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By now, most of you have probably heard of, or read, the book entitled Competing on Analytics by Thomas Davenport that demonstrates how some of the most successful organizations in the world have made analytics a core capability and integral to their strategic planning. MIT Sloan has been tracking this phenomenon since 2010 echoing Davenport’s findings. From 2010 to 2012 they indicated that 67% of those surveyed believed that analytics gave their organizations a competitive edge. However, in their last installment of their longitudinal study, something interesting happened. Something that I like to call the ‘Oakland Athletics Effect’.
The Athletics, thanks to the popular movie called ‘Moneyball’ starring Brad Pitt, became the poster child of the emerging ‘analytics first’ movement in business and sports. By the grace of analytics, the Athletics were suddenly qualifying for the post season on a regular basis while maintaining the lowest payroll in baseball. This trend lasted for a while until everyone else figured it out, like the Boston Red Sox, thus marginalizing that competitive edge that the Athletics once enjoyed. This phenomenon is echoed by the 2013 installment of the MIT study indicating that a plateau has been reached on analytics and being competitive.
A key takeaway in MIT’s more recent report ‘The Analytics Mandate‘, speaks to how competing on getting the right data has become as important as competing with data, and gives rise to the need to find data sets, both internal and external, that can provide the valuable insight that separates leaders from laggards. Examples of these valuable data sets are economic indices, census data, customer satisfaction indices, and industry benchmarks, to name a few.
What are some of the 3rd party data sources that you use on a regular basis and how have they impacted your competitive edge?