Adam Gartenberg's Blog

Business Analytics and Optimization, IBM and Social Marketing

Live blogging: New Intelligence: Making Better Decisions


Live blogging: New Intelligence: Making Better Decisions session

I'm in Eric Sall's New Intelligence session, which will focus on how companies are using information and analytics to make better decisions and actions.  (This is a session close to heart for me, because it's pretty much been my day job for the last 9 months :)

He is starting with a few scenarios...

Imagine if you could track disease outbreaks across country borders in real time.  An area have learned a lot about lately.  Scary, but also fascinating to see how quickly disease can spread around world and how important to get quick information about it.  What are symptoms, who's being effected, what steps can be taken.  There is an international health agency that is looking to set up near real-time access to local and international disease data to be able to better forecast health risks.  Hospitals and countries have more time to prepare for potentially disastrous disease outbreaks, while still complying with national privacy and security requirements.

Another example - imagine if you can catch money laundering before it happens.  There's a major bank in Korea that is identifying patterns or linkages across accounts, products or channels so they can better predict illegal activity.  They are running over 100 scenario-based algorithms employing 300 variables.

What would the implications be if you could apply social relationships of customers to prevent churn?  Especially in markets where the switching costs are low, preventing churn is very important.  The service and provider used by a person's friends and family plays a very influential role in determining which provider they will use.  By looking at trends in calling patterns of their subscribers, a major telco provider is able to decrease churn and come up with products better targeted for certain demographics.

And one more example - imagine if you could identify at-risk students before they drop out of school.  The Mobile County (Alabama) Public School System is looking at early indicators of when a student begins to have problems, with the goal being proactive intervention when students cross at-risk thresholds and get them the help needed to try to keep them in school.

All four examples have in common that all are leveraging information that's already there.  It's not about collecting new info, but using info already have and thinking about what could be telling you and helping make decisions you make every day.

Explosion in information - in volume, variety, and compounded by velocity of decision making.  While info should be helping that, the reality is that organizations are operating with blind spots.  1 in 3 managers say the frequently make critical decisions without the information they need; 1 in 2 don't have access to the information across the organization needed to do their jobs, and 3 in 4 say predictive information would drive better decisions.

As was discussed in keynotes, need to move beyond sense and respond to be able to predict and act; need to be able to make real-time, fact-driven decisions, rather than relying on uninformed instinct and intuition.  Need to move analytics out of the back office and the hands of a few skilled experts to everyone and at every point of impact throughout the organization.

IBM's CIO study talked to 2,500 CIOs around the world, and Business Intelligence and Analytics came out as the top priority, with 83% citing it as a priority in gaining competitive advantage.

A shift is happening from business automation, which has been the major focus over the last 2-3 decades, to business optimization, and new investments are going into business optimization two times faster than into business automation.  

When we talk about business optimization, there are several factors that we usually think about.  We're seeing enterprises that are looking to:

  • Gain insight from the information explosion:  Smarter integrated solutions help you manage, protect, process and analyze unprecedented volumes of structured and unstructured data - creating insight that drives innovation and business optimization.
  • Engage the entire value chain:  Visibility into every part of the value chain creates an ecosystem that enables an organization to capture and share collective wisdom, collaborate and make decisions with greater confidence.
  • Move from reaction to prediction:  Apply advanced analytics and industry expertise at all levels of the organization in order to more precisely predict - and continuously act on - risks and opportunities.
  • Create value faster:  Operate with speed by delivering trusted insight that gives decision-makers – especially those at the point of customer contact - the confidence to take action faster, driving innovation and optimizing business results.

All the companies that are doing these aspects today are really on a journey along an information-led transformation.  They're improving decision making across the company.  Often decision making is thinking of as a senior executive thing - the big strategic bets.  But really, decisions and actions are made and taken throughout the organization.  Can see acceleration in the business optimization benefits get by taking a few steps.

The three entry points for information-led transformation are to:
  • Plan an information agenda - what is strategy, roadmap, governance plan to support business needs.
  • Apply business analytics to optimize decisions - taking predictive analytics techniques, BI techniques to optimize decisions and actions
  • Establish a flexible information platform - underlying platform and information management technologies to support it

Can start anywhere, depending on your particular situation, but to see full benefits need to make sure are encompassing all three.

When look across the IBM solutions that can help you get started with your information-led transformation, you can think of solutions across four areas:
  • Ensure cost effective information availability, security, retention and compliance for all types of workloads - Workload Optimized Systems and Services
  • Create a single, trusted view of information across the organization managed over a strategic period - Trusted Information Platform (e.g., information integration and MDM, ECM, Data Warehousing & Data Mgmt)
  • Optimize processes, manage business performance, and anticipate opportunities and threats - Business Analytic & Optimization Platform. (e.g., Perf Mgmt and Analysis, Predictive Analytics, Process Optimization)
  • Analyze and use information at the point of industry-specific business impact - Business Analytics & Optimization Solutions (e.g., industry-specific and cross-industry solutions)

IBM has been investing to accelerate our clients' information-led transformation.  We've invested over $12B in software investments since 2005, has over 4,000 dedicated consultants, offers analytics in a box to accelerate time to value, and has the largest math department in private industry.

One final thought.  A lot of what talking about is leveraging data already have.  Challenge you to think about what data you have in org. that could use for predictive value but not using it today.  In the "farm to fork" example, talked about using RFID for food safety. But once have data, are able to start doing things like smart replenishment, to move product more effectively and reduce distribution costs.  And then can get to point where think about lineage as a competitive differentiator.  They're now printing lineage on the label, so you can tell where it's come from, where it's going to.  For something that is largely a commodity business, with very thin margins.  This is a way of differentiating product, getting more value.

Visit the new intelligence website for a lot more information:  ibm.com/new-intelligence