Business Intelligence Analytics and Data Science A Managerial Perspective 4th Edition Sharda Solutions Manual
Business Intelligence Analytics and Data Science A Managerial Perspective 4th Edition Sharda Solutions Manual
Business Intelligence Analytics and Data Science A Managerial Perspective 4th Edition Sharda Solutions Manual
CHAPTER
and Managerial
8
Considerations in
Analytics
Explore some of the emerging technologies that may impact analytics, business
intelligence (BI), and decision support
Describe the emerging Internet of Things (IoT) phenomenon, potential
applications, and the IoT ecosystem
Describe the current and future use of cloud computing in business analytics
Describe how geospatial and location-based analytics are assisting organizations
Describe the organizational impacts of analytics applications
List and describe the major ethical and legal issues of analytics implementation
Identify key characteristics of a successful data science professional
CHAPTER OVERVIEW
This chapter introduces several emerging technologies that are likely to have major
impacts on the development and use of business intelligence (BI) applications.
In a dynamic area such as analytics, the terms also evolve and overlap. As noted
earlier, we can refer to these technologies as BI, analytics, data science, machine
learning, artificial intelligence (AI), cognitive computing, Big Data, or by several other
labels. Our goal is not to focus on subtle differences among each, but to look at the
collection as one big constellation. We focus on some trends that have already been
realized and others that are about to impact analytics further. Using a crystal ball is
always a risky proposition, but this chapter provides an analysis of some growing areas.
We introduce and explain some emerging technologies and explore their current
applications. We then discuss the organizational, personal, legal, ethical, and societal
impacts of analytical support systems and issues that should be of importance to
managers and professionals in analytics. This chapter contains the following sections:
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CHAPTER OUTLINE
8.1 Opening Vignette: Analysis of Sensor Data Helps Siemens Avoid Train
Failures
8.2 Internet of Things
8.3 Cloud Computing and Business Analytics
8.4 Location-Based Analytics for Organizations
8.5 Issues of Legality, Privacy, and Ethics
8.6 Impacts of Analytics in Organizations: An Overview
8.7 Data Scientist as a Profession
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ANSWERS TO END OF SECTION REVIEW QUESTIONS
Section 8.1 Review Questions
There are many parameters that could be evaluated to help estimate current
performance and repair needs. Some of these parameters could include time in
use, weather, adverse impacts, and so on.
Weather data could indicate if the components have been exposed to water, or if
the components have been exposed to excesses and heat or cold.
3. Estimate how much data you might collect in one month using, say, 1,000 sensors
on a train. Each sensor might yield 1 KB data per second.
1,000 sensors at 1KB of data per second (43,200 K/month) is a total of 43.2 GB
across all sensors.
This volume of data would need to be stored in a robust database system that
would be able to analyze all of the individual readings.
There are a wide variety of uses for the Internet of Things (IoT). Examples can
include monitoring the status of different devices, as well as communicating that
status and other environmental information to other devices or to central systems.
3. What is RFID?
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identification technologies, which also includes the ubiquitous barcodes and
magnetic strips.
5. Identify some key players in the IoT ecosystem. Explore their offerings.
Major players in the Internet of things can be classified into building block
suppliers, platforms and enablement, and applications across multiple verticals. A
discussion of any of these areas will be highly variable based on the player and
sub area selected and when the research is conducted.
6. What are some of the major issues managers have to keep in mind in exploring
IoT?
When managers consider the IoT there are several important concepts to take into
account. The first is organizational alignment; how does this technology fit in
with the company’s current goals and resources? Second are interoperability
challenges; will the company be able to use this advancement within their current
infrastructure? The final issue is security; will information be able to be controlled
in a manner that is required and consistent with company policy and existing law?
1. Define cloud computing. How does it relate to PaaS, SaaS, and IaaS?
Cloud computing offers the possibility of using software, hardware, platform, and
infrastructure, all on a service-subscription basis. Cloud computing enables a more
scalable investment on the part of a user. Like PaaS, etc., cloud computing offers
organizations the latest technologies without significant upfront investment.
In some ways, cloud computing is a new name for many previous related trends:
utility computing, application service provider grid computing, on-demand
computing, software as a service (SaaS), and even older centralized computing with dumb
terminals. But the term cloud computing originates from a reference to the Internet as a
“cloud” and represents an evolution of all previous shared/centralized computing
trends.
Companies offering such services include 1010data, LogiXML, and Lucid Era. These
companies offer feature extract, transform, and load capabilities as well as advanced
data analysis tools. Other companies, such as Elastra and Rightscale, offer dashboard
and data management tools that follow the SaaS and DaaS models.
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3. How does cloud computing affect BI?
In the DaaS model, the actual platform on which the data resides doesn’t matter. Data
can reside in a local computer or in a server at a server farm inside a cloud-computing
environment. With DaaS, any business process can access data wherever it resides.
Customers can move quickly thanks to the simplicity of the data access and the fact
that they don’t need extensive knowledge of the underlying data.
AaaS in the cloud has economies of scale and scope by providing many virtual
analytical applications with better scalability and higher cost savings. The capabilities
that a service orientation (along with cloud computing, pooled resources, and parallel
processing) brings to the analytic world enable cost-effective data/text mining, large-
scale optimization, highly-complex multi-criteria decision problems, and distributed
simulation models.
Student selections will vary from those discussed on pages 429 – 440.
Student examples will vary from those discussed on pages 429 – 440.
Traditional analytics produce visual maps that are geographically mapped and based
on the traditional location data, usually grouped by the postal codes. The use of postal
codes to represent the data is a somewhat static approach for achieving a higher level
view of things.
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2. How can geocoded locations assist in better decision making?
They help the user in understanding “true location-based” impacts, and allow them to
view at higher granularities than that offered by the traditional postal code
aggregations. Addition of location components based on latitudinal and longitudinal
attributes to the traditional analytical techniques enables organizations to add a new
dimension of “where” to their traditional business analyses, which currently answer
questions of “who,” “what,” “when,” and “how much.” By integrating information
about the location with other critical business data, organizations are now creating
location intelligence (LI).
4. Explore the use of geospatial analytics further by investigating its use across various
sectors like government census tracking, consumer marketing, and so forth.
Another app that is mentioned in the text is one deployed in Pittsburgh, Pennsylvania,
and developed in collaboration with Carnegie Mellon University. This app, called
ParkPGH, includes predictive capabilities to estimate parking availability. It
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calculates the number of spaces available in downtown Pittsburgh parking lots and
garages. (Student answers will vary.)
8. What other applications can you imagine if you were able to access cell phone
location data? Do a search on location-enabled services.
• What is the value of an expert opinion in court when the expertise is encoded in a
computer?
• Who is liable for wrong advice (or information) provided by an intelligent
application?
• What happens if a manager enters an incorrect judgment value into an analytic
application and the result is damage or a disaster?
• Who owns the knowledge in a knowledge base?
• Can management force experts to contribute their expertise?
In general, privacy is the right to be left alone and the right to be free from
unreasonable personal intrusions. The Internet, in combination with large-scale
databases, has created an entirely new dimension of accessing and using data. The
inherent power in systems that can access vast amounts of data can be used for the
good of society. For example, by matching records with the aid of a computer, it is
possible to eliminate or reduce fraud, crime, government mismanagement, tax
evasion, welfare cheating, family-support filching, employment of illegal aliens, and
so on. The same is true on the corporate level. Private information about employees
may aid in better decision making, but the employees’ privacy may be affected.
Similar issues are related to information about customers.
3. In your view, who should own the data about your use of a car?
• Electronic surveillance
• Ethics in DSS design
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• Software piracy
• Invasion of individuals’ privacy
• Use of proprietary databases
• Use of intellectual property such as knowledge and expertise
• Exposure of employees to unsafe environments related to computers
• Computer accessibility for workers with disabilities
• Accuracy of data, information, and knowledge
• Protection of the rights of users
• Accessibility to information
• Use of corporate computers for non-work-related purposes
• How much decision making to delegate to computers
Analytics can change the manner in which many decisions are made and can
consequently change managers’ jobs. They can help managers gain more knowledge,
experience, and expertise, and consequently enhance the quality and speed of their
decision making. In particular, information gathering for decision making is
completed much more quickly when analytics are in use. This affects both strategic
planning and control decisions, changing the decision-making process and even
decision-making styles.
Less expertise (experience) is required for making many decisions. Faster decision
making is possible because of the availability of information and the automation of
some phases in the decision-making process. Less reliance on experts and analysts is
required to provide support to top executives. Power is being redistributed among
managers. (The more information and analysis capability they possess, the more
power they have.) Support for complex decisions allows decisions to be made faster
and of better quality. Information needed for high-level decision making is expedited
or even self-generated. Automation of routine decisions or phases in the decision-
making process (e.g., for frontline decision making and using ADS) may eliminate
some managers, especially middle level managers. Routine and mundane work can be
done using an analytic system, freeing up managers and knowledge workers to do
more challenging tasks.
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4. Identify other examples of analytics applications to redesign work space or team
behavior.
Examples can include the use of HR systems to identify potential job candidates that
will be the best fit within an existing organization. Another example is analyzing how
employees move through the organization and who they collaborate with. This is data
that can be used to design office space that is more efficient.
Cognitive computing will have a large impact in many different industries because
jobs that were historically completed by humans may be automated. This would have
large cultural implications as well as business implications. From a business
perspective, automation has the possibility to decrease cycle time while increasing
quality. Conversely, startup cost for automation may be significant.
According to the articles, initial job losses will focus on areas that are not skill-based,
and that may require repetitive actions that do not require a high amount of
knowledge.
7. Study The Economist (Standage, 2016) report mentioned in this section. What other
impacts of automation did you find interesting?
Student perceptions may vary, but most will comment on the significant cultural
changes and implications of automation and the resulting loss of jobs.
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2. What are the common characteristics of data scientists? Which one is the most
important?
Becoming a great data scientist requires you to delve deeply into developing
quantitative and technical skills, as well as interpersonal and communication
skills. In addition, you will need to gain significant domain knowledge (e.g., in
business). This effort will most likely require an advanced degree. It also requires
a continuous thirst for knowledge and an intense curiosity; you will always be
learning in this profession. In addition to meticulous analytical skills, it also
requires creativity and imagination. (Students will vary in their answers to this
question.)
1. What type of information might the sensors on a race boat generate that would be
important for the racers to know? What about for the fans?
Student opinions will vary, but examples may include information on boat
systems (engine, etc.), location and speed as well as biometric information on the
racers.
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Student opinions will vary, but may include car racing, motocross and mountain
bike racing.
Many challenges exist, with some of the primary issues including the selection
and management of large amounts of data, as well as the potential to receive that
data in real-time.
Application Case 8.2: Rockwell Automation Monitors Expensive Oil and Gas
Exploration Assets
1. What type of information would likely be collected by an oil and gas drilling
platform?
2. Does this application fit the three V’s of Big Data (volume, variety, velocity)?
Why or why not?
This application fits this model well. There would be a very large volume of
information coming in across multiple locations with a significant number of
sensors at each location. Each of these locations could potentially monitor a wide
variety of data inputs. Finally, this information would need to be evaluated in real
time so that if an issue existed it could be repaired quickly.
There are many possibilities. Other industries that could use this technology
include transportation, manufacturing, food production, and agriculture.
Application Case 8.3: Pitney Bowes Collaborates with General Electric IoT
Platform to Optimize Production
Application Case 8.4: Great Clips Employs Spatial Analytics to Shave Time in
Location Decisions
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1. How is geospatial analytics employed at Great Clips?
Great Clips depends on a growth strategy that is driven by rapidly opening new
stores in the right locations and markets. They use geospatial analysis to help
analyze the locations based on the requirements for a potential customer base,
demographic trends, and sales impact on existing franchises in the target location.
They use their Alteryx-based solution to evaluate each new location based on
demographics and consumer behavior data, aligning with existing Great Clips
customer profiles and the potential revenue impact of the new site on the existing
sites.
2. What criteria should a company consider in evaluating sites for future locations?
Major criteria include potential customer base, demographic trends, and sales
impact on existing franchises in the target location.
3. Can you think of other applications where such geospatial data might be useful?
Geospatial data can be used to help customers find the right location (for example,
the closest Great Clips location). It is certainly relevant for other companies in a
variety of industries. Analyzing customer profiles and applying these to
geographic information can assist with many retail firms. Another possibility is
utilizing geospatial analysis to find locations for manufacturing facilities; in this
case you would be looking for supplier and raw materials’ locations more than
customer locations. In the consumer market, geospatial analysis can help users in
a variety of applications; for example finding the best locations for restaurants or
stores catering to the customer’s desires. (Student answers will vary.)
Application Case 8.5: Starbucks Exploits GIS and Analytics to Grow Worldwide
1. What type of demographics and GIS information would be relevant for deciding
on a store location?
There are a variety of types of information that would be very relevant for
Starbucks. From a demographic perspective, it would be important that the
individuals being evaluated fit the demographic of existing Starbucks customers.
From a GIS perspective, it would be important that these individuals were close to
a potential store location, and that the store location is convenient as they go to
and from work.
2. It has been mentioned that Starbucks encourages its customers to use its mobile
app. What type of information might the company gather from the app to help it
better plan operations?
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The company could have mobile users’ location and location history. Additionally
this information could possibly be tied to purchasing behaviors.
3. Will the availability of free Wi-Fi at Starbucks’ stores provide any information to
Starbucks for better analytics?
WiFi at locations can support data capture from the mobile app. Additionally Wi-
Fi could provide additional information about the duration of customer stays at
the location, and the types of activities they take part in while at the store.
2. What type of new applications can emerge from knowing locations of users in real
time? What if you also knew what they have in their shopping cart, for example?
One prominent application is in the emerging area of reality mining, which uses
location-enabled devices for finding nearby services, locating friends and family,
navigating, tracking of assets and pets, dispatching, and engaging in sports, games,
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and hobbies. Adding shopping cart knowledge will enhance the application’s ability
to provide targeted information to a customer; for example, the app could find prices
for similar products in nearby stores.
3. How can consumers benefit from using analytics, especially based on location
information?
Students’ answers will differ. Privacy threats relate to user-profiling, intrusive use of
personal information, and not being able to control what is being collected.
5. Is cloud computing “just an old wine in a new bottle”? How is it similar to other
initiatives? How is it different?
In some ways, cloud computing is a new name for many previous related trends:
utility computing, application service provider grid computing, on-demand
computing, software as a service (SaaS), and even older centralized computing with dumb
terminals. But the term cloud computing originates from a reference to the Internet as a
“cloud” and represents an evolution of all previous shared/centralized computing
trends.
Cloud computing offers the possibility of using software, hardware, platform, and
infrastructure, all on a service-subscription basis. Cloud computing enables a more
scalable investment on the part of a user. Like PaaS, etc., cloud-computing offers
organizations the latest technologies without significant upfront investment.
Mobile social networking enables social networking where members converse and
connect with one another using cell phones or other mobile devices.
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like just another number. On the bright side, one of the major objectives of analytics
is to create flexible systems and interfaces that allow individuals to share their
opinions and knowledge and work together with computers. Despite all these efforts,
some people are still afraid of computers, so they are stressed; others are mostly
afraid of their employers watching what they do on the computer.
8. Diagnosing infections and prescribing pharmaceuticals are the weak points of many
practicing physicians (according to E. H. Shortliffe, one of the developers of
MYCIN). It seems, therefore, that society would be better served if MYCIN (and
other ES) were used extensively, but few physicians use ES. Answer the following
questions:
Students’ answers will differ. Some reasons are: physicians do not understand and
therefore do not trust the ES; malpractice insurance does not cover
recommendations made by MYCIN; administrators will not invest in it;
physicians fear they will be replaced or earn less.
b. Assume that you are a hospital administrator whose physicians are salaried and
report to you. What would you do to persuade them to use ES?
c. If the potential benefits to society are so great, can society do something that will
increase doctors’ use of such analytic systems?
9. What are some of the major privacy concerns in employing analytics on mobile data?
Legally, the right of privacy is not absolute. The public’s right to know is superior to
the individual’s right to privacy. For example, the USA PATRIOT Act broadens the
government’s ability to access student information and personal financial information
without any suspicion of wrongdoing. Location information from devices has been
used to locate victims and criminals, so provides a social good. But at what point is
the information not the property of the individual?
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10. Identify new cases of violations of user privacy from current literature and their
impacts on data science as a profession.
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ANSWERS TO END OF CHAPTER EXERCISES
5. Identify ethical issues related to managerial decision making. Search the Internet,
join discussion groups/blogs, and read articles from the Internet. Prepare a report
on your findings.
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6. Search the Internet to find examples of how analytics systems can facilitate
activities such as empowerment, mass customization, and teamwork.
10. Enter YouTube.com. Search for videos on cloud computing, and watch at least
two. Summarize your findings.
11. Enter Pandora.com. Find out how you can create and share music with friends.
Explore how the site analyzes user preferences.
12. Enter Humanyze.com. Review various case studies and summarize one interesting
application of sensors in understanding social exchanges in organizations.
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Student responses will vary.
13. The objective of the exercise is to familiarize you with the capabilities of
smartphones to identify human activity. The data set is available at
archive.ics.uci.edu/ml/datasets/Human+Activity+Recognition+Using+Smartphon
es. It contains accelerometer and gyroscope readings on 30 subjects who had the
smartphone on their waist. The data is available in a raw format and involves
some data preparation efforts. Your objective is to identify and classify these
readings into activities like walking, running, climbing, and such. More
information on the data set is available on the download page. You may use
clustering for initial exploration and to gain an understanding of the data. You
may use tools like R to prepare and analyze this data.
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