Off the Beaten Path: A Data Scientist in Consulting
“Twenty years from now you will be more disappointed by the things that you didn’t do than by the ones you did do. So throw off the bowlines. Sail away from the safe harbor. Catch the trade winds in your sails. Explore. Dream. Discover.” — Mark Twain
After spending nine fulfilling years in the tech industry, I, a seasoned Economist turned Data Science (DS) Manager, decided to embark on an uncharted path by joining a boutique consulting firm. Why, one might ask? Mostly, I’m intrigued by the opportunity to constantly tackle new cases and rise to unprecedented challenges. It’s a privilege traditional firms seldom offer.
Yet, a question frequently posed by my DS friends are: why would a consulting firm hire a Data Scientist?
In my experience, the role of a Data Scientist in a consulting firm is quite diverse, can straddling the worlds of litigation and business consulting.
Roles in Litigation Consulting
In litigation consulting, if I had to summarize DS work in a single phrase, it would probably be “to determine compensation amounts.”
Consider a hypothetical example — A few years ago, many French news publishers sued Google for monopoly. Why? They believed that the rapid growth of Google’s advertising business was built on their shoulders. Google attracted users by citing their news content online, effectively capturing potential advertising revenue that publishers could have generated through their own websites, a particularly painful loss during an era of declining print sales.
However, Google saw things differently. They argued that the web traffic steered by their search engine and news aggregator brought substantial user traffic to news websites, enabling publishers to generate their own advertising income.
This led to a crucial question in the debate between Google and the publishers: who benefits more, and how should the profit be divided for it to be just and sustainable? After all, Google can’t survive without publishers, because without content, their search engine is a gateway to nothing. Whether publishers can survive without Google is another question. While they have thrived independently in the past, the present landscape renders a Google-less existence seemingly inconceivable.
In this process, lawyers need to work with experts to calculate how much each stands to gain and what would be a fair concession. This involves various calculations related to attribution, causal inference, and other adjustments that only an expert can testify in court.
Yet, the experts, often esteemed professors in the field, lack the resources to promptly and efficiently deliver the needed results. Hence, consulting firms step into this gap as the vital bridge between the experts and lawyers. And because the DS work here is quite demanding and must withstand the scrutiny of opposing parties, thereby requiring an elevated level of technical expertise.
Consider one aspect of the debate: “What financial gains do publishers accrue from Google’s existence?” It’s not simply a matter of examining the publishers’ web traffic, and assuming that if 90% derives from Google searches, Google is responsible for 90% of their income. Opposing parties could easily counter by suggesting that, in the absence of Google, the public would visit publishers’ websites directly, possibly resulting in increased revenues!
Therefore, to establish a framework acceptable to all parties, it might be more productive to pose a causally-driven question such as: “How does the presence of Google, compared to its absence, affect the advertising revenue of publishers?” Upon defining this question, we can delve into causal analysis to seek an identification strategy most compatible with the available data.
(TBC)
Note, if you are interested in the case mentioned above, you can check out here.
