Everything is Moneyball

Suddenly, everything is “Moneyball” and analytics are all the rage. It’s beginning to dawn on a broad spectrum of industries that the kind of analytics that Wall Street has used for years to drive decision-making has a similar value for everyone. And the media is catching on. A quick search of “moneyball” returns great examples:

  • Nate Silver’s FiveThirtyEight blog was moneyball for politics as his algorithms accurately called the Presidential election and Congressional outcomes
  • VentureBeat reported on General Catalyst, a VC firm that uses statistical analysis to put meat behind their decisions to invest in startup businesses. They have moneyball for venture capital.
  • TechCrunch’s Dave Chase told us how healthcare’s delivery model is being changed by outcome-based models rather than “do more, bill more”.  That would be moneyball for medicine.
  • CIO told us how we can have moneyball for resourcing as an approach to building a better technology workforce
  • It appears there’s even a moneyball for college students as a way to improve education

But why should this be such a hot story? What’s changed recently that makes this interesting?

Tools

The realm of analytics used to be the back room with a population exclusively of quantitative analysts crunching complex algorithms. We’ve moved beyond that and now have tools in the hands of business users that auto-discover the math that reveals data patterns. Drag and drop controls allow data sets to be connected and dissected. Visualization is rich and revealing. It’s a whole new ball game.

As one author puts it:

business analytics are an evolved version of business intelligence but with far more emphasis on gaining insights and predicting trends.

The tools that worked for BI aren’t sufficient for a moneyball approach. There needs to be a retooling toward the business-friendly, real-time tools that are getting all of the attention now. Poor BI is sitting the bench.

Tactics

The tools are just the front end for executing tactics. There’s a growing number of companies that understand that high-velocity connectivity from source to output is the foundation for working with Big Data. If the infrastructure doesn’t pass muster, data can’t move through the system in a way that makes tools valuable. The new tactic is to use in-memory computing to hold data in cache, far faster and more flexible than traditional databases. That in-memory capability, when embedded in applications, lowers the load on the network and database and frees up the system for the incredibly high speeds required for great analytics.

Many companies perform ‘what-if’ analysis to see how scenarios play out against historical data. This tactic puts them in a position to watch for those scenarios and act quickly to prevent or achieve a predictable outcome. It is a proactive stance that only great analytics can front end.

Data

More than tools and tactics, the amount of data that’s now being amassed is a powerful reason for the rise of analytics. Nature abhors both a vacuum and a surplus, and once information starts coming over the walls as Big Data, the opportunity to do something with it is irresistible. Once one enterprise is taking advantage of analytics and data, it becomes a competitive issue that pulls everyone along as a matter of survival.

Tools, tactics and data are what makes our time the age of analytics. It fuels increased competition by delivering less risk, more customers and increased profitability. It simply makes decisions far, far better.

Are you playing moneyball for your industry?

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Categories: Data Analytics / Big Data

Author:Chris Taylor

Reimagining the way work is done through big data, analytics, and event processing. There's no end to what we can change and improve. I wear myself out...

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Trackbacks/Pingbacks

  1. Nate Silver taking his analytics to ESPN and ABC | Successful Workplace - July 20, 2013

    […] for analytics; baseball. Known as sabermetrics, this is the science behind the popular story of Money Ball and is now a standard way to gauge the potential of players in many […]

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