big data lazy brain
TRANSCRIPT
ThrivOn Analytics Presentation at TDWI
Key to Success with
Big Data and Lazy Brain
March, 2013
Rajeev Kumar
571-228-7037
ThrivOn Services
User engagement•User engagement
platform
– Enterprise portal
– Member/patient
portal
– SharePoint
– Collaboration
– Social Media
•Document Assembly
Analytics•Business analytics
•Data Warehousing
•Master Data
Management
•Big Data, Hadoop
•Now Data
Corporate Strategy•Growth Consulting
•M&A Assessment
•Value based Management
•New Market Assessment
and Entry Support
•Customer Strategies
ThrivOn closes the decision loop with combination of research, analytics and strategy
Technology Partnerships
IBM SVP Partner: Information Management, Analytics and Big Data
Only VMware Vfabric certified partner in mid-atlantic region, Cloud, Platform as a service
Member of the Clouder Connetct partner program – Hadoop Big Data Platform
Hortonworks – Big Data Hadoop/Mapreduce partner
Agenda
• Practical insights into “Decisioning Process" • How consumers make use of analytics • Framework for ensuring impact from analytics
My effort to leverage behavioral psychology with big data analytics in practice
Body and mind
A bat and ball cost $1.10.The bat costs one dollar more than the ball.
How much does the ball cost?
Bat and ball - Do not try to solve it but listen to your intuition
10 cents
What affects our mind and hence our decisions
• Context• Halo effect• WYSIATI - Information availability bias• Priming• Framing• Anchoring• Substitution• Quest for causality• Loss aversion• Possibility and certainty effect• Behavior under desperate situations
Context
Coffee room experiment
Priming: Coffee room experiment
Information Availability
“Steve is very shy and withdrawn, invariably helpful but with little interest in people or in the world of reality. A meek
and tidy soul, he has a need for order and structure, and a passion for detail.”
Is Steve more likely to be a librarian or a farmer?
Framing: What is more re-assuring
Hospital A Hospital B
The odds of survival one month after surgery are 90%”
The mortality within one month of surgery is 10%.”
Allen Vs Ben
• Alanintelligent—industrious—impulsive—critical—stubborn—envious
• Ben envious—stubborn—critical—impulsive—industrious—intelligent
Anchoring
Sales promotion for Campbell’s soup at about 10% off the regular price.
3 days a week – Limit of 12 per person. Other days – No limit per person.
Shoppers purchased an average of 7 cans when the limit was in force, twice as many as they bought when the limit was removed
Substitution
• How happy are you these days• How many dates did you have last month
• How many dates did you have last month• How happy are you these days
When are we more likely to gamble
• Get $900 for sure or 90% chance to get $1000
• Lose $900 for sure or 90% chance to lose $1000
Possibility and certainty
Are each of the 5% increase in probability to win $1M valued equally?
– 0% to 5%– 5% to 10%– 60% to 65%– 95% to 100%
Premium for certainty
At final stages of a settlement where your lawyer suggests you have 95% chance to win $1M, a settlement company approaches you with an offer of $910K
•Will you take it or leave it?
What affects our mind and hence our decisions
• Context• Halo effect• WYSIATI - Information availability bias• Priming• Framing• Anchoring• Substitution• Quest for causality• Loss aversion• Possibility and certainty effect• Behavior under desperate situations
Can we truly benefit from big data when we make decisions?
What holds the key to achieving success with big data analytics?
Wish we had a magical wand and a spell
And the skeptics would say
From The Checklist Manifesto
1.heart rate2.respiration 3.reflex4.muscle tone5.color
ThrivOn data decisions grid
Frequently made decisions that have been pre-validated and
accepted to be “system 1 – proof”
Periodic decisions requiring insights from large data that have been pre-validated and
accepted to be “system 1-proof”
Decisions arrived at by skilled analysts based on
lots of data
Highly subjective decisions that are made in board
rooms with very little data
Big DataSmall Data
Lazy Brain
Fast Brain
ThrivOn data decisions grid
Automated real time decisioning
Rule based batch decisions
Continuous experimentation
Checklist assisted decision making
Big DataSmall Data
Lazy Brain
Fast Brain
Putting this in practice
5 Point Action items
• Culture and awareness• Analytics Competency Center• Technology infrastructure• Analytics Playbooks• Culture of experimentation
How can we protect us from ourselves
• Statistics rules• Algorithms are better (80% of the time)• Expert judgment still needed• What you see is NOT all there is• Find the answer to the right question• Psychology matters
Golden rules
• Hire great analysts– Right mix of data science and business acumen
• Educate your top brass– To make analytics “mandatory” part of decision making
• Checklist manifesto – Establish comprehensive framework to ensure avoiding
common decision pitfalls
• Put all analysts in one room (or one floor)– Break organizational barriers, improve creativity
Recap
• Human being are genetically wired to be irrational – for good reasons
• It’s no longer just about how decisions are made inside a company. Think how your customers make decisions
• Big data alone is not going to make you winner. Mesh big data with your lazy brain