PROVEN. RESULTS. FASTER.

University of Tennessee© Bradley, Miles and Pannell

Business Analytics Strategic

Approaches

Session Objectives

To review the definition of business analytics

To introduce five approaches to business analytics

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What is Business Analytics?

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Blindfolded Men Describe Elephant

It’s a Snake It’s a

Spear

It’s a Bridge

It’s a Tree Trunk

It’s a Blanket

It’s a Python

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Blindfolded Men Describe Elephant

It’s Data Warehousin

gIt’s SAS Softwar

e

It’s Statistic

s

It’s Mathematical Models

It’s 6 Sigma

all over again!

It’s Executive Dashboar

ds

Business Analytics

It’s Computer Science

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Davenport – Competing on Analytics

“The extensive use of data, statistical and quantitative analysis, explanatory and predictive models, and fact-based management to drive decisions and actions”.

Re-quoted from Competing on Analytics

Enterprise Analytics. Thomas Davenport. Pearson Publishing. 2013. Page 9.

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 TQM (1980’s)

Fact-based decision making. In order to know how well an organization is performing, data on performance measures are necessary. TQM requires that an organization continually collect and analyze data in order to improve decision making accuracy, achieve consensus, and allow prediction based on past history.

Six Sigma (1990’s)

Features that set Six Sigma apart from previous quality improvement initiatives include:

A clear focus on achieving measurable and quantifiable financial returns from any Six Sigma project.

An increased emphasis on strong and passionate management leadership and support.

A special infrastructure of "Champions", "Master Black Belts", "Black Belts", "Green Belts", etc. to lead and implement the Six Sigma approach.

A clear commitment to making decisions on the basis of verifiable data and statistical methods, rather than assumptions and guesswork.

Been There …… Done That?

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Differences We See

Big Data Real-Time use of data Selling data Decision-Based data

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The Best Definition

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Allen’s Definition of Business Analytics

Utilizing Data to Increase Shareholder Value

Data = Big and Small Internal and External Structured and Non-structured Traditional and “New” “Free” and Purchased

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Allen’s Definition of Business Analytics

Utilizing Data to Increase Shareholder Value

Utilizing = Determine Business Needs Capture and Store Ensure Quality Access and Format Analyze and Summarize Gain Insight and Produce Action and …….. ‘Sell’ It

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PROVEN. RESULTS. FASTER.

Types of Questions and Analytics

Descriptive Predictive Prescriptive

Questions What happened?What’s happening?What actions are needed?What exactly is the problem?What actions are needed?

Why is this happening?What will happen next?Why will it happen?

What should I do?Why should I do it?What’s the best that can happen?What if we try this?

Enablers • Ad hoc Reports• Dashboards• Data Warehousing• Alerts

• Data Mining• Text Mining• Web/Media Mining• Forecasting

• Optimization• Simulation• Decision Modeling• Randomized Testing

Outcomes Well defined business problems and opportunities

Accurate projections of the future states and conditions

Best possible business decisions and transactions

Possible Strategies for Business Analytics

1. Competing ON Analytics Analytics is THE key competitive advantage Target Result – Sustainable competitive advantage

2. Competing WITH Analytics Focus on one business process Target result – Incremental profits

3. Improving With Analytics Culture of analytics Target result – Continuous improvement

4. Revenue Through Analytics “Sell” data as a secondary product Improved margins or market share

5. Persevering Through Analytics Do what the competition does The price of entry

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Which Strategy?

Our Mission:CareerBuilder's mission is to empower employment. We are striving to organize all the world's human capital data and make it meaningful for society

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Analytics Practices…Who’s Doing What?

51%

19%

12%

8%

5%4%

1%Improving with Analytics (Incrementalists)

Competing with Analytics (Internists)

Revenue through Analytics (Industrialists)

Competing on Analytics (In-tensivists)

Persevering though Analyt-ics (Idlers)

Are you kidding me…I have no idea!

Other

N=95 firms

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