By Associate Professor Tony Webber, Data Analytics and Modelling Unit Coordinator, The University of Sydney Business School MBA program
It’s interesting teaching a subject like Data Analytics and Modelling (DA&M) within the University of Sydney Business School MBA program, knowing that 90% of students dread doing it, and most try and delay taking it. Although inevitably, like death and taxes, they must because it’s a compulsory unit.
This dread mostly comes about because there’s always a subset of students that don’t see themselves as analytical, and when they see maths or stats involved in a subject, they start hyperventilating. It’s really hard to change this mindset, because more often than not, it’s just part of someone’s DNA. So my job as an instructor is to try and make it as fun and accessible as possible, and to offer the best ‘after sales’ service imaginable, so that when the anxiety kicks in with an assignment or exam, I’m available to bring relief.
Often the dread and anxiety with a subject like mine is misplaced. While the name does look a bit daunting, much of DA&M and subjects of this ilk are about identifying the data you need, determining how you source the data, selecting the right approach to dissect the data, communication of the information you see in the data, and how you use the data to make the right decisions at work. None of these critical parts to DA&M involve mathematics and statistics.
A big part of the first two weeks of my course, for example, involves enlightening students on the best way to present a PowerPoint presentation to senior management, executive management or a board. Having presented to all three groups of people during my time as Chief Economist at Qantas, and after Qantas as an aviation and tourism consultant, I know that the key to a good presentation is understanding the layout of the room in which you are presenting, understanding the IT capabilities of the room, starting with the material in which you are most confident, ensuring the content is succinct, correct and useful, and if you don’t know the answer to a question, say so.
The course also looks out how you make conversation in an elevator with a senior executive about how the economy may be playing out over the next twelve months, and how that may affect the company.
So why is DA&M important and taking on increased importance? The GFC taught us a very big lesson – the world’s economic and financial markets are uncertain and volatile, and, as Willy Wonka once said to Charlie and Grandpa Joe, and possibly some Oompa Loompas, even the unimaginable can happen.
Data helps us to identify when these types of events are building up, and when they are likely to occur. Data also helps us to understand how to best react to these types of events. To do this, companies need to identify the phenomena that are external to the company and that affects the company. For example, macroeconomic phenomena like GDP, oil prices, exchange rates, interest rates and inflation. Companies need to source data for these phenomena and quantify how they affect the company. To react to these phenomena companies, need to understand how their own operational levers, such as price, advertising and investment, affect profits. Collection of internal data, combined with external data, can deepen this understanding.
Certainly, there is more than meets the eye with DA&M. And sometimes when you use just the eye, things will seem more complicated than they are. The ears and brain also help from time to time.