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Blog: The Analytics Fix
What is analytics and how does it relate to Operations Research?
By Kevin Geraghty
I was just reading an article on the INFORMS Analytics section, intriguingly titled Analytics, OR and INFORMS - Where the three meet. I am responsible for the Analytics department of a growing digital marketing agency and I have a long career in Operations Research behind me, so the question “What is analytics and how does it relate to Operations Research?“ I wrestle with.
To a certain extent, the issue is semantic. I am still involved with the same basic challenges as when I started my career in the Business Support and Operations Research department of British Airways in the mid-1980s. The challenge was to take data and turn it into business insight. The computing technologies and the available data have changed radically, but the job remains the same. However the term “Analytics” seems to encompass a broader set of expectations than those originally assumed to be the province of O.R.
The original purpose of analytics departments in most business was to produce reports. Initially the analytics job involved cutting and pasting numbers from various sources into a spreadsheet to produce a report that delivered actionable insight to an executive or sales person or other decision maker. This process often led to the creation of local databases in MS Access or a more formal reporting database as a shared resource. So the first people to move the needle on the effectiveness and applicability of analytics were data modelers, DBAs and others with a grasp of SQL. Soon after, products such as Cognos, Hyperion and other business intelligence tools hit the market creating even greater opportunity to troll for business value in large sets of data.
So where does Operations Research fit in to this picture. O.R. People have been everywhere in the process. Some have helped develop these tools. Others have exploited the greater accessibility of the data to develop ever more robust and insightful models. The general role of Operations Research has been in the vanguard explaining why you need ever-greater understanding of what data is telling you.
Of course Operations Research practice has had to evolve along with the demands and opportunities that a much more volatile business environment creates. I often joke that I have code that I wrote 20 years ago still running at various airlines; however any code I have written in my past five years has not lasted more than six months without substantial revision. That effect is probably heightened by the fact that I work at digital agency.
Of course the relevance of Operations Research to analytics depends on what you believe Operations Research brings to the table. For me it’s the ability to derive insight from data and turn those insights into tangible results. The rigorous education of Operations Research students in the analytic techniques of Optimization, Statistics, Queueing Theory and all the others are to me, just a means to an end. The hallmark of an Operations Research education is not what you learn but understanding how to make it work in the real world. What a nice coincidence that this is exactly what business leaders are looking for Analytics to provide: Actionable, data-driven business insight and the ability to use those insights to meet business challenges.
As vice president of Reporting and Analytics for 360i, Kevin Geraghty (KGeraghty@360i.com) is responsible for delivering data-driven insights that enhance marketers' business results. He has received honors from the Institute for Operations Research and the Management Sciences (INFORMS) for outstanding Operations Research practice and serves as editor-in-chief for INFORMS Online.