Change before you have to — Big Data based Decision Making
Big data is the buzzword of 2017. But who is going to mold this data into decision making?
Isn’t big data just a fancy word for “analytics”? In our view, big data is the next stage in analytics. This is due to the new industrial revolution: internet driven economy. New Data Companies like Google, Amazon, Uber, Bol.com, Bunq, Easyjet, Takeaway.com, Netflix and Coolbue have been established and developed by big data. These companies have the same information as traditional companies use this data more extensively. Why have these companies been successful? Because they have employed the right specialists who analyse and use the (big) data in an innovative way. Without them, these companies would not have been a success.
Change is eminent. Not only for companies but also for quantitative candidates. Traditional companies who still not use and implement big data will be out of existence within the next 10 years. We are seeing that traditional organizations such as a major insurance and a beer company have realized that their products and services have become too much commoditized. Competing on price or service will not be a game changer anymore. So, what are they doing differently?
They are setting up new divisions and teams with primary focus: big data. They have hired people from different quantitative backgrounds and put them in a room together. These people have never worked within the industry or specific markets. These people are no marketing or sales specialists; they are no designers or artists. But they sure are creative: they are quantitative specialists! They have the freedom to start from scratch and design new business models and processes. Fully independent, free and without any restrictions. Nobody from the traditional business line is involved with this new adventure. The quantitative specialists have the authority to try to do new things and to implement new products and services within the traditional business lines.
What are the initial results within an insurance or a beer company? The insurance company is implementing new business models in which client awareness is focused on safety rather than the insurance product. The beer organization is surpassing supermarket chains and using Takeaway.com, Foodora, Uber and other online channels to offer their products. This is naturally easy, but these traditional organizations have realized that they have access to so much client and environment data that they can make a much better offering to each designated client, rather than to a whole group. This has proven to improve the overall margin and therefore profitability of both organizations. Additionally, they are making huge savings on marketing and promotion costs.
Insurance and beer companies have basically copied the business models of New Data companies. The managers at these traditional companies realized that they needed to do something differently. And they were right.
What type of people are working on big data? Amongst others are scientists, actuaries, engineers, econometricians, physicists and mathematicians. They all have the same academic background but they also have something very much in common: they are all creative, flexible and have project management skills. Each candidate had something unique: one played an instrument, the other was involved with human society, the other with politics. Age or experience does not matter. It all comes down to human interest and thinking out of the box.
I can make one prediction: your position as (future) actuary will be made redundant within 10 years. Your academic and quantitative skills will be taken over by computers and robots. Your jobs as highly paid specialists will be history. If you want to uphold the position as actuary, your skills will only be used for administrative purposes. Is this the future you see for yourself?
So how does an actuary change into a big data specialist? It all comes down to personality and willingness to change. The steps required for you to change:
1. Read about big data
2. Go to expo events: for example, there is a big data expo event in September 2017
3. Try to network with people within the big data industry. Networking is a big challenge for most quantitative people. However, it is of utmost importance that you get to know other people with different backgrounds. I know this is not easy but if you want to be successful in your new role as big data specialist or any new role for that matter. You need to get out of your comfort zone. But how do you do that? You can be adventurous – try, you should use someone as piggyback or alternatively use an executive coach who can train you. The coach will not change your attitude but will support you in learning new competencies.
4. In your spare time focus on arts and culture: read fiction, go to a concert or museum, start playing an instrument, become a painter. Whatever get’s you going.
If you do not get out of your comfort zone, you will never become adventurous and creative. Being active in arts and culture will have enormous positive effects on your creative competencies.
Before you change, it is important to know yourself. During the VSAE Actuary Congress 2017 my colleague Thomas Pleunis will give a workshop on Carl Jung’s Archetypes. The Archetypes unite the human unconscious across cultures and continents, industries and markets. They come to life in the Culture Talk Survey System as 12 characters, adding structure and definition to your unique cultural profile. If you attend his workshop, you will be able to complete the survey system and you will find out what archetypes are compatible with your character. With this information, you are given insight on who you are and what you stand for. You can then reflect on who you want to be and what your professional objectives should be.
The change is going to be enormous, and of course big data is going to be more significant. But the underlying desire to change into a broader quantitative specialist will pay off. The evidence is clear: Data-driven decisions tend to be better decisions. Leaders will either embrace this fact or be replaced by others who do. In sector after sector, companies that figure out how to combine domain expertise with data science will pull away from their rivals. We can’t say that all the winners will be harnessing big data to transform decision making. But data tells us that’s the surest bet.
Dave Heilbron is Senior Partner at Lens. His chief area of search expertise is the financial sector: the risk management and big data disciplines, especially. In addition, he is involved in a wide range of search activities around b2b positions across the globe.