[R] How to Describe R to Finance People

[Paul Gilbert]

Marc Schwartz wrote:

>On Fri, 2004-06-04 at 09:19, Paul Gilbert wrote:
>  
>
>>Ko-Kang Kevin Wang wrote:
>>
>>    
>>
>>>It is not only used by statisticians or scientists,
>>>but also econometricians and people in finance due to its cost (FREE)
>>>and its powerfulness.
>>>
>>>      
>>>
>>I think "(FREE)" will distract your intended audience from the real 
>>point. In a corporate environment, lots of people argue that free 
>>software actually costs more than commercial software because of 
>>internal support cost, etc, etc.  These arguments will all hinge 
>>critically on the corporate IT support abilities. For R, I have never 
>>seen a convincing argument that it costs more, but the real point is 
>>that this is irrelevant. If it costs less, that is nice.  If it costs 
>>more, then that is what you pay to use something that is better. If they 
>>need to, I think people in finance are generally willing to pay, so I 
>>think it is a mistake to put much emphasis on the cost. Put the emphasis 
>>on how good it is.
>>    
>>
>
>
>I agree that quality and value are important, but I think that the issue
>of cost should not be discounted out of hand. Value (for both company
>and client) is directly tied to cost.
>  
>
[snip ...]

Marc

I agree with this, and most of what you say. Cost is important in both 
large and small companies, and also in government. The point is really 
that total cost of ownership is a very complicate thing, and you should 
not get into it without the specifics of a particular company and 
situation in mind. For example, if the end users takes responsibility 
for all the support, the cost implications will be very different from 
the situation where the IT department needs to guarantee availability. 
Even in your own company you may have a very different attitude with 
respect to your research software and your accounts receivable software. 
People in finance making real time market decisions will have a very 
different cost structure from academics in finance.

The point was really that many people are very sensitive to arguments 
about cost, and often have positions that they feel obliged to promote. 
So, as soon as you mention cost you are likely to get into a very long 
discussion that will not be fruitful unless you are prepared to talk 
about very particular situations. For this particular audience I think 
it would probably be more to the point to describe how good and reliable 
R is. A particular company may decided R is just too expensive. For 
example, some companies in finance are worried about real time decision 
making. They may have to hire 10 more IT staff to guarantee 24/7 
availaility with no more than 5 minutes outage per week whereas, with 
commercial software,  they may be able to buy guarantees. (This is not a 
statement about commercial software being more reliable, it is a 
statement about being able to buy insurance.)  But, as you say, for must 
of us R is a real bargain.

Paul