Consumer industries are amassing huge data sets, highlighting the importance of choosing the right analytical models to help make commercial decisions.
Analysing data is a straightforward matter for statisticians or engineers, but not for many executives. As a result there is demand for more commercially savvy IT professionals, known as data scientists, and business schools are responding to this call.
Imperial College London recently announced a research partnership with Chinese telecoms company Huawei in July. Backed by the UK government, academic and business experts will work together to develop technologies that utilise “big data” – the term used to describe masses of information harvested from commercial activities, social media and other sources.
Another sign of the times can be seen at University of Oxford Saïd Business School, which has added a big data module to its MBA programme. This is taught through an online platform called “Global Opportunities and Threats: Oxford”, and aims to help students learn how to ask questions of the data that will help an organisation to prosper.
“We want Oxford MBAs to be able to apply new business models that will respond creatively to the challenges and opportunities that big data will bring,” says Janet Smart, senior research fellow at Saïd, who specialises in systems engineering and programme management.
“When an organisation makes the investment in skills and technical resources, it needs to be able to generate a return on that investment. That will require people who can ask the questions of the data that will lead to the actionable insights.”
Launched in 2010, the programme now has more than 80 students and is supported by CIONet, Europe’s biggest community of IT executives.
Modules from the programme have been shared with Technical University Munich in Germany and the University of St Gallen in Switzerland.
“Chief information officers think their departments should be more prominent in organisations and I think they are right, especially when they are spending €1.3bn a year on IT,” says professor Marcel Creemers, programme director at Nyenrode. “The financial business model now relies heavily on IT.”
He recently organised a cyber security masterclass with KPMG, at which students and invited chief information officers took part in a business simulation of a cyber attack in order to put together some best practice measures for companies to employ against hacking.
Meanwhile, the first cohort of the Masters in Business Analytics course at the Schulich School of Business at Canada’s York University is about to graduate, having spent a year studying the subject, including work on a data analysis project directly applicable to the corporate world.
And in the US, Eric Bradlow and Peter Fader, marketing professors known for their ability to analyse consumer data to predict trends and formulate business strategies, are directing Customer Analytics Initiative for the Wharton school at the University of Pennsylvania.
Jonathan Wareham, vice-dean of research at Esade Business School in Spain and a professor of information systems, says: “Students are typically resistant to subjects on database technologies, data structures or pure statistics.
“However, when they see the applications – how the data can be used to address real operational decisions – their attitude changes substantially ... They see the incredible power that knowledge of such technologies commands.”
For some academics, however, it is important that business schools respond to the emerging trend with care.
Clive Holtham, professor of information management at City University Cass Business School in the UK, says: “Our job is to bring a broader, balanced view [and] the actual value of big data is probably less than is being claimed.”
Vast quantities of historical data are not necessarily going to help you make the right decisions over the coming months or years, he says. Furthermore, data often come from unreliable sources. Hurricane Sandy, for example, generated thousands of tweets but most were from the Manhattan area. Those in poor areas – who were either affected the worst or just did not own smartphones – were not represented.
Prof Holtham says: “Rather than worry too much about having too few data scientists, we should worry about whether our senior managers are numerate enough and whether we have enough critical thinking skills across the whole workforce.”
Business schools need to continue teaching quantitative and research methods, he adds, methods that have been around for a long time.