Knowledge Representation & Reasoning for Business Analysis
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1 Knowledge Representation & Reasoning for Business Analysis LECTURE 2 Types of data, information, assumption, and knowledge in Business Analysis Ivan Jureta Senior Researcher, Fonds de la Recherche Scientifique - FNRS Associate Professor, Dept. Business Administration, University of Namur ivan.jureta@fundp.ac.be
2 Purpose of the lecture Identify the main types of: - data, - information, - assumptions, - knowledge, - decisions, - advice used and produced in Business Analysis.
3 Problem Top management of a large international electronics manufacturer needs better marketing intelligence from the company s consumer electronics division. One of the initiatives that the company s marketing executives chose, is to improve merchandising intelligence.
4 What is merchandising? At a retail in-store level, merchandising refers to the variety of products available for sale and the display of those products in such a way that it stimulates interest and entices customers to make a purchase. Source: Wikipedia.
5 What is merchandising intelligence? (1/2) Reporting, planning, forecasting and optimization of decisions and activities related to merchandising. Involves answering questions such as: - What products to have at points of sale? - How to - display products at points of sale? - help salespeople sell? - know what goes on with products at a point of sale? - What data to collect for marketing intelligence? - How to use collected data in decision-making?
6 What is merchandising intelligence? (2/2) A domain within Business Intelligence: Business intelligence (BI) concerns the gathering, storage, and processing of data, to turn it into information that is meaningful and relevant for decisionmaking in businesses and organizations.
7 How to address the problem? (1/3) 1. Preparation 2. Elicitation 3. Synthesis 4. Exploration 5. Evaluation 6. Decision 7. Advice 8. Supervision
8 How to address the problem? (2/3) 1. Preparation 2. Elicitation 3. Synthesis 4. Exploration 5. Evaluation 6. Decision 7. Advice 8. Supervision Understand the problem Design alternative solutions Choose one solution Deliver the solution
9 How to address the problem? (3/3) 1. Preparation 2. Elicitation 3. Synthesis 4. Exploration 5. Evaluation 6. Decision 7. Advice 8. Supervision Understand the problem Design alternative solutions Choose one solution Deliver the solution Data, information, assumptions, knowledge
10 What types of data, information, assumptions, and knowledge are used at each step? The answer to the question depends on why you ask that question. Why is that?
11 What is a type? A category of people or things having common characteristics. Synonyms: kind - sort - pattern - model - exemplar species Example: Blood types. Source: Google.
12 Therefore: The types you are interested in, depend on the characteristics you want to focus on. The reason to focus on some specific characteristics, instead of others, is because they are useful to solving the problem you have.
13 Example (1/3) If you need to do statistical analysis, then you might be interested in categorizing the data, information, assumptions, and knowledge according to: 1) The types of variables that you can use to model them: - Continuous / Quantitative - Discrete / Qualitative: - Nominal - Ordinal 2) Their role in a statistical model: - Dependent - Independent
14 Example (2/3) If you need to engineer a software system, then you might be interested in categorizing the data, information, assumptions, and knowledge according to: What role they play in engineering: 1) Requirements, which are about what the system should do; 2) Specifications, which are about how the system should do it; 3) Domain Assumptions, which are about conditions in the environment of the system.
15 Example (3/3) If you need to design a business process, then you might be interested in categorizing the data, information, assumptions, and knowledge according to: What they are used for, in the process to define: 1) Responsibilities of process participants; 2) Resources used in the process; 3) Products of process steps; 4) Relationships between process steps.
16 Goals to achieve when solving a problem dictate the choice of types by which to categorize data, information, assumptions, and knowledge about that problem. Example: Suppose an investor purchases a zoo, and wants to lower costs. Clearly, zoology taxonomies are of some use in solving this problem. But types for categorizing animals in this problem are likely to be chosen to reflect, for example, the expenses associated with keeping them in the zoo, their sale price, etc.
17 Types used to categorize data, information, assumptions, and knowledge in a business problem are influenced by the following considerations: 1) The expected structure of the solution to the problem 2) The step of the method used to solve the problem
18 What is the structure of a solution? The structure of the solution simply defines what types of information the solution includes.
19 EXAMPLE 1 Problem: What are optimal positions of products in a store? Artwork: Andreas Gursky. 99 Cent MoMA.
20 EXAMPLE 1 Problem: What are optimal positions of products in a store? Solution structure: - Terminology, which defines store display types, positions on store displays, product categories, and other terms specific to the problem and its solution - Rules on, for example: - Which products should be placed where - When to collect and how to report data: - about actual product positions - for estimating the effect of changes in product positions - Who is responsible for monitoring and reporting on product positions - Processes for, for example: - How to collect data about product positions - How to analyse that data - How to produce reports from that data
21 EXAMPLE 2 Problem: How to recommend cars to buyers? Artwork: Jeff Koons. BMW Art Car
22 EXAMPLE 2a Problem: How to recommend cars to buyers at points of sale? Solution structure: - Terminology, which defines types of cars, groups of buyers, and other terms specific to the problem and its solution - Rules on, for example, how salespeople should: - Categorize buyers according to buyer preferences - Customize communication with a potential buyer based on their preferences - Processes for, for example, how salespeople should: - Elicit preferences of a potential buyer - Present a car s features to a potential buyer
23 EXAMPLE 2b Problem: How to recommend cars to buyers online? Solution structure: - Terminology, which defines types of cars, groups of buyers, and other terms specific to the problem and its solution - Rules on, for example: - Categorizing potential buyers according to their preferences - Customize communication with a potential buyer based on their preferences - How to store and process data about potential buyers - Which channels of communication to use with which buyers - Processes for, for example: - How to elicit preferences of a potential buyer through each communication channel - How to present a car s features to a potential buyer in different communication channels - How to automatically respond to patterns of behaviour observed on a channel of communication (website, newsletter, social media, etc.)
24 EXAMPLE 3 Problem: How to increase sales of artworks using social media? Artwork: Damian Hirst. The Physical Impossibility of Death in the Mind of Someone Living
25 EXAMPLE 3 Problem: How to increase sales of artworks using social media? Solution structure: - Terminology, which defines types of artworks can be promoted through social media, and which sold online - Rules on, for example: - Which artworks to promote when and on which social media - Which artworks to accept for sale online, based on how they need to be preserved - Processes for, for example: - How to promote artworks on social media - How to respond to customer participation in conversations on social media
26 EXAMPLE 4 Problem: How to continuously improve manufacturing processes at a airplane manufacturer?
27 EXAMPLE 4 Problem: How to continuously improve manufacturing processes at an airplane manufacturer? Solution structure: - Terminology, which defines positions involved in the processes, names of resources used in processes, and so on - Rules on, for example: - Which events in processes to record data on, for use in process improvement - Processes for, for example: - How to collect suggestions from employees, on process improvement - How to maintain regular training of employees
28 Common types of information in solutions: 1. Terminology 2. Positions and roles 3. Rules 4. Processes
29 Terminology (1/4) Terms are words and compound words that in specific contexts are given specific meanings, meanings that may deviate from the meaning the same words have in other contexts and in everyday language. Source: Wikipedia
30 Terminology (2/4) A terminology gives definitions of terms. Reasons for having an explicit terminology in a solution are to: - Clarify the intended meaning of important terms in the description of the solution - Establish conventions to use when: - Communicating about the solution - Using the solution - Discussing and revising a solution - Avoid ambiguity and vagueness in communication about the solution.
31 Terminology (3/4) Having explicit terminology in a solution is particularly relevant when the solution refers to: - Abstractions and intangibles - Examples: algorithms, customer satisfaction, reputation - Concepts without a universally accepted definition - Examples: salesperson, performance indicator, quality - Terms having a meaning specific to the problem and solution domains - Examples: Point Of Sale, Field Merchandiser, customer data, user
32 Terminology (4/4) Example definitions in a terminology that comes in a document that defines a business process: Point of Sale (POS): Location (shop) where company X s products are being sold. POS Data: Data (text, measurements, images) collected at a POS by an FMR. Field Merchandiser (FMR): An individual visiting a POS on behalf of company X, and collecting data about the POS. An FMR receives a list of POS to visit, and at each visit collects data about company X s products being sold at POS, the characteristics of a POS, and any other data of use to company X. Report: A file generated by software Y to facilitate the understanding of POS Data.
33 Positions and roles (1/3) Purpose of a defining a position is to situate an individual within an organization. A position will define, among others: - The responsibilities that will be assigned to the person who occupies the position - Whom this person reports to - Who reports to this person
34 Positions and roles (2/3) Examples of positions: - CEO, CTO, CIO, CSO - Creative director - Art director - Regional director - Marketing manager - Board member - President
35 Positions and roles (3/3) Roles also define responsibilities and who reports to whom, BUT are usually specific to processes. Examples of roles: - Project leader - Team leader
36 Rules (1/2) A rule defines a condition that should be satisfied by one or both of the following: - The deliverable of the task - The act of performing the task Rules are intended to impose constraints on how participants in processes: - Communicate in relation to their tasks - Access inputs required for their tasks - Deliver outputs of their tasks - Evaluate and ensure quality in the outputs they produce
37 Rules (2/2) Examples of rules: - All customer complaints should be answered within 48 hours of reception. - If a complaint cannot be answered within 48 hours of reception, then the customer will, within the first 48 hours, be informed of the date by which she can expect a response to her complaint. - If a major defect is observed on more than 5 / products, then another sample of 20 items must be drawn from that batch and checked for defects.
38 Processes (1/5) A definition of a process should include at least the following information: - Purpose, defining one or more goals that the process is applied to satisfy - Applicability, defines conditions that must be satisfied in order for the process to be performed. Conditions can be the completion of other Processes, the availability of some deliverable, or another event - Roles, listing Roles specific to that Process
39 Processes (2/5) (Continued.) - Positions, listing Positions participating in the Process - Resources, listing names of resources (documents, software, etc.) used, produced, or otherwise manipulated in the Process - Meetings, defining meetings scheduled and/or held in the Process - Sequence of steps in which to execute tasks in a process
40 Processes (3/5) Example: Responding to a Client RFP in a software engineering company A.1) Account Manager holds preliminary meetings with Client A.2) Account Manager elicits the Client s request: If the Client does not provide an RFP, then Account Manager formulates an initial RFP A.3) Account Manager decides whom to send RFP: - If RFP is for a new Project of a current or new Client, then send to HPMO and go to Step B - If RFP is for a change on a Project in progress for that Client, then send to Project Manager already allocated to the Project and go to Step B.2
41 Processes (4/5) Example (Continued.) B) B. Allocation of resources for preparation of support (& demo) based on availability and expertise B.1) HPMO receives RFP and allocates Project Manager to the Project B.2) Project Manager receives RFP and sends to Head of Technology and Business Analyst with the following information: - RFP - Official Project name to use in all Project-related documents and communication - Proposed deadlines for Head of Technology to allocate Lead Developer to Project and for holding Internal Requirements Meeting B.3) Business Analyst and Head of Technology confirm proposed deadlines, or propose other deadlines to Project Manager B.4) Head of Technology appoints Lead Developer and confirms Lead Developer appointment by to Project Manager and Business Analyst
42 Processes (4/5) Example (Continued.) B) B. Allocation of resources for preparation of support (& demo) based on availability and expertise B.1) HPMO receives RFP and allocates Project Manager to the Project B.2) Project Manager receives RFP and sends to Head of Technology and Business Analyst with the following information: - RFP - Official Project name to use in all Project-related documents and communication - Proposed deadlines for Head of Technology to allocate Lead Developer to Project and for holding Internal Requirements Meeting B.3) Business Analyst and Head of Technology confirm proposed deadlines, or propose other deadlines to Project Manager B.4) Head of Technology appoints Lead Developer and confirms Lead Developer appointment by to Project Manager and Business Analyst
43 Processes (5/5) Example (Continued.) B) C) Technical response drafted and client meeting support C.1) Project Manager schedules Internal Requirements Meeting with Business Analyst, Lead Developer, Creative Director, Account Manager C.2) Internal Requirements Meeting: Based on RFP content, participants decide if SRS needs to be produced; If SRS should be produced, Business Analyst elicits requirements and decisions from Account Manager, Lead Developer, Creative Director; C.3) Business Analyst sends meeting report by to Account Manager, Project Manager, Lead Developer, Creative Director, and other participants, if any - If decision is to produce SRS, then Business Analyst sends deadline for delivering SRS to Project Manager and go to Step C.4 - If decision is not to produce SRS, then it is assumed that RFP includes SRS and Project Manager initiates Activity F;
44 Processes (6/6) Example (Continued.) C.4) Business Analyst produces SRS draft If RFP concerns changes to current Project for the Client, then Business Analyst revises SRS for that Project C.5) Business Analyst sends SRS to Project Manager and Lead Developer C.6) Lead Developer requests changes or confirms SRS C.7) Business Analyst sends to Project Manager Lead Developer the changed SRS If RFP is for a change on a Project in progress for that Client, and Project Manager and Lead Developer judge that the change requires no Scope Clarification Client Meeting, then go to Activity F. And so on
45 Terminology, positions, roles, rules, and processes are used together in order to design solutions which are realized through the coordination of people and resources.
46 Recall the steps: 1. Preparation 2. Elicitation 3. Synthesis 4. Exploration 5. Evaluation 6. Decision 7. Advice 8. Supervision Understand the problem Design alternative solutions Choose one solution Deliver the solution Data, information, assumptions, knowledge
47 Are terminology, positions, roles, rules, and processes are for describing solutions only?
48 But are terminology, positions, roles, rules, and processes are for describing solutions only? 1. Preparation 2. Elicitation 3. Synthesis 4. Exploration 5. Evaluation 6. Decision 7. Advice 8. Supervision Understand the problem Design alternative solutions Choose one solution Deliver the solution Data, information, assumptions, Knowledge Terminology, roles, positions, rules, processes
49 Mandatory readings for the next lecture 1. A. Langley, H. Mintzberg, P. Pitcher, E. Posada, J. Saint-Macary. Opening up Decision Making: The View from the Black Stool. Organization Science, Vol. 6, No. 3 (May - Jun., 1995), pp R. L. Keeney. Decision Analysis: An Overview. Operations Research, Vol. 30, No. 5 (Sep. - Oct., 1982), pp
50 Optional readings for the next lecture 1. B. b. de Mesquita. The contribution of expected utility theory to the study of international conflict. Journal of Interdisciplinary History (1988), pp G. Sharp. The Meanings of Non-Violence: A Typology (Revised). The Journal of Conflict Resolution, Vol. 3, No. 1, Studies from the Institute for Social Research, Oslo, Norway (Mar., 1959), pp F. A. Hayek. The Use of Knowledge in Society. The American Economic Review, Vol. 35, No. 4 (Sep., 1945), pp
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