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What would be of Sherlock without Dr. Watson? The case of data analytics.

Being able to tell a good story is as important as good data analysis.

Sherlock had the ability to analyze and put together odd pieces of events. But his findings were set on paper in a catching way by his friend Dr. Watson. Being able to tell a good story is as important as having the right data analysis to back it up.

Traditionally, concerns were focused on how to minimize data processing time and how to build a model with the highest predictive value. Today’s concerns are towards what actions can be taken based on predictive modelling and what constituencies will support or block implementation.

“Data, hardware, and software are available in droves, but human comprehension of the possibilities they enable is much less common.” Tom Davenport. HBR.

Data analytics is without question on the rise and it was enabled by technology. Today there are thousands of businesses that collect vast amounts of data but are at a loss when trying to put this information to use[1].

Why are both important?

In an organization efforts are aligned through its strategic objectives and in most cases data allows to measure progress in order to reach these objectives. Within the decision making processes in organizations people with tech and non-tech skills coexist and both are equally important. “Without data you’re just another person with an opinion.” As said by Deming.  But without a hypothesis/objective you’re just a person with data. Communicating proposals validated on data points and generating consensus throughout the organization drives meaningful new ideas. Enabling to leverage data in order to achieve business results and create insight.

When does analytics fail? The case of Netflix

A couple of years ago Netflix launched a $1 million prize for the team that could come up with an algorithm that improved by 10 points the current match making of recommendations.  So the algorithm was developed and there was a winner but it was never implemented because Netflix changed its service from DVD-by-mail to streaming.  Meaning the whole organization was changing and the algorithm developed was rendered useless in most part[2].

References:

[1] http://burning-glass.com/research/hybrid-jobs/

[2] http://techblog.netflix.com/2012/04/netflix-recommendations-beyond-5-stars.html

Challenges in the automotive industry’s business model

How have 21st Century technologies allowed companies in the automotive industry to change their business models?

Since the beginning of the 21st century new players from the technology and communications sectors are entering the automotive industry and dramatically changing its chain value and traditional business model.  The main segments that were altered significantly are production, sales experience, key partners, product innovation and R&D.  Today the companies that follow have a chance to leap at the front of the game and those ahead might stay behind if their business model is not flexible at its core.

1)     Transition from push production to demand pull and modular production

We have seen this change in an innumerable amount of industries but Dell is the first name to come in mind when talking about modular production.  The automotive industry has been taking in at a late stage technological advances that arise in other industries.   In this way production transitioned to offer products with attributes selected by the client, sometimes ordered through internet and delivered within 15 days; for instance, Toyota’s upstart Scion.

2)    Changes in sales experience

Car dealers as sale points are being swept out as in the case of BMW and Tesla.  BMW chooses to change the buying experience by introducing the ‘BMW product genius’ who will educate the customer on all the lines of products.  The motivation of ‘BMW product genius’ is not to sell (they do not earn commissions per sale) but to build customer loyalty.  It certainly takes after the service offered in Apple Stores.  As to Tesla S1 electric car sold directly to customers is more aggressive and is reprimanded by car dealers.  Not because they are direct competitors (Tesla’s sales represent 0.1% of US auto market) but because out of fear that other brands might follow.

Technology has disrupted the way people make their buying decisions; today people use platforms to determine who to trust and what to buy.  Above that, consumers today value innovation in automobiles.  They want to buy from the companies they perceive as brining new technology first to the market.

3)    Product Innovation and R&D: Sustainable cars, Electric cars, Autonomous cars

In the ‘2016 EU Industrial R&D Investment Scoreboard[1]’ 6 automakers are among the top 30 and the number of patent filings in the automotive industry also reflect an increase.  Volkswagen was the company with the highest investment in R&D worldwide, until it stated struggling after falsifying environmental testing protocols.  Innovation has become a top priority for automotive companies.  Today there are at least 50 hybrid models in the market whereas in 2001 there were only 2.

Focusing only on downsizing internal combustion engines and fuel efficiency may mean leading companies may fall behind innovative companies in the future.  Changes in their products must be timed as to gain acceptance and not lose their loyal customers.  

The main product changes from mechanical to hybrid to electric to partly automated which shifted the sales motto of ‘faster, stronger’ to ‘sustainable, innovative’.

4)    Shared ownership

Going a step further the ‘Car2Go’ by Daimler and ‘DriveNow’ by BMW services suggest no ownership.  Another different example is ‘Autolib’ where the service is run by the government, a key partner, and the company providing the cars is unknown to the public.

Altogether there is more to technology innovation than changes to the product itself.  It enables new business models and relationships between stakeholders.  The emerging model is still to come but it is certain it will be driven by technology.  The chain value and business model will be shifting as new stakeholders enter the industry with the advances in electronics, communications, alternative fuels and materials.

 

REFERENCES:

[1] https://www.iriweb.org/sites/default/files/2016GlobalR%26DFundingForecast_2.pdf

SOURCES:

Ø  www.forbes.com

Ø  www.bcgperspectives.com

Ø  www.bain.com

Ø  www.bloomberg.com

Ø  www.economist.com

Ø  www.kpmg.com

Ø  www.ibm.com

Ø  https://www.iriweb.org/sites/default/files/2016GlobalR%26DFundingForecast_2.pdf

 

 

Success and the power of mentorship

 

“And you ask any successful person how they got to where they are today, chances are they’ll tell you about a mentor they had somewhere along the way.”– Barack Obama[1]

People are complex but, in a great way, we are defined by our environment and ambitions.  Having clear objectives, is the first step towards success, because after that moment you can work towards them.

Today, looking backwards, having gone through university and some first professional experiences I’m convinced that a mentor can bring down obstacles.  The first time I came across a mentor formally was during my participation in the SABF team and I will always be grateful for her dedication.

A mentor gives you the means to improve personal and professional skills. It raises awareness of your strengths and weaknesses to better align yourself towards your goals. It inspires you and brings more confidence when facing challenges.  It´s important to be open minded to receive advice and be willing to work on it.

To find a mentor the most important thing is to learn to approach people for advice.  And to take the most out of the relationship, you have to be honest about your own personal and professional objectives.

Without doubt, if you seek for a mentor you will win opportunities to meet interesting people and enrich your experiences.  Always be open to give advise, people are amazing!