3/15/2015
1
Trends in Digital Transformation Call For New Approaches to Make Decisions
1
New customer data is available
Unstructured Geospatial Analytical
Social Internet of Things
Mobile interactions leave a short window to learn about your customer and act
Customers are expecting offers
that are dynamically
tailored
Shift from IT to the Lines of Business
3/15/2015
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Externalizing the Logic Behind Your Operational Decisions Outside Business Processes
There are 4 major benefits
1. Streamlined business processes
2. More generic business processes
3. Business processes that do not need to be changed that often
4. Decisions are shared and therefore more consistent
2
Determine 3 Products to Recommend
Ask Client to Select
Determine the Price
Product Recom-
mendationDecision Service
PricingDecision Service
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Managing the Logic Behind Your Operational Decisions
3
Transparency� Rule language
� Changes auditable
� Audit trail
Agility� Non IT stakeholders can change the rules
� Integrated testing and simulation capabilities
� Decision change cycles decorrelated from IT cycles
Governance� Access rights
� Versioning
� Rule change workflow
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Banking scenario in 6 steps
1. Recommending the right product at the right time
2. Preventing client churn
3. Detecting fraud by leveraging insight into past transaction history
4. Detecting fraud by leveraging location awareness
5. Managing fraud in real-time
6. Tapping into an unlimited source of insight
3/15/2015
5
Mr Friedlander, votre solde est €3,225.25
DétailAutres services
bancaires
Jeudi prochain – Visite spéciale de notre distillerie
� Yesterday I landed at
Dublin Airport, and
withdrew cash from an ATM
� I took a cab to my hotel
� Right before arriving I
checked my account
� Why was this message
in French?
� Yesterday I landed at
Dublin Airport, and
withdrew cash from an ATM
� I took a cab to my hotel
� Right before arriving I
checked my account
� Why was this message
in French?
Une surprise réservée ànos meilleurs clients
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Mr Friedlander, your balance is €3,225.25
DetailOther banking
services
Next Thursday - Special tour of our distillery
� Why was this tour
recommended to me?
� Why was this tour
recommended to me?
Tap for a top customer reward!
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Recommend the Right Offer at the Right TimeInsights Rules Can Be Owned by Non-IT Stakeholders
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Recommend the Right Offer at the Right TimeInsights Rules Can Be Owned by Non-IT Stakeholders
I am likely to buy Whiskey ...
... or I have purchased enough Whiskey recently
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Recommend the Right Offer at the Right TimeInsights Rules Can Be Owned by Non-IT Stakeholders
I am in a county near enough
the Distillery
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Recommend the Right Offer at the Right TimeInsights Rules Can Be Owned by Non-IT Stakeholders
The visit is in less than 3 days
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Recommend the Right Offer at the Right TimeInsights Rules Can Be Owned by Non-IT Stakeholders
That offer was not
recommended recently
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WithdrawalDublin AirportTUE NOV 25 2:45 PM
My bank knows a bit more about my journey
Online bankingBurlington RoadTUE NOV 25 3:35 PM
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Banking scenario in 6 steps
1. Recommending the right product at the right time
2. Preventing client churn
3. Detecting fraud by leveraging insight into past transaction history
4. Detecting fraud by leveraging location awareness
5. Managing fraud in real-time
6. Tapping into an unlimited source of insight
3/15/2015
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Mr Friedlander, your balance is €3,225.25
DetailOther banking
services
Next Thursday - Special tour of our distillery
� What was that reward?� What was that reward?
Tap for a top customer reward!
3/15/2015
15
Mr Friedlander, your balance is €3,225.25
DetailOther banking
services
Next Thursday - Special tour of our distillery
� Why is my bank so nice
with ME?
� Why is my bank so nice
with ME?
Tap for a top customer reward!
Visit the distillery and
My Smart Mobile
Bank will offer you
3 bottles of our best old whiskeys!
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Global Aggregates
• Global Aggregates are statistics across an entire population of entities, clients, "things"
• They enable you to identify outliers requiring special attention and allocate scarce resources to these
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Banking scenario in 6 steps
1. Recommending the right product at the right time
2. Preventing client churn
3. Detecting fraud by leveraging insight into past transaction history
4. Detecting fraud by leveraging location awareness
5. Managing fraud in real-time
6. Tapping into an unlimited source of insight
3/15/2015
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� 8 PM! It was time to go
for a nice diner with a
few friends
� I purpously left my
mobile in my hotel as I wanted to enjoy!
� Once in Temple Bar I withdrew € 200 Euros
� I usually withdraw no more than € 40
� Did this transaction get accepted?
� 8 PM! It was time to go
for a nice diner with a
few friends
� I purpously left my
mobile in my hotel as I wanted to enjoy!
� Once in Temple Bar I withdrew € 200 Euros
� I usually withdraw no more than € 40
� Did this transaction get accepted?
Welcome to the
€20€20
€40€40
€60€60
€80€80
€100€100
€120€120
€200€200
OtherOther
€200€200
SubmitSubmit
How much do you want to withdraw?
Automated Teller Network
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Welcome to the
€20€20
€40€40
€60€60
€80€80
€100€100
€120€120
€200€200
OtherOther
€200€200
SubmitSubmit
How much do you want to withdraw?
Automated Teller Network
� Waiting� Waiting
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� Suddenly, my mobile
started ringing!
� Suddenly, my mobile
started ringing!
My Smart Mobile BankMy Smart Mobile Bank
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OK, so I'll authorize the
transaction.Asking because €200 is not usual
for you
Francis Friedlander
Bank agent
Hello?
Yes it is
Yes I do
Hello, is this Mr Francis
Friedlander
Do you confirm you are attempting to withdraw
€200 from Dublin?
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WithdrawalDublin AirportTUE NOV 25 2:45 PM
Again, my bank knows a bit more about my journey
Online bankingBurlington RoadTUE NOV 25 3:35 PM
WithdrawalTemple BarTUE NOV 25 8:15 PM
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Banking scenario in 6 steps
1. Recommending the right product at the right time
2. Preventing client churn
3. Detecting fraud by leveraging insight into past transaction history
4. Detecting fraud by leveraging location awareness
5. Managing fraud in real-time
6. Tapping into an unlimited source of insight
3/15/2015
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Can't verify a transactionPlease call 1-800-432-BANK
within the next 60 minutes
Please call us back in the next 30 minutes else we will
disable your credit card
We have temporarily disabled your credit card
� We had a great diner in
the evening
� But when I came back to
my room I saw strange
messages on my mobile
� ... and saw strange text
messages!
� What did happen?
� We had a great diner in
the evening
� But when I came back to
my room I saw strange
messages on my mobile
� ... and saw strange text
messages!
� What did happen?
My Smart Mobile BankMy Smart Mobile Bank
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Here is what happened ...
In Galway, 223 kilometers away, ... an identity thief attempted to withdraw
€40 using a copy of my card
As I was enjoying the evening with my few good friends in Dublin...
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� ... and my mobile started
ringing again!
� WHY?
� ... and my mobile started
ringing again!
� WHY?My Smart Mobile BankMy Smart Mobile Bank
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Banking scenario in 6 steps
1. Recommending the right product at the right time
2. Preventing client churn
3. Detecting fraud by leveraging insight into past transaction history
4. Detecting fraud by leveraging location awareness
5. Managing fraud in real-time
6. Tapping into an unlimited source of insight
3/15/2015
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Back to the Story
As I did not take the call, my
bank asked to call them
We cannot verify this transaction
Please call 1-800-432-
BANKwithin the next 60
minutes
And a similar message was
sent to my mobile
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Banking scenario in 6 steps
1. Recommending the right product at the right time
2. Preventing client churn
3. Detecting fraud by leveraging insight into past transaction history
4. Detecting fraud by leveraging location awareness
5. Managing fraud in real-time
6. Tapping into an unlimited source of insight
3/15/2015
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Mr Friedlander, your balance is €3,025.25
DetailOther banking
services
Francis, going to San Francisco? Join the Napa
wine tour on December 3rd
Tap for a top customer reward!
� This morning I checked
my account again
� Impressive because on
December3rd I will be in
San Francisco and available!
� How does my bank know?
� This morning I checked
my account again
� Impressive because on
December3rd I will be in
San Francisco and available!
� How does my bank know?
3/15/2015
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SAN FRANCISCO and ARMONK, NY - 29 Oct 2014: Twitter and IBM (NYSE: IBM) today
announced a landmark partnership that will help
transform how businesses and institutions
understand their customers, markets and trends
– and inform every business decision. The
alliance brings together Twitter data that
distinctively represents the public pulse of the
planet with IBM’s industry-leading cloud-based
analytics, customer engagement platforms, and
consulting services.
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What Does This Story Tell Us?
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Make sense and take advantage of a continuous flow of client data and events through different channels
Detect risks and opportunities as soon as they occur
Perform the right action at the right time
New Business
Capabilities
Rule language accessible to the lines of business
Correlation of timestamped and geo-localized events
Detection of missing events
Predictive and global analytics integrated in the decision
New Software
Capabilities
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Next Generation Customer-Centric Decisions
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� At the time of interaction
� When the risk / opportunity is occuring
� ProactiveReal-time
� Block a transaction
� Recommend a productAction
� Takes into account the past – Past events
� The present – The current state
� The future – What is likely to happen
Insight(contextual)
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And Context Matters!
http://www.adexchanger.com/comic-strip/adexchanger-context-matters/
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Business EventsBusiness Events
Situation Detection &
Action
Situation Detection &
Action
The IBM VisionThe Real-time Actionable Insight Loop
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IBM Decision Server Insights Core Building Blocks
EventMessage representing
something that happened
EventMessage representing
something that happened
AgentBusiness logic that is
applied to an incoming event on a given entity
AgentBusiness logic that is
applied to an incoming event on a given entity
EntitySome business
relevant thing and related information
EntitySome business
relevant thing and related information
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Ou
tsid
eW
orl
d
Agents
Entity+ Event
Data Model
AggregateModels
SPSSScoringModels
Event,time based, situational
rules
LibertyeXtreme
Scale
ODMDecisionEngine
Connecti-vity
Business Entity Lifecycle
Business Events
Generated Events
Changed Business Entities
Rule basedSPSSor Java
BusinessEntities
BusinessEvents
Deployedon theelasticgrid
Kept as needed
Runtime Solution
Design time Runtime components
Gate
way
Binding
Overview architecture