Walmart Chief Data Officer Bill Groves, who joined the retail giant about seven months ago, says he quickly sized up the potential for Northwest Arkansas to become a national hub for data science. He said the country is in the midst of a fourth industrial revolution via the digital age and connected world.
“Everything you touch today is digital content,” Groves said during a Friday (Feb. 1) address at the Greater Bentonville Area Chamber of Commerce WalStreet Breakfast.
Some global jobs in biggest demand are data scientists. Groves said the U.S. puts the gap between 50% to 60% for the deep analytic talent needed. He went so far to predict the CEOs of the future will likely come from data science and analytics than from finance and marketing which have been the primary pools from which top corporate executives have been sourced.
While collecting the data is easy, it takes data scientists to help companies make use of the mountain of data collected. He said using data in predictive analysis can be a huge advantage, and can be key to winning with consumers who want personalization. An example of using data to drive a business model is Uber or Airbnb, Groves said. The largest personal transport service owns no cars and the largest lodging company owns no hotels. What they do have is data which they use to the best of their ability, he noted.
Groves said four to five million jobs in the U.S. will require data analysis skills by year-end. He said 4 in 10 data scientists lack the skills needed and 63% of employers have to provide on-the-job training to new data scientist hires.
“It’s a real challenge to find data scientists, even for Walmart. This talent is important as companies undergo digital transformations,” Groves said.
More companies like Honeywell, where Groves worked prior to joining Walmart, are trying to grow their own class of data scientists from within. He led a program at Honeywell that resulted in 200 data scientists in three years. He said the company conducted interview after interview and got nowhere.
“In a hundred interviews I might hire one candidate,” Groves explained.
He said the company then opted to work with its engineers and others who already had the industry background knowledge and then provide the tools to help with the math and predictive analytics. Groves said this model works but it takes time to implement. He said companies like Honeywell able to develop internal talent have a competitive advantage given the major shortage. He said as the nature of work changes, the workforce needed to succeed is shifting to one with stronger data capabilities.
Groves said 17 of the 20 highest paying jobs in the nation involve data analytics and math. He said data scientists are evolving to meet the demand of emerging technologies. He described them as unicorns — someone who is adept at computer science, machine learning, math and statistics and able to take traditional software and do traditional research while also layering on subject matter expertise.
Groves said Northwest Arkansas is ripe to become a data science hub because of the diverse group of large employers — Walmart, Tyson Foods, J.B. Hunt, Arvest Bank, Mercy, Simmons Foods – with operations in need of digital and analytical talent to grow their businesses. He said the region’s quality of life is a plus for recruiting and retaining talent.
The third element needed to grow into a hub are educators in the region and surrounding states who can offer training and work with industry to keep the talent moving through the pipeline. He referenced the University of Arkansas, John Brown University, along with the University of Kansas, University of Texas and Washington University in St Louis. He said the region has advantages over areas like New Jersey, or the West Coast where the cost of living is considerably higher.
He said Walmart has a clear vision for how it will leverage data to enable the company’s digital transformation. He said president and CEO Doug McMillon’s vision is to support Walmart becoming a digital enterprise through data-driven decisions and automation. The top priority McMillon wants, Groves said, is to protect data acquired on customers, employees and suppliers. He said ensuring data is protected is a competitive advantage and an issue of trust which Walmart is not willing to compromise.
Groves said Walmart is also leveraging data to fuel growth in its core business and in pursuing new opportunities. Walmart is also working to use data to support process improvements and automation that should enable savings. Some of that technology already introduced are self checkouts and the fast unloader being tested by the retailer giant.
He also said Walmart is trying to establish a companywide data focus by instilling a data-minded culture and developing retail/tech data partnerships. Groves said change is the hardest part of the plan. He said old systems die hard, and it usually takes a mistake or oversight from the status quo before new ideas are welcomed. He described an incident at a former employer where predictive analytics found a risk potential worth looking at. Groves said veteran management didn’t take the risk and it cost the company $17 million. The predictive analysis was then followed.
Bill Akins, with Walmart Labs, said a big reason the region has a “vendorville” is because of the data Walmart decided to share with suppliers in the early 1990s through its RetaiLink system. He said suppliers, along with technology and analytics service providers needed to interpret the data, began to set up shop in Northwest Arkansas.