An assignment for an internship on Data Analytics with Managerial Applications under Professor Sameer Mathur, IIM Lucknow

1. by Jeanne W. Ross, Cynthia M. Beath and
Anne Quaadgras

2. Companies are investing like crazy in
data scientists, data warehouses, and
data analytics software. But many of
them don’t have much to show for their
efforts.
WHY???
● Unreasonable Hype - companies are
expecting it to deliver more value than
it actually can
● Analytics-generated insights can be
easy to replicate – ATM model case
●
Turning insights from data analytics
into competitive advantage requires
changes that businesses may be
incapable of making.

3. The biggest reason that investments in
big data fail to pay off, though, is that
most companies don’t do a good job
with the information they already have.
They don’t know how to manage it,
analyze it in ways that enhance their
understanding, and then make changes
in response to new insights.

4. 3 years, 7 case-studies, interviews of
executives at 51 companies tell us that -
Few companies have a culture of
evidence-based decision making, - and
they tend to be more profitable than
companies that don’t have that kind of
culture.

6. A company that has had a culture of
evidence-based decision making since
its founding : Southland Corporation
(Seven-Eleven)
Toshifumi Suzuki, first CEO, decided
that the key to profitability for the
company’s tiny stores would be rapid
inventory turnover. So he placed
responsibility for ordering—the single
most important decision in the business
—in the hands of the stores’ 200,000
mostly part-time salesclerks. Those
employees, Suzuki believed, understood
their customers and, with good
information, could make the best

7. .

8. The result???
Seven-Eleven has been the most
profitable retailer in Japan for more
than 30 years!
This is not a story about big data, or
even about big investments in data. This
is a story about a lot of little data. More
important, it’s about betting your
business success on the ability of good
people to use good data to make good
decisions.

9. Companies with a culture of evidence-
based decision making follow four
practices:
1. Agree on a Single Source of Truth -
Using performance data from just one
authorized source. Eg : Aetna, Foxtel.
2. Use Scorecards - Giving decision
makers at all levels near-real-time
feedback. Regular scorecards clarify
individual accountability and provide
consistent feedback so that individuals
know how they are doing. It’s
important for scorecards to be based
on the right metric. Eg : PepsiAmericas,
Protection One.

10. 3. Explicitly Manage Your Business
Rules - Continually assessing and
improving business rules by
articulating them clearly and ensuring
consistency across the company. Use
little data for this purpose. Eg : Citrix.
4. Use Coaching to Improve
Performance - Help them shift from
basing their decisions on instinct to
basing them on data. Eg : Seven-Eleven
Japan, Protection One.

11. .

12. List the two most
(important/interesting/
informative)
insights from this article ?

13. First insight -
The change to a culture of evidence-
based decision making will be a
disruptive one – it involves people at all
levels and needs good coaching.
It is best to start at the medium level of
employees rather than start at top and
come down like it is usual.
Over time, the culture can spread to
many, maybe even most, roles.

14. Second insight -
Much of the hype around big data
focuses on getting more information
and more people to analyze it. But the
opportunity presented by the
information economy is best tapped by
getting all people to use data more
effectively. That may seem like an
expensive and risky endeavor. But it’s
actually a cheap and powerful way of
taking advantage of all the big—and
little—data you are accumulating.

15. Why and How are these
insights relevant to a
manager in India?

16. Since this tells us about the importance
of little data over big data, it is a boon
for companies that lack the resources
for extensive big data analysis and use
cheaper, more efficient methods to
make the best use of the upcoming
data revolution.
● Managers can easily follow the 4
practices which can be easily
implemented in their companies.
● Once the cultural change has been
adopted, it is not easily replicated by
competitors giving the former a
competitive edge – very important for
the growing Indian economy.

18. - PARUL VERMA