Spotlight Interview: How Big Data & Analytics are changing business and institutions
Part of an interview series entitled "BD&A Spotlights", which features alumni and faculty members in q&a sessions. See what they have to say about Big Data & Analytics:
Gary Cokins, Class of 1974
Founder and CEO at Analytics-Based Performance Management LLC
Tell us a little about your background in terms of BD+A.
I have been fortunate to be internationally recognized as a thought leader in business analytics and co-authored a book “Predictive Business Analytics”. My 1971 Cornell University undergraduate degree was in operations research. I have waited 45 years for analytics to finally become recognized as a basis for gaining a competitive advantage. That day has arrived! My daily work-life has changed by now having a much broader audience interested in what I write. My passion is teaching. My profession is analytics and enterprise and corporate performance management (EPM/CPM) methods that leverage analytics.
How do companies decide on which capabilities to develop inside and what to outsource in terms of Big Data & Analytics?
My belief is that organizations should internally develop the needed skills to apply analytics for insights and foresight to solve problems and pursue opportunities. Regarding outsourcing, having been a management consultant with Deloitte, KPMG, EDS, and SAS for 35 years, I’ve learned that consultants have what organizations do not have – the ability to focus without distractions. After the implementation phase, consultants can then be used to train internal staff.
How do you use data to make decisions?
I believe there are two aspects data can provide: 1. Gaining actionable insights previously not seen (i.e. descriptive and diagnostic analytics); and 2. Strategic and tactical planning using what-if scenario analysis (i.e. predictive and prescriptive analytics). Prescriptive analytics introduces the opportunity for optimization. Analytical techniques like regression, correlation, clustering, and segmentation are a good starting point, but optimization is the Holy Grail to aspire to.
How do we start leveraging analytics within companies?
There are two schools of thought on how to organize and leverage analytics. One is to create a “center of excellence” staffed with highly skilled professionals to deploy by users. The other is for users themselves with some training to initially use analytics for quick wins. I advocate the latter school of thought. Start small but think big. Have initial successes with applying analytics and then broadcast the successes so others in the organization can see the benefits.
What are the risks/obstacles when introducing analytics within organizations?
The major risks are not technical ones; analytical software tools are proven. The risks involve social and human obstacles including natural resistance to change, fear of others knowing the truth, fear of being measured or held accountable, and weak leadership who is accustomed to relying on their intuition and gut feeling and consequently are uncomfortable using analytics.