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How Investors Trip Themselves Up

April 17, 2015

Parent trap. A third study found that investors put more money into mutual funds when the share price of the fund’s parent company is outperforming the market than they put into mutual funds run by companies whose share prices are lagging behind.

For most of the companies in the study, running mutual funds was a relatively minor source of revenue. That suggests that the inflow of investor money wasn’t driving the parent company’s share price, according to Clemens Sialm, a professor at the University of Texas at Austin who co-wrote the study—which also included fund firms such as T. Rowe Price Group and Janus Capital Group.

The study, which didn’t include companies whose shares aren’t publicly traded, such as Vanguard Group and Fidelity Investments, is due to be published in Management Science, another peer-reviewed journal.

Point/Counterpoint on Big Data: INFORMS VP in CNN Online

March 12, 2015

In his CNN opinion piece, "The Big Dangers of Big Data" , Konstantin Kakaes of New America raises some interesting points about the ways that designing certain types of Big Data projects could lead to bad societal results.

Unfortunately, Mr. Kakaes' column appears to be part of a larger narrative that is skewing the perception of the importance of advanced data analytics to economies, societies and families around the world.

Big Data is not merely the accumulation of vast amounts of information, but a collection of interconnected and interrelated data points that, when analyzed carefully, helps business leaders make decisions that lead to increased profitability and job creation, assists doctors and scientists in understanding critical factors about health care, helps policymakers better protect the public from potential terror attacks, and much more.

Marketing Science: Tension between sales and market managers

March 2, 2015

It all starts with the sales rep. He or she is on the front line of the battle for corporate revenue. They also are the first and sometimes last contact point a customer has with the company. So who better than to turn to about advice on said customers, correct, than the sales rep? For that reason, when the sales rep urge headquarters to come down a notch on pricing, their opinion should seriously be considered, right?

Maybe, according to academic research on the subject—but first have the sales reps strenuously argue the case as to why a price should be lowered.

So found a study that ran in the November issue of Marketing Science, a publication of the Institute for Operations Research and the Management Sciences (INFORMS).

The study, called "Why do sales people spend so much time lobbying for low prices?" was conducted by Duncan Simester, the Nanyang Technological University Professor of Management Science, and Juanjuan Zhang, Associate Professor of Marketing, both at the MIT Sloan School of Management.

Looking for Big Pay, Less Stress? OR!

January 16, 2015

Operations research analyst is another high-growth job in the business sector. These data miners can be involved in everything from logistics to manufacturing, looking to enhance a company's profitability and cost efficiency. In 2013, the typical salary was pushing $75,000 annually, but analysts in New York, San Jose and San Diego often earn more than $130,000.

Survey shows most organizations don't have plan in place to assess their analytics maturity

November 13, 2014

According to a new INFORMS survey of 230 business, government and academic representatives released today, the concept of "analytics maturity" is important or very important to their businesses (65 percent). Yet, 82 percent of those same respondents admitted they do not have a plan, model, or any other mechanism in place for measuring the efficacy or maturity of their analytics best practices over time.

Some 47 percent of those surveyed attributed the lack of analytics maturity modeling to the fact they don't believe it will help their businesses thrive, while 21 percent said they cannot afford an analytics maturity model solution.

"The ability to fully assess the maturity level of an organization's analytics best practices is paramount to their efficacy," said Aaron Burciaga, senior manager, operations analytics at Accenture. "With more access to information than ever before, organizations must have a strategy in place for how they leverage data and analytics, and assess the maturity of their programs to empower decision making and drive organizational strategy."

Executive Pay: The final reckoning

October 23, 2014

IN HIS book, “Capital in the Twenty-First Century”, Thomas Piketty argues that it is impossible to find an “objective basis” for the high salaries of senior executives in terms of their individual productivity: they pay themselves such exorbitant sums simply because they can. However, in a forthcoming paper in Management Science, an American journal, two academics claim to have found such an objective measure, and conclude that most bosses are not overpaid.

In their study, Bang Dang Nguyen of the University of Cambridge’s Judge Business School and Kasper Meisner Nielsen of the Hong Kong University of Science and Technology looked at how firms’ shares react when the chief executive or another prominent manager dies suddenly. They identified 149 cases of this happening at American companies between 1991 and 2008.

Marketing Science Study: Skillfully Use Product Placement

October 15, 2014

Consumers have become highly adept at avoiding television advertisements. We switch channels, divert attention to our tablets and phones, and of course fast-forward through ads on our DVRs. Partly in response to this loss of attention, marketers are increasingly focused on product placement as an alternative way of exposing us to their brands. After all, product placement is innately much harder to skip given its integration into the actual program content.

Most academic research on product placement has primarily considered it as a separate persuasive technique independent from the commercial break advertising. That is, mirroring early research on TV advertising, research has focused on how product placement influences viewers’ recall of and attitude toward brands. However, this overlooks the possibility that product placement in a show might influence the likelihood of viewers watching an advertisement for related products at the next commercial break.

In research just published in Marketing Science, my colleagues David Schweidel of Emory University and Natasha Foutz of the University of Virginia and I began to explore whether such synergies exist.

Data Science (and Analytics) Certification

November 12, 2013

Much like the definition of big data, the job description for data scientist is definitely a work in progress. What skills are required? Well, in addition to possessing a strong math and computer science background, including the ability to devise algorithmic solutions to complex problems, data scientists need to be good communicators -- people capable of grasping business issues and explaining data-driven insights to executives and managers.

Fair enough. But how does an organization know that the data scientist it's just hired has all of these skills? The Institute for Operations Research and the Management Sciences (INFORMS), a 10,000-member international organization of analytics professionals, believes its recently launched Certified Analytics Professional (CAP) program provides the rigorous certification needed in the burgeoning big data field.

"We realized that there were a lot of people putting themselves out there as analytics practitioners, but no real defining body on what that meant," INFORMS president Anne Robinson told InformationWeek in a phone interview.

Tip for Getting Analytics Job: Get Certification

July 3, 2013

[Adam] McElhinney said he thinks Enova's hiring practices and goals are what you'd find at most leading-edge analytics shops. So here are eight things you need to know if you're aiming to pass McElhinney's or his ilk's scrutiny and land a coveted analytics job...

2. Get involved with a professional society. The emphasis here is on involvement. Don't just show up for meetings but become involved in some way -- offer up your web development skills if you have them, or help write a newsletter or volunteer to help plan an event, McElhinney said.

3. Show continued development. McElhinney suggested three ways to make your resume stand out in this respect. One, get an analytics-related certification, be it via an independent organization like INFORMS, platform-specific from a vendor like SAS, or related to a specific domain, like finance, risk, or actuarial science. Two, enter a data analysis competition at Kaggle or the like. You don't have to win, but do be prepared to talk about the experience. Three, participate in open-source software development, maybe creating a package for R, working on a Python data analysis tool, or showcasing projects on GitHub.

Award recognizes business research for the common good

Award recognizes business research for the common good

University of Notre Dame Ideas & News, July 18, 2005

INFORMS members Scott Nestler, CAP, and David Hunt were named by the University of Notre Dame’s Mendoza College of Business to its annual list of Office of the Dean Mission Awards, which honor faculty members for a specific research study that contributes to the common good. Nestler and Hunts “Using INFORMS Ethics Guidelines in the Classroom” describes how the Institute for Operations Research and the Management Sciences (INFORMS) and its ethics guidelines can be used in the classroom. Their work stems from their involvement with the creation of the INFORMS Ethics in O.R. & Analytics Group, which is meant to bring awareness to issues of ethics in operations research and analytics.  

OrgSci study: How some men fake an 80-hr work week

Imagine an elite professional services firm with a high-performing, workaholic culture. Everyone is expected to turn on a dime to serve a client, travel at a moment’s notice, and be available pretty much every evening and weekend. It can make for a grueling work life, but at the highest levels of accounting, law, investment banking and consulting firms, it is just the way things are.

Except for one dirty little secret: Some of the people ostensibly turning in those 80- or 90-hour workweeks, particularly men, may just be faking it.

Many of them were, at least, at one elite consulting firm studied by Erin Reid, a professor at Boston University’s Questrom School of Business. It’s impossible to know if what she learned at that unidentified consulting firm applies across the world of work more broadly. But her research, published in the academic journal Organization Science, offers a way to understand how the professional world differs between men and women, and some of the ways a hard-charging culture that emphasizes long hours above all can make some companies worse off.

Benefits of Counterfeit Competition

Even pirates have their redeeming qualities.

The counterfeiter might be a profit-sapping scourge to many designers, but recently published research from a trio of academics shows that fakes can also push brands to up their game — particularly in terms of aesthetics.

A study published in Market[ing] Science academic journal looked at 31 brands that sold fashion leather and sport shoes in China from 1993 to 2004. The Chinese market proved to be something of a petri dish to the researchers, since it saw a major influx of counterfeits after 1995, when the government pivoted away from the enforcement of footwear trademarks to respond to problems in other sectors, including gas explosions and food poisonings.

“Established companies don’t sit idly by while they are copied shamelessly,” said Yi Qian, a professor at University of British Columbia Sauder School of Business, who cowrote the study. “They react by improving their products to set themselves apart from their illegal competitors.”

What's the value of a win in college sports?

As the debate continues over whether college student-athletes should be paid for their on-field performances, a new study from Harvard Business School reveals just how much intercollegiate football and basketball programs contribute to a school’s bottom line.

The quantitative link between game day and payday is courtesy of Assistant Professor Doug J. Chung, who reviewed 117 schools with Division I football and basketball teams, matching athletic performance with revenue flow covering an 11-year period. The findings were jaw-dropping—winning just one more football game in a season, for example, could bump revenues by as much as $3 million for a high-powered program like Alabama or Michigan.

Chung details the correlation between wins on the field and wins for a school’s piggy bank in his paper, How Much Is a Win Worth? An Application to Intercollegiate Athletics, forthcoming in Management Science.

Syngenta Outlines Edelman Winning Research in Agriculture

Swiss-owned Syngenta, which has a major presence in North America, celebrated a major award at Iowa State University Nov. 13 calling for a math revolution in agriculture.

Attended by plant breeders, ag graduate students and college faculty at the Scheman Building on ISU's campus, Syngenta officials explained how it has incorporated advanced analytics into its soybean breeding procedures with assistance from ISU faculty and others.

The team's success won Syngenta the 2015 Franz Edelman Award for achievement in operations research and the management sciences in mid-April.

Healthcare Analytics Trends for the New Year

Analytics continues to bring dramatic change to the healthcare industry in the United States and other countries, offering advances and challenges for the year ahead. Following are 10 trends to chart in 2016.

WorkWise: Strong and weak ties - their impact on job-hunting

WorkWise: Strong and weak ties - their impact on job-hunting

Rarely in the published research about job-hunting does a new perspective on methods emerge. Job seekers have to avoid restricting restricting their search to any one method, because they can’t predict the one that will produce. However, fresh perspective comes from a new study published in the INFORMS journal Management Science.