"Most of the time, analytic decisions are more accurate than those that are made with the gut," Davenport said. "If this is your competitive strategy, it makes no sense to do it in a series of pockets throughout the organization -- particularly if the pockets are spreadsheets."

In addition, senior executives need to be squarely behind the effort, said Gary Loveman, CEO and chairman of Las Vegas-based Harrah's Entertainment Inc. When Loveman came on board in 1998, Harrah's was struggling to compete and was seen as a takeover candidate, he said. In response, Loveman devised a plan to use analystics to build customer loyalty. For example, the company at the time had "one of the worst Web sites" of any business, he said. Even so, Loveman turned down requests to overhaul it, instead requiring employees to focus on customer loyalty.

Since then, Harrah's has developed a program that assesses customer worth, tailors marketing programs to them and sets optimal prices for hotel rooms. Since 1998, the company has raised its share of the gaming market by 750 basis points, and its stock price has grown from US$14 to $73 per share. Loveman described analystics as "the juice that makes the company go."

He stressed that solving complex problems with analytics is difficult and said companies must require employees to use the technology. "If I had been hired as the senior vice president of marketing, we wouldn't be having this conversation," he said. "The only way I did it is I ordered [employees] to do it. If I were to disappear tomorrow and someone came in with different ideas, there is no question in my mind that this would be gone."

While Procter & Gamble Co. has used analytics since the 1930s, it pushed analytics to an enterprisewide level only last year. In 2005, it formed an analytics group of about 100 employees by combining operations research with marketing and consumer research analysis groups, said Glenn Wegryn, associate director of global analytics at the Cincinnati-based company. Analytics, which Wegryn said used to be viewed as a "bump on the side of the IT organization," is now key to planning large strategic initiatives.