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Information systems coupled with internet, cloud computing, mobile devices and Internet of Things have led to massive volumes of data, commonly referred as big data. It includes mix of structured, semi-structured and unstructured real-time data, constituting of data warehouse, OLAP, ETL and information. Business firms and academicians have designed unique ways of tapping value from big data. There is a great scope of using large datasets as an additional input for making decisions. The aim of the paper is to explore the role of big data in these areas for making better decisions. Here we explore how big data can be used to make smart and real-time decisions for improving business results. The paper undergoes literature review and secondary data to provide a conceptual overview of potential opportunities of big data in decision making. The paper discusses the concept of big data, its role in decision making and also the competitive advantage of big data for different firms. The paper also discusses a framework for managing data in decision making. The topic must be addressed for taking better decisions for firms which will contribute to high quality knowledge.
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OPERATIONS AND SUPPLY CHAIN MANAGEMENT
Vol. 11, No. 1, 2018, pp. 36 - 44
ISSN 1979-3561 | EISSN 2759-9363
Role of Big Data in Decision Making
Shirish Jeble
Faculty of Management
IBS Business School, Pune, India
Email: shirish.jeble@gmail.com (Corresponding Author)
Sneha Kumari
Symbiosis Center for Research and Innovation
Symbiosis International University, Pune, India
Email: snehakumari1201@gmail.com
Yogesh Patil
Symbiosis Center for Research and Innovation
Symbiosis International University, Pune, India
ABSTRACT
Information systems coupled with internet, cloud
computing, mobile devices and Internet of Things have led to
massive volumes of data, commonly referred as big data. It
includes mix of structured, semi-structured and unstructured
real-time data, constituting of data warehouse, OLAP, ETL and
information. Business firms and academicians have designed
unique ways of tapping value from big data. There is a great
scope of using large datasets as an additional input for making
decisions. The aim of the paper is to explore the role of big data
in these areas for making better decisions. Here we explore how
big data can be used to make smart and real-time decisions for
improving business results. The paper undergoes literature
review and secondary data to provide a conceptual overview of
potential opportunities of big data in decision making. The
paper discusses the concept of big data, its role in decision
making and also the competitive advantage of big data for
different firms. The paper also discusses a framework for
managing data in decision making. The topic must be addressed
for taking better decisions for firms which will contribute to
high quality knowledge.
Keywords: big data, big data analytics, social media analytics,
marketing analytics
1. INTRODUCTION
Information systems have evolved over the years from
being transactions recording system to supporting business
decisions at different levels. Traditional information systems
depended primarily on internal data sources such as
enterprise resource planning systems (ERPs) for making
business decisions. These datasets were structured and used
relational database management system (RDBMS). These
were used for supporting internal business decisions such as
inventory management, pricing decisions, finding out most
valuable customers, identifying loss making products etc.
Besides, data warehouse was built using this data for analysis
and mining purpose. These data sources were integrated with
data from business partners such as suppliers and customers
using enterprise application integration (EAI) platforms. EAI
enabled seamless integration of information systems
between business partners. It enhanced speed of business to
business transactions (B2B), communication and reduced
cost of inter-company transactions.
In the next wave in early nineties, arrival of internet
further simplified integration of firms with their business
partners. In the last decade, information systems coupled
with internet, cloud computing, mobile devices and Internet
of Things have led to massive volumes of data, commonly
referred as big data. It includes structured, semi-structured
and unstructured real-time data, constituting of data
warehouse, OLAP, ETL and information. Computer science
has advanced to store and process large volumes of diverse
datasets using statistical techniques. Business firms and
academicians have designed unique ways of tapping value
from big data. The objective of this paper is to explore the
role of big data in making better decisions and how big data
can be used to make smart and real-time decisions for
improving business results.
The revolution of big data is more powerful than the
analytics which were used in the past. Using big data helps
managers to make better decisions on the basis of evidences
rather than intuition. Businesses are collecting more data
than required for any use (McAfee et al., 2012); big data
helps in making better predictions and smarter decisions.
Leaders across industries use big data for better managerial
practices. There are several researches conducted in
individual areas such as transactional data, social media data,
supply chain big data etc. However, there is lack of holistic
review of understanding potential of big data for decision
makers. Driven by this need we explore the role of variety of
big data in various decision-making scenarios. This paper
acts as a bridge this gap by achieving the following
objectives:
a) To explore the existing literature on the fundamental
concepts of big data and its role in decision making
b) To explore role of big data in making strategic, tactical
and operational decisions.
The study is useful for making important decisions with
the help of big data. In the present era, big data has been used
Jeble et al.: Role of Big Data in Decision Making
Operations and Supply Chain Management 11(1) pp. 36 - 44 © 2018 37
in many business and educational sectors. This has led to
make better predictions and better decisions.
In the next section, we review extant literature on big
data and how it is gaining significance for business and
society. Here we have reviewed several definitions of big
data from leading big data and analytics professionals. We
also touch upon different ways in which applications of
analytics can be classified. Third section discusses various
applications and benefits of big data. Here we review how
different institutions such as banks or business firms have
been able to collect, analyze and use big data for enhancing
their business performance.
Role of Analytics based decision making using big data
is nothing new for some of the leading companies. However,
there are still many small and medium size companies which
can start taking advantage of this emerging field. In the
fourth section, we present a framework on big data that can
be used by such companies. This framework could be a
starting point to refine the model suitable for their
businesses. Finally, in the last section we conclude our study
with our findings and suggest future research directions.
2. LITERATURE REVIEW
In this section, we review the extant literature which
provides various ways in which firms are using big data for
analysis and decision making. After defining the objectives
of our research, we identified keywords such as “Big Data’,
‘Big Data and Decision Making’ and ‘Big Data Analytics’.
We searched through research papers in top journals,
conference papers and web sources and shortlisted relevant
papers. Good quality research papers have been selected
through Scopus, Science Direct and Google Scholar
database. The identified keywords have been typed in the
database and papers relevant to the topic have been selected.
Figure 1 shows the number of papers per year published in
various journals.
2.1 What is Big Data?
Big data has been defined in several ways by several
authors. Boyd and Crawford (2012) have defined big data as
cultural, technological and scholarly phenomenon while Fan
et al. (2014) have defined big data as the ocean of
information. According to Kitchin (2014), big data is defined
as huge volume of structured and unstructured data. Waller
& Fawcett (2013) define big data as datasets that are too large
for traditional data processing systems and therefore require
new technologies to process them. Dubey et al. (2015)
describe it as the traditional enterprise machine generated
data and social data. Big data is a term that describes the large
volume of data both structured and unstructured that
inundates a business on a day-to-day basis. But it’s not the
amount of data that’s important. It is what organizations do
with the data that matters. Big data can be analyzed for
insights that lead to better decisions and strategic business
moves.
According to Dyche (2014), the concept of big data for
many people is just millions of data which can be analyzed
through technologies. Big data in true sense is the proper use
of data through technologies in any particular aspect. Big
data evolved in the first decade of the 21st century embraced
first by the online and startup firms. A new type of data
voice, text, log files, images and videos have come into
existence (Davenport and Dyche, 2013). The proper use of
big data results in several applications of big data helping in
decision making.
Various techniques and tools enhance the decision-
making ability. Firms such as Amazon, Netflix have
developed algorithms to find out correlation between
customer searches, past purchase history to predict which
products customer is likely to buy. Customers are reminded
about their past searches or recommended products based on
their purchase history. This creates opportunity of customers
buying some of the recommended products thereby boosting
Figure 1 Classification of research papers year wise from top journals
Jeble et al.: Role of Big Data in Decision Making
38 Operations and Supply Chain Management 11(1) pp. 36 - 44 © 2018
sales. This technique results in as much as one third of their
new sales (Artun and Levin, 2015). Telecom companies
scrape through massive volumes of data to predict which
customers are most likely to leave them. This helps in
designing policies towards customer retention.
2.2 Five Vs of Big Data
While the term “big data” is relatively new, the act of
gathering and storing large amounts of information for
eventual analysis is ages old. The concept gained momentum
in the early 2000s when industry analyst Doug Laney
articulated the now-mainstream definition of big data as the
three Vs Volume, Velocity and Variety. With further
refinement, big data is now characterized with five V’s as
summarized in Table 1 below.
Table 1 Five V's of big data
Characteristics
Description
Volume
Large amount of Data in terabytes or
petabytes has been doubling every
forty months (Davenport, 2014)
Velocity
Rate of Data accumulation is
increasing in every business or
organization
Variety
There are multitude of Data Sources
like enterprise systems, social media,
text, video, audio, email, RFID, web
applications and other digital devices.
Veracity
Quality of Data is very essential for
the accuracy of decision.
Value
Economic & Social Outcomes can be
improved by obtaining value from the
heterogeneous data.
Reputed data analytics firm SAS considers two
additional dimensions such as Variability and Complexity
when it comes to big data.
Variability - In addition to the increasing velocities and
varieties of data, data flows can be highly inconsistent with
periodic peaks. Is something trending in social media? Daily,
seasonal and event-triggered peak data loads can be
challenging to manage, even more so with unstructured data.
Complexity - Today's data comes from multiple
sources, which makes it difficult to link, match, cleanse and
transform data across systems. However, it’s necessary to
connect and correlate relationships, hierarchies and multiple
data linkages or your data can quickly spiral out of control.
2.3 Different Sources of Big Data
In addition to traditional information systems, big data
originates from different sources such as social network
sites, cloud applications, software, social influencers, Data
warehouse appliances, public, network technologies, legacy
documents, business applications, meteorological data and
sensor data. Few sources are explained below.
A. Transactional data
Transactional data coupled with statistical tools such
as regression analysis and decision tree can help in defining
a model to predict an outcome such as sales forecast or level
of success of a new product launch. The model can take
inputs of past data and predict dependent variable. These
models can easily be created using statistical tools like SPSS
or SAS. All the past data with independent variables is
known as transactions and keeping a track on these
transactions is mainly referred as ‘Transactional Processing
System’. The main purpose of Transaction Processing
System is to capture the information and update the data for
the operational decisions in an organization. There are two
ways to process transactions namely Batch processing which
processes the data as a single unit over a period of time and
Real Time Processing System where data are processed
immediately. Both the methods are helpful for making
operational decisions in any organization.
B. Social media data
Popularity of social media in recent years is leading to
information getting collected at every possible location in the
world. Events are getting reported as they occur. Netizens are
happy to share their views, product or service feedback,
movie reviews within minutes on Facebook, twitter or
WhatsApp. This provides a unique opportunity for decision
makers to gather market intelligence. People share their
information through social media which helps customers to
make purchasing decisions by having a glance at the
feedback, customer complaints and miscellaneous services
provided with a product. Sentiments of the consumers are
also expressed on social media which help companies to
make production decisions. Social media Analytics is also
used for gathering competitive intelligence about the firm’s
product and services offered by the competitors in any
particular market segment. This also promotes new business
ideas for improving the business life cycle. Therefore, the
social media data are very essential in making marketing
decision at strategic, operational and tactical level.
C. Internet Applications
With evolution of internet, millions of users are surfing
through various websites generating high volumes of click
streams, web searches for products or services. There are
numerous online ecommerce websites (such as Amazon,
Flipkart, Alibaba, eBay, Paytm, bookmyshow.com etc.)
search engines (Google, Yahoo, Bing, etc.) or online banking
applications where millions of users are logging in daily and
using them. During their searches or transactions various
click streams and logs get generated which could be of value.
D. Data from electronic instruments
There are numerous electronic media such as smart
phones, RFID tags, GPS Sensors, machines connected to
networks, scanners, cameras which generate high volumes of
datasets. These are other sources of big data.
2.4 Big Data Analytics
Big data analytics has emerged as an important tool for
supporting managerial decision making. Dyché (2014)
suggests that big data discovery efforts can reveal previously
unknown findings which can result in insights that are
helpful for managerial decision making. Before the invention
of computers, people were limited in their ability to store and
process data. There were experts who used to make decisions
Jeble et al.: Role of Big Data in Decision Making
Operations and Supply Chain Management 11(1) pp. 36 - 44 © 2018 39
on the basis of their intuitions. These intuitions were not
always perfect as huge data collection was not possible
(Duan and Xiong, 2015). In the present era, big data has led
to volume, velocity and variety of data. This has made it
easier to analyze the data in terms of statistical reliability and
improvement of models (Chen et al., 2012); Big data
Analytics is used in making decisions in e-commerce, e-
government, politics, science, technology, health, security
and public safety through database segmentation, graph
mining, social network analysis, text analytics, web analytics
and sentiment affect analytics, criminal network analysis,
cyber-attack analysis, multilingual text analysis, health
analytics and patient network analysis.
Multi criteria decision making tool also helps in
decision making in health industry in order to understand the
complete evaluation process by providing a decision support
tool (Venkatesh et al., 2010). RFID are introduced for data
warehouse which could be integrated in terms of logic and
operations (Zhong et al., 2015).
Big data analytics has a significant effect on business
value and firm performance leading to savings, reduce
operating costs, communication costs, increase returns
improve customer relations and developing new business
plan. Big data analytics constitute of advance analytic
techniques to operate big data sets. Advanced Analytics
prepares big data for making intelligent decisions by the
users (Russom, 2011). The analysts compare the historic data
from the data warehouse which leads to making better
decisions. Big data analytics is not just about data volume
but it deals with data variety. According to a research report
by Russom (2011) it has been found that there is a very few
percentage of the population who are aware of the terms like
predictive analytics, advance analytics and big data
analytics. RDBMS, data warehousing, data mining,
clustering, association, OLAP, BPM, ETL, regression,
classification, analysis, genetic algorithm, multivariate
statistical analysis and heuristic research are the tools for big
data analytics. Big data provides a great benefit for making
decisions by providing beneficial data to customers,
providing benefits to the business analytics and specific
analytic application. In spite of the benefits there are few
barriers in the use of big data analytics for making decisions.
These barriers generally include inadequacy of staff for
handling the advanced analytics for decision making, lack of
business support and the problems that frequently arises with
the database software.
2.5 Classification of Analytics
In general analytics can be classified into 3 categories
based on the purpose of use descriptive, predictive and
prescriptive. Descriptive analytics explains a phenomenon
from past data through reports, dashboards, which helps in
understanding what has happened. Predictive analytics helps
us to understand what can happen. It supports predictions
based on past data, correlations between variables and
patterns. Prescriptive analytics is another powerful tool that
supports executive decision making. It helps to understand
different outcomes under different scenarios. It consists of
various tools such as optimization, simulations, what-if-
analysis scenarios with change in input set of parameters.
Managers can make a decision with proper understanding of
expected outcomes and plan contingency in advance.
Data sources play an important role in the way it can be
used for analysis. Analytics can be further classified into
Text, Audio Video, Web or Network analytics based on
source of data. In the following section, we discuss these in
detail.
2.5.1 Text Analytics
Document representation, enterprise search system,
search engines, user models, relevance of feedback, query
processing’, billions of searches of customer for a particular
product on google, searches on Amazon’s website provide
indicator of intention to purchase the product by customer.
Amazon, Jet Airways many other ecommerce firms use this
feature to recommend products or flights when next time
customer will be browsing their website, thereby improving
the probability of customer purchase decision.
2.5.2 Audio and Video Analytics
Audio analytics takes seconds to process audio through
technology mainly for safety purpose in any organization and
can track a wide range of sound in the environment. Video
analytics is used to process and analyze videos from variety
of fields and industries. This helps in extracting events
helpful for taking operational decisions.
2.5.3 Web Analytics
Online retailer Amazon uses data mining techniques to
mine the big data such as click streams, web searches, order
history, online etc. to derive intelligence. This intelligence is
used to make decisions about product promotions and it is
working successfully for companies such as Amazon. A
correlation is derived between previous purchase history and
potential new purchase based on similar purchases in the
past. This correlation is used to identify potential customers
and promote different products to these customers using
digital media such as emails, Facebook or by flashing
messages on Amazon.com.
2.5.4 Network Analytics
Network analytics provides information about devices
which are connected to network and how they are interacting
with each other. This information helps in designing network
policies, to make actionable decisions that help in improving
business performance and reducing costs.
2.6 Technology for Big Data Analytics
Due to increasing competition in business, there is need
for rapid information and data analysis. Rapid data analysis
results in better understanding and hence leads to better
decision making (Schläfke et al., 2012). Technology is
helping to use analytics for predicting the level of risks for
disease and infection. Shein (2012) reported that big data can
be a great tool in making decisions in medical field. The
hospital collects data from electronic devices that monitor
the premature babies. There is a huge amount of data which
cannot be analyzed by human beings. So, the role of
technology can be seen here. Structured data looks for
patterns that predicts the onset of diseases and reduces the
stay of a person in a hospital. New algorithms can also
correlate a patient’s behavior change to infection.
Jeble et al.: Role of Big Data in Decision Making
40 Operations and Supply Chain Management 11(1) pp. 36 - 44 © 2018
3. ROLE OF BIG DATA IN
DECISION MAKING
In the current era, business executives are challenged
with high expectations from customers, high competition,
rising costs of labor and materials and shorter product
lifecycles. Globalization is blurring the boundaries among
nations. Location and distance from the market are no longer
barriers to access the markets. In such a volatile
environment, firms need to continuously scan for risks and
opportunities and make business decisions quickly based on
available data. In this section, we discuss the role of
traditional “small data” as well as “big data” for making
business decisions.
3.1 Traditional decision support systems
Traditional decision support systems supported internal
business decisions based on data generated by transactions
processing systems such as ERPs (Davenport & Dyché,
2013). Further evolution led to addition of similar systems
on supply and demand side (SRM and CRM). These systems
helped to integrate internal operations of the firm with their
business partners such as suppliers (e.g. Ariba) and
customers (e.g. Siebel). All these systems used well defined
structured data in relational databases. Internal operational
and tactical decisions were made from these decision support
systems (such as how to price the products for optimizing
sales, status inquiry of orders, inventory planning, cost
analysis, outstanding balance payments according to their
due dates etc.). This information helped in accuracy and
speed of internal decisions. Traditional data sources provided
inputs to data warehouse and data mining operations. Overall
architecture included core transaction database, data
warehouse which stores extracted data, classifies that data
into smaller databases. Further data mining tools provide
business intelligence from these datasets. Data mining from
accumulated data helped to analyze and identify patterns,
correlations or association rules (Han et al., 2011).
3.2 Benefits of Using Big Data in Decision
Making
In the last few years, with advent of big data, the
information requirements of executives have changed. In
addition to traditional datasets described above, there are
large datasets coming from variety of sources in structured,
semi-structured or unstructured forms. There are several
ways in which firms can tap value from these datasets to
make strategic, tactical and operational decisions.
Business transaction data when mined for association
rules provide key insights for decision makers about products
bought together or predicting demand for certain items.
Getting an understanding of patterns helps retailers such as
Wal-Mart to redesign their isles and placement of products
together leading to improved sales (Shaw et al., 2001).
Prediction of demand for certain items, helps in improved
planning ahead of major natural disasters like hurricanes
(Shaw et al., 2001). Analysis of terabytes of data coming
from aircraft engine provides indicators of part failures
thereby improving maintenance as well as safety (Dyche,
2014). Table 2 below summarizes, how big data driven
insights lead to information, prediction and actionable
decisions.
Table 2 Role of big data in making decisions
Big data source
Big data driven Insights
Actionable Decisions
Reference
Google search for a
product or brand
Customer intention to buy a
particular product
Identify customer preference for a
particular brand
Predicting demand for product
Google search by
specific key words
What particular information citizens
are looking for or concerned about
Predict spread of flu by geography
by regions
Mayer-Schönberger &
Cukier, 2013
Amazon search
Customer intention to buy a particular
product
Reminder to customer next time
she/he visits the site leading to
chances of sale
Amazon.com website
Amazon Purchase
history
Using association rules mined from
billions of records, identify which
different products are bought by
customers
Product recommendation
(customer who bought this also
bought)
Amazon.com website
Walmart POS data
Using association rules mined
from billions of records, identify
which products customers buy
together (market basket analysis)
Facing disaster such as
hurricanes people buy some
unusual things like pop-tarts etc. in
addition to usual water, batteries,
shovels etc.
Store layouts redesign to place
such products together
Inventory planning based on
buying patterns prior to
disasters such as hurricanes
Waller & Fawcett, 2013
Dyché, 2014
Jeble et al.: Role of Big Data in Decision Making
Operations and Supply Chain Management 11(1) pp. 36 - 44 © 2018 41
Table 2 Role of big data in making decisions (Con’t)
Comparative analysis between
competing products
Plan product strategy
Vries et al.,2016
Information about speed, routes,
direction, braking, drive train
performance
Redesign Routes leading to saving
of millions of gallons of fuel
Davenport & Dyché, 2013
Create complete profile for
customer journey
Design future strategies for
improved customer service
Davenport & Dyché, 2013
3.2.1 Understanding Customer Journeys
Leading banks such as Wells Fargo, Bank of America
and Discover get to understand their customer relationship
using big data gathered through variety of sources as
described in Figure 2 below. They create complete profile of
customer journey’s using mix of structured, semi-structured
and unstructured data originating from call center logs,
website clicks, transaction records, ATM transactions,
clickstreams etc. This profile helps them to understand
reasons for customer attrition, correlating journeys with
customer opportunities and problems (Davenport & Dyché,
2013).
Figure 2 Customer journey
3.2.2 Competitive Intelligence
There are several studies conducted to understand
consumer sentiments, attitudes and opinions using social
networking sites (SNSs). In addition to consumer sentiment
about their own products, business executives need to know
what customers think about competitor’s products. This
intelligence will help to plan innovations in future products
or design a strategy to market the products. Mining of a
social media data can obtain comparative analysis of
consumer opinions and sales performance of a business and
its competitors.
Similarly, trends analysis provided by google provides
a good mechanism of comparing product searches of two or
more competing products. These analytics provides insights
on how different products, services or persons are being
searched over the web in different geographies. This can
provide valuable intelligence regarding product awareness
and designing future marketing strategies or new product
launches. There are websites such as sentiment140.com
which provide glimpse of possible ways in which this
intelligence can be tapped.
3.2.3 Cost and Time Reduction
There are numerous opportunities of cost and time
reduction using big data. Big data technologies such as
Hadoop clusters are emerging as significantly low-cost
option compared to traditional databases. It can play a role in
real time decisions regarding promoting offers and services
to customers based on their current locations. UPS saves
millions of dollars in fuel by collecting, analyzing data from
telematics sensors installed on its 46,000 vehicles and
redesigning its vehicle routes using this large dataset
(Davenport & Dyché, 2013).
3.2.4 Optimization and Simulations of Supply Chains
Supply chains are getting increasingly complex with
multitude of suppliers and business partners. Over last two
decades, members of supply chain have implemented
enterprise systems which record every transaction. With
advancement of EAI information sharing happens between
business partners such as suppliers and customers. For
efficient movement of goods across supply chains,
technology plays an important role. Scanning devices such
as sensors and RFID, location tracking devices like GPS,
video recordings etc. all these churn large volumes of data
with inventory movement. Supply chain analytics enhances
capability of decision makers by getting an integrated view
of the data within supply chain. We can extract, transform,
analyze data from data sources within supply chain system
and run analytics to derive intelligence. Supply chain
analytics provide several advanced capabilities such as
dashboards, pattern and trend analysis, drill down views,
forecasts, knowledge base, scenario and what-if analysis,
simulations and optimization capabilities. These enhance
decision making capabilities and interpretations of situations
which is very crucial for firms in competitive business
environments (Nair, 2012).
3.2.5 Predicting Future Outcomes
There are several opportunities of using datasets for
predicting future outcomes. Analytics frameworks can be
developed to analyze different datasets and make predictions
as listed below-
a) Based on historical transactional data, using forecasting
models such as regression predict future sales for the
product or services for a firm.
b) Based on correlations found in historical purchases,
identify products purchased together by customers.
Referring to these correlations and purchase history of
a customer, predict which products a customer is most
likely to buy and make online recommendations.
(Artun & Levin, 2015)
Profile of Customer Journeys
Online
transactions
Website
clicks
Call center
logs
Jeble et al.: Role of Big Data in Decision Making
42 Operations and Supply Chain Management 11(1) pp. 36 - 44 © 2018
Figure 3 Conceptual framework on big data and decision making
Analyze historical data, study patterns of customer
attrition from the past data and identify which variables
contribute to customer attrition. Predict which customers are
most likely to leave, take proactive steps to retain them.
(Artun & Levin, 2015)
There are many more applications of predictive
analytics such as predicting which customers are most likely
to buy which products based on their historical purchases.
Also, based on Google searches, outbreak of diseases in
certain geographic locations can be predicted.
3.2.6 Real-time Decision Making
Several visionary companies have developed real-time
decision-making capabilities using supply and demand side
information. Using analytics, they have online real-time
decision-making capabilities that cannot be matched by
traditional business models. Transport service providers such
as Uber uses big data for real time routing of cars to minimize
pick up times and optimize customer experience of a ride
(Woodie, 2015). Ola and Uber provide real-time information
to both customer and cab driver on Google map. They
receive continuous stream of high volume cab demand data
and availability of cabs in different geographic areas. They
come up with demand management strategies based on real-
time demand information. City of Singapore has recently
introduced a demand driven, shared private transportation
concept enabled by data analytics and mobile technology
called as Beeline. This system uses crowd sourced travel
patterns, transportation data to identify potential travel routes
and dynamically allocates buses to routes based on demand
patterns. This reduces travel time for commuters and
increase use of shared transport services (Askari, 2015).
4. CONCEPTUAL FRAMEWORK
ON BIG DATA AND DECISION
MAKING
In this section, we describe conceptual framework for
firms which would like to develop analytics practices for
their business to support business decisions in different
areas. Driven by the objectives and the literature, conceptual
framework in Figure 4 has been designed. As described in
earlier section, several leading companies are practicing
analytics in one or more aspects of their business. There are
still several small and medium size firms which have yet to
adopt analytics for gaining competitive advantage. We have
developed a framework for such firms to bring analytics into
their mainstream business practice. We recommend that once
analytics practice is established in the company, this function
can be headed by a senior executive. This will ensure that
critical insights gained from data analysis are used for
decision making. Further, analytics can be incorporated in
performance measurement system such as balanced
scorecard, real-time dashboard or KPIs.
From the literature review, authors have explored
different ways in which big data plays critical role in
analytics which in turn provide insights for decision making.
Figure 3 clearly depicts the path from big data to decision
making. The constructs have been discussed in detail below.
The conceptual framework shown in Figure 3 depicts a
relationship between five constructs.
4.1 Develop data sources
Data sources include traditional data sources such as
enterprise systems, customer data, supplier data, social
media data, logistics trajectory etc. As a first step, firm needs
to have information systems infrastructure and processes in
place to collect data through variety of sources based on its
business model. For example, a products company focusing
on designing new products and assembling them will collect
data related to supply, distribution and logistics. A logistics
company will collect data related to its fleet movement,
packages and routes etc.
4.2 Data Mining
Data mining is a process of discovering patterns in large
datasets using various statistical techniques, computer
programs and database systems. It helps in getting
meaningful information from the data. Once data sources are
established, based on analytics requirements from different
departments, data warehouse will be developed to store
multi-dimensional data for query and analysis purpose.
Mining these datasets helps in finding previously unknown
patterns, correlations and association between different
variables.
4.3 Data Analysis
Having large volumes of variety of datasets are
necessary but not sufficient. Firm needs to develop capability
in analytics to get insights from the data. Firm needs to
develop a team of analytics professionals with several
interdisciplinary skills in the team- a) knowledge and
experience in statistics tools such as R software, SPSS, SAS
etc. b) programming knowledge c) domain knowledge about
the business processes d) data management skills in SQL e)
experience in data analysis. With help of domain knowledge
and data analysis various opportunities of analytics projects
can be identified.
4.4 Analytics
As described earlier, firms can take advantage of three
types of analytics descriptive, predictive and prescriptive.
Firm can develop their requirements based on opportunities
of acquiring new customers, retention of existing customers
or identifying risks for its business. Business analytics uses
Develop
Data
Sources
Data
Mining Data
Analysis Analytics Decisions
Jeble et al.: Role of Big Data in Decision Making
Operations and Supply Chain Management 11(1) pp. 36 - 44 © 2018 43
a set of principles, statistical tools and computer algorithms
to extract knowledge from the data. IBM, SAP, Oracle, SAS,
SPSS and R software have already developed tools for data
analysis and model development. Hadoop provides
framework for developing model from different data sources.
4.5 Decision Making
Business analytics is emerging as a potential tool for
enterprises to improve their business performance in terms
of customer service, customer retention and acquisition.
Predictive analytics helps us to predict what can happen
based on certain available information. This gives a
competitive advantage for a firm to plan ahead. Patterns from
data, correlations and associations are helpful for improving
sales performance, identifying right customers for products
or segmenting markets. Analytics has applications in every
domain where data can be collected. Supply chain analytics
are available in the areas of inventory optimization,
procurement planning, demand forecasting, fleet and route
sizing and optimization (Nair, 2012). Social media data
provides competitive intelligence, new product ideas and
reviews of existing product crucial information helpful to
decide next strategies (Bell, 2012). Big data discovery can
provide startling and highly actionable findings (Dyche,
2014). Main goal of data science is to improve ability of
managers to make better business decisions (Provost and
Fawcett, 2013). Leading companies such as Amazon, Wal-
Mart, Google or Netflix have mastered the art of using data
and analytics as a tool for predictions, simulations or
sometimes for just getting insights. Amazon and Wal-Mart
use analytics for decision making in all aspects of conducting
their business right from generating demand to managing
their supply chains efficiently.
5. CONCLUSION AND FUTURE
RESEARCH DIRECTIONS
We have come a long way since information revolution
has changed the way business firms work. Big data is helping
firms to get competitive advantage using different analytics
techniques. These techniques help us to get insights, patterns,
correlations and associations which could not be understood
through traditional small data. These support decisions
making process for business executives with the help of
social media data, competitive intelligence, cost and time
reduction strategies, supply chain analytics, web analytics
etc. Firms which recognize significance of big data and
developing products around data have received huge
dividends in recent years. Many firms use analytics in almost
all aspects of conducting their business to reap the benefits
of analytics based decision making. In this paper, we present
a conceptual framework for developing analytics capabilities
and how this emerging knowledge can be help small and
medium firms to compete using lesser resources. It can be
adopted by such companies with changes in line with their
business domain and model. This framework can be a
starting point for further analysis, enhancement and future
research opportunities.
With continued digitization of every aspect of society
as well as business, pace of generation of high speed high
volume data is going to continue. This provides a sound
opportunity to exploit the field of analytics for decision
making in different business domains. There are several
unique research opportunities in different business, scientific
and government domains wherever data is generated
continuously.
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Shirish Jeble is currently a faculty at IBS Business School, Pune, India with the Department of IT and Operations. He holds
a Masters in Management from University of Mumbai and is currently a PhD scholar at the Symbiosis International University,
India. He has over 20 three years’ experience that includes both industry and academics. He has over five years of experience
of PG teaching and research experience in the area of operations management, supply chain management, lean, information
technology and business analytics. His research interests include big data and sustainable business development.
Sneha Kumari is a Junior Research Fellow at Symbiosis International University. She has completed her graduation in
Agriculture under Indian Council of Agriculture Research fellowship and her Masters in Agribusiness Management under
Indian council of Agriculture Research merit. Currently she is pursuing PhD from Symbiosis International University. She has
published few research papers in the area of agriculture, sustainability, technology, climate change and attended several
national and international conferences.
Yogesh Patil is Professor and Head Research Publications at Symbiosis Centre for Research and Innovation, Symbiosis
International University, Pune, India. He holds Master and Doctorate from University of Pune, India and has over 16 years of
PG teaching and research experience in the area of environmental science, management and technology. His research interests
include waste management, sustainability, climate change, industrial ecology and reverse logistics. He has published over 50
research papers/chapters and successfully completed projects funded by UGC, IFS, Sweden; OPCW, The Netherlands and
World Bank. He has received several awards and fellowships.
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