Archives For February 2012
In conjunction with a webinar that I am participating in on 2/29 ( ZD & IBM – “Get More from your Data: How Business Analytics Gives You a Competitive Advantage”), I am posting a series of four blogs entitled “Business Analytics and the Mid-Market“.
(To attend my webinar on 2/29, Register at: http://b2b.ziffdavis.com/webcasts/improve-performance-your-data-business-analytics/?tfso=10480 )
This is Final installment (No. 4).in that series; ”
To recap from my previous 3 postings;
- Business Analytics (BA) is “the use of data & analysis techniques to understand your business in a a way that facilitates better decision making”. BA is “fact-based decision-making in real-time based upon a 360 degree view of the business. It portends to offer the highest potential for competitive advantage of any strategic enabler (much less tactical or operational) available in the business leaders portfolio today, much less the future.
- To achieve true Competitive Advantage (CA) one must embrace the notion of Business Analytics in a holistic fashion in order to create “a pervasive culture of analysis and numerical literacy”. The 5 components of a holistic approach are; People, Processes, Technology, Culture & Data
- To achieve competitive advantage (via differentiation), much less sustain it, Organizations must make Business Analytics a core competency and foster its deep usage across all domains of the business. Business Analytics must be made pervasive across the organization
- Critical to the successful creation of Competitive Advantage is the role of the Business Analytics Strategy. It should encompass all domains of your business and support the 5 Pillars (People, Processes, Technology, Culture & Data) of a holistic approach to Business Analytics.
- A successful Business Analytics Strategy (BAS) is one that is fully-aligned and synergistic with the Organizations’ Long-Term Strategy (3-5 years) and companion Near-Term Strategic Goals & Outcomes (1-2 years).
- The key to developing your Business Analytics Strategy is to find the entry and inflection points in your strategy’s execution where BA can be embedded and used as either a catalyst or an accelerator for success.
- The value of having an Analytics Partner (AP) in this process is substantial and in the early stages of any organizations’ journey to Analytics Maturity they can make the difference between success and disappointment, much less outright failure.
“Choosing an Analytics Trusted Advisor to support your BA Strategic Planning Process”
At this point we have established that pervasive Business Analytics (BA) can be a game changer for every Organization. To achieve Competitive Advantage (CA) from Business Analytics you need a well defined Strategy that aligns all BA activities and outcomes with the Business Goals & Objectives (BG&O) defined in both the long-term and near-term strategies & tactics of the Organization. This alignment should be across all major domains of the Business/Organization. Fostering and leveraging synergies found in core information assets into Analytical Focus Areas that benefit the entire organization is the cornerstone of such a Business Analytics Strategy.
Developing a BAS requires collaboration and partnership with an Analytics Trusted Advisor in the vast majority of cases. Most organizations in the Mid-Market do not have the depth of personnel or base of applied experience required to create a comprehensive Business Analytics Strategy internally. Staff efforts are mainly focused on Operational Performance and Innovation Activities and not on strategy endeavors, therefore justifying the need for a Trusted Advisor as being paramount to success. Choosing a BA Trusted Advisor is an early step in your Analytics Journey (AJ) and should be done after a thorough and rigorous interview & selection process. There are many Business Intelligence consultancies who claim to be as good at Business Analytics, but one should be wary of such claims. Although the worlds of Information Management (IM), Business Intelligence (BI) and Business Analytics are merging together at many levels, the expertise required to develop a successful Business Analytics Strategy is limited to a small community of Consultancies and Suppliers. In most cases you will have to take a long-term view of the partner whom you choose in the context of not only helping you to develop your BA Strategy, but ultimately helping you to acquire & deploy the necessary solutions & capabilities required to insure that the strategic outcomes successfully achieved. The Business Analytics Trusted Advisor will provide support in developing, testing and optimizing early Analytical Models & Data Sets. All of these activities will be complimented with an effective plan & activity set for Change Management & Cultural Adoption for your Organization. A holistic approach to your overall Business Analytics Strategy and its successful execution requires a long-term view of achieving success and the support of Trusted Advisor whom can provide all of these types of services to the levels required.
Choosing your Analytics Trusted Advisor does not need to be an arduous process. It could be as simple as engaging with an existing partner or conducting a quick survey of the leaders in the Business Analytics space who have focus areas on your type of business (Mid-Market) and industry segment (Service Providers, Software/Technology, Retail, etc.). The market leaders will all have consulting teams & solution sets optimized for the specifics of your size & type, as well as having a deep portfolio of critical enablers for Business Analytics success e.g Strategy Templates, Specific Analytics Solution sets (Customer, Finance, Corporate Performance, etc.), Change Management collateral, Information Governance guidelines, etc. All of these elements will be required over the long haul as you move from Strategy to Execution t0 Outcomes. Additionally, your BA Trusted Advisor will bring an overall discipline to the overall approach by helping you to focus on early quick wins in your Analytics Journey, as you change your culture to being an Analytics-Driven one over time. The depth and maturity of your BA Trusted Advisors appraoch to achieving such outcomes while reducing risk to a manageable level is a Critical Success Factor that every organization should look from in their partner(s).
In the end, each Organization must define the criteria and process for choosing and engaging with an Analytics Trusted Advisor. Going it alone is fraught with risks and should only be advocated if the Organization believes that it has the depth of experience and know-how to achieve Analytics Success on their own. In choosing your Advisor one must look for a leader who has made/demonstrated a commitment to supporting Organizations of your size, ambitions and market focus. Only a handful of Consultancies/Suppliers in the marketplace rise to this level of distinction.
For more information on one such Trusted Advisor in the market (IBM), please check out the following links;
http://www-01.ibm.com/software/analytics/excellence-center/
http://www-935.ibm.com/services/us/gbs/bao/
http://www-935.ibm.com/services/us/gbs/thoughtleadership/ibv-embedding-analytics.html
In conjunction with a webinar that I am participating in on 2/29 ( ZD & IBM – “Get More from your Data: How Business Analytics Gives You a Competitive Advantage”), I am posting a series of four blogs entitled “Business Analytics and the Mid-Market“.
(To attend my webinar on 2/29, Register at: http://b2b.ziffdavis.com/webcasts/improve-performance-your-data-business-analytics/?tfso=10480 )
This is installment No. 3 in that series; ”
To recap from my previouspostings;
- Business Analytics (BA) is “the use of data & analysis techniques to understand your business in a a way that facilitates better decision making”. BA is “fact-based decision-making in real-time based upon a 360 degree view of the business. It portends to offer the highest potential for competitive advantage of any strategic enabler (much less tactical or operational) available in the business leaders portfolio today, much less the future.
- To achieve true competitive advantage one must embrace the notion of Business Analytics in a holistic fashion in order to create “a pervasive culture of analysis and numerical literacy”. The 5 components of a holistic approach are; People, Processes, Technology, Culture & Data
- To achieve competitive advantage (via differentiation), much less sustain it, Organizations must make Business Analytics a core competency and foster its deep usage across all domains of the business. Business Analytics must be made pervasive across the organization
- Critical to the successful creation of competitive advantage is the role of the Business Analytics Strategy. It should encompass all domains of your business and support the 5 Pillars (People, Processes, Technology, Culture & Data) of a holistic approach to Business Analytics.
“How to Define & Create a Business Analytics Strategy for your Organization”
A successful Business Analytics Strategy is one that is fully-aligned and synergistic with both the Long-Term Strategy (3-5 years) and its companion Near-Term Strategic Goals & Outcomes (1-2 years). The Business Analytics Strategy cannot exist outside of these influences and should not be an after-thought in the Strategic Planning Process. In a recent MIT/IBM Study – “Analytics: The New Path to Value” ( http://www-935.ibm.com/services/us/gbs/thoughtleadership/ibv-embedding-analytics.html) 45%+ of the Top Performing organizations were using analytics-driven insights to guide & define their long-term strategies (to create competitive advantage). These same Top Performers used BA at a rate of 5x in comparison to lower performers i.e. pervasiveness. These statistics are a small subset of the many that were uncovered in respect to how Top Performers differentiated themselves from their peers and the competition in numerous benchmark measures.
Business Analytics provides strategic enablement around the 3 major pillars of any long-term strategy*
- Using Innovation to Differentiate
- Revenue & Profit Growth
- Efficiency Enhancements (along with reducing inherent costs)
The key to developing your Business Analytics Strategy is to find the entry and inflection points in your strategy’s execution where BA can be embedded and used as either a catalyst or an accelerator for success. Every Organization will have different points along its strategic journey where BA can fill such roles, but typical ones would include;
- Corporate Performance Management (Measuring, Monitoring and Optimizing key levers for Strategic Goal Attainment)
- Product Research & Development (Design & Simulation, Quality Optimization & Zero Defect Designs)
- Financial Management (Budget & Gross Margin Optimization, Cash & Investments & Risk Controls)
- Customer Insights & Engagement (Advocacy, Brand & Awareness)
A successful Business Analytics Strategy fully aligns itself with all aspects (and aspirations) of the overall strategy for the Organization. Achieving successful outcomes from the BA Strategy process requires a partnership amongst all of the key stakeholders (Executives, Finance, Sales/Marketing, Engineering & Development, Manufacturing & Distribution, Support, etc.), the IT Services team (internal an/or external) and the organizations’ Trusted Analytics Partner. The value of having an Analytics Partner in this process is substantial and in the early stages of any organizations’ journey to Analytics Maturity they can make the difference between success and disappointment, much less outright failure.
Critical questions to ask/answer in your Business Analytics Strategic Planning exercise should include;
- What are the measures of Strategic Success? How do we quantify them? Where and When should they be measured? What data sources & proxies are required?
- How do we instrument the Value Chain and measure/monitor outcomes at critical junctures?
- What predictors of success/behavior are critical to leverage?
- What historical & real-time information sources are required?
- What modeling methods are most appropriate and provide the deepest insights?
There are many others that you would want to consider given the breadth and scope of the organization’s strategy altogether. Your Trusted Analtyics Advisor should be well versed in your business vertical and know your organization intimately so as to guide/facilitate the Strategic Planning Process to a successful outcome.
In my final installment of this series (4 of 4), I will focus on “How to Choose your Trusted Analytics Advisor”.
* When one considers the fact for every $1 invested in Business Analytics there is an ROI of $10.66 (Nucleus Research Note L127) it would be hard to not include BA as a “strategic enabler” in any Organizations strategic planning endeavors.
In conjunction with a webinar that I am participating in on 2/29 ( ZD & IBM – “Get More from your Data: How Business Analytics Gives You a Competitive Advantage”), I am posting a series of four blogs entitled “Business Analytics and the Mid-Market“.
(To attend my webinar on 2/29, Register at: http://b2b.ziffdavis.com/webcasts/improve-performance-your-data-business-analytics/?tfso=10480 )
This is installment No. 2 in that series; ”
To recap from my last posting;
- Business Analytics (BA) is “the use of data & analysis techniques to understand your business in a a way that facilitates better decision making”. BA is “fact-based decision-making in real-time based upon a 360 degree view of the business. It portends to offer the highest potential for competitive advantage of any strategic enabler (much less tactical or operational) available in the business leaders portfolio today, much less the future.
- To achieve true competitive advantage one must embrace the notion of Business Analytics in a holistic fashion in order to create “a pervasive culture of analysis and numerical literacy”. The 5 components of a holistic approach are; People, Processes, Technology, Culture & Data
Where to use Business Analytics (BA) to create sustainable sources Competitive Advantage”
Business Analytics must be used pervasively in order to achieve long-term Competitive Advantage. In most organizations, the central focus for BA has been around the domain of “Customer”. This is clearly the most mature and comprehensive area of application of successful Business Analytics (there are now 30+ dimensions of Customer activity that can be measured, modeled and used to create a “predictive view of behavior,opportunity or risk”) and yet, sustainable Competitive Advantage is elusive. Many organizations under the auspices of the Strategic Marketing banner (CMO) have focused their entire energy only on this domain, leaving others untouched or given the short shrift. As one would imagine this singular focus is closely monitored by mimiced by the competition, thereby negating the means to sustain this source of Competitive Advantage. In many cases the data, the tools & platforms and the algorithms are all the same i.e. Salesforce.com creating little opportunity for differentiation at the end of the day.
To achieve differentiation, much less sustain it, Organizations must make Business Analytics a core competency and foster its deep usage across all domains of the business. This “pervasive approach” not only addresses all domains of the business equally, but creates a higher level of differentiation and operational excellence (both of which are great sources of Competitive Advantage) in aggregate. Business Leaders must strive for this “multiplier effect” as they plan to build their “”Predictive Enterprise” and assign/assess the necessary investments required to achieve it (the 5 Pillars of a holistic approach).
Critical business domains where Business Analytics can create Competitive Advantage appear to be straight-forward and self-evident, but warrant discussion nonetheless. Regardless of the size or type of your Mid-Market organization, Business Analytics can successfully be applied to the following domains with relative ease;
- Manufacturing & Distribution
- Sales & Marketing
- Finance & Risk
- Human Capital Management
- IT Services
- Corporate Management
In each of these domains there are mountains of data created during the normal course of business, much less available from 3rd parties. The critical path is “how to leverage it with Business Analytics to achieve sustainable competitive advantage”?
Critical to the successful creation of competitive advantage is the role of the Business Analytics Strategy. This strategy must be a subset of your overall Corporate Strategy, Vision & Roadmap. It should not be subordinated to a lesser role or criticality in the grand scheme of things.
A Business Analytics Strategy should encompass all domains of your business (as listed above), along with the 5 Pillars required to create a holistic “culture of analytics” in your organization altogether. It should take a “top-down” view and apply a “bottoms-up” approach to building it out. In most cases, this is the time when each organization must begin (if not already in place) to choose a “strategic partner” for their long-term analytics journey. In the Mid-Market space, few organizations have the internal resources, expertise or depth of knowledge to create a BA Strategy on their own. Relying on a true strategic partner for these services is the most viable approach in almost all cases and enhances the “time to value” in achieving successful analytics outcome and ultimate competitive advantage.
In my next posting “Defining your Business Analytics Strategy” I will focus on the criteria one should use in choosing a BA strategic partner and what should be contained in the BA Strategy to assure success.
For those who to dig deeper into the concepts of Competitive Advantage this is where to begin.
In conjunction with a webinar that I am participating in on 2/29 ( ZD & IBM – “Get More from your Data: How Business Analytics Gives You a Competitive Advantage”), I am going to post a series of four blogs entitled “Business Analytics and the Mid-Market“.
(To attend my webinar on 2/29, Register at: http://b2b.ziffdavis.com/webcasts/improve-performance-your-data-business-analytics/?tfso=10480 )
This is installment Number 1 in that series; ” Business Analytics and Competitive Advantage”
In the world of business strategy there is one term that is is continuously referred to by nearly everyone, but is only well understood by a few. That term is “Competitive Advantage”. In the early 1980’s a young professor, Dr. Michael Porter, began to espouse the concept of Competitive Advantage, based upon his research findings at HBS. Central to his new concept in Management Theory was the notion of “differentiation” (versus “disruption”, which came along years later from his colleague, Dr. Clay Christensen ). Numerous case studies have been formulated and books written on Competitive Advantage by Dr. Porter and many, many others since then. When I was getting my MBA at Wharton the study and analysis of Porter’s theories and early work were a central theme to the course work on Strategy altogether. For businesses to succeed they must clearly differentiate themselves in both tangible and intangible ways from their competition. The most used (but most fleeting) method of differentiation used today is Price (or perceived value by the customer). Advantages based upon price alone are short lived and very difficult to sustain over the long term, without core cost structures being inherently lower than all other competition. Pursuit of this lower cost of goods and services has fostered wave-after-wave of investment in new technologies and processes that promise to “change the game cost-wise” Little empirical evidence exists as to just how successful these investments were as competitors were quick to follow with similar investments of the own e.g. ERP, CRM, HRM, et However, what has resulted from these endeavors is the vast wealth of data that until just recently was not well leveraged due to poor Information Management practices and architectures. Enter the role and influence of the concept of “Business Analytics”. Business Analytics (BA) is “the use of data & analysis techniques to understand your business in a a way that facilitates better decision making”. BA is “fact-based decision-making in real-time based upon a 360 degree view of the business. It portends to offer the highest potential for competitive advantage of any strategic enabler (much less tactical or operational) available in the business leaders portfolio today, much less the future. We have had comprehensive Information Management and Business Intelligence solutions for many years now. IM ha provided a rich framework for collecting and organizing vast amounts of information from complex systems and unstructured sources (ala Big Data), and BI has provided a means to report and display both historical and current state information in numerous ways, but neither of these have created true competitive advantage for most organizations (large or small). To achieve true competitive advantage one must embrace the notion of Business Analytics in a holistic fashion in order to create “a pervasive culture of analysis and numerical literacy”. Business Analytics is not an elitest sport for Geeks or so-called “Data Scientists”, but must be regarded as part of the core fabric of the organization. It must be woven into every part of the enterprise;
- The People (everyone from the CEO to the front-line Knowledge Worker must embrace analytics as a source of competitive advantage and exploit it for the good of the business)
- The Proceses (every aspect of running and measuring the performance of the business, and governing the use & exploitation of all the information assets)
- The Technology (an Information-driven enterprise requires inordinate investments in the health & welfare of the entire information infrastructure)
- The Culture must be made numerically literate, analytics capable and driven by the desire to use information as a strategic weapon.
- The Data must be robust and represent all facets of the business. It must be characterized and organized for successful exploitation by the entire analytics-driven culture.
Once your Analytics-driven enterprise is firing on all cylinders, you will then realize the cumulative effect of your competitive advantage in such a fashion that no one can easiely mount a meaningful competitive threat against you or your partners without you being able to “pull the levers of differentiation” to counter it. In my next Installment ( “Where to use Business Analytics to Create sustainable sources of Competitive Advantage”) I will dig into the specifics of how Mid-Market organizations can successfully apply BA to their business.
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