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Organizing Data Analytics

Author

Listed:
  • Ricardo Alonso

    (Department of Management, London School of Economics and Political Science, London WC2A 2AE, United Kingdom)

  • Odilon Câmara

    (Department of Finance and Business Economics, Marshall School of Business, University of Southern California, Los Angeles, California 90089)

Abstract

We develop a theory of credible skepticism in organizations to explain the main tradeoffs in organizing data generation, analysis, and reporting. In our designer-agent-principal game, the designer selects the information privately observed by the agent who can misreport it at a cost, whereas the principal can audit the report. We study three organizational levers: tampering prevention, tampering detection, and the allocation of the experimental-design task. We show that motivating informative experimentation while discouraging misreporting are often conflicting organizational goals. To incentivize experimentation, the principal foregoes a flawless tampering detection/prevention system and separates the tasks of experimental design and analysis.

Suggested Citation

  • Ricardo Alonso & Odilon Câmara, 2024. "Organizing Data Analytics," Management Science, INFORMS, vol. 70(5), pages 3123-3143, May.
    • Handle: RePEc:inm:ormnsc:v:70:y:2024:i:5:p:3123-3143
    DOI: 10.1287/mnsc.2023.00207
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    References listed on IDEAS

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    Keywords

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    JEL classification:

    • D8 - Microeconomics - - Information, Knowledge, and Uncertainty
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • M10 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - General

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