Intelligent Economy

Here's some "intelligent economy" thinking from the folks at MercerMC.

The article is called "Uncovering the Hidden Drivers of Demand" and presents a good example of how a data-driven business model works to maximize profit.

Here's how they describe it:

"It's not enough to know what makes demand happen. Executives also need to know the variable costs of acting on that information so that they can determine whether a given move will make or lose money. Linking the information about each demand driver directly to the variable costs of the business answers questions such as: If the brand matters most, where should we invest to improve brand equity and what will it cost? If external influencers matter, should we shift the marketing mix away from golf tournaments and toward better relations with trade journalists? If customer acquisition cost determines most of the lifetime value of that customer, how do we adjust our channel mix to ensure a profitable relationship? If customer service matters, what exactly merits investment--a shorter wait on the phone, the knowledge of call center representatives, or the speed of technician response? If the customer is asking for 24-hour delivery of a turbine, what are the economic implications?"

Decisions are based on data and "profound knowledge" (hat tip to the late, great Deming) to embed the key value drivers and business economics data into a graphical representation of a company's business model, an Interactive Strategy Model, they call it.

Here's a "dashboard" of how this might look:

Doesn't that make you want to read the whole article?