Why We Aren’t an Advanced Analytics Firm, and Why We Don't Want to Be One!

Ed Crowley – Chief Thought Leader – Virtulytix, Inc.

Advanced analytics refers to a broad range of analytics that are intended to give businesses greater insight into their data than they could ordinarily. Some of these techniques include machine learning, data mining, predictive analytics, location analytics, big data analytics and location intelligence. A number of companies offer software packages that perform advanced analytics.
— Techopedia

Advanced analytics is in vogue now and a lot of companies are calling themselves advanced analytics companies. From consulting firms to software companies, by calling themselves advanced analytics firms, companies hope to position themselves as being able to add value to customers businesses by helping them ‘sort through’ their data and turn it into meaningful business action. Gartner’s list of top advanced analytics firms demonstrates the software and technology centricity of the firms it identifies as leaders in advanced analytics (SAS, IBM, Dell, KNIME, and RapidMiner) and visionaries in advanced analytics (Microsoft, Alteryx, Predixion Software, and Alpine Data).

Each of these companies provides great technology and certainly provides advanced analytics ‘tools’.  But to us, it’s all about application. Tools are great – but what use is a tool if it isn’t applied to solve a problem. The first person to pick up a sharp stone didn’t have a tool – they just had a sharp stone. But once they began ‘applying’ this tool by using it dig, hunt, or scrape – it became a powerful tool! And over time, and use, they refined the sharp rock into an even better tool – arrowheads, axe heads, you get the idea. The value is in the application – not the tool!

We think there are a ton of great tools out there. Finding tools isn’t the problem. In fact, I have spent this week at an IBM event (THINK) rubbing elbows with some of the leading developers in predictive analytics, prescriptive analytics, visual insights, and other parts of the IBM Watson Cognitive ecosystem. I am convinced there are tons of good analytics tools and we really like the tools from IBM. And we use these tools.  But I don’t think this makes us an advanced analytics firm.

There are also a number of firms like ours that have data scientist and data engineers. Now don’t get me wrong, data engineers and data scientist are hard to find. In fact, a study by Bain and Company found only 4% of firms are able to combine the people, tools, data, and organizational focus that they need to take advantage of their big data. Data engineers and data scientists are key to what we do and without them, we couldn’t successfully execute the great projects for our clients that we get to work on! We also have consultants with deep experience in specific industry segments, who understand processes, who can help clients develop strategies and execute these strategies. Firms we compete with like IBM Global Business Services (GBS), or Bain & Company, or Accenture have a few data scientists and data engineers as well as numerous consultants. Most of these companies call themselves management consultants or professional services firms. But we don’t consider ourselves just a management consulting or professional services firms. These firms might have (and this is a stretch) 1-2% of their work force that are data engineers or data science professionals. One demonstration of our focus is that 30% of our staff are data scientists and engineers and over 50% of our staff works in the analytics development and delivery group.

There are also firms that have programmers, project managers, and technical staff who can write python code, or do system deployments, or integrate tools into client’s on-premise systems or cloud-based environments like we do. They often call themselves system integrators, or solutions providers and they drive a significant portion of their revenue from selling software. But we don’t think we are a system integrator or solution provider firm since our primary focus is not selling software or software tools.

So, what is Virtulytix? Virtulytix is an applied analytics firm focusing on solutions for the Industrial Internet of Things (Industrial IoT). What does that mean? It means we bring all of the tools and resources to the table to enable our clients to leverage their data to drive significant operational improvements. We specialize in the industrial IoT sector by creating manufacturing quality, maintenance / service optimization, and logistics optimization platforms using machine data. In order to develop these platforms, we bring together:

  • Management consulting and analytics to understand customers business processes, IoT infrastructure, and enablement barriers.
  • Processes, knowledge, and analysis skills to develop use cases that describe the financial value of overcoming these barriers and optimizing client’s business processes.
  • Development and deployment of the industrial grade analytics decision making platforms which fit into your existing IoT and corporate IT infrastructure. We also develop pay-for-use analytics decision making platforms to allow clients to capture the benefits without the expense and time of developing an in-house solution.
  • Training, processes, and support to operate these platforms and ensure they will grow and evolve with the client organization’s needs.

As an applied advanced analytics firms, we will often leverage partners to provide cloud services, IoT sensor installation, gateway deployment, ERP systems, or other technology components which are important and necessary for our solutions, but not part of our core skill set. We outsource or partner for these services. We are big believers in selecting the best partners to deliver turn-key platforms rather than doing it all ourselves.

Some would argue that IBM’s GBS unit is an applied analytics firm – which it would be hard to dispute.  But they also have a significant management consulting practice, and they have a strong incentive to sell IBM software. So, I wouldn’t call them a ‘pure’ Applied Analytics firm. Also, while IGS is exceptional at working with massive, global deployments, they can’t scale down very well. If you’re looking for a plant level pilot or you are a firm that is ‘mid-market’ (generally considered to be firms with $100M to $3B in revenues), GBS will have a difficult time ‘scaling down’ to do proof of concept (POC) pilots or deployments.  We live in the mid-market, and even develop platform solutions using a SaaS model for smaller businesses (our SuppliesIQ being a prime example).

We think it takes unique skills and abilities to be a true applied advanced analytics firm. So, we aren’t an advanced analytics firm, we aren’t a management consulting firm, and we aren’t a systems integrator. We are a little bit of all these – but by bringing these things together, we feel we are much more than any individual component. The graphic below shows a few of the major components (but not all) that we bring together to develop and deliver advanced analytics solutions.


Based on our discussions with clients, partners, and other members of the Industrial IoT ecosystem, I think we are a pretty unique type of company. What do you think? How would you label our firm? Do you know of other companies that offer similar abilities? How would you describe them? We would love to hear your thoughts.