Quants: Unlocking the NumbersBy Baselinemag Print
The authors of Competing on Analytics say technology only takes a CIO so far. Aligning people around the numbers produced by business intelligence is essential for future success.By Thomas H. Davemport and Jeanne G. Harris
Quantsor quantitative analytical specialistsare in high demand by everyone from Wall Street brokerages and banks to Web 2.0 enterprises the likes of Netflix and Google. Quants leverage a variety of business intelligence toolssuch as financial and accounting software packages, enterprise resource planning systems, customer relationship management applications and custom algorithms and codesto distill raw operational data into actionable intelligence that accelerates business performance and maximizes revenue and profit potential.
In their book Competing on Analytics: The New Science of Winning (Harvard Business School Press, 2007), Thomas H. Davenport and Jeanne G. Harris present the case for why today's enterprises need the technology and the skilled analysts who can make sense out of numbers produced by automated systems.
While quants are heavily dependent on algorithms, advanced software tools and sophisticated mathematics, Davenport and Harris point out that quantitative analysis is entirely dependent on quant specialists. Entry-level quants can earn upward of six figures. More seasoned quants in the financial and investment community are commanding compensation packages valued at $1 million or more. The following excerpt from their book shows how quants are changing the role of CIOs and the people they manage.
When most people visualize business analytics, they think of computers, software, and printouts or screens full of numbers. What they should be envisioning, however, are their fellow human beings. It is people who make analytics work and who are the scarce ingredient in analytical competition.
The CEO will have the primary responsibility for changing the culture and the analytical behaviors of employees. But CIOs can help in this regard too. They can work with their executive peers to decide what behaviors are necessary and how to elicit them.
At least two CIOs we came across are clearly focused on changing the analytical culture of their organizations. Irving Tyler, formerly CIO of Quaker Chemical Corp. (now at IMS Health), provided the results of data analysis and reporting through e-mail alerts for several years to Quaker employees. He believed that the more information was delivered to users, the more it began to shape their ability to solve problems and make decisions based on information rather than intuition. He also worked with other Quaker executives on how the organization made key decisions and solved business problems.
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