Bergmann Award winners examine links between data and decision-making
As data becomes ever more crucial for all types of businesses, it’s no wonder that companies have rapidly adopted the practice of data-driven decision making (DDD). At the same time, what is the connection between data and the managers using that information? How can small to medium size companies – ones that often do not have the resources to hire teams of analysts – compete with larger firms using the same information?
These are central questions behind a BSF-funded project spearheaded by Prof. Sagit Bar-Gill of Tel Aviv University, and Prof. Erik Brynjolfsson of the Massachusetts Institute of Technology. Their project focuses on the economic impacts of DDD on small-to-medium businesses.
Along with their BSF grant, Bar-Gill and Brynjolfsson are among the 2019 recipients of BSF’s Bergmann Memorial Award, given annually to young scientists who are recipients of new BSF grants, judged on the basis and quality of their proposals.
“I am very honored that we were selected,” said Bar-Gill, an assistant professor of Technology Management and Information Systems at Tel Aviv University’s Coller School of Management, and a Digital Fellow at MIT’s Initiative on the Digital Economy.
Brynjolfsson serves as the director of that Initiative, as well as a professor at MIT’s Sloan School of Management. They have been working together since Bar-Gill was a postdoc at MIT.
Bar-Gill said the Bergmann award money will be used to cover travel expenses to allow for more face-to-face meetings between her and Brynjolfsson. The genesis of the project started about five years ago, when Bar-Gill was a visiting researcher at eBay, which was part of her postdoc at MIT. At the time, eBay was launching Seller Hub, a new data-rich seller dashboard that provides performance reports and data-driven recommendations. Seller Hub was gradually rolled-out in 2016, with randomly selected groups of commercial business-to-consumer (B2C) sellers receiving access to the tool in seven waves.
To study Seller Hub’s impact, Bar-Gill and Brynjolfsson used both survey data of adopters and non-adopters’ management practices, as well as weekly panel data for eBay’s B2C sellers over the year of Seller Hub’s introduction.
Bar-Gill and Brynjolfsson found that, while mid- and high-volume sellers enjoyed sales increases using Seller Hub’s tools, sales actually decreased for low-volume sellers in the short run. Bar-Gill and Brynjolfsson believe that these differential outcomes are due to differences in sellers’ responses to new reports and analytics. Smaller sellers generated more new listings of lower quality, while larger sellers worked “smarter”, creating fewer new listings but increasing their listing and service quality.
With their BSF-funded project, Bar-Gill and Brynjolfsson aim to go beyond their initial findings, specifically exploring the role of managerial skills and practices that complement data as a key differentiator between firms of different sizes. While data is an obviously important tool for companies, Bar-Gill and Brynjolfsson’s project is unique because it also centers on managerial skills of the data users.
Bar-Gill said the findings could prove beneficial, especially for smaller business aiming to compete with bigger companies.
“Highlighting potential skill gaps in smaller firms will inform policies to educate and support small-to-medium businesses, allowing them to effectively compete in the data era,” she said.
Bar-Gill’s research is centered around the economics of online markets, and the impacts of digitization on firms and consumers. She combines economic modeling, experiments and data analytics to understand the online economy.
Bar-Gill has been a “numbers person” for as long as she can remember. When she’s not crunching numbers, she enjoys dancing – both classical and contemporary works. She also enjoys time with her partner Nir Bitansky, a professor at Tel Aviv University’s School of Computer Science, and their two children. Given that she and Bitansky are both academics, time is a precious commodity.
“Both of us travel to conferences, and our partnership allows us to grow our separate careers, demanding as they may be,” Bar-Gill said.
She jokes that her daughter is 2, but “she already knows how to say ‘conference’. Our older son thinks of us as UPS people, because whenever we go someplace, we always bring him something back.”
Bar-Gill praises both Tel Aviv University and MIT for offering financial support to help pay childcare expenses for academics traveling with children.
“They understand that we have lives beyond our work,” she said.