The fifth edition of Mu Sigma’s Annual Customer Summit was held in Caesars Palace, Las Vegas on March 3rd and 4th, 2013. The summit attracted a growing crowd of Mu Sigma’s current and prospective customers. This year’s event was attended by 150 clients from across several industries. The Summit provided an exciting opportunity for Executives, Business Leaders and Practitioners to exchange notes and learn from each other. Discussions featuring participants from different client organizations highlighted trends and possible future directions for the role of Decision Sciences in companies.
The confab kicked off on Sunday, 3rd March with an engaging discussion between Dhiraj Rajaram, Founder, CEO and Chairman of Mu Sigma and Gary Reiner, a former CIO at GE. The fundamental point made during the course of the session was the importance of both the “art” and the “science” of decision-making. To draw the contrast, Dhiraj made an interesting analogy by comparing the movies “Moneyball” and “Trouble with the curve.” While the former highlights the role of statistics in making better decisions by a resource constrained baseball team, the latter emphasizes the importance of baseball scouts in identifying talent in situations where data might not be widely available. Ultimately, both are important in providing a more holistic picture as “the scout can see things that numbers cannot see and the numbers say things that the scout cannot say.”
Day two commenced with the keynote session by Gary Loveman, an erstwhile HBS professor and current CEO of Caesars Entertainment. Loveman emphasized the importance of “profitably influencing consumer behavior”. Contrasting the tendency of retailers to “reward” low-spending customers by having express lanes for those who shop little (think “10 items or less”), Loveman emphasized that the more a customer spent at Caesar’s properties, the better they were treated; keeping in mind the costs and benefits of that investment in retention. To aid in deciding the level of retention spending, the company looks in-depth at data. “Treat every customer well but treat them uniquely” is the theme that Caesars has adopted in designing a successful loyalty program with more than 40 million members.
Big Data was one of the key themes discussed at the Summit with two panels focusing on the topic. While everyone is talking about big data, the looming question remains – is big data hope, hype or opportunity? Zubin Dowlaty, head of Innovation and Development, Mu Sigma moderated a panel with executives from Insurance, Social Media, and Technology companies.
A take-away from the panel was that Big Data is as much about the infrastructure and technology as it is about emerging data sources and modeling techniques, and both are equally important. A survey conducted across all attendees during the summit interestingly revealed that while most companies regard big data as an opportunity, more than half of them are still unsure about how they may be able to leverage it. This topic was explored from another angle as Dhiraj moderated a session on Big Data partnership – bringing increased value to Big Data” with panelists from Microsoft and MasterCard Advisors. As Big Data also implies more noise, companies will make some mistakes and will need to learn from these. There was agreement that companies experimenting with big data should explore greedily and implement carefully.
An ensuing discussion around enabling consumption of insights had executive participation from a leading retailer, a major financial institution, and a popular entertainment company. The panel discussion centered around the challenges companies face in operationalizing insights from analytics projects. Some companies have set up a Customer Insights Center of Excellence to ensure alignment with business and challenge the business to think differently. An interesting point made was that the choice of the model for analytics governs not just the structure and reporting, but also dictates the skill-sets and consumption mechanisms. One of the panelists used the analogy of feeding a sick pet by including medicine in the cheese as a telling way of highlighting how insights may need to be packaged to drive consumption.
Using the popular Ted Talk format, executives from across industries shared compelling examples of data-driven insights delivered within their organizations. One of the speakers from a leading Online Marketplace emphasized the importance of A/B testing to tease out confounding factors in the online medium. Business executives today constantly face situations where decisions have to be made amidst ambiguity. A speaker from a leading Search Platform emphasized the need to replace debate with data, and utilize surrogate KPIs when ideal KPIs are not available.
Senior marketing executives from a leading home improvement retailer, a leading sports goods manufacturer and Microsoft discussed how their organizations are taking advantage of the increasing amount and variety of data available to understand and market to their customers better. As companies are using increasingly sophisticated CRM platforms to reach out to their customers at the right time, through the right channel and with the right products, an interesting observation was that organizations should not think about omni-channel unless all channels have common goals that are aligned.
The final topic for the day was a panel discussion around the evolving role of technology organizations in Decision Sciences. The participants comprised technology executives from retail, airlines and healthcare services, and the CMO of a leading healthcare provider.
While there was consensus that the CIO’s organization plays a key part in enabling data availability and integrity to support the creation of analytics, there is ongoing contention around how much IT groups should play an enabling function versus playing an active role in the creation of analytics. The panel through discussion and debate concluded that as CIOs put together their strategy for Decision Sciences, they should be thinking about putting in place the right architecture that can enable the flow of information in real time to support business decisions.
Mu Sigma’s Innovation & Development (I&D) and Product booths drew a lot of attention and interest. While the I&D booth showcased the latest in visualization techniques and real-time computing methodologies; the product booth focused on the bionics Mu Sigma is bringing to life to enable companies to create and scale their decision scientists. Some of the products showcased included a framework for Market Mix Optimization (muMix), an automated platform for analytics (muRx) and Mu Sigma’s proprietary Problem DNA framework (muPDNA). In a world where business problems are constantly evolving and are muddy in nature, the Problem DNA framework helps bring focus to the definition of the problem and the design of a solution from first principles. While the framework itself is being widely used by all our clients; Dhiraj announced the launch of the muPDNA tool which will help Mu Sigma clients and analysts alike develop a language for problem solving that will be used both as a communication medium and a powerful knowledge management asset.
Amidst humorous anecdotes, voicing of common challenges and brainstorming of possible solutions, Mu Sigma Convergence 2013 truly lived up to its name. As we play a part in defining the next most powerful economic engine - “Decision Sciences”, we will continue to act as a platform to connect thought leaders and converge to innovate.