The mathematics behind analytics, statistics and business value
Most people have either a love or hate relationship with math. I’ve always been on the love side, and I probably have some really good math teachers to thank for that. If you lean more to the hate side, I’m hoping you’ll open your mind to understand the great benefits of math in today’s world.
Math is everywhere, but in business it’s called analytics and statistics. Analytics promises to solve all of the world’s problems, and newspaper headlines are filled with metrics. We need to at least know if we can trust these facts to be sure they are not leading us down the garden path.
What math can do
Analytics is being used by elite professionals of all kinds. For example, tennis star Serena Williams uses analytics to plan her game strategy, and long-distance cyclist David Haase uses it to improve his training and recovery regimens. Billy Beane used it to change baseball entirely. If nontraditional occupations are benefiting so significantly by using math, just imagine what data-centric organizations in finance, risk management and sales compensation can do with it.
Whether or not you’re good at math, probabilities and percentages can possibly trick or mislead us. Consider the car dealership offering a zero percent financing loan on the purchase of a new car. Would you be surprised to hear that this is a trick? It is. They’ll raise the price of the car by three percent if you choose the zero percent financing option.
Or, how about all those statements made by politicians? For example, one claim often made by Rob Ford, former Toronto mayor, is that his city’s government saved USD1 billion for the taxpayers. Unfortunately, his math was dubious, but many people accepted this statement at face value.
Another way to look at math
If you’re tired of being tricked or swayed, don’t despair—a remedy exists. Mathematician Jordan Ellenberg has written a brilliant book that is both engaging and easy to understand: How Not to Be Wrong: The Power of Mathematical Thinking. “The math we learn in school can seem like a dull set of rules, laid down by the ancients and not to be questioned,” Ellenberg writes. He demonstrates how terribly limiting this view of math can be: “Math isn't confined to abstract incidents that never occur in real life, but rather touches everything we do—the whole world is shot through with it.”
After reading this book, you’ll be able to see the true meaning of information taken for granted: How early should you get to the airport? What does public opinion really represent? Why do tall parents have shorter children? Who really won Florida in the 2000 election? And how likely are you, really, to develop cancer?
Ellenberg is the ultimate teacher. He provides the surprising revelations behind all these questions and many more by using a mathematician’s method of analyzing life and exposing the hard-won insights of the academic community in a way that we all can understand.
Math in the spotlight
Are you ready to see how math can help you in your business? Specifically, do you want to understand how analytics can transform valuable insight into successful business outcomes? Maybe you’d like to be the hero in your business who makes this transformation happen? Attendees at this year’s IBM Vision 2015 conference can hear directly from Ellenberg as he helps us understand the math behind the analytics and metrics, and helps us learn how not to be wrong.
Be sure to also check out the Slate website, where Ellenberg writes the long-standing series “Do the Math.” Registration for IBM Vision 2015 is still open. If you miss Ellenberg’s session, be sure to catch it on Vision Go.