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8/3/2019 Picking Up Signals
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Picking up signals
Information Management
An adage says that nothing happens in a vacuum, and
this is especially true when it comes to the complex
environment that most businesses operate in. Virtually no
event is random. Seemingly unrelated events are otenconnected in ways that cannot be ully understood
without extensive analysis. Events that occur during the
course o business operations can be thought o as
signals that are — or should be — recorded in some way
by organizational inormation systems.
Signals come rom business or inormation domains such
as customer, nance, risk, supply chain, workorce, and
product and protability management. These domains are
interdependent, much like environmental ecosystems, and
signals oten span domains, creating a ripple eect
throughout the business environment. How eectively
companies can detect these signals and determine their
signicance to the business is a key actor in managing
business perormance.
It’s relatively easy to detect signals rom internal systems
such as transaction processing systems, ERP systems and
other back-oce operational systems. It’s also a airly
straightorward process to detect signals that are
aggregated by decision-support systems such as data
warehouses or unctional data marts. This data is typically
structured content that is collected, organized and
disseminated or analysis and decision-making on a
regular schedule.
However, the signal detection process is complicated by
the act that an ever-growing amount o data is in the
orm o unstructured content such as emails, scanned
documents, online conversations, customer interaction
logs, video and audio les, etc. This content is
unstructured because it doesn’t t into traditional
database structures that are typically used to organize
data or analysis and reporting. To say unstructured
content is nontraditional does not imply that it has no
value — quite the opposite.
Unstructured content can provide a wealth o signal
inormation to help companies better understand,
manage and predict perormance. For example, rich
content can be mined rom social Web analytics. Social
Web analytics is the application o search, indexing,
semantic analysis and business intelligence technologies
to identiy, track, listen to and participate in distributed
conversations about a particular brand, product or issue.
These distributed conversations can exist in traditional
media, social media, advertising and customer
interactions. They can be a valuable source o inormationabout market trends, perceptions and timing.
Internal systems and back oce operations provide a wealth o unused,valuable inormation
Published in Information Management Magazine, July/August 2011
8/3/2019 Picking Up Signals
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Inormation gathered by these means can be used to
analyze and quantiy each conversation’s sentiment and
infuence how it shapes — and will shape — market
trends and preerences.
Online prediction markets are another eective way to
detect signals rom business events — especially vis-a-vis
adverse events that may aect mission-critical projects.
The term “prediction markets” describes the knowledge
that is aggregated across multiple participants in a
project or business. It exemplies the theory that crowds
carry more wisdom than individuals. Prediction markets
acilitate the breakdown o social barriers inherent in
complex projects, especially when these projects span
unctional and geographic boundaries.
In prediction markets, participants share knowledge
anonymously, in real time. The ability to tap the
predictive powers o participants’ collective wisdom and
gather inormation about what’s going to happen —
both in the short term and in the long term — can be
leveraged to enhance business perormance. Forexample, i project leaders receive early indicators that
timelines have slipped, they can make immediate and
proactive decisions, thereby reducing risks, shortening
delays and saving costs long term.
Companies can also tap prediction markets to gain
oresight. As an illustration, consider the eect o trader
knowledge on stock prices. In this example, prediction
markets build on the principle that the stock market
serves to aggregate the belies o multiple traders to
generate a orecast — the stock price. For example, at
any given time, a stock price is refective o traders’collective belies about the company’s expected uture
earnings, allocated to each share o stock.
Like the stock market serves to assign a price to the
uture estimated earnings o a company, prediction
markets assign a value to collective belies about the
uture, or predictions o events to come. They can be
used as the basis or quantied scenario analysis o
possible events to support assigning values to potential
outcomes and using those values — along with other
inormation — as a oundation or decision-making.
Internal inormation systems, social Web analytics and
prediction markets are just a ew o the sources o
signals that inundate most organizations on a daily basis
These signals are oten conusing and dicult to
decipher. Making the eort to detect and put them into
some type o rame o reerence is essential. It’s not
everything, though. Signals are o no use unless they can
be eectively aggregated and analyzed to understand
and improve perormance.
My next column will continue on the topic o signal
detection with a discussion about how to apply analytics
to signal detection in order to provide deeper insight intoperormance and acilitate more sophisticated oresight
into possible uture events. Stay tuned.
Jane Grin is a Deloitte Consulting LLP partner.
Grin has designed and built business intelligence
solutions and data warehouses or clients in numerous
industries. She may be reached via e-mail at
As used in this document, “Deloitte” means De loitte Consulting LLP., a subsidiary o Deloitte LLP. Please see www.deloitte.com/us/about or a detailed description o
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