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Analytics Magazine

Executive Edge: Statistics make the world work better

July/August 2011

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Whether you’re a modern supermarket shopper or a subsistence farmer in an impoverished nation, statistics profoundly affect your life. And with ongoing advances in high performance computing and the explosion of data, statistics will remain a positive social influence around the globe.

By Jim Goodnight

Hal Varian, Google’s chief economist, says that statistician is the sexy job of the coming decade. I think he’s behind — using statistics has been the sexy job of the last 30 years. It’s just taken awhile for organizations to catch on. Statistics underpin many cost-effective efforts to reduce preventable deaths, make the economy run smoother, fight fraud, improve education and please customers.

Statisticians have been around for a long time, helping tabulate population and economic data, but it took the growth of high-performance computing to effect real change. Computing power dramatically improved the ability to analyze data in innovative ways — revealing discoveries that are difficult, if not impossible, to compute manually.

Shoppers who receive a fistful of coupons for favorite brands at the checkout can thank statisticians for lowering their grocery bill. Ditto if your favorite Web site functions like a personal shopper, suggesting items you might buy. Companies can now rapidly comb through data in real time to present personalized offers, coupons and Web specials. This helps both consumer and company. An example: Catalina Marketing, a consumer packaged goods marketing company, mines 250 million customer transactions weekly to predict consumer interests. The result: Instead of getting offers at the grocery checkout that don’t relate to your life (like cat food coupons for someone allergic to cats), Catalina and statistics ensure you get discounts for products that you actually might try.

Not only do statistics improve commerce, they also help make the world a better place. The same statistical software used by Catalina is distributed by Statistics Norway to distressed countries such as Uganda, Moldova and Albania to help better analyze their population, housing and income data. Using statistical software, developing nations can analyze this data, map the analysis results, identify their people’s most pressing needs, and share the results with government and nongovernment organizations to better target assistance.

Here in the United States, statistics helps reduce the staggering cost of health care and helps people stay healthier. The Dartmouth Atlas Project uses powerful statistical tools to analyze Medicare data to show that quantity of care in a patient’s dying days doesn’t produce quality care — it just produces a big bill. The project’s analysis sparked important discussions among physicians, policymakers and the public about whether high-cost treatments at end of life are humane or necessary.

At Maine Medical Center, staff created data dashboards that make it easy to measure everything from hand washing compliance to whether a congestive heart patient is offered a flu vaccination. Among measureable benefits, it’s helped them dramatically drop the rate of hospital-acquired infections and ensure that all heart failure patients receive evidence-supported care. With statistics, Maine Medical now measures new methods for taking care of stroke patients to lower complications — and lower cost.

The Clinton Health Access Initiative (CHAI) is another example of statistics working for the public good. This nonprofit worked with a Caribbean clinic contemplating a costly expansion to care for growing numbers of patients. Using statistics, CHAI found that redesigning existing clinic space could serve more patients without additional building. CHAI has also used statistics to help emerging nations overcome concerns that concentrating on specific illnesses like HIV/AIDs or malaria, even with donated medicine, drains resources from other pressing health problems. CHAI models showed countries how to step up treatment plans without overwhelming existing capacity. One model helped an African nation understand how nurses could manage most routine HIV/AIDS treatment, freeing up doctors to concentrate on other services.

The University of North Carolina uses statistical discovery to study emissions data as part of its effort to become climate neutral by 2050. Researchers analyze statistics on greenhouse gas data and graphically display the analysis so that patterns “just visually pop out,” according to a researcher. One conclusion was that nearly 90 percent of greenhouse emissions result from energy used in campus buildings, a discovery that has already yielded improved energy performance.

Whether you’re a modern supermarket shopper or a subsistence farmer in an impoverished nation, statistics profoundly affect your life. And with ongoing advances in high-performance computing and the explosion of data, statistics will remain a positive social influence around the globe. I’d venture to say that statistician could be the sexy job of the century. ‚ùô

Jim Goodnight is founder and CEO of SAS (www.sas.com). Headquartered in Cary, N.C., SAS has provided analytical software for 34 years and is recognized as an industry leader. SAS is used at more than 45,000 sites, including 92 of the top 100 companies on the 2009 FORTUNE Global 500 list. Goodnight holds a Ph.D. in statistics from North Carolina State University. Another version of this article appeared in the Jan. 13 issue of Statistical Analysis and Data Mining under the headline, “The forecast for predictive analytics: hot and getting hotter.” Copyright SAS.

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