The Value of Business Analytics: Identifying the Path to Profitability

THE SECRET OF SUCCESS

When one looks globally, some organizations seem not to mistrust analytics. Somehow, they seem to create renewable value through applying their competencies across many different business problems. Somehow, they succeed, not once, but repeatedly. And somehow, they translate their experience and skills into sustainable competitive advantage. Whether one is looking at Marriott, Canada Post, Sainsbury’s, or Telstra, some organizations consistently manage to deliver significant returns through their application of business analytics.

Possibly the best-guarded secret in business analytics is that in practice, their success comes down not only to organizational culture but also to the ability of their managers to successfully sell the value of analytics. As researchers such as Thomas Davenport and Jeanne Harris have rightly pointed out, overall success can often be linked to a variety of factors, including organizational structure, management commitment, and successful strategic planning. However, it is often “where the rubber hits the road” that the greatest impact can occur.

Change comes from two directions: top down or bottom up. If the organization already has the right management culture, using insight as a competitive advantage is relatively straightforward. As Jack Welch is reputed to have said, “An organization’s ability to learn, and translate that learning into action rapidly, is the ultimate competitive advantage.”

In these organizations, applying business ...