Notes

Chapter 1

1. Accenture survey of 254 U.S. managers; see “Most U.S. Companies Say Business Analytics Still Future Goal, Not Present Reality,” Accenture press release, Dec. 11, 2008, http://newsroom.accenture. com/article_display.cfm?article_id=4777.

2. John W. Tukey, Exploratory Data Analysis (Reading, MA: Addison Wesley, 1977); Edward Tufte, The Visual Display of Quantitative Information, 2nd ed. (Cheshire, CT: Graphics Press, 2001).

3. Gary Klein, Sources of Power: How People Make Decisions (Cambridge, MA: MIT Press, 1999).

4. Interview with Mike Linton, February 15, 2006.

5. Nassim Nicholas Taleb, The Black Swan: The Impact of the Highly Improbable (New York: Random House, 2007).

6. Cameron French, “TransAlta Says Clerical Snafu Costs It $24 Million,” GlobeandMail.com, June 3, 2003, http://www.globeinvestor.com/ servlet/ArticleNews/story/ROC/20030603/2003-06-03T232028Z_01_N0 3354432_RTRIDST_0_BUSINESS-ENERGY-TRANSALTA-COL.

7. Jonathan B. Cox, “Incentive Model Called Too Rosy,” Raleigh (NC) News and Observer, March 22, 2007, http://www2.nccommerce.com/ eclipsfiles/16386.pdf.

8. Carol Hymowitz, “Companies Need CEOs to Stop Spinning and Start Thinking,” Wall Street Journal, December 19, 2007.

9. David Olive, “Getting Wise Before That ‘One Big Mistake,’” Toronto Star, December 17, 2007, B1.

10. Willy Shih, Stephen Kaufman, and David Spinola, “Netflix,” Case 9-607-138 (Boston: Harvard Business School, revised November 19, 2007).

Chapter 2

1. Interview with Al Parisian, January 2009, and e-mail correspondence.

2. Chuck Salter, “Why America Is Addicted to Olive Garden,” Fast Company, July 1, 2009, http://www.fastcompany.com/magazine/137/why-america-is-addicted-to-olive-garden.html.

3. Mark McClusky, “The Nike Experiment: How the Shoe Giant Unleashed the Power of Personal Metrics,” Wired, June 22, 2009, http://www.wired.com/medtech/health/magazine/17-07/lbnp_nike.

4. Accenture, “Helping the Royal Shakespeare Company Achieve High Performance Through Audience Analytics, Segmentation and Targeted Marketing,” 2008, http://www.accenture.com/NR/rdonlyres/891F5 AA1- A1C2-4828-81E8-BE4EBAD7948B/0/RSCcredentialFinal.pdf.

5. Mary Hayes Weier, “Coke’s Customer-Loyalty Web Site Scores Big with Consumers,” InformationWeek, July 21, 2008.

6. In the business intelligence (BI) world, this is known as the “Field of Dreams” approach. But if you build it, they will not come—and anyway, you will probably suffer in the effort.

7. Blog post by Judah Phillips of Web Analytics Demystified, July 19, 2008, http://judah.webanalyticsdemystified.com/2007/08/web-analytics-data-quality.html.

8. From an enterprise IT perspective, a data mart and an EDW serve different purposes. An EDW is truly a warehouse—a storage area where you can get bulk deliveries of very detailed data to fill the “store shelves.” A mart is more like a grocery store, where items are already sitting on store shelves, packaged and ready for consumption.

9. “Getting a Handle on Our Information! Information Stewardship at BMO FG” (document furnished to author), May 12, 2006, and discussion with BMO executives, April 19, 2007. This document suggests that BICCs are responsible for two key data functions: acquisition and stewardship. Acquisition includes activities such as data integration, data storage, testing, and maintenance. Stewardship includes the responsibility for data standards, quality, and governance.

10. Gloria J. Miller, Dagmar Brautigam, and Stefanie V. Gerlach, Business Intelligence Competency Centers: A Team Approach to Maximizing Competitive Advantage (New York: John Wiley & Sons, 2006), 38.

11. Interview with Lisa Tourville, March 6, 2008.

12. Interview with David Donkin, October 28, 2006; Wayne Eckerson, “New Ways to Organize the BI Team,” Data Warehousing Institute Business Intelligence Journal, March 28, 2006, http://www.tdwi.org/Publications/ BIJournal/display.aspx?ID=7896.

Chapter 3

1. Interview with Robin deHaan and Venkat Parakala, February 7, 2009.

2. Accenture Information Management Services survey of more than 250 executives is the basis of a report, “Competing Through Business Analytics,” which studied companies’ use of and investment in analytics to remain competitive. December, 2008.

3. Jeanne G. Harris and Thomas Davenport, “New Growth from Enterprise Systems: Achieving High Performance Through Distinctive Capabilities,” Research report, Accenture Institute for High Performance, 2006, 10.

4. Interview with Jim Kolsky and Mike Van Houten, July 17, 2008.

5. For a discussion of the enterprise IT architecture needed for business intelligence and analytics, see Thomas H. Davenport and Jeanne G. Harris, Competing on Analytics (Boston: Harvard Business School Press, 2007), chapter 8, “The Architecture of Business Intelligence.”

6. David L. Hill and Jeanne G. Harris, “Using Enterprise Systems to Gain Uncommon Competitive Advantage,” Outlook 1 (2007): 65–71.

7. Andrew K. Reese, “Planning to Succeed at Procter & Gamble,” Supply & Demand Chain Executive 8, no. 2 (February 1, 2007): 20.

8. Interview with Pradeep Kumar, June 24, 2009.

Chapter 4

1. Thomas H. Davenport, Jeanne G. Harris, David DeLong, and Al Jacobsen, “Data to Knowledge to Results: Building an Analytic Capability,” California Management Review 43/2 (Winter 2001): 117–138.

Chapter 5

1. Interview with Shannon Baillet-Antorcha, January 20, 2009.

2. Thomas H. Davenport and Jeanne G. Harris, Competing on Analytics (Boston: Harvard Business School Press, 2007), 9.

3. Leahy quote from George Anderson, “Part I: Tesco’s Leahy ID’s Global Opportunities,” Retail Wire Discussions series, http://www.retailwire.com/Discussions/Sngl_Discussion.cfm/12090.

4. For a useful framework describing three different business types and how they create value, see Øystein D. Fjeldstad and Espen Andersen, “Casting Off the Chains: Value Shops and Value Networks,” European Business Forum 14 (Summer 2003): 47–53. See also Charles B. Stabell and Øystein D. Fjeldstad, “Configuring Value for Competitive Advantage: On Chains, Shops, and Networks,” Strategic Management Journal 19 (1998): 413–437.

Chapter 6

1. Jeanne G. Harris, Elizabeth Craig, and Henry Egan, “How to Create the Talent-Powered Analytical Organization” research report, Accenture Institute for High Performance, 2009.

2. Interview with Dr. Steven Udvarhelyi, December 10, 2008.

3. Interview with Kyle Cheek, November 24, 2008. Kyle Cheek has moved to another company since we interviewed him for this book and is now vice president of data services and analytics at Emdeon Business Services.

4. Interview with Daryl Wansink, January 29, 2009.

5. Interview with David Scamehorn, December 31, 2008. Scamehorn has moved to another company since we interviewed him for this book and is now director of customer analytics at Advance Auto Parts.

6. “Will Smith Voted 2008’s Top Money-Making Movie Star,” www.reuters.com/article/entertainmentNews/idUSTRE5013DY20090102, Reuters newswire, January 2, 2009.

7. R. Grover, “Box Office Brawn,” BusinessWeek, January 14, 2008, 18.

8. Scott Bowles, “Will Smith Has Found the Magic Formula,” USA Today, June 26, 2008.

9. R.W. Keegan, “The Legend of Will Smith,” Time, November 29, 2007.

10. Christopher Kelly, “Box-office champ Smith says ‘Seven Pounds’ offers him the chance to shed old persona” December 16, 2008, http://www.popmatters.com/pm/article/67010-box-office-champ-smith-says-seven-pounds-offers-him-the-chance-to-she/ or this one from the Will Smith fan site, http://www.willsmithweb.com/2008/12/14/seven-pounds%e2%80%99-offers-chance-to-shed-some-of-his-old-persona/.

11. Interview with Byrne Doyle, January 6, 2009. Since our interview, Doyle has been promoted to vice president, territory general manager, a significant promotion.

12. A common misconception is that most analytical workers lack broader business know-how. In fact, our research found that analytical workers had higher levels of business acumen than their non-analytical counterparts. Analysts in our study showed a greater and often more nuanced understanding of their company’s strategy, goals, and core capabilities, as well as the impact of external forces on their organization—such as the actions of competitors or regulators. Analytical champions scored highest on business acumen, which is needed to align analytical capabilities with business priorities. Professionals had high levels of business acumen as well. It’s clear that, despite their deep technical skills, pros are not just backroom statisticians, but also must possess strong business insight.

13. Warren E. Buffett, Annual Letter to Shareholders of Berkshire Hathaway, 2008, http://www.berkshirehathaway.com/letters/2008ltr.pdf.

14. Interview with Sharon Frazee, November 10, 2008.

15. This section adopts a framework published in Peter Cheese, Robert J. Thomas, and Elizabeth Craig, The Talent Powered Organization (London: Kogan Page, 2007).

16. Jeanne G. Harris, Elizabeth Craig, and Henry Egan, “How to Organize Your Analytical Talent,” research report, Accenture Institute for High Performance, 2009.

17. These Web sites include quantfinancejobs.com, jobs.phd.org, wilmott.com, and quantster.com.

18. Internal Accenture analysis, 2009.

19. On September 21, 2009, Netflix declared “BellKor’s Pragmatic Chaos,” a global group of researchers, scientists, and engineers, as winners of its $1 million contest to improve Cinematch. The winning entry improved the model’s performance by 10.6 percent.

20. Good Will Hunting, Miramax, 1997.

21. Interview with Cathy Mildenhall, May 25, 2007, and March 10, 2008.

Part Two

1. Gary Loveman, foreword, in Thomas H. Davenport and Jeanne G. Harris, Competing on Analytics (Boston: Harvard Business School Press, 2007), x.

Chapter 7

1. “Optimization Drives $19 Million at Avis,” www.fico.com/en/FIResourcesLibrary/Avis_Success_2540CS.pdf.

2. Also see Thomas H. Davenport and Jeanne G. Harris, Competing on Analytics (Boston: Harvard Business School Press, 2007), 150–152.

Chapter 8

1. Discussion by Teruyuki Minoura, then Toyota’s managing director of global purchasing, at 2003 Automotive Parts System Solution Fair held in Tokyo, June 18, 2003, http://www.toyotageorgetown.com/tps.asp.

2. Interview with John D’Amore, May 18, 2009, and e-mail correspondence.

3. Michael Roberto, Why Great Leaders Don’t Take Yes for an Answer (Upper Saddle River, NJ: Pearson Education/Wharton School Publishing, 2005).

4. Warren Bennis, Daniel Goleman, and Patricia Ward Biederman, Transparency: Creating a Culture of Candor (San Francisco: Jossey-Bass, 2008), 3–4.

5. “Profile: Barry Beracha,” St. Louis Commerce Magazine, November 1999, http://www.stlcommercemagazine.com/archives/november1999/ profile.html.

6. The online marketing consultant Jim Novo makes a similar point in his blog. See Jim Novo, “Marketing Productivity Blog,” http://blog. jimnovo.com/about-the-blog/

Chapter 9

1. Mathew Maier, “Finding Riches in a Mine of Credit Data,” Business 2.0, October 1, 2005, http://money.cnn.com/magazines/business2/business2_archive/2005/10/01/8359235/index.htm.

2. “Conning & Co. Study Says Auto Insurers Are Paying Closer Attention to Credit Scores,” Insurance Journal, August 2, 2001, http://www.insurancejournal.com/news/national/2001/08/02/14177.htm.

3. Interview with Dave Williams, January 29, 2008, and e-mail correspondence.

4. Brian P. Sullivan, “Pricing Sophistication Separates Carriers into Those Who Will Thrive, and Those Who Will Not,” Auto Insurance Report, May 31, 2004, www.insurquote.com/AIR05-31-04.pdf.

5. The American Airlines yield management story is described in detail in Robert L. Phillips, Pricing and Revenue Optimization (Palo Alto, CA: Stanford University Press, 2005), chapter 6.

6. Michael Lewis, Moneyball: The Art of Winning an Unfair Game (New York: Norton, 2003).

7. Jahn K. Hakes and Raymond D. Sauer, “The Moneyball Anomaly and Payroll Efficiency: A Further Investigation,” Clemson University working paper, September 2007.

Chapter 10

1. Interview with Jolie Baasch, October 16, 2007.

2. The American Medical Informatics Association defines informatics as “the effective organization, analysis, management, and use of information in health care.” See http://www.amia.org/informatics/.

3. Interview with Lisa Tourville, March 6, 2008.

4. Best Buy Q1 FY09 Earnings Call, June 16, 2009.

5. Interview with Marc Gordon, August 14, 2006.

Chapter 11

1. See, for example, Darrell Huff, How to Lie with Statistics, revised ed. (New York: Norton, 1993).

2. Paul Rogers and Marcia Blenko, “Who Has the D? How Clear Decision Roles Enhance Organizational Performance,” Harvard Business Review, January 2006.

3. See, for example, the RACI Diagram entry in Wikipedia, http://en.wikipedia.org/wiki/RACI_diagram (accessed November 28, 2008).

4. However, a Nielsen report in 2009 suggests that for most categories of consumer goods sold at retail, historical pricing elasticities still apply. It’s good to have and use data!

5. “Remarks of President Lawrence H. Summers,” Harvard School of Public Health Leadership Council, Cambridge, Massachusetts, October 21, 2003, http://www.president.harvard.edu/speeches/summers_2003/hsph_deans_council.php.