Towards Design Principles for Data-Driven Decision Making: An Action Design Research Project in the Maritime Industry

Data-driven decision making (DDD) refers to organizational decision-making practices that emphasize the use of data and statistical analysis instead of relying on human judgment only. Various empirical studies provide evidence for the value of DDD, both on individual decision maker level and the organizational level. Yet, the path from data to value is not always an easy one and various organizational and psychological factors mediate and moderate the translation of data-driven insights into better decisions and, subsequently, effective business actions. The current body of academic literature on DDD lacks prescriptive knowledge on how to successfully employ DDD in complex organizational settings. Against this background, this paper reports on an action design research study aimed at designing and implementing IT artifacts for DDD at one of the largest ship engine manufacturers in the world. Our main contribution is a set of design principles highlighting, besides decision quality, the importance of model comprehensibility, domain knowledge, and actionability of results

Experimental designs for environmental valuation with choice-experiments: A Monte Carlo investigation

We review the practice of experimental design in the environmental economics literature concerned with choice experiments. We then contrast this with advances in the field of experimental design and present a comparison of statistical efficiency across four different experimental designs evaluated by Monte Carlo experiments. Two different situations are envisaged. First, a correct a priori knowledge of the multinomial logit specification used to derive the design and then an incorrect one. The data generating process is based on estimates from data of a real choice experiment with which preference for rural landscape attributes were studied. Results indicate the D-optimal designs are promising, especially those based on Bayesian algorithms with informative prior. However, if good a priori information is lacking, and if there is strong uncertainty about the real data generating process - conditions which are quite common in environmental valuation - then practitioners might be better off with conventional fractional designs from linear models. Under misspecification, a design of this type produces less biased estimates than its competitors

Calibrated imputation of numerical data under linear edit restrictions

A common problem faced by statistical offices is that data may be missing from collected data sets. The typical way to overcome this problem is to impute the missing data. The problem of imputing missing data is complicated by the fact that statistical data often have to satisfy certain edit rules and that values of variables sometimes have to sum up to known totals. Standard imputation methods for numerical data as described in the literature generally do not take such edit rules and totals into account. In the paper we describe algorithms for imputation of missing numerical data that do take edit restrictions into account and that ensure that sums are calibrated to known totals. The methods sequentially impute the missing data, i.e. the variables with missing values are imputed one by one. To assess the performance of the imputation methods a simulation study is carried out as well as an evaluation study based on a real dataset