making based on data (49%)
– Better enablement of key initiatives (16%)
Does analytics improve competitive positioning?
– Significantly improved (25%)
– Fairly improved(30%)
Who oversees analytics initiatives?
– Business unit or division head(23%)
– No single executive(20%)
Analytics is centralized or decentralized? 
– Localized analytical capabilities that are beginning to share tools, data, and people (38%)
– A central analytical group with some coordination over analytical activity across the enterprise(30)%
What are the leading barriers to analytics use? 
– No centralized approach to capturing and analyzing data for our company’s use(32%)
– Our company lacks proper technology and infrastructure to capture the data(23%)
Data management challenges.
– Un-integrated (31%)
– Adequate central data repositories (31%)
Key barriers to use data
–  Basic reporting tools with limited predictive analytics tools (49%)
– Spreadsheets and basic reporting tools (18%)

The following is an interpretation using latent dimensions for directional weights.

While organizations realize the importance of analytics,
– nearly half of them do not see that as a competitive advantage, means they have no clue
– analytics does not strong thought leader, there is no common institutionalized platform
– lacks centralized data management in coordination with analytics
– lacks right tools

 See more details here:

 Analytics Advantage Survey 2013 Release – Full Document From Davenport and Deloitte

From Data Monster & Insight Monster

Measuring the Contribution of Analytics – IBM and Sloan Management Review Study

Two powerful statements on value:

  • Analytics driven organizations outperforms 3 times more likely to perform better than their competition
  • Analytics helps 5 time better performance in value.

Read this summary of 2012 Survey on Analytics by IBM and Sloan Management Review

Analytics challenge expressed by executives:

What: Management, skills, culture
How: Analytics is used for reporting,  visualization, but we need predictive analytics
Biggest challenge:  Apply analytics in business processes

General categories on how organizations are using analytics:
– Advanced analytics players: all aspects of operations – What Davenport and Harris call Stage5
– analytics for work force management, servcing your customer, R&D of key processes – Stage 4
– aspirational – base financial functions, sales, and marketing – Stage 3

 IT enabled, but a growing analytics unit supporting business unit/function, centralized excellence

Creating value:

Reduced measurements, productivity, 

–  finance, fraud, risk functions, supply chain visibility, human capital analytics,

Five steps to adopt:

– start at high value point
– start with questions the business wants to ask
– Operationalizing insights
– Recognize analytics is a major capability to your business
– Cohesive leadership commitment (IT,Executive, Business operations)

Commit, Choose high value and prove, Expand

IBM – 2012 Big Data Study – 1100 Executives Response to the Survey – Summarized
How are they finding value in Big Data

From Data Monster & Insight Monster

Strategic Metric, KPIs, and KLIs – Which are directly related to the Strategic Metric?

Successful and smart organizations have just only one strategic metric that encapsulates their segment and their vision.

Steve Jobs famously pointed out in different places that Apple wanted to make the best computer that had the latest technology which was on the ramp to more adoption with ease with which owner(consumers) could operate the computer easily, and with a design that the owners can be proud of.

There is a segment for such a product. Organizations have to understand their segments very clearly.

Samsung, in the last one decade, just wanted to follow the bread crumbs of Apple and now they know how to build a bakery. They found the gaps where APPLE did not compete and fulfilled gaps and now they are growing beyond that limited positioning, as they learn more and more about the market and the relevant technologies.

In 2002, the strategic metric of the underdog Oakland A’s was much better defined already in a crisp

way, called OBP (On base percentage).  That was the reason why they came to practice every day and went to the ball park to play the game against their competition, and win 20 games to reach the division title.

Strategic metric relates to vision and aspirations but for the strategic metric to be worked out for winning the market, organizations need associated metrics that can be leveraged, not just performance measured, which is what is happening in the meaning of KPIs.  So in the following I am defining more active leverage metrics as KLI and KLI’s are the ones organizations should be focused on while KPIs are victory measurements, which is also needed just to validate whether in the end we achieved the fulfillment of daily life or not.

Note also that the other side of strategic metrics is budget.  They go hand in hand.

For example, sales metrics are not KLI but are KPIs.  In the case of Moneyball, the number of wins and division titles are KPIs, not KLIs.

Some KLIs in the case of Oakland A’s are (1) Whether each one of the hire satisfies budget requirements and has a high probability of fulfillment of the strategic metric (KLI1).  This has a high positive correlation with strategic metric (2) the designing of training method and player success metric in following the training is highly positively correlated to the strategic metric (KLI2). (3) How many run attempts and completions are based on OBP metric in actual games (KLI3). (4) Is the fielding of the players optimized for OBP (KLI4).

So the simple lessons are the following.

The whole organization should have only one strategic metric, the KLIs are the ones that can help leverage the organizations move towards vision supported by the strategic metric, not the performance indicators. For example, the ticket sales at the home stadium vs. visiting stadium are KPIs but that are not something Oakland leverage directly.

Both in the case of Apple and Samsung, it is easy to pull out the KLIs.

What is Google’s strategic metric?  Is it creating google phone, though they are the creators of Android OS?  Think about it.  Now what are the KLIs of Google?

What is your strategic metric and do you know how to define your KLIs?

From Data Monster & Insight Monster