O.R./Analytics at Work Blog

Professionals in the fields of operations research – which uses advanced analytical methods to help make better decisions – and analytics are slowly becoming aware of one another, and after 70 years of crunching numbers for business and government, the synergy is becoming more manifest.

Professionals in the two intersecting fields use similar math modeling and related tools that handle big data with improved software and the burgeoning computing power of today’s hardware. The mantra of descriptive analytics, predictive analytics, and prescriptive analytics resonates among operations researchers and practitioners of analytics.

Now, an April 2012 analytics conference in Huntington Beach, California brings speakers from major corporations and other organizations to explore new ideas and compare experiences in analytics and operations research (O.R.).

The INFORMS Conference on Business Analytics & Operations Research, sponsored by the Institute for Operations Research and the Management Sciences (INFORMS), takes place April 15-17 at the Hyatt Regency Resort & Spa.

“This conference is the one place where world-class organizations go to showcase difference-making projects,” says Ford Motor’s Erika Klampfl, a technical leader of strategy and sustainability analytics at Ford Research and Advanced Engineering, who is serving as the conference chair. “Organizations like Boeing, UPS, Cisco, Hewlett Packard, Procter & Gamble and many others come here to learn and share their strategic use of operations research and analytics.”

The two keynotes – Hal Varian, the Chief Economist at Google, and Bob Page, Vice President, Analytics Platform, eBay – speak to the importance of using analytics in major tech organizations. Varian plans to examine ways of “predicting the present” with Google Trends: Google Trends allows users to gather data and measure various aspects of the economy, opening the path to inference and recommendations. Page will look at web analytics at the world’s largest marketplace, eBay. He oversees eBay’s data and analytics infrastructure, and creates the strategy and policies that power eBay’s data-driven decisions. From data warehouse and business intelligence solutions to advanced analytics and custom insights, he delivers solutions for strategic use of data.

Since 1972, analytics/ O.R. teams at business and government organizations have been competing in the Franz Edelman Award Competition for the best work by an organization. For the competition’s fortieth anniversary, HP, Intel, the Centers for Disease Control (CDC), Carlson Hotels, the Dutch transportation company TNT Express, and the Greek shipping company Danaos Corporation are sending teams to make the argument for their case studies.

In contrast to the Edelman ruby anniversary, this is the very first year of a competition, Innovations in Analytics. Some 50 teams are awaiting the announcement of the winner, which will be made at the conference.

Analytics professionals often focus their attention on seven interest areas – the analytics process, decision analysis, energy and the environment, marketing analytics, the public sector, the soft skills that analysts need, and supply chain management.

These topics are addressed by speakers from LinkedIn, Target, P&G, Marriott, Cisco, Nestlé, Verizon Wireless, the US Dept. of Energy, the National Academy of Sciences, MITRE, RAND, the US Dept. of Homeland Security, Sasol, HAVI Global Solutions, Alpine Data Labs, Mannheim Consulting, Prognos, and Insight Decisions.

Many of these organizations are sending their executives to an executive forum at the conference. Tech workshops and an analytics job fair round out the fare.

My mother worked for EPA for almost 20 years, instilling me with a respect for the world around me. The topic of O.R. and the Environment seemed like a natural (weak pun intended) fit. I was struck by the sentence in Patricia Randall’s blog entry, “While I am certain it is possible to include green objectives in a model, I haven’t had a client say ‘Minimize my emissions or my carbon footprint’. Or have I?” “Green objectives” need a paradigm shift from being viewed as going above and beyond, to being intrinsic to the fabric of good business. What O.R. and analytics are already doing is finding the best way to solve problems with optimum impact, and that optimization should include preserving the planet we all share.

There are many opportunities for OR/MS and analytics folks to include “greening” as an element of their analysis that protects the earth while streamlining supply chain networks and decision models, decreasing waste, and increasing revenue and production. Maybe the call is to go beyond the obvious solution, to add in environmentally friendly options, as a “value-added” service to your clients, or to calculate the impact to future generations of not implementing green measures. Of course, this could be viewed as Pollyanna thinking, that it isn’t financially possible, it’s too difficult, or that no one really cares about those types of objectives. But to quote a cute, mustachey guy (no, not Paul Rubin,) “I am the Lorax, I speak for the trees.”

Thank you to everyone who submitted to this blog challenge, they will be included in the upcoming Focus On Environment, a compilation of articles from INFORMS journals. As we head into the holidays, the next blog (and perhaps personal) challenge will be O.R. and Families. Please email your entries to socialnetworking@mail.informs.org by December 12.

O.R. and the Environment

Extra Credit goes to Anna Nagurney and Laura McLay for two entries.

• Brilliant Lecture by Dr. Elinor Ostrom, Nobel Laureate and Activist, Anna Nagurney
• Sustainability of Supply Chain Networks, Anna Nagurney
• only you (and your optimization model) can prevent forest fires, Laura McLay
• crowd sizes, home energy usage, baseball odds, and pop songs, Laura McLay
• Environmental Business – A Green Light for Analytics?, Capgenini Blog Team
• Corporate Buyouts, Sustainability in the DNA? , Ian Frommer
• EnviORment [sic], Francisco Marco-Serrano
• Deciding on Lean or Green, John Poppelaars
• OR, the Environment, and the Law of Unintended Consequences, Paul Rubin
• Optimizing Your Transportation Network can Reduce Your Carbon Footprint , Patricia Randall
• Primal and dual valuation of our natural resources using O.R., Thiago Serra
• Water supply and the environment, David Smith
• Jumbo decision models to protect the environment, Shivaram Subramanian
• Grizzlies, Pandas, and Optimal Ecological Structures, Mike Trick

Kevin Geraghty, new IOL Editor-in-chief

I guess it's time I introduce myself. My name is Kevin Geraghty. I am the new Editor-in-Chief of INFORMS Online, and I'm very excited by the opportunities and direction that INFORMS leadership intends to take our site. One of the more notable recent changes we are adopting for the INFORMS brand is the incorporation of the term ‘Analytics’. The INFORMS Analytics Section has been launched along with a rather exciting Innovation in Analytics Award competition that you really should read up on. Since my background is in Digital Marketing, a lot of what I want to achieve over my two-year tenure is to let the world know just how cool Operations Research/Analytics is. But getting the word out cannot be a haphazard undertaking. It requires an organized marketing approach to give voice to the true enthusiasm of our members. One of my first areas of attention is to improve our approach to SEO (Search Engine Optimization.) SEO refers to a tool bag of technical adjustments to a website, content creation, and reputation enhancement that allows search engines to understand what our site is about and why the content on our site speaks with authority and relevance. We need to explain to the Search Engine bots, in a language the bots understand that a searcher who has typed in a keyword such as ‘Operations Research’ or ‘Analytics’ will be happier if www.informs.org is prominently featured on the SERP (Search Engine Results Page). While there are many other ‘for pay’ marketing tactics, such as paid search or display, those are really not necessary for a site such as www.informs.org. We already have a site with strong, highly relevant content and boatloads of authority.

One area where the membership could really help us is in developing back links. If you find an article or page on www.informs.org that you like, you should place a link from your site to ours. The search engines will take that link as a vote of confidence and rank us more highly for relevant keywords. This is particularly the case for sites with .edu or .mil as their top-level domain.

The other area I am particularly interested in exploring is social media. For those of us with experience in applying Operations Research to Analytic problems in the real world, we know how good this stuff is. For those of you who are just starting out in your career, not only do you know the power of your practice area, but I bet you are a bit more sophisticated with the use of Social Media than us old-timers. The buzz that is possible from social environments creates awareness and understanding of our profession. So when you read an article you like, Tweet about us, push the Like button, reference us on Quora, Digg or in some way let the world know what you think about us. Not only will you be furthering the interests of your chosen profession, but you will also be helping to transform it. That transformation is already underway in many areas. The extraordinary availability of data on the sematic web feeds our ever increasing need for understanding. Operations Research is the perfect tool to leverage that data. Increased communication capability has transformed management planning from a monthly exercise to an instantaneous response to an increasingly dynamic environment. Communicating your thoughts about the shared content and capability represented by INFORMS OnLine, and its contributors amplifies our impact on the world. Early in the information age, transformative power was concentrated in the hands of the people building the infrastructure. Increasingly, the infrastructure, such as the Internet or the mobile environment, is stable and reliable, and transformative power now moves to people with the skill set to leverage computing power and data to create insight and understanding. That sounds like INFORMS people to me.

I look forward to working with many of you to create a site that becomes a platform for transformation. And I look forward to seeing you at the annual conference in Charlotte. If you have a chance and are inclined to do so, please stop by the IOL Reception, Sunday evening at 6 pm in Trade Room, Westin Hotel for refreshments.

Thanks,
Kevin

New Blog! OR/Analytics in Action
Sponsored by the INFORMS Public Information Committee (PIC)

My work in the area of biomass-for-biofuels began as an accident. I had just started working as an assistant professor at Mississippi State University (MSU), and being eager to secure research funding I responded to a call for proposals from the university’s newly founded Sustainable Energy Research Center (SERC). I didn’t get the grant, but what I learned from that experience was much more valuable to me. Read the rest on the new OR/Analytics in Action Blog

Electronic medical record (EMR) systems may have drawbacks

I'm excited to be seeing you soon at the INFORMS Healthcare conference. It’s amazing that this specialized conference, offered for the first time, features 13-14 parallel tracks. Congratulations to the organizing committee for putting together such a rich schedule.

As part of my preparations for leaving, I was looking over the latest travel news and noticed that a computer glitch at United Airlines had led to the stranding of thousands of passengers. The problem seems to have hit both United’s reservation and flight scheduling systems (“our computers are just paperweights” said one customer service agent).

Despite such occasional problems, there is no doubt that computerized reservation and scheduling systems have been a boon to the airlines – leading to more efficient airplane utilization and lucrative revenue management. But centralized computer systems can be fragile, and a focus on analysis may sometimes lead firms to deemphasize customer service (e.g., see Guillaume Roels’ blog post from INFORMS Austin).

A similar trade-off may be appearing right now, as hundreds of hospitals implement electronic medical record (EMR) systems. These systems may lead to both lower costs and improved quality – in part, because they would allow us to apply the sort of analytics that we hold so dear (there will be many talks on this subject at the conference). But there is the chance that these systems may be more fragile, on the whole, than paper records. And electronic systems may reduce the human contact that can be vital in services. For example, at our local hospital, implementation of EMR meant that physicians no longer hand their prescriptions directly to nurses but instead enter them into the EMR, to be processed later. This eliminates an opportunity for instantaneous error-checking and feedback between the nurse and the MD.

In general, as we develop our models and tools, we might be on the lookout for such unintended consequences. Have you noticed, or worried about, similar issues? Please feel free to comment, below.

There has been a lot of buzz about the analytics movement here at INFORMS beginning with the Capgemeini study that was completed last fall. The INFORMS Board of Directors have approved funding to build out the executive forum at the rebranded Analytics Conference, as well as developing certification and continuing education programs. The INFORMS Conference on Business Analytics and Operations Research set unbelievable attendance records. There is now an Analytics Section of INFORMS, and the readership of Analytics Magazine is growing by leaps and bounds. Would you like to offer your two cents? Participate in our online survey about developing a certification program for individuals in the analytics field. We may be onto something here.

Part of the OR/MS challenge (at least from a marketing point of view) has been how to explain/convey/sell operations research to the uninitiated masses. This blog has been one way to learn about different viewpoints, our twitter peeps are getting quite chatty, and there are some great discussions on LinkedIn. But these conversations tend to reach an already involved audience. We’d love to spread the word about OR/MS and analytics to a wider audience. So June’s Blog Challenge (in honor of the upcoming Harry Potter final installment) will be O.R. for Muggles. Please send your entries to graphics@mail.informs.org.

Our bloggers extraordinaire offer their take on the subject of May's Blog Challenge, O.R. and Analytics

• Analyse This! : Analytics explained and applied
  Capgemini Figure it out blog
• Welcome to the Insight Age Larry D’Agostino
• Green O.R. Job Skills: Business Analytics vs. Sustainability Ian Frommer
• On "Analytics" and related fields Harlan Harris
• Terrorism Analytics Laura McLay
• Analytics and Operations Research -- Learning from One Another Anna Nagurney
• Analytics and Operations Research; a practitioner’s view John Poppelaars
• When the Data Changes Before the Model Even Finishes Solving Patricia Randall
• Will Analytics Drag O.R. Back to Its Roots? Paul Rubin
• How Analytics makes Operations Research the next big thing Thiago Serra
• April 1963 discussion: OR v Analytics Shivaram Subramanian
• Business Analytics and Operations Research: Tomato, To-mah-toe, Tractor! Mike Trick
• Should You Hire Security When Tenting Your House? Tallys Yunes

As my operations-research readers know, analytics has become the word en vogue in the community - the INFORMS Practice conference was recently renamed INFORMS Conference on Business Analytics and Operations Research to reflect this trend, as Mike Trick pointed out in this blog post of his. My non-operations-research readers will be left thinking: what exactly is operations research anyway? Research on operations? That is partly true - OR (as we call it, which makes for some interesting Google queries since the web service mistakes it for "or" (as in "either/or") emerged from the need to improve military logistics during World War II, but has become much broader than that, now representing the broad field of quantitative decision-making.

According to this Wikipedia page, "operations research is an interdisciplinary mathematical science that focuses on the effective use of technology by organizations"; this certainly is the most awful definition of OR that I've ever seen. The second paragraph is more accurate, stating: "Employing techniques from other mathematical sciences --- such as mathematical modeling, statistical analysis, and mathematical optimization --- operations research arrives at optimal or near-optimal solutions to complex decision-making problems."

Few non-OR trained people will naturally come to the same conclusion when first faced with operations research, and the issue of how to call what we are doing is one that we have all struggled with, whenever anyone asks us about our profession. (I stick to: "I do mathematical models for business.") In contrast, analytics has become a much more accepted term in the business community, where books by Thomas Davenport and Jeanne Harris have emerged as market leaders: "Competing on Analytics: The New Science of Winning" (2007) is a landmark book in that respect, and was followed earlier this year by "Analytics at Work: Smarter Decisions, Better Results". These books are published by Harvard Business Press, which certainly added to their legitimacy.

Mike Trick recently posted on his Twitter feed a graph, using a new Google Labs tool called n-grams, showing the incidence of words like "operations research" and "analytics" in books; when this morning a friend and reader of this blog sent me a more complete graph including "industrial engineering" and "systems engineering", I figured it was time for a blog post. Here is the graph, courtesy of Andrew Ross. You will notice that the use of "operations research" abruptly rose in the 1950s and peaked in the early 1960s, to undergo a fast-paced decline ever after. This is not good news for our profession, as "operations research" is part of the brand we communicate to the media and potential business collaborators. Analytics, on the other hand, is currently the most popular of the terms by far, and the trend does not seem to be slowing down by far...

Read the rest of this post on Aurelie Thiele's blog Thoughts on business, engineering and higher education

The strategic planning subcommittee of the 2011 INFORMS Practice Conference Organizing Committee has decided to take steps to re-configure and re-brand the Practice Conference to better serve the emerging business analytics field.

Based on an analytics market study commissioned by INFORMS and performed by Capgemini Consulting, it was found that there is an emerging view of business analytics in the business world that is different than the traditional view of operations research in business.

The definition of analytics that emerged from the study is that:

Business analytics facilitates realization of business objectives through reporting of data to analyze trends, creating predictive models for forecasting and optimizing business processes for enhanced performance.

There is also a view that business analytics are “business as usual” with the analytical activities embedded in a multitude of business practices and that operations research is a specialized set of skills that are called upon for complex problems.

The study also contained recommendations regarding products and services that INFORMS could offer to become more in tune with the growing business analytics trend, some of which are a natural fit with the Practice Conference. The recommendations that the Conference strategic planning subcommittee chose to incorporate to enhance the current Practice Conference offerings are:

• more of a vertical focus to some tracks – including a track concentrating on training
• an expanded analytics executive program
• addition of a job fair for professionals
• case studies in applying analytics
• a track devoted to the analytics process

With these enhancements planned, it was decided to rebrand the Conference so that it captures the attention of business analysts without losing the support of traditional attendees from the operations research community. So, INFORMS Conference on Business Analytics and Operations Research was born.

The new title includes the key term “business analytics”, of course, but removes the word “practice” since it is more of an inward-looking term and is now covered by the word “business.” “Operations research” was kept because the Conference will in fact continue to report on and showcase all the core competencies of our discipline. It is, after all, a key element of the broader analytics field. Please note we have kept our current tag line “Applying Science to the Art of Business” because it is well liked, well known, and continues to describe the proceedings quite well.

With this strategic change, we now expect to attract a broader analytics audience to the Conference in 2011 while keeping our current attendees happy with a substantial operations research program. Please give us your thoughts on our Practice (or should we say “Analytics”) Conference reconfiguration and rebranding efforts.

Gary Bennett is Director of Marketing and Member Services for INFORMS.

David Leonhardi is a Decision Consultant at Boeing Commercial Airplane Group and this year’s General Chair of the 2011 Analytics Conference Organizing Committee.