Finding Causal Effects


Winning in sports or business requires knowing and measuring the drivers of success. This is the lesson of Michael Lewis’s best-selling book, Moneyball. Moneyball tells the tale of how the Oakland A’s used advanced analytics to isolate the metric that could predict a baseball player’s potential to score runs.

For years, baseball teams unquestioningly relied on batting average to determine which players to hire. But using advanced analytics, the Oakland A’s determined that the On Base Percentage (OBP) is a better predictor of a player’s potential to score runs.

Once the A’s started basing hiring decisions on this metric, they began winning, most notably the American League division title. The A’s won because they knew what factors caused them to win.

Using Advanced Analytics to Determine Causation

Business results tend to be characterized into three broad buckets:

  • Profit-How much money is the business making after costs
  • Share-How well is the business doing relative to the market and its competitors?
  • Customer Acquisition and Retention-Are customers staying or leaving?

These business outcomes are caused by commercial activities that generate specific metrics such as number of calls, customer satisfaction, customer churn, revenue, and costs. For example, increasing the number of calls on a particular medical specialty may drive higher market share, or not. Higher customer satisfaction metrics may or may not result in improved customer retention.

Contemporary advanced analytics can separate out the meaningful versus the interesting metrics. We use Bayesian Belief Networks (BBNs) to examine a wide range of interacting variables that may be impacting your business results. With BBNs, we can estimate the probability that a particular metric is actually causing your business results. Specifically, we leverage AWS Data Lakes tools to have the computational power to examine millions of data points from disparate sources like claims data, medical records, prescription data, and company-generated data to establish which activities are actually producing your business results.

The Brabeuo Process

We have a robust process to work with our clients to answer four questions regarding their Key Business Metrics (KBMs):

  1. Are they simple to define and understand? Complexity often kills company-wide metrics plans because it makes alignment and implementation difficult.
  • Can the KBMs be easily quantified? If you struggle to create a KBM, it will fall by the wayside.
  • Can the KBMs be influenced? Not all metrics can be influenced by company initiatives. In some categories, like hemophilia, an inherited and easy to diagnose condition, the number of patients can’t be increased by a disease awareness campaign.
  • Do your KBMS drive a key business objective? Have you gone beyond intuition to determine which metrics actually drive business results?

The Bottom Line

Armed with the knowledge of what actually drives their business (and equally important, what doesn’t), we inform tactical plans and strategies to produce better business results. We apply our unique suite of advanced analytic tools and decades of experience to determine the metrics that are responsible for moving your business. Measuring what matters directly informs how to win.
Are you interested in discussing what drives the success of your business? Please CONTACT us and someone will be in touch with you right away.


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Do you want to get better answers out of your data?