Explaining the competitive advantage generated from Analytics with the knowledge-based view: the example of Logistics and Supply Chain Management

The purpose of this paper is to provide a theory-based explanation for the generation of competitive advantage from Analytics and to examine this explanation with evidence from confirmatory case studies. A theoretical argumentation for achieving sustainable competitive advantage from knowledge unfolding in the knowledge-based view forms the foundation for this explanation. Literature about the process of Analytics initiatives, surrounding factors, and conditions, and benefits from Analytics are mapped onto the knowledge-based view to derive propositions. Eight confirmatory case studies of organizations mature in Analytics were collected, focused on Logistics and Supply Chain Management. A theoretical framework explaining the creation of competitive advantage from Analytics is derived and presented with an extensive description and rationale. This highlights various aspects outside of the analytical methods contributing to impactful and successful Analytics initiatives. Thereby, the relevance of a problem focus and iterative solving of the problem, especially with incorporation of user feedback, is justified and compared to other approaches. Regarding expertise, the advantage of cross-functional teams over data scientist centric initiatives is discussed, as well as modes and reasons of incorporating external expertise. Regarding the deployment of Analytics solutions, the importance of consumability, users assuming responsibility of incorporating solutions into their processes, and an innovation promoting culture (as opposed to a data-driven culture) are described and rationalized. Further, this study presents a practical manifestation of the knowledge-based view.