Big Data and Machine Learning - Strategic Decisions In a VUCA World
Abstract: The world we live in today has become more complex, turbulent and unpredictable than ever before. One of the main reasons for this is the emergence of the digital transformation and everything that comes with it, from technological advancements in artificial intelligence and robotics to sharing platforms and the Internet of Things. This dynamic environment is often addressed with the acronym VUCA which stands for volatility, uncertainty, complexity and ambiguity. In a world where the environment is defined as volatile, uncertain, complex and ambiguous, making strategic decisions becomes increasingly challenging, since the speed of change can lead long-term decisions to become inefficient. Moreover, in a VUCA environment, managers can no longer make strategic decisions on past experience and knowledge. In light of this, the authors of this paper aim to investigate whether Machine Learning and Big Data could be the answer to making strategic decisions in a VUCA environment by answering two research questions. As such, the overall purpose of this study is to provide an analysis of different articles in order to understand the role and use of Machine Learning and Big Data for strategic decisions in the VUCA environment. To this end, the authors conducted a literature review on the areas addressed in the thesis, in order to give a thorough explanation of each theory. The authors also applied a meta analysis on 44 found articles that examine the use of Machine Learning and Big Data in different organizations’ strategic decisions. The literature review resulted in the authors finding five major functions in which Machine Learning and Big Data are used in conjunction to guide strategic decisions. After analyzing and discussing these, the authors conclude that strategic decisions using Machine Learning and Big Data are suitable for the VUCA environment, as it leads to quicker decision making which facilitates agility in the organization. Furthemore, the authors argue that BD and ML's role is to lead the organization to enhance its predictability, decrease costs, lower human bias, and improve top management performance. This is followed by the authors addressing how Machine Learning and Big Data is used by organizations in their strategic decisions and ends with suggestions on further research into these rather intricate elements.
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