1. 1. Kevin Gray, Cannon Gray, Japan Festival of NewMR 2012 - Main Stage Session 2 APresenta*onfrom TheFes*valofNewMRMainStage 5December2012 What do we mean by Analytics? AllcopyrightownedbyTheFuturePlaceandthepresentersofthematerial Formoreinforma:onaboutNewMReventsvisitNewMR.org KevinGray CannonGray
2. 2. Kevin Gray, Cannon Gray, Japan Festival of NewMR 2012 - Main Stage Session 2 What do we mean by Analytics? Kevin Gray Cannon Gray
3. 3. Kevin Gray, Cannon Gray, Japan Festival of NewMR 2012 - Main Stage Session 2 Analytics, Schmanalytics Data Analytics: Crunching the Future - BloombergBusinessweek, September 2011 How Target Figured Out A Teen Girl Was Pregnant Before Her Father Did - Forbes, February 2012 The Plan to Rescue Sears - The Wall Street Journal, March 2012
4. 4. Kevin Gray, Cannon Gray, Japan Festival of NewMR 2012 - Main Stage Session 2 James who? Data Scientist: The Sexiest Job of the 21st Century - Harvard Business Review, October 2012
5. 5. Kevin Gray, Cannon Gray, Japan Festival of NewMR 2012 - Main Stage Session 2 Sounds great, but what is it?
6. 6. Kevin Gray, Cannon Gray, Japan Festival of NewMR 2012 - Main Stage Session 2 Some Unofficial Definitions (excerpted from December 2011 LI Discussions) The overlay of interpretation on data that has been run through some algorithm to give meaning to that data. Analytics has always been about understanding the relationship among various pieces of available data, usually in a predictive mode[Its] the construction of a set of mathematical models relating current data streams in a manner that will help assess the probable consequences of various potential future actions.
7. 7. Kevin Gray, Cannon Gray, Japan Festival of NewMR 2012 - Main Stage Session 2 Some Unofficial Definitions (excerpted from December 2011 LI Discussions) I think of large data sets and analysis intended to predict rather than to understand as opposed to analysis where I think the purpose is to understand rather than to predict. Crunching massive amounts of data to find patterns, frequencies and statistical significance. It's both a verb and noun. It's a step in the research process. It tells you the what. The end output helps inform decision making
8. 8. Kevin Gray, Cannon Gray, Japan Festival of NewMR 2012 - Main Stage Session 2 Some Unofficial Definitions (excerpted from December 2011 LI Discussions) Analytics has suffered the fate of any term that enjoys widespread popularity and usage - the meaning has been sucked out of it. Its use by people who don't really understand its origin, methods or nuances results in a kind of entropy that sees it attached to activities we never before imagined could be classified as analytics. For example: - A query from an OLAP data cube - A graph in a New York Times article - Examining a monthly sales report - Reading your sons report card
9. 9. Kevin Gray, Cannon Gray, Japan Festival of NewMR 2012 - Main Stage Session 2 Advanced Analytics... Have you ever seen promo for software that offers Advanced Analytics... ...only to discover that it is little more than a package for crosstabs and graphics?
10. 10. Kevin Gray, Cannon Gray, Japan Festival of NewMR 2012 - Main Stage Session 2 Some Official Definitions The method of logical analysis - Merriam-Webster This is a science of using mathematical techniques to understand data. It may involve using statistics and other related techniques to make inferences or obtain meaningful information from data to facilitate making decisions. It might be used as a broader term to include all areas of capturing, storing, retrieving and analyzing data. - wiki.answers.com
11. 11. Kevin Gray, Cannon Gray, Japan Festival of NewMR 2012 - Main Stage Session 2 Some Official Definitions The field of data analysis. Analytics often involves studying past historical data to research potential trends, to analyze the effects of certain decisions or events, or to evaluate the performance of a given tool or scenario. The goal of analytics is to improve the business by gaining knowledge which can be used to make improvements or changes. - BusinessDictionary.com
12. 12. Kevin Gray, Cannon Gray, Japan Festival of NewMR 2012 - Main Stage Session 2 Some Official Definitions From Wikipedia: Analytics is the discovery and communication of meaningful patterns in data. Especially valuable in areas rich with recorded information, analytics relies on the simultaneous application of statistics, computer programming and operations research to quantify performance. Analytics often favors data visualization to communicate insight.
13. 13. Kevin Gray, Cannon Gray, Japan Festival of NewMR 2012 - Main Stage Session 2 Some Official Definitions From Wikipedia (cont): Analytics is a two-sided coin. On one side, it uses descriptive and predictive models to gain valuable knowledge from data - data analysis. On the other, analytics uses this insight to recommend action or to guide decision making - communication. Thus, analytics is not so much concerned with individual analyses or analysis steps, but with the entire methodology.
14. 14. Kevin Gray, Cannon Gray, Japan Festival of NewMR 2012 - Main Stage Session 2 Much Ado About Little? If its a multi-billion dollar business it would be useful to understand what it is!
15. 15. Kevin Gray, Cannon Gray, Japan Festival of NewMR 2012 - Main Stage Session 2 A Proposed Definition Analytics is the discovery and communication of meaningful patterns in data. It makes use of information technology, statistics and mathematical algorithms to develop knowledge, to quantify performance or to make predictions. It uses the insights gained from this process to recommend action or to guide decision making. Analytics is best thought of as a methodology, not simply as isolated tools or steps in a process.
16. 16. Kevin Gray, Cannon Gray, Japan Festival of NewMR 2012 - Main Stage Session 2 Why This One? Analy:csisnotsimplyonething Itisamethodology Itemploysmanytoolsaspartofaprocess Analy:csiseasiertodescribethantodeneconcisely
17. 17. Kevin Gray, Cannon Gray, Japan Festival of NewMR 2012 - Main Stage Session 2 The Analytics Process DeningObjec:ves DataCollec:on DataPrepara:on ModelBuilding ModelEvalua:on Interpreta:on Scoring/Simula:ons Communica:on
18. 18. Kevin Gray, Cannon Gray, Japan Festival of NewMR 2012 - Main Stage Session 2 Some Analytics Tools WhenthinkingofAnaly5cs,toolsareimportant butshouldnotbetheoverridingfocus However,afewwordsonanaly:cstoolswill makethistopicmoreconcrete Becauseof:meconsidera:onswewillfocus ontheModelingstepsintheprocess
19. 19. Kevin Gray, Cannon Gray, Japan Festival of NewMR 2012 - Main Stage Session 2 Still Alive an Kickin Core Methods Descrip:ve Sta:s:cs Graphics Experimental Designs Sampling Measuresof Associa:on Inferen:al Sta:s:cs Regression Factor Analysis Cluster Analysis
20. 20. Kevin Gray, Cannon Gray, Japan Festival of NewMR 2012 - Main Stage Session 2 Underutilized? Specialized Methods Conjoint Structural Equa:on Modeling Quan:le Regression Logis:c Regression Poisson Regression Mul:level Modeling Survival Analysis Missing Data Imputa:on
21. 21. Kevin Gray, Cannon Gray, Japan Festival of NewMR 2012 - Main Stage Session 2 Underutilized? Specialized Methods Latent Class Growth Modeling Latent Transi:on Bayesian Es:ma:on Bayesian Networks Social Network Analysis Text Analy:cs Monte Carlo Methods
22. 22. Kevin Gray, Cannon Gray, Japan Festival of NewMR 2012 - Main Stage Session 2 Forecasting, MRM, ROI Forecas:ng, MRM,ROI Smoothing Methods ARIMA Transfer Func:on Modeling Panel Modeling VAR,VEC Dynamic Factor Analysis StateSpace Models GARCH
23. 23. Kevin Gray, Cannon Gray, Japan Festival of NewMR 2012 - Main Stage Session 2 Data Mining and Predictive Analytics Data Mining, Predic:ve Analy:cs Trees Nearest Neighbor Classiers Boos:ng, Bagging Stacking, Ensembles Associa:on Rules Ar:cial Neural Networks Support Vector Machines GAM MARS
24. 24. Kevin Gray, Cannon Gray, Japan Festival of NewMR 2012 - Main Stage Session 2 The Future? Future? Enhanced Variable Selec:on Sparse(n