One of my favorite business books of all times is The Control Revolution by James Beniger. It has been some time since I read it, but as I remember the argument, he notes that every time there is a new method to track, move and control things -- the economy creates the potential for new business models. The famous twin innovations of the telegraph and the railroad, which many people including Al Chandler say were the necessary preconditions to modern capitalism.
It struck me that with the instrumentation of everything -- from cars, to people, to the planet itself (check out both Cisco's and IBM's efforts on Planetary Skin and the Smart planet). It is the tremendous amount of available data that is creating the demand for more analytics.
It is true that in history, each control revolution created new industries. Without computers you can't have Bloomberg. Without miniture integrated circuits, you can't have laproscopic surgery -- which "controls" the intervention at a wholly different level. Without extensive control systems you can't make phone calls, or have OnStar. I believe that as we "instrument the planet" we will continue to have more and more analysis because the opportunities for improvement will continue to increase at an increasing rate. How can analytics help? Here are some ways:
- To improve the yield on assets by making them more efficient. For example, 7-11 in Japan can restock 20% of their stores four times a day, thereby creating 60% additional "space" by slicing the location in time.
- To improve understanding and lower risk. For example, BP had not drilled a dry well in 15 years due to improved seismic analysis and control.
- To create new visualizations which can allow people to "see" the issue more clearly. At one insurance company my company is working with, we are using data visualization to help the sales and analysis department see the trade-offs more easily.
I am sure there are many more uses of analytics, and given the vast evolving instrumentation of the globe, it will only continue and improve.