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Manufacturing Moneyball: Using Big Data and Business Intelligence To Spur Operational Excellence | Forbes

The national unemployment rate is 9.1 percent, up nearly four points from the first quarter of 2008. Recent news has not been optimistic. In August, for the first time since 1945, the federal government reported a national net job change of zero. Meanwhile, the global economy sputters




In these economic times, it is important to examine existing business practices and ask difficult questions: “How can we work smarter? How can we improve our processes? What are we leaving on the table? How can we regain our competitive advantage through operational excellence?” This piece focuses on the manufacturing industry, which is experiencing an industrial renaissance as a result of its application of business intelligence (“BI” or analytics) to Big Data to uncover and leverage data that has remained either (i) hidden or (ii) unappreciated. In this respect, manufacturers that are ahead of the curve are playing what amounts to Moneyball, a strategy first implemented successfully by then-Oakland Athletics’ manager Billy Beane and made famous first by author Michael Lewis and, more recently, by the movie of that name starring Brad Pitt.

This piece refers to a development I coin throughout as Manufacturing Moneyball. Implementing the tenets of Moneyball into manufacturing and other industries is a business imperative. The amount of hidden information and rigorous analysis of it that can create actionable intelligence is overwhelming. Corporations that do not tap into and leverage that resource will be stranded.

Manufacturing Moneyball has ushered in a new era of data transparency and visualization; competitive advantage both at home and internationally; and new business practices. Like the use of other technologies such as cloud computing, which, as we will see, is an integral part of Manufacturing Moneyball, the integration of BI and Big Data is no longer a domain reserved for IT. Those who play Moneyball will enjoy a significant advantage in the manufacturing industry. According to the McKinsey Global Institute:


The use of Big Data is becoming a key way for leading companies to outperform their peers. Across sectors, we expect to see value accruing to leading users of Big Data at the expense of laggards, a trend for which the emerging evidence is growing stronger. Forward-thinking leaders can begin to aggressively build their organizations’ Big Data capabilities. This effort will take time, but the impact of developing a superior capacity to take advantage of Big Data will confer enhanced competitive advantage over the long term and is therefore well worth the investment to create this capability. But the converse is also true. In a Big Data world, a competitor that fails to sufficiently develop its capabilities will be left behind.

Big Data: The Next Frontier of Innovation, Competition, and Productivity(McKinsey Global Institute June 2011).

Manufacturing Today

Before we turn to Moneyball, we must....

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