Analytics and Dynamic Customer Strategy: Big Profits from Big Data

Chapter 2Mapping Dynamic Customer Strategy

Whether it's business or our personal life, we all have theories about how things work. From as simple as whether we think the Paleo diet is better than the Atkins diet to complex models of how we may finance our child's college, we create theories of how we think things work.

David Cronenberg, the movie director, once said, “We're all mad scientists experimenting our way through life.” That's a pretty good description of DCS. As we experiment, we learn what actually works and what doesn't.

The challenge is figuring out what actually causes the results. If we are mistaken—that is, we think something led to success when actually the real cause was something else—then we repeat the wrong thing, wasting resources because what really caused what we wanted was something else.

Strategy, then, is based on our theories of how things work, and when we develop a strategy, we base it on our particular theory of how the market works. You may have studied theories such as Porter's Five Forces or Vroom's Expectancy Theory of Motivation or Maslow's Hierarchy of Needs. But the challenge is how to create your own theory or even to apply these other theories in a way that makes sense, and to do that, it helps to know what makes for a good theory.

Theory as Strategy

Dynamic Customer Strategy begins with understanding how things work conceptually—our theory. In the DCS and Big Data Framework I introduced in the last chapter, this concept map is how we ...