analytics: real world use of big data by ibm's neil isford

© 2013 IBM Corporation

Analytics: Real World Use of Big Data Neil Isford, IBM VP of Smarter Solutions, North America

GlobalDirections ’13 Sept 23, 2013


Agenda

The Big Data & Analytics Evolution

Institute Business Value Big Data Study

Client Use Cases

What’s Next


What if …

Chief Marketing Officer

...could predict the right offer for the

right customer at the right time and

improve customer intimacy or

prevent churn?

Chief Product Designer

...could consider the risk

and profitability of the entire

customer relationship chain,

lifetime value and predict

demand trends when

designing and pricing new

product offerings? Chief Finance Officer

...could streamline

compliance and understand

risk exposure across

businesses and regions?

Chief Risk Officer

...uses anti fraud predictive

analytics to detect and

prevent rapid fire anomalous

transactions or wire transfers

identified as high probability

of fraud?

Chief Executive Officer

...could make better business decisions

using accurate data across all time

horizons: past, present and future?

Chief Information Officer

...could analyze oceans of machine

generated logs to predict which components

or equipment in the datacenter are likely to

fail and thereby avert a disruption during

critical quarter end?


The power of ALL data coming together

with the power of technology

& improved IT economics

“Big Data is high-volume,

high-velocity and high-variety

information assets that demand

cost-effective, innovative forms of

information processing for

enhanced insight and decision

making.”

What is Big Data?


• Personalization

• Profitability

• Retention

• Acquisition

• Global Operations

• Infrastructure and Asset Efficiency

• Fraud

• Security

Optimize Operations

and Reduce Fraud

• Financial and Operational Performance

• Financial Risk

• Operational Risk and Compliance

Transform Business

Performance

• Data Driven Products and Services

• Non-Traditional Partnership

• Mass Experimentation

2

4 5

1 Acquire, Grow and

Retain Customers

• Harness and Analyze All Data

• Govern All Data

• Optimize Analytical Workloads

• Spectrum of Analytics

Maximize Insights and

Improve Economics 3

Create New Business

Models

Demand for Big Data & Analytics……driven by business outcomes

© 2013 IBM Corporation 6

Obstacles to widespread Big Data & Analytics adoption

Lack of understanding how to use analytics to improve the business 38%

Lack of management bandwidth due to competing priorities 34%

Lack of skills internally in the line of

business 28%

Ability to get the data 24%

Culture does not encourage sharing

information 23%

Ownership of the data is unclear or

governance is ineffective 23%

Lack of executive sponsorship 22%

Concerns with the data 21%

Perceived costs outweigh the projected

benefits 21%

No case for change 15%

Organizational

Data

Financial

Analytics: The New Path to Value Joint Study MIT Sloan Management Review

& IBM Institute of Business Value Copyright © Massachusetts Institute of Technology 2010.


Agenda



Client Use Cases

What’s Next


IBM Institute for Business Value and the Saïd Business School partnered to benchmark global Big Data activities

IBM Global Business Services, through the IBM

Institute for Business Value, develops fact-based

strategies and insights for senior executives

around critical public and private sector issues.

Saïd Business School

University of Oxford

IBM

Institute for Business Value

www.ibm.com/2012bigdatastudy

The Saïd Business School is one of the leading

business schools in the UK. The School is

establishing a new model for business education by

being deeply embedded in the University of Oxford, a

world-class university, and tackling some of the

challenges the world is encountering.


Nearly two out of three respondents reports realizing a competitive advantage from information and analytics

Source: Analytics: The real-world use of big data, a collaborative research study by the IBM Institute for Business Value

and the Saïd Business School at the University of Oxford. © IBM 2012

Total respondents n = 1144 2010 and 2011 datasets © Massachusetts Institute of Technology

Realizing a competitive

advantage

Respondents were asked “To what extent does the use of information (including big

data) and analytics create a competitive advantage for your organization in your industry

or market.” Respondent percentages shown are for those who rated the extent a [4 ] or

[5 Significant extent]. The same question has been asked each year.

63%

58%

37%

2012

2011

2010

70%

increase


Three out of four organizations have Big Data activities underway; and one in four are either in pilot or production

Big Data adoption

Source: Analytics: The real-world use of big data, a collaborative research study by the IBM Institute for

Business Value and the Saïd Business School at the University of Oxford. © IBM 2012


Five key findings highlighted in the 2012 Big Data study

Big Data is dependent upon a scalable and extensible

information foundation 2

The emerging pattern of Big Data adoption is focused

upon delivering measureable business value 5

Customer analytics are driving Big Data initiatives 1

Big Data requires strong analytics capabilities 4

Initial Big Data efforts are focused on gaining insights

from existing and new sources of internal data 3

Source: Analytics: The real-world use of big data, a collaborative research study by the IBM Institute

for Business Value and the Saïd Business School at the University of Oxford. © IBM 2012


Improving the customer experience by better understanding behaviors drives almost half of all active Big Data efforts

Total respondents n = 1061

Big Data objectives

Top functional objectives identified by organizations with active big data pilots or

implementations. Responses have been weighted and aggregated.

Customer-centric outcomes

Operational optimization

Risk / financial management

New business model

Employee collaboration




Big Data efforts are based on a solid, flexible information management foundation

Respondents with

active big data

efforts were asked

which platform

components were

either currently in

pilot or installed

within their

organization.



Big Data infrastructure


Internal sources of data enable organizations to quickly ramp up big data efforts

Big Data sources

Respondents were

asked which data

sources are

currently being

collected and

analyzed as part of

active big data

efforts within their

organization.




Strong analytics capabilities – skills and software – are required to create insights and action from Big Data

Respondents were

asked which

analytics

capabilities were

currently available

within their

organization to

analyze big data.



Analytics capabilities


Big Data leadership shifts from IT to business as organizations move through the adoption stages

Leadership shifts

Respondents were asked which executive is most closely aligned with

the mandate to use big data within their organization. Box placement

reflects the degree to which each executive is dominant in a given stage.





Executive desire for quick and precise decisions to keep up with the pace of business drives real-time data needs

Speed to insight


Respondents were asked how quickly business users require data to be

available for analysis or within processes. Box placement reflects the

prevalence of that requirement within each stage.




Challenges evolve as organizations move through the stages, but the business case is a constant hurdle

Obstacles to big data

Respondents were asked to identify the top obstacles to big data efforts

within their organization. Responses were weighted and aggregated. Box

placement reflects the degree to which each obstacle is dominant in a

given stage.Total respondents n = 973




Agenda



Client Use Cases

What’s Next


University of Ontario

Institute of Technology

(UOIT) Detects Neonatal

Patient Symptoms Sooner

Need

• Performing real-time analytics using

physiological data from neonatal babies

• Continuously correlates data from medical

monitors to detect subtle changes and alert

hospital staff sooner

• Early warning gives caregivers the ability to

proactively deal with complications

Benefits

• Helps detect life threatening conditions up

to 24 hours sooner

• Lower morbidity and improved patient care

“Helps detect life threatening conditions up to 24 hours sooner”


Memphis Police Department is detecting unwanted threats to improve public safety

Need • Predict and respond criminal activity

where and when it is happening

• Optimize limited resources and funds

through the department

Results • Reduced serious crime by 30% while

increasing convictions by over 4X

• Realized 863% ROI with annual benefit

of over $7M


Banorte is transforming banking by focusing on key imperatives

Need

• Become more customer centric

• Increase efficiencies

• Increase profitability

Expected Benefits

• Increase flexibility and

streamline operations

• Drive innovation while

managing cost

• Optimize enterprise risk

management


First Tennessee is increasing customer acquisition by selling based on customer preference rather than product

Need • Reduce overall campaign costs

• Improve campaign performance and

more tailored programs

Results • Lowered mailing costs by 20% with

3.1% boost in response rates

• Realized an ROI of over 600%


Santam is transforming threat & fraud identification processes

Need • Identify fraud early with a predictive

analytics solution

• Improve productivity and reduce cost

Results • Identified major fraud ring less than 30

days after implementation

• Saved more than USD 2.5 million in

payouts to fraudulent customers

• Reduced claims processing time on

low-risk claims by nearly 90%

© 2013 IBM Corporation 25

Barnes & Noble helps

suppliers track sales and

inventory in real time

25

Need

• Publishers absorb the losses on returns when

they print too many books, and have stock-

outs when they print too few

• To provide publishers with the ability to get

real-time insight into sales and view inventory

trends over time

Benefits

• Decreased time to run queries from weeks to

seconds and enabled an 80% reduction in

time to run compared to its previous system

• Reduced inventory levels and inventory

carrying costs


Agenda



Client Use Cases

What’s Next


Cognitive Computing…with IBM Watson

…built on a massively parallel

probabilistic evidence-based

architecture

Understands

natural

language

and human

speech

Adapts and

Learns from

user selections

and responses

Generates and

evaluates

hypothesis for

better outcomes


Watson Decision Advisor helping oncologists treat cancer

Business problem:

Need better individualized cancer treatment plans

Solution:

• Evidence-based suggestions to inform oncologists’

decisions

• Analyzes patient data against massive volumes of

medical literature

• Evolves with the fast-changing field

WellPoint’s Interactive Care

Insights for Oncology

powered by IBM Watson

Attacking the cause of

¼ of deaths


Watson Decision Advisor helping streamline pre-approvals

Business problem:

Faster review and authorization of medical procedures

Solution:

• Objective review based on clinical, medical, & patient

data

• Actionable, confidence-weighted analysis based on

relevant content, policies, and guidelines

Accelerating pre-

approvals from 24

hours to minutes

WellPoint’s Interactive Care

Guide and Reviewer powered

by IBM Watson


Delivering Competitive Advantage For Your Organization

Analytics

• inform decisions • optimize processes • drive new business models.

Big Data

• explosion of data • new types of sources • moving at high speed


Big Data & Analytics: How to get started

Focus on a business case with measurable business outcomes

Take a pragmatic approach

Develop blueprint and roadmap

Expand your big data capabilities and efforts across the enterprise

Tapping into new sources of value

© 2013 IBM Corporation 32 32

Neil Isford

IBM Vice President

Smarter Solutions

1-212-745-2088

[email protected]

www.linkedin.com/pub/neil-

isford/14/5a/89a

Thank You!

We invite you to participate in the 2013 IBV Analytics Study

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