Driving into the Unknown of Analytics (Part 3)

Driving into the Unknown of Analytics (Part 3) The Model A of Analytics

It is said that Henry Ford’s biggest fault occurred near the end of the Model T’s production. He never saw a fault with the Model T and when the Model T ended production, roads were still limited 35 MPH (55 km/h) and it was still more than capable of driving America. So what caused it to become an albatross and go extinct? (The world moved on…)


Ford moving beyond the 1900’s

It is often forgotten that the Model T wasn’t borne of the 1920’s or even the 1910’s. The Model T began its life in 1908, at a time when most people still got around with horses and bicycles. When the Tin Lizzie came on the stage it had everything that the consumer could ever need.


But by the end of the Model T, the consumer might have not needed more, but they wanted more. They wanted something that had more capability, had more features, and was easier to use. To meet these requirements, Ford created the Model A at a very large cost, a car that was in every way more capable, more comfortable, and easier to use.

Replacing the Tin Lizzie of analytics

Today’s Model T is Excel™ -- and we can see a major shift away from it for the more advanced analysis of data from newer products like Tableau™, Domo™, and PowerBI™. Excel™ is a spreadsheet software whereas these newer products are from another field entirely, Business Intelligence. These platforms allow for greater and more in-depth KPI analysis than ever before, driving growth through better efficiencies and customer targeting. This is done by a trifecta of improvements to the traditional spreadsheet software.


The first improvement is the enhanced capabilities in data handling and analysis. Where Excel is limited to analyzing 2 or 3 factors at once, these business intelligence software’s can display a half dozen factors in an easy-to-understand interface. If you’re doing route planning, you use a map. If you’re analyzing the cause of something, you use a tree. The world of data is an oyster and BI will grow the pearls of knowledge.


Secondly, these business intelligence platforms can create a large amount of dashboards quickly. These dashboards give up to the minute information for dozens of metrics simultaneously, providing businesses leaders with a greater scope of a business’s performance, faster than ever before.


Lastly, all of these capabilities don’t come with a large learning curve. They strive to be as easy to use as even the simplest spreadsheet software, but like any good tool, their capability grows with the user’s skill. And this capability is seen every day with the amazing and beautiful dashboards that are published every day on Tableau Public.


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Innovation

Does this mean that Excel is doomed to become a dinosaur? No, Excel™ will not be replaced and will remain a critical tool for at least a couple of decades. The use of Excel™ has become deeply ingrained in personal and business use, similarly to how QWERTY is the standard for keyboards. However, its importance has faded from business analysis and visualizations as better solutions continue to spread across businesses.


Everett Rogers coined the term the “Diffusion of Innovations”. It describes the diffusion of a technology throughout a system and analyzes how the rate of diffusion is related to the current adoption of the technology. It starts with a low adoption rate and increases to a maximum rate at 50% market share, then decreases as everybody that was going to adopt it, has.


If we apply this curve to the adoption of Tableau (as a representative of the broader BI marketplace), we can see that Tableau is still growing at ever increasing rates. This increase places BI at within the Early Adopters phase, meaning companies that adopt it will have a marked advantage in the market space. Additionally, this market still has room to grow and diffuse through the marketplace.


These companies that are able to compare their status against KPI’s regularly correct themselves when things go downhill and tend to be considered “Data Informed”. Join me next time to see how Data Driven companies set themselves apart and are leading our industries today.


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