Introduction

1. Thomas H. Davenport and D. J. Patil, “Data Scientist: The Sexiest Job of the 21st Century,” Harvard Business Review, October 2012, https://hbr.org/2012/10/datascientist-the-sexiest-job-of-the-21st-century.

2. NewVantage Partners, Big Data Executive Survey 2017: Executive Summary of Findings, http://newvantage.com/wp-content/uploads/2017/01/Big-Data-Executive-Survey-2017-Executive-Summary.pdf.

3. Thomas H. Davenport, Jeanne G. Harris, David W. Delong, and Alvin L. Jacobson, “Data to Knowledge to Results: Building an Analytic Capability,” California Management Review 43, no. 2 (Winter 2001): 117–138; Thomas H. Davenport, “Competing on Analytics,” Harvard Business Review, January 2006; Thomas H. Davenport, “Analyze This,” CIO, October 1, 2005, http://www.cio.com/archive/100105/comp_advantage.html; and Thomas H. Davenport and Jeanne G. Harris, “Automated Decision Making Comes of Age,” MIT Sloan Management Review (Summer 2005).

Chapter One

1. Netflix quotation from Jena McGregor, “At Netflix, the Secret Sauce Is Software,” Fast Company, October 2005, 50. Other Netflix information comes from the company website (http://www.netflix.com); Mark Hall, “Web Analytics Get Real,” Computerworld, April 1, 2002; Timothy J. Mullaney, “Netflix: The Mail-Order Movie House That Clobbered Blockbuster,” BusinessWeek Online, May 25, 2006, http://www.businessweek.com/smallbiz/content/may2006/sb20060525_268860.htm?campaign_id=search; and a telephone interview with chief product officer Neil Hunt on July 7, 2006.

2. The “long tail” concept has been popularized by Chris Anderson in The Long Tail: Why the Future of Business Is Selling Less of More (New York: Hyperion, 2006).

3. Neil Hunt, interview with Tom Davenport, July 7, 2006.

4. Timothy J. Mullaney, “Netflix,” Bloomberg, May 25, 2006, https://www.bloomberg.com/news/articles/2006-05-24/netflix.

5. We define distinctive capabilities as the integrated business processes and capabilities that together serve customers in ways that are differentiated from competitors and that create an organization’s formula for business success.

6. David Darlington, “The Chemistry of a 90+ Wine,” New York Times Sunday Magazine, August 7, 2005.

7. One of the first books written on the subject of decision support was by Peter G. W. Keen and Michael S. Scott Morton, Decision Support Systems: An Organizational Perspective (Reading, MA: Addison-Wesley, 1978). A subsequent book written on the topic is by John W. Rockart and David W. De Long, Executive Support Systems: The Emergence of Top Management Computer Use (Homewood, IL: Dow Jones-Irwin, 1988). Also note Tom Gerrity Jr.’s 1971 article, “The Design of Man-Machine Decision Systems: An Application to Portfolio Management,” MIT Sloan Management Review 12, no. 2 (1971): 59–75; and Charles Stabell’s 1974 work, “On the Development of Decision Support Systems on a Marketing Problem,” Information Processing, as formative research in the field of DSS.

8. Rockart and De Long, Executive Support Systems.

9. Peter J. Denning, “The Science of Computing: Saving All the Bits,” American Scientist 78, no. 5 (September–October 1990): 402–405, http://denninginstitute.com/pjd/PUBS/AmSci-1990-5-savingbits.pdf.

10. Timothy King, “Gartner: BI & Analytics Top Priority for CIOs in 2016” (orig. posted March 11, 2016, in Best Practices), Business Intelligence Solutions Review, http://solutionsreview.com/business-intelligence/gartner-bi-analytics-top-priority-for-cios-in-2016/.

11. For example, refer to Jeffrey Pfeffer and Robert Sutton’s article “Evidence-Based Management,” Harvard Business Review, January 2006; and Eric Bonabeau’s article “Don’t Trust Your Gut,” Harvard Business Review, May 2003.

12. Malcolm Gladwell, Blink: The Power of Thinking Without Thinking (New York: Little, Brown, 2005).

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

14. Alan Deutschman, “Inside the Mind of Jeff Bezos,” Fast Company, August 2004, 52.

15. Sujeet Indap, “IBM Bets on Mergers and Algorithms for Growth,” Financial Times, January 12, 2016, https://www.ft.com/content/11010eea-ae5f-11e5-993b-c425a3d2b65a.

16. Seth Fiegerman, “Amazon Opens a Grocery Store with No Checkout Line,” Money, December 5, 2016, http://money.cnn.com/2016/12/05/technology/amazon-go-store/.

17. Michael Lewis, Moneyball: The Art of Winning an Unfair Game (New York: W. W. Norton & Company, 2004).

18. Alan Schwartz, The Numbers Game: Baseball’s Lifelong Fascination with Statistics (New York: St. Martin’s Griffin, 2005).

19. Ben Lindbergh and Rob Arthur, “Statheads Are the Best Free Agent Bargains in Baseball,” fivethirtyeight, April 26, 2016, https://fivethirtyeight.com/features/statheads-are-the-best-free-agent-bargains-in-baseball/.

20. For those not familiar with the Curse of the Billy Goat: https://en.wikipedia.org/wiki/Curse_of_the_Billy_Goat.

21. “Cubs Brass Finalizes ‘The Cubs’ Way’ Guide,” MLB.com, February 18, 2012, http://m.mlb.com/news/article/26749684/.

22. Andy Wasynczuk, then chief operating officer, New England Patriots, telephone interview with Tom Davenport, January 11, 2005.

23. From “Interview with Packers Director of Research and Development Mike Eayrs,” Football Outsiders, June 22, 2004, http://www.football-outsiders.com/ramblings.php?p=226&cat=8.

24. Chris Ballard, “Measure of Success,” Sports Illustrated, October 24, 2005.

25. Graham Ruthven, “When the Nerds Take Over,” Sports on Earth (blog), December 13, 2013, http://www.sportsonearth.com/article/64603094.

26. Uta Spinger, “World Cup in Brazil: Cheat Sheets Make Way for Apps,” SAP.com, June 17, 2014, http://news.sap.com/world-cup-brazil-cheat-sheets-make-way-apps/.

27. “The Great Analytics Rankings,” ESPN.com, http://www.espn.com/espn/feature/story/_/id/12331388/the-great-analytics-rankings.

Chapter Two

1. David Alles and John Burshek, “Ranking Analytics Maturity by Industry,” International Institute for Analytics report, June 2016, http://iianalytics.com/analytics-resources/ranking-analytics-maturity-by-industry.

2. Professor Mark Oleson of the University of Missouri, quoted in Pat Curry, “The Future of FICO,” Bankrate.com, November 1, 2005, http://www.bankrate.com/smrtpg/news/debt/debtcreditguide/fico-future1.asp.

3. Rajiv Lal and Patricia Matrone Carrolo, “Harrah’s Entertainment, Inc.,” Case 9-502-011 (Boston: Harvard Business School, 2002), 6.

4. Data from a BetterManagement survey and described in Gloria J. Miller, Dagmar Brautigam, and Stefanie V. Gerlach, Business Intelligence Competency Centers: A Team Approach to Maximizing Competitive Advantage (Hoboken, NJ: Wiley, 2006).

5. For more information on spreadsheet errors, see Raymond Panko’s article, “What We Know About Spreadsheet Errors,” Journal of End User Computing 10, no. 2 (Spring 1998): 15–21.

6. “Gartner Estimates That 90 Percent of Large Organizations Will Have a Chief Data Officer by 2019,” press release, January 26, 2016, http://www.gartner.com/newsroom/id/3190117.

7. A. Charles Thomas, LinkedIn profile, https://www.linkedin.com/in/acharlesthomas, accessed April 20, 2017.

8. Christopher H. Paige, “Capital One Financial Corporation,” Case 9-700-124 (Boston: Harvard Business School, 2001).

9. Victoria Chang and Jeffrey Pfeffer, “Gary Loveman and Harrah’s Entertainment,” Case OB45 (Stanford, CA: Stanford Graduate School of Business, November 2003), 7.

10. Keith Coulter, managing director, U.K. cards and loans, Barclay, telephone interview with Tom Davenport, October 11, 2005.

11. ORION example taken from several interviews with Tom Davenport and Jeanne Harris in 2014 through 2016 with project leader Jack Levis and other UPS executives; some of the example is described in Thomas H. Davenport, “Prescriptive Analytics Project Delivering Big Benefits at UPS,” DataInformed, April 19, 2016, http://data-informed.com/prescriptive-analytics-project-delivering-big-dividends-at-ups/.

12. Barry C. Smith, Dirk P. Gunther, B. Venkateshwara Rao, and Richard M. Ratliff, “E-Commerce and Operations Research in Airline Planning, Marketing, and Distribution,” Interfaces, March–April 2001, 37–55.

13. Tallys H. Yunes, Dominic Napolitano, et al., “Building Efficient Product Portfolios at John Deere,” working paper, Carnegie Mellon University, Pittsburgh, PA, April 2004.

14. Gary H. Anthes, “Modeling Magic,” Computerworld, February 7, 2005.

15. Gary Loveman, CEO of Harrah’s, from presentations and interviews with Tom Davenport, January 2005–June 2006.

16. The American Medical Informatics Association defines informatics as “data, information, and knowledge to improve human health and the delivery of health care services.” See https://www.amia.org/sites/default/files/files_2/What-is-Informatics-Fact-sheet-04-08-11.pdf.

Chapter Three

1. Ben Clarke, “Why These Tech Companies Keep Running Thousands of Failed Experiments,” Fast Company, September 21, 2016, https://www.fastcompany.com/3063846/why-these-tech-companies-keep-running-thousands-of-failed.

2. Ibid.

3. Susan Nunziata, “Capital One: Think Like a Designer, Work Like a Startup,” InformationWeek, May 2, 2016, http://www.informationweek.com/strategic-cio/capital-one-think-like-a-designer-work-like-a-startup/d/d-id/1325353?_mc=RSS_IWK_EDT&page_number=2.

4. Joanne Kelley, “Risky Business,” Context, July–August 1999.

5. See http://www.progressive.com.

6. Clarke, “Why These Tech Companies Keep Running Thousands of Failed Experiments.” Clarke quotes Jeff Bezos from Peter Diamandis, “Culture & Experimentation—with Uber’s Chief Product Office,” Abundance Insights, April 10, 2016, https://medium.com/abundance-insights/culture-experimentation-with-uber-s-chief-product-officer-520dc22cfcb4#.i9bh5xdie; and Jeffrey H. Dyer, Hal B. Gregersen, and Clayton M. Christensen, The Innovator’s DNA (Boston: Harvard Business Review Press, 2011), 136.

7. Jim Collins, Good to Great: Why Some Companies Make the Leap . . . and Others Don’t (New York: HarperCollins, 2001), 69.

8. Henry Morris, Stephen Graham, Per Andersen, Karen Moser, Robert Blumstein, Dan Velssel, Nathaniel Martinez, and Marilyn Carr, The Financial Impact of Business Analytics: Distribution of Results by ROI Category, IDC #28689 (Framingham, MA: International Data Corporation, January 2003).

9. Henry Morris, Predictive Analytics and ROI: Lessons from IDC’s Financial Impact Study, IDC #30080 (Framingham, MA: International Data Corporation, September 2003).

10. “Analytics Pays Back $13.01 for Every Dollar Spent,” Nucleus Research, September 2014, http://nucleusresearch.com/research/single/analytics-pays-back-13-01-for-every-dollar-spent/.

11. Rasmus Wegener and Velu Sinha, “The Value of Big Data: How Analytics Differentiates Winners,” Bain Brief, September 17, 2013, http://www.bain.com/publications/articles/the-value-of-big-data.aspx.

12. Kendall’s tau_b - coefficient: .194, error: .107 (one-tailed test); Spearman’s rho - coefficient: .272, error: .094 (one-tailed test). The small sample size of publicly reporting firms (N=20) explains the relatively low significance levels.

13. For this study, we defined an enterprise system as an integrated software package (from vendors such as SAP and Oracle) that addresses most of an organization’s day-to-day transactional data processing needs.

14. For more details, see Jeanne G. Harris and Thomas H. Davenport, New Growth from Enterprise Systems (Wellesley, MA: Accenture Institute for High Performance Business, May 2006).

15. Thomas H. Davenport, Jeanne G. Harris, and Susan Cantrell, The Return of Enterprise Solutions: The Director’s Cut (Wellesley, MA: Accenture Institute for High Performance Business, 2002).

16. Using Pearson’s product-moment coefficient of correlation, profit has a significant positive correlation with analytical orientation at r=.136 (p=.011), revenue growth is significantly correlated at r=.124 (p=.020), and shareholder return is correlated at r=.122 (p=.022).

17. For the purposes of this study, top and low performers were defined by asking respondents to assess their standing—on a scale of 1 to 5— in the industry relative to profit, shareholder return, and revenue growth. Top performers scored 14 or higher (out of a possible 15 points); 13 percent of the sample scored at this level. Low performers scored 8 or fewer points and represented 16 percent of the sample. We found these scores to be highly correlated with publicly reported business performance. We excluded government respondents because government agencies could not be evaluated using these criteria.

18. Steve LaValle, Eric Lesser, Rebecca Shockley, Michael S. Hopkins and Nina Kruschwitz, “Big Data, Analytics and the Path from Insights to Value,” MIT Sloan Management Review, Winter 2011, http://sloanreview.mit.edu/article/big-data-analytics-and-the-path-from-insights-to-value/.

19. Accenture and MIT, Winning with Analytics (Executive Summary), 2015. https://www.accenture.com/t20170219T213328—w—/us-en/_acnmedia/Accenture/next-gen/hp-analytics/pdf/Accenture-Linking-Analytics-to-High-Performance-Executive-Summary.pdf#zoom=50.

20. Michael Lewis in a speech at Accenture, San Francisco, June 16, 2006.

21. CompStat is described in detail on Wikipedia—see http://en.wikipedia.org/wiki/CompStat. Steven Levitt has questioned the crime reductions due to CompStat in “Understanding Why Crime Fell in the 1990s: Four Factors That Explain the Decline and Six That Do Not,” Journal of Economic Perspectives 18, no. 1 (Winter 2004): 163–190.

22. Thomas H. Davenport, “How Big Data Is Helping the NYPD Solve Crimes Faster,” Fortune, July 17, 2016, http://fortune.com/2016/07/17/big-data-nypd-situational-awareness/.

23. “Recent examples of crime reduction,” predpol.com/results/, accessed April 21, 2017.

24. “LAPD Using Big Data to Fight Crime,” Dataconomy, April 24, 2014, http://dataconomy.com/2014/04/lapd-using-big-data-fight-crime-2/.

25. Cindy Blanthorne and Kristen Selvey Yance, “The Tax Gap: Measuring the IRS’s Bottom Line,” CPA Journal Online (New York State Society of CPAs), April 2006,

26. Catherine Arnst, “The Best Medical Care in the U.S.,” BusinessWeek, July 17, 2006, 51.

27. “Smart Nation Big on Big Data,” Infocomm Media Development Authority website, https://www.imda.gov.sg/infocomm-and-media-news/buzz-central/2016/6/smart-nation-big-on-big-data, accessed April 21, 2017.

28. Duncan Cleary, “Using Analytics to predict fraud,” SAS website, https://www.sas.com/sv_se/customers/irish-tax-and-customers.html, accessed April 21, 2017.

29. For examples of analytics use by police, see PredPol website: http://www.predpol.com/in-the-press/.

30. Stephen Russo, “Improved Crisis Preparedness with Smarter Emergency Response Planning,” IBM Big Data & Analytics Hub blog, April 28, 2015, http://www.ibmbigdatahub.com/blog/improved-crisis-preparedness-smarter-emergency-response-planning.

31. Marco Iansiti and Karim Lakhani, “Data Ubiquity: How Connections, Sensors and Data Are Revolutionizing Business,” Harvard Business Review, November 2014, https://hbr.org/2014/11/digital-ubiquity-how-connections-sensors-and-data-are-revolutionizing-business.

32. Julianne Pepitone, “What Your Wireless Carrier Knows About You,” CNN Money, December 16, 2013, http://money.cnn.com/2013/12/16/technology/mobile/wireless-carrier-sell-data/.

33. Nathan Vardi, “The Quants Are Taking Over Wall Street,” Forbes, August 17, 2016, http://www.forbes.com/sites/nathanvardi/2016/08/17/the-quants-are-taking-over-wall-street/.

34. Doug Henschen, “Catalina Marketing Aims for the Cutting Edge of ‘Big Data,’” Informationweek, September 6, 2011, http://www.informationweek.com/big-data/big-data-analytics/catalina-marketing-aims-for-the-cutting-edge-of-big-data/d/d-id/1099971.

35. See http://www.catalinamarketing.com.

36. Sunil Garga, president of IRI’s Analytical Insights group, telephone interview with Jeanne Harris, October 2, 2006.

Chapter Four

1. Abhishek Menon and Anupam Jain, Overcoming Challenges in Data Integration, Stakeholder Collaboration, and Talent/Technology Investment to Operationalize Analytics in Pharma and Life Science, 2014, http://www.genpact.com/docs/default-source/resource-/analytics-in-pharma-and-life-sciences.

2. Jerry Z. Shan et al., “Dynamic Modeling and Forecasting on Enterprise Revenue with Derived Granularities,” Hewlett-Packard Laboratories, May 2005, http://www.hpl.hp.com/techreports/2005/HPL-2005-90.pdf.

3. Ibid., 6.

4. David Larcker and Chris Ittner, “Coming Up Short on Nonfinancial Measurement,” Harvard Business Review, November 2003.

5. Mark Leon, “Ad Game Analytics,” Intelligent Enterprise, January 21, 2005.

6. John Ballow, Robert Thomas, and Goran Roos, “Future Value: The $7 Trillion Challenge,” Journal of Applied Corporate Finance 16, no. 1 (Winter 2004): 71–76.

7. For example, see Peter D. Easton, Travis S. Harris, and James A. Ohlson, “Aggregate Accounting Returns Can Explain Most of Security Returns,” Journal of Accounting and Economics (1992); Gary C. Biddle, Robert M. Bowen, and James S. Wallace, “Does EVA(c) Beat Earnings? Evidence on Associations with Stock Returns and Firm Values,” Journal of Accounting and Economics (1997); and Stephen O’Byrne, “EVA and Its Critics,” Journal of Applied Corporate Finance (1997).

8. The Microsoft example comes from Jennifer Warnick, “88 Acres: How Microsoft Quietly Built the City of the Future,” Microsoft News Center, https://www.microsoft.com/en-us/stories/88acres/.

9. Coalition Against Insurance Fraud, “By the Numbers: Fraud Statistics,” http://www.insurancefraud.org/statistics.htm, accessed April 21, 2017.

10. William Dibble, Infinity Property & Casualty Builds a Smarter System for Fraud, InformationWeek Insurance and Technology, November 30, 2011, http://www.insurancetech.com/infinity-property-and-casualty-builds-a-smarter-system-for-fraud/a/d-id/1313275?.

11. Ibid.

12. Symantec Corporation, “2016 Internet Security Threat Report,” vol. 21, April 2016, https://www.symantec.com/security-center/threat-report, accessed April 21, 2017.

13. “Detecting Attacks before They Happen: Advanced Technologies for Better Cyber Attack Defense, FICO white paper, http://www.fico.com/en/latest-thinking/white-papers/detecting-attacks-before-they-happen.

14. Tom Davenport, “The Future of Cybersecurity,” LinkedIn, November 4, 2016, https://www.linkedin.com/pulse/future-cybersecurity-tom-davenport.

15. “Deloitte M&A Focus On: Analytics Survey Findings,” February 25, 2016, http://www.slideshare.net/DeloitteUS/deloitte-ma-focus-on-analytics-survey-findings .

16. Sujeet Indap, “IBM Bets on Mergers and Acquisitions for Growth,” January 12, 2016 , https://www.ft.com/content/11010eea-ae5f-11e5-993b-c425a3d2b65a.

17. “NX CAD Technology Drives Custom Surfboard Design,” Siemens case study, https://www.plm.automation.siemens.com/en_us/about_us/success/case_study.cfm?Component=123472.

18. Bill Brougher, interview with Tom Davenport, July 18, 2006.

19. International Institute for Analytics, “The Excellence in Analytics Award—‘The Anny,’” http://www.iianalytics.com/analytics-resources/the-excellence-in-analytics-award, accessed April 21, 2017.

20. Shigeru Komatsu of Toshiba Semiconductor, interview with Tom Davenport, April 10, 2006.

21. “Toshiba Taps AI to Boost Productivity at Memory Plant” Nikeii Asian Review, June 29, 2016. http://asia.nikkei.com/Spotlight/Toshiba-in-Turmoil/Toshiba-taps-AI-to-boost-productivity-at-memory-plant.

22. Rod Doerr, Union Pacific Railroad, 2016 Grain Safety and Quality Conference, Omaha, NE, August 3, 2016, https://www.youtube.com/watch?v=sJDNa-AWzJY, minute 16:35.

23. ORION example taken from several interviews in 2015 and 2016 with project leader Jack Levis and other UPS executives; some of the example is described in Thomas H. Davenport, “Prescriptive Analytics Project Delivering Big Benefits at UPS,” DataInformed website, April 19, 2016, http://data-informed.com/prescriptive-analytics-project-delivering-big-dividends-at-ups/.

24. A factorial (represented in mathematical equations as an exclamation point) is calculated as the product of an integer (n) and every integer below it: n! = n (n – 1)(n – 2)(n – 3) . . . In this case, 120! = 120*119*118 . . . *1.

25. IIA––International Institute for Analytics, “CATERPILLAR 3000K,” YouTube video, September 28, 2016, https://www.youtube.com/watch?v=JeS5SPyvHmA.

26. “13 Innovations Highlighted in Oberhelman’s Remarks at the 2015 Annual Stockholders Meeting,” press release, June 10, 2015, http://www.caterpillar.com/en/news/caterpillarNews/innovation/13-innovations-highlighted-in-oberhelmans-remarks-at-the-2015-annual-stockholders-meeting.html.

27. Barry Werth, The Billion Dollar Molecule: One Company’s Quest for the Perfect Drug (New York: Simon & Schuster, 1995), 135.

28. Steven Schmidt of Vertex Pharmaceuticals, interview with Tom Davenport, April 5, 2006.

29. Alex Bangs, “Predictive Biosimulation and Virtual Patients in Pharmaceutical R&D,” in Medicine Meets Virtual Reality 13: The Magical Next Becomes the Medical Now, eds. James D. Westwood et al., vol. 111, Studies in Health Technology and Informatics (Amsterdam, Netherlands: IOS Press, 2005), 41.

30. Information about American Healthways obtained from a presentation by Dr. Carter Coberly at the Health Information Technology Summit, Washington, DC, 2004, http://www.ehcca.com/presentations/cahealthit2/2_03_1.pdf.

31. Bill Belichick, “Quotes from New England Patriots Media Day,” February 1, 2005, cited in James Lavin, Management Secrets of the New England Patriots, vol. 2 (Stamford, CT: Pointer Press, 2005), 159.

32. “The Right Profile Helps Super Bowl Champion New England Patriots Identify and Develop Mentally Tough Athletes,” PRWeb, February 8, 2017, http://www.prweb.com/releases/therightprofile/athletetypes/prweb14053056.htm.

33. Quotation from Michelle Thompson, Asia Pacific vice president for HR at American Express, in “Mastering HR Analytics with Technology,” Human Resources (Australia), March 27, 2006.

34. Kim S. Nash, “How Analytics Helped eBay Tackle Worker Retention,” Wall Street Journal, February 3, 2017, http://blogs.wsj.com/cio/2017/02/03/how-analytics-helped-ebay-tackle-worker-retention/?mod=WSJBlog.

35. Dr. John Sullivan, “Revealing the ‘HR Professional of the Decade’: Laszlo Bock of Google,” ERE case study, March 30, 2015, https://www.eremedia.com/ere/revealing-the-hr-professional-of-the-decade-laszlo-bock-of-google/.

36. Thomas H. Davenport, Jeanne G. Harris, and Jeremy Shapiro, “Competing on Talent Analytics,” Harvard Business Review, October 2010, http://hbr.org/2010/10/competing-on-talent-analytics/ar/1.

37. Joanne Kelly, “Getting All the Credit,” Context Magazine, www.contextmag.com/setFrameRedirect.asp?src=/archives/200202/Feature2GettingalltheCredit.asp.

38. Owain Thomas, “What Has Walmart Learned from HR Analytics?” HRD Connect, April 27, 2016, https://www.hrdconnect.com/2016/04/27/what-walmart-learned-from-hr-analytics/.

Chapter Five

1. In our survey of about four hundred organizations with enterprise systems, there was a relationship between analytics and supply chain integration. The correlation (Pearson product-moment correlation, one-tailed test) between strong analytical orientation and integration with suppliers was .23.

2. Tony Kontzer, “Big Bet on Customer Loyalty,” InformationWeek, February 9, 2004.

3. American Customer Satisfaction Index, University of Michigan, 2005, fourth-quarter rankings, updated February 21, 2006, http://www.theacsi.org/fourth_quarter.htm.

4. Aaron O. Patrick, “Econometrics Buzzes Ad World as a Way of Measuring Results,” Wall Street Journal, August 16, 2005.

5. Jim Ericson, “Coming to Account,” Business Intelligence Review, April 2005.

6. The Target pregnancy marketing story was first reported by Charles Duhigg, “How Companies Learn Your Secrets,” New York Times, February 16, 2012, http://www.nytimes.com/2012/02/19/magazine/shopping-habits.html.

7. Clive Humby and Terry Hunt, Scoring Points: How Tesco Is Winning Customer Loyalty (Philadelphia: Kogan Page, Ltd., 2003).

8. Yankee Group research report from 2005, quoted in Gary Anthes, “The Price Point,” Computerworld, July 24, 2006, 34.

9. Gary Loveman, “Foreword,” in Thomas H. Davenport and Jeanne G. Harris, Competing on Analytics, 1st edition (Boston: Harvard Business Review Press, 2007).

10. The MyMagic+ system has been described in interviews with Disney executives and these articles: Brooks Barnes, “At Disney Parks, A Bracelet Meant to Build Loyalty (and Sales),” New York Times, January 7, 2013, http://www.nytimes.com/2013/01/07/business/media/at-disney-parks-a-bracelet-meant-to-build-loyalty-and-sales.html; Brooks Barnes, “A Billion-Dollar Bracelet Is the Key to a Disney Park,” New York Times, April 1, 2014, https://www.nytimes.com/2014/04/02/business/billion-dollar-bracelet-is-key-to-magical-kingdom.html; Austin Carr, “The Messy Business of Reinventing Happiness,” Fast Company, April 15, 2015, https://www.fastcompany.com/3044283/the-messy-business-of-reinventing-happiness.

11. Information about HMH comes from interviews with company executives and a presentation by Zachary Monroe at the Oracle Cloud Marketing User Group, Chicago, May 19, 2016.

12. “Which Customers Are Worth Keeping and Which Ones Aren’t? Managerial Uses of CLV,” Knowledge@Wharton, July 30, 2003, http://www.whartonsp.com/articles/article.asp?p=328189&rl=1.

13. Peggy Anne Salz, “High Performance—Intelligent Use of Information Is a Powerful Corporate Tool,” Wall Street Journal, April 27, 2006.

14. Adam Bloom, “20 Examples of ROI and Results with Big Data,” Pivotal website, May 26, 2015, https://content.pivotal.io/blog/20-examples-of-roi-and-results-with-big-data.

15. Information about Skillsoft comes from http://www.skillsoft.com/about/press_room/press_releases/april_02_14_ibm.asp, accessed April 21, 2017; and Bloom. “20 Examples of ROI and Results with Big Data.”

16. Pankaj Ghemawat, Stephen P. Bradley, and Ken Mark, “Wal-Mart Stores in 2003,” Case 9-704-430 (Boston: Harvard Business School, September 2003).

17. Figures on Walmart are from a presentation given by chief information officer Linda Dillman, quoted by Dan Briody in BizBytes, April 2006.

18. “Software Development Engineer—Global Supply Chain Optimization,” Amazon Fulfillment Services, https://www.amazon.jobs/en/jobs/384389, accessed February 14, 2017.

19. Spencer Soper, “Amazon Is Building Global Delivery Business to Take On Alibaba,” Bloomberg Technology, February 9, 2016, https://www.bloomberg.com/news/articles/2016-02-09/amazon-is-building-global-delivery-business-to-take-on-alibaba-ikfhpyes.

20. Len Kennedy, vice president of UPS, in “What Can Brown Do for You?” Location Intelligence, December 5, 2002.

21. Taken from 1954 UPS annual report.

22. Beth Bacheldor, “Breakthrough,” InformationWeek, February 9, 2004, http://www.informationweek.com/industries/showArticle.jhtml?articleID=17602194&pgno=1&queryText=.

23. Norbert Turek, “FedEx and UPS Lead the Logistics Pack,” InformationWeek, January 11, 2001.

24. Richard Tomkins, “The Art of Keeping Customers Happy,” Financial Times (London), June 17, 2005.

25. Alejandro Ruelas-Gossi and Donald Sull, “The Art of Innovating on a Shoestring,” Financial Times (London), September 24, 2004.

Chapter Six

1. For more on effective decision-making processes, see Jeanne G. Harris, The Insight-to-Action Loop: Transforming Information into Business Performance (Wellesley, MA: Accenture Institute for High Performance Business, February 2005), http://www.accenture.com/Global/Research_and_Insights/Institute_For_High_Performance_Business/By_Publication_Type/Research_Notes/InsightToPractice.htm; and Glover Ferguson, Sanjay Mathur, and Baiju Singh, “Evolving from Information to Insight,” MIT Sloan Management Review 46, no. 2 (2005): 51–58.

2. Vivienne Jupp and Elisabeth Astall, “Technology in Government: Riding the Waves of Change,” Accenture Government Executive Series report, 2002, http://www.ebusinessforum.gr/content/downloads/gove_waves.pdf.

3. Elpida Ormanidou, telephone interview with Jeanne Harris, April 29, 2015.

4. The “Monty Hall problem” demonstrates the power of a single data point. Hall was the original host of the TV game show Let’s Make a Deal. A contestant is offered one of three different doors. Only one has a valuable prize and the other two have a “zonk.” Once the contestant chooses a door, Hall reveals a “zonk” behind one of the remaining doors. He then gives the contestant a choice. She can stay her original selection or switch. Statistics demonstrate that by switching doors the contestant doubles her odds of winning from 33 percent to 66 percent.

5. Thomas H. Davenport, Jeanne G. Harris, and Bob Morison, Analytics at Work: Smarter Decisions, Better Results (Boston: Harvard Business Review Press, 2010).

6. Mark Twain attributes this quote to Disraeli; see Charles Neider, ed., The Autobiography of Mark Twain (New York: HarperCollins, 2000), 195.

7. For more on this topic, see Darrell Huff, How to Lie with Statistics (New York: W. W. Norton & Company, 1954).

8. For more on preventing statistical abuse, see “The Use and Misuse of Statistics,” Harvard Management Update 11, no. 3 (March 2006).

Chapter Seven

1. Thomas H. Davenport, Jeanne G. Harris, David W. De Long, and Alvin L. Jacobson, “Data to Knowledge to Results: Building an Analytic Capability,” California Management Review 43, no. 2, 117–138.

2. For more on evidence-based management, see Jeffrey Pfeffer and Robert I. Sutton, Hard Facts, Dangerous Half-Truths, and Total Nonsense: Profiting from Evidence-Based Management (Boston: Harvard Business School Press, 2006).

3. Interview of William Perez by Michael Barbaro, “A Not-so-Nice Nike Divorce Came Down to Data vs. Feel,” The New York Times, January 28, 2006, National edition, B4.

4. Tom Davenport, “Data Is Worthless If You Don’t Communicate It,” Harvard Business Review, June 2013, https://hbr.org/2013/06/data-is-worthless-if-you-don’t.

5. Donald A. Marchand, William J. Kettinger, and John D. Rollins, Information Orientation: The Link to Business Performance (New York: Oxford University Press, 2002).

6. Tom McCall, “Understanding the Chief Data Officer Role,” Smarter with Gartner, February 18, 2015, http://www.gartner.com/smarterwithgartner/understanding-the-chief-data-officer-role/.

7. Jeanne G. Harris and Vijay Mehrotra. “Getting Value from Your Data Scientists” MIT Sloan Management Review 56, no. 1 (Fall 2014).

8. Thomas H. Davenport and D. J. Patil, “Data Scientist: The Sexiest Job of the 21st Century,” Harvard Business Review, October 2012, https://hbr.org/2012/10/data-scientist-the-sexiest-job-of-the-21st-century.

9. Hal Varian, email correspondence with Tom Davenport, December 6, 2005.

10. Bob Deangelis, telephone interview with Tom Davenport, February 8, 2005.

11. Head of an analytical group at a consumer products firm who wished to remain anonymous, telephone interview with Tom Davenport, May 24, 2005.

12. Tyson Hartman, “Is Big Data Producing Big Returns?” Avanade Insights, June 5, 2012, http://blog.avanade.com/avanade-insights/data-analytics/is-big-data-producing-big-returns/.

13. Anders Reinhardt, telephone interview with Jeanne Harris, September 2012. Originally published in Jeanne Harris, “Data Is Useless Without the Skills to Analyze It,” Harvard Business Review, September 13, 2012, https://hbr.org/2012/09/data-is-useless-without-the-skills.

14. The three core skills needed for analytical managers is adapted research originally published in Harris, “Data Is Useless Without the Skills to Analyze It.”

15. Reinhardt telephone interview with Jeanne Harris.

16. For more on this topic, see Thomas H. Davenport and Jeanne G. Harris, “Automated Decision Making Comes of Age,” MIT Sloan Management Review (Summer 2005): 83–89.

17. For a description of business rules technology, see Barbara von Halle, Business Rules Applied: Building Better Systems Using the Business Rule Approach (New York: Wiley, 2001).

Chapter Eight

1. Julie Gallagher, “Business-Savvy CIO Turns Tech-Savvy CEO,” FinanceTech, May 31, 2001, http://www.financetech.com/showArticle.jhtml?articleID=14706275.

2. Erick Schonfeld, “The Great Giveaway,” Business 2.0, CNNMoney.com, April 1, 2005, http://money.cnn.com/magazines/business2/business2_archive/2005/04/01/8256058/.

3. M. McDonald and M. Blosch, Gartner’s 2006 EXP CIO Survey (Stamford, CT: Gartner, Inc., January 2006).

4. Marcia Stepanek, “Q&A with Progressive’s Peter Lewis,” BusinessWeek, September 12, 2000.

5. Charles Babcock, “Data, Data Everywhere,” InformationWeek, January 9, 2006.

6. International Data Corporation, Business Analytics Implementation Challenges: Top Ten Considerations for 2003 and Beyond, IDC Report 28728 (Framingham, MA: International Data Corporation, January 2003).

7. Nicole Haggerty and Darren Meister, “Business Intelligence Strategy at Canadian Tire,” Case 903E19 (London, Ontario: Ivey School of Business 2003).

8. Thomas H. Davenport and Stephan Kudyba, “Designing and Developing Analytics-Based Data Products,” MIT Sloan Management Review (Fall 2016), http://sloanreview.mit.edu/article/designing-and-developing-analytics-based-data-products/.

9. Donald Marchand, William Kettinger, and John Rollins, Making the Invisible Visible: How Companies Win with the Right Information, People and IT (New York: Wiley, 2001).

10. Michael Stonebraker, “The Solution: Data Curation at Scale,” in Getting Data Right: Tackling the Challenges of Big Data Volume and Variety (O’Reilly Publications, 2015), http://www.oreilly.com/data/free/getting-data-right.csp.

11. Madan Sheina, “Refocused: Back to the Future,” Computer Business Review, September 2005.

12. Thomas H. Davenport and Julia Kirby, “Just How Smart Are Smart Machines?” MIT Sloan Management Review (Spring 2016), http://sloanreview.mit.edu/article/just-how-smart-are-smart-machines/.

13. Henry Morris et al., The Financial Impact of Business Analytics: Distribution of Results by ROI Category, IDC #28689 (Framingham, MA: International Data Corporation, January 2003).

14. Nucleus Research, “Analytics Pays Back $13.01 for Every Dollar Spent,” Research Report 0204, September 2014, http://nucleusresearch.com/research/single/analytics-pays-back-13-01-for-every-dollar-spent/.

15. Gregory Piatetsky, “R Leads Rapid Miner, Python Catches Up, Spark Ignites,” KDNuggets, May 27, 2015, http://www.kdnuggets.com/2015/05/poll-r-rapidminer-python-big-data-spark.html.

16. For more information on spreadsheet errors, see Raymond Panko’s paper “What We Know About Spreadsheet Errors,” January 2005, http://panko.cba.hawaii.edu/ssr/Mypapers/whatknow.htm.

17. See, for example, Judah Phillips, Building a Digital Analytics Organization (Upper Saddle River, NJ: Pearson FT Press, 2013).

18. Jamie Oetting, “Too Many Tools? New Data on the Complexity of Marketing Technology,” Hubspot blog post, February 17, 2015, https://blog.hubspot.com/agency/tools-data-complexity-marketing-technology#sm.001eqysc218dxdwmqld2nqeau3z8n.

19. Thomas H. Davenport and Zahir Balaporia, “The Analytics Supply Chain,” DataInformed, February 20, 2017, http://data-informed.com/the-analytics-supply-chain/.

20. The principles-based approach to IT architecture is described in Thomas H. Davenport, Michael Hammer, and Tauno Metsisto, “How Executives Can Shape Their Company’s Information Systems,” Harvard Business Review, March–April 1989, 130–134.

Chapter Nine

1. Data from Outlook 2006 Survey, InformationWeek, January 2, 2006.

2. Thomas H. Davenport and Jim Hagemann Snabe, “How Fast and Flexible Do You Want Your Information, Really?” MIT Sloan Management Review (Spring 2011), http://sloanreview.mit.edu/article/how-fast-and-flexible-do-you-want-your-information-really/.

3. Charles P. Seeley and Thomas H. Davenport, “Integrating Business Intelligence and Knowledge Management at Intel,” Knowledge Management Review 8, no. 6 (January–February 2006): 10–15.

4. Dave Mittereder, “Pervasive Business Intelligence: Enhancing Key Performance Indicators,” DM Review, April 2005, http://www.dmreview.com/article_sub.cfm?articleID=1023894.

5. M. McDonald and M. Blosch, Gartner’s 2006 EXP CIO Survey (Stamford, CT: Gartner, Inc., January 2006).

6. Thomas H. Davenport, “Innovation in Audit Takes the Analytics, AI Route,” Deloitte University Press online essay, February 24, 2016, https://dupress.deloitte.com/dup-us-en/focus/cognitive-technologies/audit-analytics-artificial-intelligence.html.

7. Thomas H. Davenport and Julia Kirby, Only Humans Need Apply: Winners and Losers in the Age of Smart Machines (New York: Harper Business, 2016).

8. Peter Drucker, “The Next Information Revolution,” Forbes ASAP, August 24, 1998.

9. NewVantage Partners, Big Data Executive Survey 2017: Executive Summary of Findings, http://newvantage.com/wp-content/uploads/2017/01/Big-Data-Executive-Survey-2017-Executive-Summary.pdf.