How to Compete on Analytics Thomas Davenport describes the prerequisites and the five stages of analytic competitiveness By Alison Bolen Thomas Davenport's article "Competing on Analytics" was the best‐selling Harvard Business Review reprint in 2006. To write it, Davenport,The President's Distinguished Professor in Management and Information Technology at Babson College, studied the characteristics of more than 50 leading organizations that have made a commitment to quantitative, fact‐based analysis. Why is the January 2006 Harvard Business Review article so popular? We recently asked the author and educator that question and discussed further insights from his research that will be detailed in his new book, Competing …show more content…

Stage three is when somebody important to the organization's strategy decides there can be a different way to do it, and they create a vision. They think about what aspects of the business it might drive or enable, and they start assembling the capabilities to actually pull off some analytical competition. Stage four companies have most of the pieces in place except for maybe the passion of leadership. They know where analytics might be relevant to the business. They know what human capabilities they need, and they've assembled those. They've bought a lot of SAS software. They have the right hardware architecture in place. It's a part of what they do, but it's not yet the primary focus for their competitive strategy. Stage five is the full‐bore analytical competitors that consciously and visibly use analytics as a primary factor in their competition and strategy. These organizations have made a conscious decision at the highest levels to compete on analytics. They have identified the key strategies and capabilities to be sup ported by analytics, and are actively using analytics to influence the ways they conduct business. Why do you think this research is resonating so strongly with executives right now? DAVENPORT: I think senior executives have realized that ultimately the only way they can compete effectively is to have better processes than anybody else. But to have better processes, you have to have better data and ‐ ultimately ‐ have