Category Archives: Analytics

VW Compliance Executive Pleads Guilty

“Ex-VW Official Admits Role in Emissions Cheating,” The Wall Street Journal, August 5, 2017 B3. A former VW “compliance executive” charged with conspiracy to defraud the US, wire fraud, and Clean Air Act violations pleads guilty.  He admits he knew about the software used to mislead US environmental regulators.  Faces sentencing in criminal case in December.

Hiding information from the government is not a good thing.  What was the culture that allowed this to happen?  Did people feel a need to do this to compete?  Too many car companies have been caught up in such scandals to have it be random.

The shareholders have paid (and are continuing to pay) for the mistakes of the employees of the company.  Who else from the company is going to go to jail,  or lose his/her job?  VW is facing costs in just the US of more than $25 billion and investigations elsewhere.  Does the “compliance executive” know of others who also knew?  Might he offer up some names before December?  People who bought VWs are going to want to recover damages from someone.

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Filed under Accuracy, Analytics, Board, Compliance, Compliance, Controls, Corporation, Culture, Culture, Data quality, Directors, Duty, Employees, Governance, Information, Internal controls, Oversight, Oversight, Value

There’s gold in them thar hills

What are you buying when you go to the grocery store?  Organic bananas?

Not if you’re Amazon.

“Big Prize for Amazon: Shopper Data,” The Wall Street Journal, June 21, 2017 B5. Amazon seeks to buy Whole Foods, but for what?  Its hard assets such as stores and locations? Its customer base?  Its purchasing and distribution network?  More likely: information on how shoppers shop.

If you’re the government agency in charge of approving or disapproving this deal, how do you analyze the impact on competition?  What is the “market” that needs to be analyzed?  Is this a vertical or horizontal deal?  Or something else?

Is most of the value (to Amazon) in this deal the information that it gets?  Where’s that on the Whole Foods balance sheet?

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A handful of stories

  1. Compare

“FCC Won’t Move Against Colbert for Crude Remarks,” The Wall Street Journal, May 24, 2017 A3.  Remarks about Trump don’t draw a fine.  The question remains, what will?  What’s the impact of the regulator not even trying to enforce regulatory standards?

With

“Pakistan Investigates Social-Media Critics of Its Military,” The Wall Street Journal, May 24, 2017 A8.  Twenty-seven critics investigated for “unacceptable” comments criticizing and ridiculing the military and judiciary.  The FCC wasn’t consulted.

2. “U.S. Sues Chrysler Over Emissions Tests,” The Wall Street Journal, May 24, 2017 B1.  Apparently VW wasn’t the only one seeking to game the emissions-testing process.

3.  “Human Still Rule Machines in Insurance,” The Wall Street Journal, May 24, 2017 B1.  Despite the new sources of data, and the ability of computer programs to determine how much an individual insurance policy should cost, humans are still a necessary decision-maker.

4.  “Target Settles Probe Into Its 2013 Hack,” The Wall Street Journal, May 24, 2017 B3. Following the 2013 data breach, Target pays an additional $18.5 million to settle state charges.

5. “High-Ranking Chinese Regulator Faces Probe,” The Wall Street Journal, May 24, 2017 B14.  Assistant chairman of the China Banking Regulatory Commission fired for breaking the rules.  Details not available.

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Filed under Accuracy, Analytics, Compliance, Compliance, Controls, Corporation, Culture, Duty, Employees, Governance, Government, Information, Internal controls, Management, Managers, Oversight, Supervision, Value

You manage what you measure

If the Board asks how much the company paid for something, “I don’t know” isn’t a good answer.  Neither is “We can’t track that today.”

“Algorithms Help Calpers Tally Fees,” The Wall Street Journal, May 23, 2017 B1. The question was how much the pension plan had paid private-equity managers in performance fees.  It turns out the answer was $3.4 billion, over 25 years, with $490 million last year.  Answer was derived using algorithms.

“It took five years to develop a new data collection system that requires private-equity managers to fill out various templates describing their various fees.”

How comforting – a self-graded exam for $3.4 billion in fees.

What’s information worth?  How can you manage without it?  How did they?

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Algorithms

Is the use of algorithms to set prices a subterfuge to facilitate price fixing?

“To Set Prices, Stores Turn To Algorithms,” The Wall Street Journal, May 9, 2017 A1. Use of algorithms to establish prices for a wide range of products, from Staples to gas stations based on “big data.”

But what if everyone uses the same algorithm?  Or if the algorithms are wrong or the data upon which they are based is wrong?  Can anyone explain what they do and how they do it?  The ultimate black box.

 

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Spooky

Companies begin to move towards the use of quantum mechanics into practical application.

“A Quantum Leap for Computers Looms,” The Wall Street Journal, May 8, 2017 B4.  Huge processing speed increases possible when processing and analyzing huge volumes of data.

You think you have ediscovery problems now, wait until the qubits disappear or mutate (sublimate?) to a different state.

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Filed under Access, Analytics, Data quality, Definition, Discovery, Information, IT, Legal

4 for Thursday

There were four pieces in today’s WSJ relevant to governance or information governance, or both.

“Currency Trading Data Hint at Leaks in U.K.,” The Wall Street Journal, April 27, 2017 B1. Indications that some investors are getting a sneak peek at UK statistics before they are published.  Does this go to access or to the calculus of the value of information including a factor for timeliness?

“FCC Chief Rails At Net Neutrality,” The Wall Street Journal, April 27, 2017 B1.  Is the government right in trying to control how information is accessed over the internet, or how (high-speed) access to that information is priced?  Who governs the internet, if any one?

“United Cites Litany of Failures,” The Wall Street Journal, April 27, 2017 B1.  CEO says “‘We let our policies and procedures get in the way of doing the right thing.'”  CEO also to give up his role as Chairman of the Board. A CEO taking accountability for the actions of employees on his watch – remarkable.  United also took out full-page ad.  Intersection of governance and crisis management.

“Hedge Fund Bets on ‘Big Data,'” The Wall Street Journal, April 27, 2017 B11.  Investments in analytics to identify profitable trades.  Timeliness of information is a factor in the value of that information.

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