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Understanding Data Analytics, And ‘Competitive Advantage’

Posted on November 12, 2021November 23, 2021 by neilbendle

Anil Maheshwari’s Data Analytics Made Accessible is a helpful book. Schools use it as a textbook and it has that feel. There is a lot of information there in a somewhat ‘just the facts’ sort of format. It should help with understanding data analytics.

Useful Information To Aid In Understanding Data Analytics

The book is ambitious. It covers a very wide range of topics. Many of which were really quite useful. The book has an extensive discussion of how data is held at companies. This should be useful for any MBA types getting into a new firm.

Maheshwari gives details on clustering that are informative. He also does a good job of getting a lot of the jargon into the book and going some way towards demystifying it. You might have a better idea about the enigmatic Support Vector Machine after reading the book. You might also understand the ever-mysterious Manhattan distance.

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Don’t Use One Industry To Create Examples For CLV (Customer Lifetime Value)

Competitive Advantage Is Not Just A Filler

I do, however, have one gripe to get off my chest. This is when people use the term competitive advantage as a filler phrase. Business people often use it to try and add some false depth to a statement. You can usually see it is nonsense. One should never use the term ‘competitive advantage’ when no competitive situation is present.

An Example Of An Unnecessary, But Not Wrong, Use Of ‘Competitive Advantage’

Typically the business writer can get away with using ‘competitive advantage’. In business, even if you don’t explicitly mention the competition, one can often make the argument that they are implicitly in the background. Thus, you can throw ‘this will gain you a competitive advantage’ into a lot of places. Adding the phrase doesn’t add anything but because competition exists you can get away with the phrase even when it is not needed.

The author does this when he mentions that data mining evolved ‘to help gain a competitive advantage in business’ (Maheshwari, 2021, page 60). His first example then notes that understanding that people buy bread, milk, and cheese together can be useful. This seems like a bit of a stretch for a competitive advantage. There is no competition explicitly mentioned and it simply isn’t clear what the competitive advantage is. Is it the advantage data analytics capacity? The specific knowledge about bread and dairy? Do you generate the advantage by something you do after gaining the knowledge? That said, at least competition probably exists somewhere off-camera.

Competitive Advantage Cannot Exist Without Proper Competition

His second example of a competitive advantage shows how little thought was put into showing the idea of competitive advantage. (I would argue that this is typical of most business writing).

Similarly, people with blood pressure greater than 160 and an age greater than 65 were at a high risk of dying from a stroke.

Majheswari, 2021, page 60

The obvious question is why does this knowledge generate a competitive advantage for a healthcare provider? Let us assume that this is new and useful medical knowledge. (If it isn’t new or useful knowledge presumably it can’t be an advantage). Wouldn’t medical knowledge like this usually be shared? What sort of monster would keep the knowledge secret to their own organization? ‘Come to our hospital because we’ll keep you alive with secrets that we won’t tell our competitors. If you go to another hospital we think you deserve to die.’

If, as any decent human being would, the healthcare organization shares their knowledge it can’t be a competitive advantage. Everyone now has the knowledge. My point is not about medicine per se but about the fact that the term competitive advantage was clearly used as a ‘sounds good’ filler term. The phrase didn’t mean anything but was thrown in anyhow. Let’s stop using terms that don’t mean anything just because they sound like something that business people should like.

No Competitive Advantage Without Competition
No Competitive Advantage Without Competition

Understanding Data Analytics

Hopefully, my unhappiness with some language doesn’t detract too much from the idea that understanding data analytics is a useful goal for marketers and this book can help with that.

For more on data analytics see here and here.

Read: Anil Maheshwari (2021) Data Analytics Made Accessible

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