Monday, March 1, 2010

Book review: Analytics at work by Tom Davenport

I have mentioned the work of Tom Davenport numerous times on this blog. For those who don't know him, he is a Babson College professor, Accenture fellow, author, speaker and renowned consultant. I particularly liked two of his previous books: "The Attention Economy: Understanding the New Currency of Business" and "Competing on Analytics: The New Science of Winning". His latest one, entitled "Analytics at Work: Smarter Decisions, Better Results", goes deeper in how leading businesses are gaining a competitive advantage through analytics.

First impressions

If you haven't read "Competing on analytics" go there first, it's a must for any serious online analyst. Also be forewarned this is about "analytics" not "web analytics" nor "online analytics" - a subtle but very important distinction.

Whenever I read a book I take margin notes and fold the page corners. This simple method is some kind "engagement" metric: 19 folded pages out of 188 (or 10%) - not bad! But be forewarned this is my own appreciation, biased by my experience and interests.

There are some gems worth noting, like the simple "Key questions addressed by analytics" table (ref. Figure 1-1) showing Past, Present, Future on the top, and Information, Insight on the left. For example, the intersection of "Information/Past" is "What happened? (Reporting)" but "Insight/Past" is "How and why did it happen? (Modeling, experimental design)". Neat and simple.

I also liked "the best decision makers will be those who combine the science of quantitative analysis with the art of sound reasoning". Seems obvious, no? But this is always a topic of passionate discussions among the tenants of "creativity" and those of "analytics".

DELTA - Data, Enterprise, Leadership, Targets, Analysts

The book is structured around the DELTA acronym. Certainly a good play on the Greek Delta letter which signifies "change". Each chapter introduces the requirement and characteristics of the acronym letters as well as a self-assessment of maturity stages. The remainder of the book talks about developing the culture of analytics.

In chapter six, "Analysts", Davenport defines analyst as "workers who use statistics, rigorous quantitative or qualitative analysis, and information modeling techniques to shape and make business decisions". He also provides definitions for various roles, including that of "Analytical Semiprofessionals" who "apply the models and algorithms developed by professionals" - which is probably the case of most web analysts today.

My take

It's a great book for organizations that wants to develop a competitive edge using analytics and an excellent academic reference. If you are into online analytics, as I suspect most readers of this blog are, you might feel a bit overwhelmed by the topic. My concern is few of us are involved with truly analytical companies like the Expedia or Amazon of this world. If you feel "web analytics is hard", this book will be depressing! At best, if you are a web analyst you would probably qualify as "Stage 1: Analytically Impaired" or "Stage 2: Localized Analytics" in Davenports analytical maturity model. Basically, as stated in my proposition of the Web Analytics Maturity Model, Davenport model takes where the WAMM levels four and five ends.

All in all a good read with strong supportive arguments and an efficient way of assessing your maturity. However, probably not as interesting for those just starting up in web analytics or whose role is limited to online analytics and optimization.