Authors Thomas Davenport and Jeanne Harris contend in their new book, Competing on Analytics: The New Science of Winning, that companies that don't use their stores of data to develop competitive strategies are missing a mammoth opportunity. Business intelligence (BI) and analytical software and service provider SAS used its recent executive conference to expound upon this notion.

The conference, held in tandem with the company's annual user group meeting in April in Orlando, FL, focused on performance management, a term that sums up SAS's encompassing view of BI technologies. SAS's view is that performance data - gleaned from such techniques as quantitative and statistical analysis and predictive modeling - can be used as a competitive weapon in manufacturing's increasingly cutthroat atmosphere of cost constraints and narrow margins. Executives gathered at the conference to hear both what SAS had to say about data, analytics, and BI applications, and from fellow managers about how their companies are using such technologies to augment their competitive strategies and to optimize their resource allocation.

John Kerr, general manager of quality and operational excellence at appliance giant Whirlpool, whose company uses SAS products to help mitigate costs associated with warranty claims, described in an interview with Managing Automation during the conference an intricate matrix of factors that Whirlpool must juggle, including stringent energy requirements and sound-level and frequency efficiencies, as it continues to focus on innovation in creating new products. Precise data is needed to apply customer feedback toward achieving this goal. Indeed, one of the major themes at the conference involved the challenge of translating service technicians' notes into actionable information for solving service issues and developing products.

Mike Newkirk, SAS's global marketing manager for manufacturing, also in an interview during the conference, described a concept called data optimization, which goes a step further than traditional predictive forecasting to allow manufacturers to examine what-if scenarios in detail - and to take appropriate action to mitigate or prevent an event, rather than reacting after the fact. Newkirk said such concepts are critical to manufacturers trying to realize profits from their service chains - another recurring topic at the conference - by working toward "first call resolution."

In a live product demonstration, IBM's logistics applications manager, Neil Reitmeyer, described how his company's 300-mm semiconductor manufacturing facility in East Fishkill, NY, uses SAS BI tools to translate complex production data from the factory into customizable, digestible reports delivered daily to executives via e-mail. Prior to the facility's use of BI tools, its in-house IT staff had to manually create individual reports with information, such as production quality and throughput cycle times, for use in making business decisions.

A keynote presentation by Steve Bandrowczak, computer maker Lenovo's senior vice president and CIO, tied the manufacturing sessions together with a look at the pervasive challenge of customer management, and the importance of connecting organizational silos to achieving and maintaining customer satisfaction. Bandrowczak has found that information properly applied from the post-product service chain can not only assist in realizing a profit in that area of the business, but also have a positive effect on product design, quality assurance, and, in turn, customer growth and retention.

As the issues that organizations face are compounded by an increasingly global business environment, they are finding that BI and such "performance management" tools are no longer nice-to-haves in the ongoing quest to allay supply risk, optimize product design, improve production processes, and cultivate competitive arsenals. BI vendors such as SAS have a key role because operational data is often such an immensely untapped asset. In the words of Tim Rey, counselor-statistics at Dow Chemical's Data Mining Capability Group, another SAS customer, "Corporate America has invested hundreds of millions of dollars in data; now they need to extract its meaning."

This article originally appeared in the June 2007 issue of Managing Automation.