competing on analytics - ag & aipresentatie...competing on analytics sandjai bhulai...

‹#› Het begint met een idee

COMPETING ON ANALYTICS

SANDJAI BHULAIS.BHULAI@VU.NL

Vrije Universiteit Amsterdam

Prof. dr. S. (Sandjai) BhulaiFull Professor of Business AnalyticsFaculty of SciencesVrije Universiteit AmsterdamDepartment: Mathematicss.bhulai@vu.nl

Business Analytics: Optimization of Business Processes

Research / Education:Decision making under uncertaintyControl of complex high‐dimensional systemsStochastic optimization

2 Sandjai Bhulai (s.bhulai@vu.nl)

INTRODUCTIONINTRODUCTION

Vrije Universiteit Amsterdam3 Sandjai Bhulai (s.bhulai@vu.nl)

WHAT IS BIG DATA?WHAT IS BIG DATA?

BIG DATA … BIG CHANGES!BIG DATA … BIG CHANGES!

“… most managers receive much more data (if not information) than they can possibly absorb […]. Hence

they suffer from an information overload...”

Management Misinformation Systems, R.L. Ackoff,

Management Science/December 1967

THE FOUR V’S OF BIG DATATHE FOUR V’S OF BIG DATA

BUSINESS ANALYTICSBUSINESS ANALYTICS

Big data is more than simply a matter of size: it is also about creating insights!

Discovering what you don’t know you don’t know……

Business Analytics Scientific process of transforming data into insight for making better decisions

Used for data‐driven decision making, which is often seen as more objective than other alternatives for decision making.

“Why do professional baseball executives, many of whom have spent their lives in the game, make so many colossal mistakes? …

It takes time and effort to switch from simple intuitions to careful assessments of evidence.”

Thaler and Sunsteinreview of Moneyball

WHY IS BUSINESS ANALYTICS IMPORTANT?WHY IS BUSINESS ANALYTICS IMPORTANT?

ANALYTICS AS INTELLIGENCE AUGMENTATIONANALYTICS AS INTELLIGENCE AUGMENTATION

Question: Jack is looking at Anne, but Anne is looking at George.

Jack is married, but George is not.

Is a married person looking at an unmarried person?

A. Yes

C. Cannot be determined

EXAMPLE 1: PUZZLING RELATIONSHIPSEXAMPLE 1: PUZZLING RELATIONSHIPS

Question: Jack is looking at Anne, but Anne is looking at George.

Jack is married, but George is not.

Is a married person looking at an unmarried person?

A. Yes

EXAMPLE 1: PUZZLING RELATIONSHIPSEXAMPLE 1: PUZZLING RELATIONSHIPS

married unknown unmarried

EXAMPLE 2: THERE’S SOMETHING ABOUT LINDAEXAMPLE 2: THERE’S SOMETHING ABOUT LINDA

Examine the following profile:

Linda is 31 years old, single, outspoken, and very bright. She majored in philosophy. As a student, she was deeply concerned with issues of discrimination and social justice, and also participated in anti‐nuclear demonstrations.

Which of these scenarios is more likely?

A. Linda is a bank teller

B. Linda is a bank teller and is active in the feminist movement

Examine the following profile:

Linda is 31 years old, single, outspoken, and very bright. She majored in philosophy. As a student, she was deeply concerned with issues of discrimination and social justice, and also participated in anti‐nuclear demonstrations.

Which of these scenarios is more likely?

A. Linda is a bank teller

EXAMPLE 3: DECISION FATIGUEEXAMPLE 3: DECISION FATIGUE

There are two types of mental operations:

1. Type 1: automatic, effortless, associatively coherent

2. Type 2: controlled, effortful, logically coherent

THE MORAL OF THESE EXAMPLESTHE MORAL OF THESE EXAMPLES

Behavioral economics teaches us that the value of analytics is often in avoiding biased judgments and flawed decisions.

THE MORAL OF THESE EXAMPLESTHE MORAL OF THESE EXAMPLES

ANALYTICS: SHIFTING PARADIGMSANALYTICS: SHIFTING PARADIGMS

Do computers play more intelligently than humans?

Panama papers (2.6 TB, 11.5 billion documents)> 5 billion emails

> 3 billion databases

> 2 billion PDF documents

> 1 billion images

> 320,166 text files

> 2,242 other files

TOWARDS ANALYTICS MATURITYTOWARDS ANALYTICS MATURITY

THE BIG PICTURETHE BIG PICTURE

logistics

retail

energy

webshop

telecom

health care

THE ENERGY SECTORTHE ENERGY SECTOR

23-12-11 11-02-12 01-04-12 21-05-12 10-07-12 29-08-12 -20-15-10

101520253035

23-12-11 11-02-12 01-04-12 21-05-12 10-07-12 29-08-12

KNMI data has 22 factors:WindspeedHighest wind gustTemperatureDew temperatureDuration of sunshineGlobal radiationDuration of precipitationAir pressureDaily cloud cover…

THE RETAIL SECTORTHE RETAIL SECTOR

winter tires

SOCIAL MEDIA IN OUR LIFESOCIAL MEDIA IN OUR LIFE

Social listening:

FROM NU.NL TO STRAKS.NLFROM NU.NL TO STRAKS.NL

TWITTER FOR TAXITWITTER FOR TAXI

QUESTIONSQUESTIONS

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