Analytics in Consulting
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Analytics in Consulting

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This was a talk I gave in IIM Bangalore in March 2012 to Business Analytics professionals on the analytics of consulting. It covers the hypothesis driven approach to problem solving that is the core ...

This was a talk I gave in IIM Bangalore in March 2012 to Business Analytics professionals on the analytics of consulting. It covers the hypothesis driven approach to problem solving that is the core of solving problems and walks through the entire lifecycle of a management consulting assignment.

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Analytics in Consulting Presentation Transcript

  • 1. March, 2012 @ IIMBAnalytics in ConsultingUsing the Hypotheses Driven Approach to SolveBusiness ProblemsAmit Kapoor
  • 2. Context● Synthesize: Learning to combine, to condense and bring coherence to ideas● Discipline: Mastering a major way of thinking through sustained practice● Creativity: Process of having original ideas that have value
  • 3. Content● Have a dialogue on the analytics in consulting - hypothesis driven problem solving● Leverage a short case study to learn in the apprentice model● Discuss heuristics to apply in every day problem solving
  • 4. Consulting Problem Ill-Defined and Several Critical Unique UnknownsCross - Functional Business Conflicting Complexity Problem Stakeholder Views Too Much or Too Limited Time and Little Data Resources
  • 5. Consulting Process 1 Defining 2 Generating 3 Testing 4 Making the Question the Hypotheses the Hypotheses the Case ?● Write the problem ● Develop the issue tree ● Collect data and ● Develop message definition ● Generate the conduct analysis and storyboard● Concretize the hypotheses ● Write and review scope ● Develop the data ● Synthesize finding and the output● Map the issues, and matrix conclusions deliverable ● Refine hypotheses (as ● Develop required) recommendations
  • 6. Tablet Case Study - SmartAds● SmartAds currently is an ad network enabling advertising for smartphones● Tablets have emerged as a new device format with the success of the iPad● As a smartphone ad company, I should also be able to serve ads on tablet devices● What should SmartAds do?
  • 7. 1. Defining the QuestionThe Strategic Question● Define the fundamental question the client wants to be answered● Focus on the big picture and not the details● Explore the gap between what the client has and what the client wants● Understand how it fits with what else the client is trying to achieve Case: What should be SmartAds Go-to- Market Plan for Tablets Ads?
  • 8. 1. Defining the QuestionIssues and Deliverables● What issues must you investigate to answer the fundamental question?● What is the type of output will be produced from this investigation?● What deliverables are expected? Will that address the clients requirement?● What time and resources would be required to accomplish this?
  • 9. 2. Generating the HypothesesDevelop Issue Tree Issue 1 Sub Issue 2.1 Hypothesis 2.2.1 Strategic Issue 2 Sub Issue 2.2 Question Hypothesis 2.2.2 Sub Issue 2.3 Issue 3
  • 10. 2. Generating the HypothesesIssues vs. Hypotheses What is an Issue? What is a Hypothesis? ● Denotes a major piece ● Phrased as statement to of the problem prove or disprove ● Pointed to client ● Is an hunch or an concerns (“So what?”) educated guess ● Limited in number ● Nested under an issue ● Similar in size ● Provides tentative answer ● Will not “fall” to issue question ● Phrased as a question ● Provides context for or ● Amenable to closure guides information gathering
  • 11. 2. Generating the HypothesesCase Study: Issue TreeStrategic Question Issues How will the product and services market look in the tablet advertising ecosystem in the next 3 -4 years?What should beSmartAds Go-to-Market strategy for What is the best Way-to-Play forthe Tablet SmartAds in the tablet advertisingAdvertising ecosystem?Ecosystem? How can SmartAds leverage its capability system developed within the mobile context for the tablet ecosystem?
  • 12. 2. Generating the HypothesesCase Study: Hypotheses Issue Sub-Issues Hypotheses How will the H1: Market consolidateHow will the tablet around 3 major platforms –product and ecosystem iOS, Android, and Win 8services emerge in themarket look next 3 – 4 years? Which H2: Users will shift contentin the tablet Platforms? consumption (and henceadvertising ads) away from PCs toecosystem in Which tabletsthe next 3 -4 formats?years? ... ....
  • 13. 2. Generating the HypothesesTypes of HypothesisPropositional Diagnostice.g. market consolidate e.g. users will shift contentaround three platforms - consumption (and hence ads)iOS, Android and Win8 away from PCs to tablets● If accepted becomes ● If accepted becomes finding conclusion● Leaves "so what" ● Answers "so what"● Simple to test, more ● Simple to interpret if data complex to interpret fits, more complex to test● Seeks "predictive" ● Seeks "cause and effect" data data
  • 14. 2. Generating the HypothesesDevelop Good Hypothesis● Connect the Dots - General / specific exp● Do your Homework - Lit search, web search, books / journals● Engage with People - Planning meetings, clients, colleagues● Stand on the Shoulder of Giants - Experts, practice guides, other assignments● Gather Preliminary Data - Industry analysis, probing questions● Think Hard about it!
  • 15. 3. Testing the HypothesesTesting the HypothesesFor Hypothesis 1: Market consolidate around 3major platforms – iOS, Android, and Win 8 Device Installed Shipments Base ● Projection 10 -15 Lifecycle ● Projections 10-15 ● By Device type Estimate ● By Device type (Smartphone, (Smartphone, Tablets & PCs) Tablets & PCs) ● By OS (iOS, ● By OS (iOS, Windows, Android) Windows, Android)
  • 16. 3. Testing the HypothesesBuilding the Data Matrix● Think on two key dimensions ○ Method of enquiry: Interview/Focus Group, Research and Surveys, Observations ○ Source of data: Internal, Client, Competition / Customers, Industry / Government● Be cost conscious in selection of method of enquiry● Assess reliability and conduct triangulation● Organize and document rigorously
  • 17. 3. Testing the HypothesesH1: Device Shipment
  • 18. 3. Testing the HypothesesH1: Installed Base
  • 19. 3. Testing the HypothesesH1: Installed Base by OS
  • 20. 3. Testing the HypothesesH2: Tablet vs PC Usage
  • 21. 3. Testing the HypothesesSynthesizing the FactsFacts 1 Recommendation 1 Finding 1 Fact 2 Recommendation Conclusion 1 2 Fact 3 Finding 2 Recommendation Conclusion 2 3 Fact 4 Finding 3 Recommendation 4 Fact 5
  • 22. 3. Testing the HypothesesDeveloping Recommendation● Generate alternatives, evaluate, screen and select: Complete the logic tree● Specify and describe actions, results and benefits● Take account of existing conditions, barriers and resources● Cover the assignment topics and outputs● Can be tracked back to address the root cause findings
  • 23. 4. Making the CaseStructuring the Message Argument First Action First Whats wrong You must change Change Whats causing It Heres what you should do ChangeHeres what you should do This is how This is how Add the whys
  • 24. 4. Making the CaseDoing the Communication● Objective: Build relationship, share information, solve problem, take decision● Audience: Who, characteristics as individual / group, receptivity, expectation, culture● Purpose: Telling, selling, conferring, collaborating● Story: Content, emphasis, style● Medium: Visual (letter, report, text, video) or Oral (presentation, meeting, one-to-one)
  • 25. Heuristics for Daily Problem Solving● Structure your thinking● Build your fact base● Develop an initial hypothesis● Solve the right problem● Dont boil the ocean● Produce an output daily● Synthesize every day (Elevator Speech)● Focus on the change
  • 26. Contact● Please access this presentation and speaker notes (rough) at http://goo.gl/582xB● If you have any reflections or further questions, please feel free to reach out to the speaker at: me@amitkaps.com
  • 27. Backup
  • 28. Consulting Toolkit Structured Work Structure Core Oral Written Problem Solving / andMethodologies Communication Communication Analytics Management Expertise Content Thought (Functional / Knowledge Leadership Industry) People Relationship Mentoring and Career Mgmt. / Teamwork Skills Management Apprenticeship Work-Life Balance Leadership Collaboration and Vision and and Client Trusted Advisor Influence Entrepreneurship KnowledgeDevelopment Sharing
  • 29. 1. Defining the QuestionThe Client● Who will judge the success of the project?● Who has the authority to implement the recommendations?● Whose views will influence the main decision- makers?● Who will pay the bill?● Who will the team report to?Case: The CEO and BD team
  • 30. 3. Testing the HypothesesConducting an Interview● Interview is a process, not an activity● Preparations is key: objective, selection, guides● Conducting the Interview ○ Opening - Establishing rapport, position, orientation ○ Middle - People, Actions, Goals, Outcome ○ End - Summarizing and projecting● Questions Chain Link: Open - Probe - Probe - Closed - Mirror● Listening is paramount
  • 31. Case Study: Issue Tree Strategic Issues Sub-Issues Question How will the tablet ecosystem emerge in the next 3 – 4 years? Which Platforms? Which formats? How will the product and services market look in What are the changes in outlook for advertising spend the tablet advertising and type in the the tablet ecosystem? ecosystem in the next 3 -4 years?What should be What are the product and service offering that will beSmartAds Go-to- available in the next 3 - 4 years?Market strategy for What is the best Way-to- What ways-to-play are likely to be adopted in thethe Tablet Play for SmartAds in the market?AdvertisingEcosystem? tablet advertising Which way-to-play would be best suited for SmartAds ecosystem? to address the tablet ecosystem? How can SmartAds What are the key capabilities within SmartAds which leverage its capability create value and enable execution currently? system developed with the mobile context for What new or adjacent capabilities will need to be the tablet ecosystem? developed to address the table ecosystem
  • 32. Case Study: Sub-Issues & Hypotheses Sub-Issues HypothesesHow will the tablet ecosystem emerge in the next 3 – H1: Market consolidate around 3 major platforms – Apple Tablets, Google4 years? Which Platforms? Which formats? Android (including Amazon Tablet), Microsoft Windows 8 H2: Tablets will increasingly dominate content consumption (and ads) compared to PCs H3: Current trend of shift in advertising $ will accelerate and onlineWhat are the changes in outlook for advertising spend advertising will increase dramaticallyand type in the the tablet ecosystem? H4: Shift to tablet OS platform will result in increase in display advertising across the world H5: (Product) Rich media advertising supported by open standards, on bothWhat are the product and service offering that will be apps and browsers likely to accelerateavailable in the next 3 - 4 years? H6: (Service) Display value chain consolidating, maturing and value shifting towards branding and away from ad networksWhat ways-to-play are likely to be adopted in the H7: Five major ways-to-play in the display ad market – integrator,market? aggregator, distributor, platform enabler and premium/nicheWhich way-to-play would be best suited for SmartAds H8: SmartAds would need to shift from a Niche player to an Integratorto address the tablet ecosystem?What are the key capabilities within SmartAds which H9: Capabilities set consolidated in five buckets: Assets, Reach, Servicecreate value and enable execution currently? Offering, Service Delivery, EnablersWhat new or adjacent capabilities will need to be H10: SmartAds would need to extend its capability system beyond Addeveloped to address the table ecosystem Network – largely through acquisition
  • 33. Case Study: Analyses and Data Key Hypotheses Analyses and DataH1: Market consolidate around 3 major platforms – Apple Tablets, ● Projection of mobile, tablet and pc shipment and parc (2010 – 2015) Google Android (including Amazon Tablet), Microsoft Windows 8 ● Break up by platform ecosystems (OS, Windows, Android, Others)H2: Tablets will increasingly dominate content consumption ● Map the possible roadmap for development of different platforms(and ads) compared to PCs ● Segmentation of the tablet and PC usageH3: Current trend of shift in advertising $ will accelerate and online ● Projection for advertising spend on mobile vs. other forms (2010 – 2015) advertising will increase dramatically ● Break up by formats (mobile, tablet and pc)H4: Shift to tablet OS platform will result in increase in display ● Map tablet usage and impact on ad response and receptivity advertising across the world ● Map impact on Ad formats with tablet introductionH5: (Product) Rich media advertising supported by open standards, ● Map impact on likely to evolve on the tablets on both apps and browsers likely to accelerate ● Requirement level for development: standards, ● Map value chain players, consolidation / acquisitions, key trends andH6:: (Service) Display value chain consolidating, maturing and value technologies shifting towards branding and away from ad networks ● Estimate for value chain breakup- Branding vs. Direct Response, Key PlayersH7:: Five major ways-to-play in the display ad market – integrator, aggregator, distributor, platform enabler and premium/niche ● Segment key players based on (outside in) understanding of way-to-playH8:: SmartAds would need to shift from a Niche player to an Integrator ● Smart Ads Interviews (to be done)H9: Capabilities set consolidated in five buckets: Assets, Reach, ● Map broad set capabilities required in the display ad value chain Service Offering, Service Delivery, Enablers ● Assess (outside-in) the likely capabilities of sample playersH10: SmartAds would need to extend its capability system beyond ● Smart Ads Interviews (to be done) Ad Network – largely through acquisition ● Map implication on the revenue and go-to-market