Part III: EVA, ROI

Written with Daniel Fleck and David Lubert

For the final installment of our blog series, we are going to explore the assessment of projects using the Economic Value Added (EVA) and Return on Investment (ROI) metrics, as well as briefly summarize all of the metrics we’ve outlined in this series with respect to our hypothetical fraud use case.

EVA is a commonly used metric to calculate the economic profit of a particular endeavor. Simply put, this metric calculates the amount of value created in excess of a firm’s cost of capital. If EVA is positive the firm or project is…


Part II: BEP, PP, DPP

Written with Daniel Fleck and David Lubert

The next entry in our blog series will investigate breakeven points and payback periods with respect to data science projects. Our focus will be specific to the understanding and application of the Breakeven Point, Payback Period, and Discounted Payback Period metrics. In order to drive efficiency within an organization or a specific team, these metrics should be evaluated when determining the efficacy of a project. Data science projects can be a large investment in time, software, infrastructure, and employee salaries. …


Part I: NPV, IRR, PI

Written with Daniel Fleck and David Lubert

The first blog of our series will focus on utilizing Net Present Value (NPV), Internal Rate of Return (IRR), and the Profitability Index (PI) to evaluate a data science project appropriately. We will also discuss how utilizing a data science methodology can further refine the inputs of these same economic metrics to develop higher-quality evaluations.

NPV, IRR, and PI are critical evaluation metrics used by organizations in many industries and applications to determine the economic potential of investment endeavors. Though the metrics are most notably used during the capital budgeting process [a process…


Introduction

Written with Daniel Fleck and David Lubert

The field of Data Science has grown immensely over the last decade and permeated through virtually every industry. In LinkedIn’s 2020 US Emerging Jobs Report, ‘Data Scientist’ is now third in the top fifteen emerging professions in the US with projected growth of 37% in 2020. In addition, Artificial Intelligence Specialist is the top job in this report with anticipated growth of 74% in 2020. The allure of using data thoughtfully and productively has led companies to dive headfirst into this emerging field in order to stay competitive within their industry.

Business leaders…

Neeraja Sarda

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