Analytics and the Nimble Organization (part 3 of 3)

Analytics and the Nimble Organization (part 3 of 3)

Summary: Clearly, one group of companies will get tremendous value out of analytic technologies. These firms are more nimble, more cosmopolitan and, most importantly, able to change (at scale, too). This concludes this 3-part series.

TOPICS: Big Data

Analytics and the Nimble Corporation

Analytics technology will succeed in those firms that already listen to and respond to their market.  It’s that simple.

The gulf between the nimble and ossifying companies will only widen as the more nimble firms will use new technologies better than their more rigid counterparts.

Great companies have employees (including top executives) that get out and play in traffic. For example, one big San Antonio, Texas firm used to send its most senior executives out to work in front-line roles in their restaurants for two weeks every year. These executives always came back with new operational insights and appreciation for what was really going on in the real world. No analytic application can replace firsthand experience. But, this firsthand experience can enrich/validate the insights that might appear in analytic data.

A nimble firm makes it easy to communicate with them. They encourage communication with everyone.  They actually let their people from R&D, Procurement, Sales and other groups use social technologies. They collaborate with peers, suppliers and customers. Moreover, they are measured by how much influence they have within and outside the firm.

My experience suggests that the most nimble firms are often the ones with the most cosmopolitan and published talent. Show me a firm that won’t let its people speak at events, write a blog, be a source for an article, etc., and I’ll show you a rigid, ossifying firm. In contrast, the company that is willing to put its latest ideas, thoughts, experiments, etc. out in the open for the world to comment on is a nimble firm. It is this thick (not thin) skinned capability of the company that may give it its greatest success. A company that is timid, afraid to change or incapable of accepting feedback is going to fail.

A nimble firm experiments. Thomas Edison tried something like 6000 attempts at creating a long-lasting light bulb. Edison would have never been allowed 1% of those at most companies. A nimble firm can refine their analytics to isolate experimental results from those of other markets. The insights from these experiments will guide the eventual rollout of game-changing new solutions/processes/etc.

A nimble firm has many current hypotheses about the market. They use analytics to test, prove/disprove and refine these.

A nimble firm, and this is most important, can scale fast. When they see a new market opportunity, they test, refine and then use explosive energy to seize the awaiting market opportunity. These firms can exploit a new market opportunity with incredible speed and precision. They are not only capable of change, but, they can change their entire firm almost overnight.

Finally, the nimble corporation will use analytics to optimize everything: sales, operations, tax positions, pricing, facility utilization, staffing, etc. Each of these results will require changes to processes, controls, responsibilities and more.

I believe the best users of analytic technologies will therefore be companies that make a number of capabilities core competencies of their firm. They’ll need to be good at:

  • Change
  • Process re-design
  • Competitive intelligence
  • Synthesis
  • Training/Education
  • Communication
  • Risk Management
  • Experimentation
  • And more

To look at analytics as simply another technology would be a mistake. The use of analytics may very well become a delineator between the successful firms of tomorrow and the failing firms of yesteryear.

Your thoughts?

Topic: Big Data


Brian is currently CEO of TechVentive, a strategy consultancy serving technology providers and other firms. He is also a research analyst with Vital Analysis.

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  • Changing in spite of success

    One problem you can run into in a firm that "already listens to and responds to its market" is that there is someone doing all that listening and responding when the analytics arrive, and they are likely to view analytics as something that will diminish their importance, threaten their distinctive competence, and so on.

    Let's use database marketers as an example. Ask these guys to find all the 'yuppies' in your customer file, and they'll slice and dice the thing with a SQL statement that looks at age, income, geography, etc. to produce a list of 'yuppies'.

    Now bring in an analytics crew. They take the same data, look at 150 variables twisted sixteen ways, and find a cluster of people who -behave- like yuppies. Some are too old to meet the Official Definition of a yuppie. Some are too young. Some live in Junction Switch, AR. Some make minimum wage. But they act like yuppies, they spend like yuppies, and they buy yuppie stuff.

    Which list do you really want to market to? And how do your longtime heroes, the database marketers, feel about that? And what is their recommendation about whether to bring in analytics?

    There's more to it than just being nimble. You also have to be courageous.

    That's especially true when the best way to solve your problem is with a neural net. That's because no one can ever tell you precisely how a neural net arrived at the conclusion that it did. People are used to the idea of computers being giant clockworks, with rigid step-by-step logic driving what they do. But here comes an answer from a fuzzball of probabilities. A lot of people have difficulty basing business decisions on that.
    Robert Hahn
  • Sometimes change is a clear advance, sometimes not.

    Well, not all change is a clear advance.

    "Are you still fighting the BYOD movement?"

    I don't believe that BYOD is a clear advance for all organizations. There are organizations that it works well with, but others it may not work well with.

    In the military, for example, there is a need to hide troop movements from the enemy. This means that they can't have soldiers using phones with GPS and Geotagging turned on.

    Also, intelligence agenies may need to keep secrets, and personal smart phones are excellent recording devices.

    These are features that are generally OK for people to have when off duty, but very much should not be used on duty, so these organizations may prefer to give people work phones or simply ban cell phone usage completely. BYOD isn't really an option.

    So no, I do not believe BYOD is a clear advantage for all organizations out there. Many organizations may have specialized needs, and you simply cannot ignore that.

    Change is fine when it's a clear advance, but I'm not really a big fan of change for change's own sake.

    Don't get me wrong - when change *is* a clear advance, many companies fail to change, and that's a problem, yes. But ZDNet has a bad habit of worshipping things that are *not* clear advances and claiming they are inevitable somehow.
  • Analytics is not a new invention, your metaphors are very apt!

    I would say right on! Analytics is a tool, but not the be all end all. I like the ossification analogy, Some companies are beyond hope, and what amazes me is that some companies still continue to survive for years--putting nails into their own coffin.

    I used to work for W.R. Grace, and then Chairman J.P. Grace, Jr. was one who would go into our retail stores unannounced and make observations about diffident customer service, long lines, rude employees, etc., and then send out scathing memos to our group executive demanding an explanation, and we little analysts would have to craft out a satisfactory response.

    Customer complaints to the CEO were always answered, and mandated to be responded to within a few days of being passed down to the operating group. He was exceptional as a CEO, had vision and genius but his personality was so strong and overbearing that few dared to talk back.

    Nimble is a good term, and progressive is also another appropos term, but even the ossified think they are being progressive. I have worked for a lot of big name companies, as employee and as consultant--it never ceases to amaze me. And not listening to the customer is something pervasive. I am one who likes to offer feedback and complain--but with most companies out there, why bother--just vote with your feet.

    I always go back to Sun Tzu and The Art of War--he was a proponent of Analytics, and being nimble, assessing one's enemy and assessing one's own strengths--conducting war based upon intelligence, information, and assessments and calculations--analytics. Being able to reform and strike every where, striking as swiftly as a thunderbolt.