competing on analytics
The New Science of Winning
Thomas H. Davenport and Jeanne G. Harris
harvard business school press boston, masssachusetts
Copyright 2007 Harvard Business School Publishing Corporation All rights reserved Printed in the United States of America 11 10 09 08 07 5 4 3 2 1
No part of this publication may be reproduced, stored in or introduced into a retrieval system, or transmitted, in any form, or by any means (electronic, mechanical, photocopying, recording, or otherwise), without the prior permission of the publisher. Requests for permission should be directed to firstname.lastname@example.org, or mailed to Permissions, Harvard Business School Publishing, 60 Harvard Way, Boston, Massachusetts 02163. Library of Congress Cataloging-in-Publication Data Davenport, Thomas H., 1954– Competing on analytics : the new science of winning / Thomas H. Davenport and Jeanne G. Harris. p. cm. ISBN-13: 978-1-4221-0332-6 (hardcover : alk. paper) 1. Business mathematics. 2. Business intelligence. I. Harris, Jeanne G. II. Title. HF5691.D38 2007 658.4'013—dc22 2006035422 The paper used in this publication meets the requirements of the American National Standard for Permanence of Paper for Publications and Documents in Libraries and Archives Z39.48-1992.
Foreword by Gary Loveman Acknowledgments
Part One The Nature of Analytical Competition
1 The Nature of Analytical Competition Using Analytics to Build a Distinctive Capability 2 What Makes an Analytical Competitor? Defining the Common Key Attributes of Such Companies 3 Analytics and Business Performance Transforming the Ability to Compete on Analytics into a Lasting Competitive Advantage 4 Competing on Analytics with Internal Processes Financial, Manufacturing, R&D, and Human Resource Applications 5 Competing on Analytics with External Processes Customer and Supplier Applications 83 57 41 23 3
viii • Contents
Part Two Building an Analytical Capability
6 A Road Map...