Food trucks are the latest trend in the United States.
They�ve become a culinary staple in most major cities across the country. In fact, there is a sweet temptress called Flirty Cupcakes that is often parked outside the IBM offices in Chicago.
They are an easy and affordable way to eat lunch or grab high-end sweets during the week�all from the back of a truck. Forget going to a restaurant; now the food comes to you. You just have to know where to find it.
And even more important for the food truck business�you have to know when and where to find your customers. And parking.
They�re always on the go managing inventory, identifying the best geographies, tracking weather patterns, following traffic reports, and analyzing their customers, especially on social networks. And, food truck owners need to be fast on their feet (or wheels) when making important business decisions.
And,it�s not just food truck owners, but everyone is constantly on the move these days. The days of downtime are pass�. Uninterrupted productivity is the new normal, on any device, especially tablets and iPads.
Mobility reigns supreme. (It was a hot topic at IOD11 this week too, especially with the announcement of IBM Cognos Mobile for the iPad.)
In the mobile world, business and pleasure really do mix. Today, users want everything on one device � from music, books, email, social networking, and now the ability to interact � securely � with the same materials (online and offline) they do while sitting in the office.
Consider these facts:
According to a recent report from wireless industry association CTIA, wirelessly-connected devices now outnumber the number of U.S. citizens.
Industry analyst Howard Dresner reported that 80 percent of organizations ranked Mobile BI as a top priority for executives.
In research from Gartner, Inc., 33 percent of all BI is being assimilated on mobile devices.
Simple, Secure & Reliable
In today�s digital world, the appetite for information never stops. Speaking of delicious consumption, let�s get back to the food truck.
Like any organization (especially retail food sales) having a Mobile BI strategy is paramount for its success.
It�s Tuesday morning and the food truck has just departed for its first stop in the city. Using IBM Cognos Mobile, the driver can easily:
Plan the route for the day and drill into the data to understand where the biggest demand will be for each location and at the appropriate time of day.
Equipped with �location-aware� intelligence, the truck can receive reports that are dynamically filtered with location-specific information on planned stops.
Manage inventory levels of supply based on the day�s route and past sales so they can be better prepared to remain longer or shorter at one location if sales are up or down.
After each stop, update the inventory and total sales on the spot to avoid any errors.
Constantly check for updates on weather and traffic for possible delays and the chance of no customers showing up if it�s raining.
Log other dimensions into the applications (such as weather and traffic) to help better identify trends and opportunities through forecasting, planning and analysis.
Update customers via social media of when and where they�ll be and for how long.
Capture customer feedback in real-time through surveys that customers can fill-out directly on the mobile device.
Just remember � the next time you get hungry and see a food truck parked in your city, think of the benefits that Mobile BI offers�and how it could enhance your organization�s ability to make better decisions.
For more information on IBM Cognos Mobile:
Readthe press release announcing IBM Cognos Mobile for the iPad.
Downloadthe new (and free) IBM Cognos Mobile App for the iPad in the iTunes store.
Watcha demo how users on anydevice can have the same rich and visual business intelligence experience they get at the office.
IOD started with kids playing with jigsaw puzzles and ended with naked baseball players.
I dare you to say that analytics isn't fun.
And transformative. And an absolute priority should you want to survive in these uncertain times. Over the past three days we've all seen and learned so much that it's sometimes difficult to recall the key themes. So I've presented them for you here, built as we've gone along learning to turn insight into action:
3. Commit to change, embrace the new: Last year's assumptions and last month's targets are history; focus on what will take you forward. Commitment to change has helped IBM survive for a full 100 years. Billy Beane overturned an entrenched century-old culture to redefine value and change the way his game was played. Your presence at IOD attests to your desire to change, too.
4. Paging Dr. Watson: Hospital readmissions are punitive for the provider and counterproductive for the patient. Incomplete data drives incorrect diagnoses. Medical errors cost real human lives. With our health care partners we've put Watson to work with real-world solutions to reverse these trends and eliminate these errors. With Watson's help doctors can better understand each patient in startling new detail and treat each patient in effective new ways.
5. Don't mess with Billy Beane's mom.If you're writing a book about a baseball GM who swears a lot, be prepared for his mom's withering glare. Her son just doesn't talk like that.
6. No industry is immune from disruption. Urbanization. Changing citizen and customer expectations. Economic uncertainty. Increased regulations. Lots and lots of data. All are interconnected; all are hitting you on every side, all the time. Your task is to quantify the impact, assess the risks and harness the opportunities in new and productive ways. On a planet that is instrumented, interconnected and intelligent there is no domain that is untouched by these forces. There is no domain where analytics - and IBM - cannot help. At IOD you've seen how we're doing precisely this.
7. Jeff Jonas is evil. Just look at the guy. Look at the way he dresses. Luckily, he's the charismatic, smart kind of evil you can't help but listen to, because you can feel yourself getting smarter yourself the longer � and faster - he talks. Frankly, I'm glad he's on our side.
8. Got social? It's time to get serious about social media analytics. There's enough data out there and enough computational power to build predictive customer loyalty models based on blogs and tweets alone. That's along, long way from zip codes. Need the tools to get started? We have them, too.
9. Congratulation, Ginni. Our soon-to-be President and CEO will take charge with IBM operating from a solid foundation and 'at the top of its game.' She's successful, she's thoughtful. She gets things done.
10. It's business, and it's personal.This is the age of the empowered consumer. They're demanding, they're patient and they're in control of your brand. If you want to win their business � and keep them coming back � you'll need to know more about them than where they live. The data to do this is out there and so are the tools. The choice of how and when to use them is entirely up to you.
11. Kudos to the Mandalay Bay staff for keeping us fed and caffeinated. Greeting 11,000 bleary-eyed conference goers with a friendly smile before 9 AM is no easy task; yet to a person you outdo yourselves every single year.
Well, that's it from my end for this year's edition of Information On Demand. As of right now, I'm taking what I believe to be a very necessary vacation. I'll return refreshed and recharged in two weeks. Safe travels, and see you next year.
Moneyball author Michael Lewis and Moneyball pioneer Billy Beane closed out Information On Demand 2011 in a rollicking conversation with event host Katty Kay. Among the topics were challenging a century-old business culture with business analytics, the risks of standing still and why it's never a good idea to mess with Billy Beane's mom. Turbo's already done a great summary, so I've distilled their conversation into a few key quotes.
On the meaning of Moneyball: 'The number crunching was less interesting than what it exposed about the markets people operate in. The people running baseball considered themselves player experts because they'd been doing things the same way for 150 years. And here was Beane recruiting people the market perceived as defective. He was building a juggernaut out of defective parts. This was riveting to me.'
On bias: 'People tend to overvalue things that are flashy and easy to see. And they tend to undervalue things that are more difficult to see. You need to understand the forces that are clouding your judgement.'
On Beane and his players: 'He had tremendous credibility with the players because he was a great athlete. Being bigger than them also helped. The players were physically intimidated. It was kind of the law of the jungle in the clubhouse � reason imposed by violence.'
On offending Beane's mother because he left in Beane's profanity: 'She said, 'My son doesn't talk like that.' After the book signing I invited her to a two-hour dinner. It was the most awkward conversation I've ever had. I laid on as much charm as I could and got nowhere. She was just as angry with me at the end as at the beginning.'
On the need for change: 'For us it was out of necessity. Where were we going to get the best return on our dollar? We weren't in a position to trust emotion to run our business. We couldn't invest in the romance of the players. We had to be disciplined card counters.'
On taking risks: 'We didn't think it was risky because the math told us we'd be successful. Over enough games we knew we'd weed out the randomness. There was certainly resistance, but there was more risk in not doing it. Going with our gut would have been the most irrational thing to do.'
On Lewis revealing the secret: 'You could see the market was going move. It was just a matter of time. There was already momentum � you could feel the rumblings. You couldn't ignore the fact that the data was everywhere. The secret now is to keep your expertise in-house.'
On outcomes: 'I believe the best teams make it to the playoffs, but the best team doesn't always win the World Series. Small events in a short series can have a bigger impact; we never try to make decisions based on short-term results.'
On being played by Brad Pitt: 'You tend to hold your breath while they're casting the film. When you hear it's Brat Pitt, you exhale.'
There's a line that's been forming over the past few years � a line dividing what technology did and what it will do. A line dividing the certainty of the past with the uncertainty of the future; a line between those who will lag and those who will lead the way on our instrumented, interconnected and intelligent planet.
Today, IBM made that line clear and present for all to see.
We saw that line in today's news that Ginni Rometty will succeed Sam Palmisano as our President and CEO. An exceptional leader, a forward-thinker as steeped in our values as she is committed to our customers, Ginni will lead IBM into its second century fully aware of its ability to change the world. She knows that a company focused on the future must never stop changing.
We saw the line in this morning's general session, in which Steve Mills led us through a litany of success stories across such volatile industries as retail, financial services, energy, telco and energy. In each example, we saw how organizations use IBM analytics technologies and expertise to manage and master the overwhelming volume, variety and velocity of their data.
We saw the line in Frank Kern's address, in which he outlined - with startling clarity and candor - the ways in which analytics-driven organizations distinguish themselves and outperform their peers. On a Smarter Planet, data is fast becoming our most abundant resource. But while everyone has access; only the bold can draw insight. Only those with vision and commitment can move confidently with speed, at scale, and with precision. Only those who commit to building an analytically driven and fact-based culture will be able to forecast the impact on their profits of changing customer demands and new regulations, or their detailed exposure to strategic risk.
In our massively interconnected marketplace, one failure can lead to hundreds of others. Strategic risk represents nearly 70 percent of market cap declines. Analytically transformed organizations implement risk analytics into every decision they make. Rather than closing off entire aspects of their business, they identify, isolate and manage their risks to move forward with confidence. In our age of the empowered consumer, the balance of power has shifted. Consumers are in charge. Their ranks are growing. More and more, they want personalized service, on their own terms and on their own schedule. Their loyalty is fickle because other options abound. Analytically transformed organizations know they cannot meet these expectations using names, numbers and zip codes. Now they invest in the ability to discern their customers' needs and aspirations.
Watson will help humanity
We saw the line in the Watson and the way it embodies the IBM commitment to research, innovation and vision. Mike Rhodin and Manoj Saxena showed us how, working with partners who share our vision, we are putting Watson to work solving the biggest, most pressing and more difficult challenges we face as a society. Perhaps the biggest transformation is how Watson moves us away from absolute certainty and toward greater probability. Yet in facing a future in which nothing is certain, these probabilities - drawn from a wider span of knowledge and presented in the way we really speak - will be vastly more effective in increasing our collective confidence in determining which actions to take. The pace of IBM innovation is staggering: in February few thought Watson was ready for a real-world deployment. Yet less than nine months later it is being put to use. We chose healthcare as a first application not because it would be easy, but because we know our solutions must serve a greater good. We and our partners see Watson transforming for the better the way healthcare is delivered, managed and paid for. With Watson's help, doctors will know more about their patients, know more about symptoms and possible treatments to help people live longer, happier lives.
Big data, big value, big steps
IBM has identified big data as a key theme of this conference. In your comments, blogs and tweets you've confirmed the importance of that theme. You understand its potential to drive better outcomes for your organization � provided you harness it in the the right ways. You know big data and analytics are part of a journey of discovery, insights and continuous learning.
This morning Steve Mills said we are ready and willing to go with you on that journey. Kern, Rhodin and Saxena laid out the capabilities we can offer and a vision for where we're headed. Ginni Rometty is positioned to lead you � and us � into a fascinating second century.
Today, IBM redrew the starting line, with the best outcomes yet to come.
Information on Demand 2011 is in full swing, bringing with it approximately 11,000 customers, employees, business partners and vendors, all packing into the Mandalay Bay Conference Center to get a peek at the very latest from IBM in Information Management, Business Analytics and Enterprise Content Management.
At the Business Partner Summit, IBM also revealed the 2011 Business Partner Award winners for Business Analytics, Predictive Analytics, Enterprise Content Management, Information Management categories. Here's a look at this year's winners:
IBM Business Analytics Business Partner Awards
North America Business Partner Excellence Award: Newcomp Solutions
Europe, Middle East and Africa Business Partner Excellence Award: Inca Software
Asia Pacific Business Partner Excellence Award: Cortell Australia
Latin America Business Partner Excellence Award: CTI Consultores Asociados
Worldwide Application Specific Licensing Business Partner Excellence Award: Sungard Higher Education
Application Specific Licensing Business Partner Achievement Award: Forcea
ISV Achievement Award: SpotOn Systems
Financial Analytics Business Partner Achievement Award: QueBit Consulting
Global Technology Alliance Excellence Award: Esri
Solution Provider Achievement Award PerficientMidmarket Business Partner Achievement Award: ICit Business Intelligence
IBM Predictive Analytics Business Partner Awards
North America Business Partner Achievement Award: TechXtend
Europe, Middle East and Africa Business Partner Excellence Award: ACREA
Asia Pacific Business Partner Excellence Award: Data Solutions
Latin America Business Partner Excellence Award: SPSS Chile
IBM Enterprise Content Management Business Partner Awards
$10 Million Dollar Club Award: Imagine Solutions
Business Partner of the Year Award: Imagine Solutions
$5 Million Dollar Club Award: Avrio
$5 Million Dollar Club Award: Integro
$1 Million Dollar Club Award: Cenit
$1 Million Dollar Club Award: CGI
$1 Million Dollar Club Award: Ascendant Technology
$1 Million Dollar Club Award: enChoice
$1 Million Dollar Club Award: Genus Technologies
$1 Million Dollar Club Award: Prolifics
$1 Million Dollar Club Award: Tritek Solutions
$1 Million Dollar Club Award: The Dayhuff Group
$1 Million Dollar Club Award: VSS
IBM Information Management Business Partner Awards
Information Management Solution Excellence Award: Perficient
CTO Innovation Award: Kingland Systems
Rookie of the Year Award: Advent Global Solutions
Congratulations to all of the Business Partner Award winners!
Ever been instantly sure something new was a good idea? Recently, this happened to me at a friend's house during dinner. She had concocted a new quesadilla -- duck and roasted tomato and apple -- that struck me as a winner right from the description.
Now, granted, I have little knowledge of quesadillas. I have not studied at quesadilla academies. I am not a mover and shaker in the quesadilla world. Nor am I the heir to a quesadilla empire created by my grandfather, the Quesadilla King of Mexico.
Even so. Duck + roasted tomato + apple = world-class quesadilla. No doubt in my mind.
Well, this week I had much the same sort of reaction watching a presentation from the New York Business Agility Executive Forum by IBM WebSphere VP of Worldwide Sales, David Farrell. This presentation discussed what's standing in the way of business agility, and what IBM can offer to improve it.
And just like that duck-tomato-apple quesadilla, Farrell�s presentation struck me immediately as a winning combination of ingredients.
�Business agility,� of course, is a term that's defined in different ways by different folks. So I'll define it, very casually, like this: the power to change, quickly and effectively, to suit changing circumstances. To create new services, new products, new strategies, and do so in the least time, using the least resources.
This is not a little thing. This is a big thing. And it's a thing that pretty much every company, in every industry, is struggling with, to at least some degree.
Farrell put it rather bluntly like this: �There's a graveyard of failed companies who have failed to adapt, who have failed to recognize what was happening and deal with it in a proactive way. So the stakes are pretty high going forward.�
If you want a specific example of the kind of stakes he's talking about, you don't have to look very hard to find them, either. For instance: following Napster and the rise of digital music and music piracy on a mass scale circa 1999, there were basically two available roads to take:
1. Adapt to the new world and become Apple
2. Stick to the old business model and don't become Apple
Turns out that Apple had it right.
So, in my opinion, does IBM. Business agility is a complex area; really improving it means both understanding it at a deep level and having the range of capabilities needed to deliver a better outcome. And I don't think there's any single organization on the face of the Earth as well positioned in terms of capabilities, in both categories, as IBM and IBM Software.
Said Farrell: �We're all observing the same thing -- a tremendous amount of change and volatility in the marketplace today. How do we harness all of this change and turn it into a competitive advantage vs. headwind?�
Here, in short, is the IBM answer to that question.
Smarter decisions: See what's coming and do the right stuff in the right order
Business success stems, ultimately, from the decisions the business makes along the way -- large and small. But all too often, that decision-making happens without full consideration of the best available data.
This is particularly true in the case of service delivery -- how services are rendered to users, customers and business partners via IT architectures. The goal should be to replace guesswork with analysis, detect and utilize trends and patterns that guide decision-making, and wherever possible, proactively address problems before they even have a chance to manifest.
This may sound like common sense, but it's not -- at least judging by the way services are typically monitored and managed today. While most organizations have monitoring capabilities, they're still essentially handling outages in a reactive fashion.
A typical pattern: service goes down -- service outage is detected -- root cause is detected -- root cause is fixed -- service comes back online.
Let's compare that to this: service is predicted to go down -- IT takes steps to prevent that -- service never goes down.
You can improve on that still further by adding prioritization to refine the middle stage: IT takes preventative steps in the order that makes the most business sense, based on the anticipated business impact of downtime in different scenarios.
This is not a trivial improvement, but a dramatic one. And it makes the business as a whole much more agile.
Smarter processes: Connect the dots, simplify, and help your people collaborate better
Is there similar room for improvement in the way business processes typically work? You bet there is.
For instance, think of what happens when new software is created and rolled out -- software of the kind that drives all kinds of services to paying customers. This is usually a pretty clumsy process, and those paying customers are at the receiving end of the clumsiness.
See if this sounds familiar. The development team comes out with a build; the ops team deploys the build; customers try the new software and soon report that the build has problems. Then the development team comes up with a new build and the cycle starts all over again.
Well, so far so good, but the problem is that there's usually not much collaboration between the dev team and the ops team. Perhaps a new build requires a new set of Java libraries -- are the ops guys aware of that? If not, well...oops.
Similarly, if customers report problems to ops, is that information really getting back to the dev guys as fast as it could? Does that transfer of information resemble a cheetah? Or a glacier?
A much, much more agile process emerges when the dev guys and the ops guys share their information collaboratively, at all times, so that they're both aware just what's needed to render a better experience to customers. Which, really, is the whole point.
Smarter service delivery: Use the most efficient, scalable technologies
Here, we're talking in large part about delivery platforms themselves: the actual infrastructure that renders services to the people who use them.
If you've paid any attention to IT journalism in the last five years, your mental predictive analytics might tell you where I'm going next: cloud. That's because the improvements in agility you can get via cloud computing are absolutely stunning.
If you want a clear example, just look at provisioning times for cloud-based virtual servers. Manual provisioning, in a distributed architecture, typically takes days or weeks for a server cluster. Automatic, policy-driven provisioning in a cloud? Not weeks, but minutes. And every one of those virtual servers will be set up in exactly the right way -- no inadvertent mistakes. This is about as agile and accurate as you can get.
Mix and match to suit your needs
Now, in the course of trotting out my arguments, I have simplified things quite a bit. So let me add that there are a lot more capabilities, in each of these three areas, than the ones I've discussed.
And let me also add that if you work with IBM Software to improve your overall agility, you're basically able to order as if from a Chinese menu -- any capabilities you want, in any of the three areas, selected to address your particular needs and goals.
But any road you take, I think you'll struggle to come up with anybody but IBM who has all the experience, and all the solutions, you're going to need.
And that's why I say IBM is simply better positioned to help organizations improve their business agility, regardless of their specific context, than any other single IT provider you can name today.
About the author Guest blogger Wes Simonds worked in IT for seven years before becoming a technology writer on topics including virtualization, cloud computing and service management. He lives in sunny Austin, Texas and believes Mexican food should always be served with queso.
At the start of the day, IBM Senior Vice President, Software Middleware, Robert LeBlanc asked you a simple question:
Is your information strategy bold enough?
Are you ready to deliver the outcomes your business is demanding?
Are you applying the right technology?
Do you have a proactive relationship between business and IT?
Have you made an investment in innovation, skills and IT efficiency?
Has your organization made a lasting commitment to strategic and cultural change?
Looking back at that question now, at the end of the day, I'd like to propose a question of my own:
Are you bold enough?
Are you bold enough to define how your organization uses analytics?
Are you courageous enough to take a leadership role in putting that vision into production?
Are you persistent enough to overcome the cultural, process and organizational barriers that stand in your way?
Think about it:
The systems we've created are generating more data now than at any time in recorded human history. 80 percent of it has no structure.
By 2020 we'll have 44 times as much of that data as we do now.
Think about it.
There are now seven billion people on this planet. Nearly one in seven is on Facebook.
Consumers now control conversations about your company your brand.
Twitter processes one billion tweets per week.
Think about it.
Our world is becoming increasingly interconnected, instrumented and intelligent. Yet the global economy remains fragile.
The pace of business and the pace of change is now faster than our ability to keep up.
CEOs, CMOs, CFOs all cite data volumes and increasing complexity as their key challenges to overcome.
Think about it.
The gap between organizations that excel in analytics and those just getting started is growing ever wider.
This morning, Robert Leblanc said analytics isn't a set of tools. It's a capability that's infused into your business processes.
This morning, IBM Senior Vice President, Software Solutions Group Mike Rhodin said analytics helps your data work for you, not against you.
They were right.
The time for analytics from IBM is now.
The time to turn insight into action is now.
Think about it.
With analytics, you have the power to embed intelligence into every process in your organization � to make them smarter, faster, more efficient. To improve outcomes for both you and your customers.
With analytics you have the proven power to outperform your peers and your entire industry, if you choose to adopt them.
With analytics, you can make sense of what you're learning � as you learn it.
With analytics you can build a culture that values clarity and that acts on insight.
With analytics, you can master volume, variety, velocity and veracity.
With analytics, you - and your entire organziation � can turn insight into action.
There's no denying it. The time is now.
Are you bold enough to take that first step?
The tools, technology and people you need are all around you.
'Last night's Itchy & Scratchy was, without a doubt, the worst episode ever! Rest assured that I was on the Internet within minutes, registering my disgust throughout the world.' - Comic Book Guy
Hollywood may seem an unlikely place for analytics to have a starring role, but according to IBMers Richard Maraschi and Kevin Drost � consultants both within the media and entertainment practice of IBM Global Business Services - they're more than ready for their close up.
Hollywood is not immune to disruption
With good reason. Hollywood studios have been buffeted by the same disruptive forces currently transforming every other industry on the planet. Much like retailers must now pay more attention to consumers changing needs and increased influence through social channels, empowered media consumers are exercising a similar influence over their media and movie choices. The result? A dramatic erosion of the famously iron-clad control that Hollywood exercised over its processes and its product.
Increased Connectivity: Through 3 billion entertainment devices like the iPad, consumers now have near limitless access to entertainment products and the ability to share them instantly with the world. Watch a movie on the Netflix iPad app and it's shared automatically with your friends on Facebook.
Increased Influence: Word of mouth and social channels are supplanting, if not replacing, traditional marketing as the core driver of discovery and discussion. Nearly 45% of consumers consult friends on potential purchases before making a decision on what to buy and what to watch.
Increased Choice: New platforms and an ocean of both new and long-tail content give consumers endless viewing options. Half of the bandwidth in North America is consumed by content streaming. Nearly 60 percent of digital news consumers view content through an aggregator.
Today's media consumer demands relevant, personalized content that's accessible on any device, at any time, offered with a range of price points. That's provided consumers are willing to pay at all. Content piracy is also a growing concern, particularly for sports programmers, whose "of the moment" product has no shelf life. These trends have repercussions on the way Hollywood goes about its business.
Enter business analytics
Maraschi and Drost outlined three specific areas of their business where media companies can - and are � improving their outcomes.
The first is content acquisition and production. Studios spend vast sums of money investing in new content, whether it's through original programming or purchasing it from other companies. But very few understand the public demand for that content; fewer still are able to predict it. As a result, producers struggle to answer big questions: Of the 7,000 films screened at Sundance, which have story lines that will be relevant to our viewers? Of the 150 treatments we read each day, which ones will get the green light?
Analytics can help studios find, finance and produce the right content for the right audience at the right cost. Through demand forecasting, studios can better predict the marketability and playability of an unreleased film. They can prioritize their acquisitions and forecast the profitability of each acquisition. Even one of these activities can bring much-needed clarity to the production process and help studios be better equipped to make those multi-million dollar decisions.
The second is Marketing. For a typical film, traditional marketing tactics � print, TV, radio � typically cost between $30 and $60 million. Blockbusters typically cost more to market than make. Movie and media marketers need greater certainty that their campaigns will generate ROI in excess of their costs many times over. They also know that word of mouth trumps the biggest ad buy once the movie hits the screens. As a result, they must optimize their marketing spend in the critical windows before their content is released. Analytics can help movie producers better understand their audience and understand what it wants.
Releasing trailers, clips and previews on social sites such as Facebook provides internet-scale feedback on features in production in near-real time, while there's still time to make changes. Analyzing news feeds and industry publications can help them forecast a movie's ROI by market and channel and build a predictive model to optimize their marketing plan. Increased insight into real-time chatter helps them adjust their marketing spend in real time.
The third area is Sales and Distribution. Consumers have multiple channels at their command to access content. Most major film studios have thousands of movies in their libraries. But what is the most profitable channel for each film? How long after a movie's left the theaters should the DVD come out? Which network gets first pick when a movie is ready for broadcast on TV? Again, the intersection of consumer segment, channel and media product creates thousands of possible answers.
Again, however, analytics can help. Studios and media companies are now exploring the possibilities provided by Release Window Optimization, which helps them determine consumer behavior and price elasticity. It helps them project window sequencing and returns based on predictive events and data thresholds. And when possible, it helps them optimize the timing of a release into each channel.
Structured and unstructured data
To do all of this, media companies can also make use of both structured and unstructured data. Finance data mixed with consumer sentiment. Customer data mixed with Facebook and blogger buzz. Through advanced analytic tools such as Hadoop, predictive analytics and social media analyis from IBM, Smarter Hollywood can move as quickly, as effectively and as smartly as the smartest retailer.
The approach for a Smarter Hollywood will be achieved by integrating descriptive, predictive, and prescriptive analytics. Descriptive data � reports on product performance, sales and customer demographics will continue to play a role. Predictive analytics driven by social chatter and external data will help Hollywood make smarter decisions about where to invest and the returns they can expect. Prescriptive analytics � the new, third element � will move the entire industry toward a more cost-effective and profitable approach that makes the best use of an ever-shifting data landscape to better serve the new, empowered media consumer.
This year, nearly sixty percent more organizations said analytics drive better business outcomes than said so in 2010, according to a soon-to-be-released report by the IBM Institute for Business Value and the MIT Sloan Management Review.
Analytics: The Widening Divide will be released November 8, but attendees to the kickoff session of the Business Leadership Forum within Information On Demand were treated to a sneak preview of the study's main findings. You can register to receive your copy here.
Fred Balboni, Global Business Services Leader for IBM Business Analytics and Optimization presented the findings, which were based on interviews with 4,500 executives, managers and analysts in 30 industries and 132 countries.
The three key findings are:
The competitive advantage gap created by analytics is widening.
Competing successfully on analytics requires a mastery of three key competencies.
Companies are pursuing two paths to analytic sophistication.
The widening gap
The study groups companies' analytical maturity into three major categories: Transformed, Experienced and Aspirational. Transformed companies saw their ranks grow by 25 percent in the last 12 months, while the ranks of the Asiprational saw a decrease of five percent. The biggest growth, happily, was in the Experienced grouping, which grew by 66 percent.
'These companies are pedaling faster and harder to catch up,' said Balboni.
With good reason. The study also shows that organizations that deploy analytics are more than twice as likely to substantially outperform their industry. Quite simply, early analytics adopters are outpacing their less experienced competitors and leaving everyone else in the dust.
The majority of organizations now rely on analytics and data to manage key financial and operational tasks, said Balboni. But these are the table stakes; and even within Transformed companies there's still lots of room to improve.
Here, the IBM-MIT survey provides some guidance. Now, leading analytics-driven organizations are turning their attention to specific lines of business including customer management and HR management. Better insights into consumer sentiment, employee performance, retention and recruitment strategies are all fertile grounds for actionable insights that yield increased competitive advantage.
Some companies are doing some of this, Balboni said, but no company is doing all of it.
Three key competencies
Balboni then expanded on the three key analytical competencies an organization must master to drive better outcomes:
Manage the data: If people don't trust it, they simply won't use it. Establishing a solid information management foundation of standardized data management capabilities that make insights accessible and available is an essential task for any successful analytics deployment.
Understand the data: Organizations need a robust set of analytical tools and the people with the right business and technology skills to use them effectively, whether to conduct analyses on their own or to embed them into business processes.
Act on the data: Actions drive organizations forward. Analytics-driven organizations move forward more quickly and efficiently because they foster a data-oriented culture and encourage fact-driven leadership.
Two paths to get there
Most organizations pursue one of two types of paths along their analytics journey, Balboni said.
The first is the Collaborative Path, which sees organizations taking a broad-based approach spanning multiple business units who work together to master their data and share insights. The second is the Specialized Path, in which a single line of business pursues specific business outcomes, connecting new stakeholders according to business needs.
Balboni said the credit crisis and ongoing market jitters have driven many companies to taking the Specialized Path: 'Most organizations are in no mood for large-scale projects.'
This doesn't mean that you must abandon your long-term goals; rather, said Balboni, you need a series of programs that delivers results in three- to six-month intervals. Each program must build on the previous steps.
Three steps to take
To close, Balboni outlined three steps organizations can take to start or accelerate their own analytics journey. The first is simple; the other two demand a longer-term view.
Assess your current analytic sophistication: Step on the scale with both feet and face up to the number. The IBM Business Value Assessment tool will help you get started. If you're here at #iod11, we have an entire section of the third floor devoted to helping you. Schedule a meeting with one of our experts or take a live tour of our solutions in the Touch Zone.
Work to develop the three key competencies: Establish your foundation, develop the skills and tools, and create the culture that takes action.
Tie your approach together with an Information Agenda. Unlike your application agenda or IT Strategy, an Information Agenda helps you focus on the kinds of decisions you need to make now and the ones you'll need to make down the road. 'It's an external artifact that brings both IT and the business together on investment,' said Balboni.
'All of a sudden you have people talking back and forth. Those are the most fun.'
User groups are a powerful, effective and, yes, enjoyable way to get more out of your software investment. But building a successful user group takes patience, passion and a more than a small degree of persistence. Luckily, In a pre-conference session led by IBM ChampionSusan Dean, four top-notch user group experts were on-hand to share their insights into what works. Even better, they highlighted steps you can take right now if you�re here at #iod11.
Many of the insights revolved around the twin concepts of relevance and convenience. Here�s a summary:
Scheduling: Avoid scheduling meetings at the beginning or end of the quarter, when your finance and other teams are particularly busy. Also, avoid holding meetings on Mondays or Fridays, when people are either gearing up or winding down. For most panelists, the ideal time was mid-week and mid-morning, after rush hour. Start with half-day meetings until the group finds its footing and expand from there for special topics.
Vendor/partner involvement: Vendors and partners can provide direct access to product experts or specialized domain knowledge, but your group members may prefer to meet directly with fellow users. Panelists agreed that some members appreciated vendor input, while poaching and overt sales pitches are generally frowned upon. As an organizer your job is to provide members with a beneficial and valuable experience; find out their comfort level through a free survey tool such as SurveyMonkey and draw up explicit guidelines about the level of involvement you�ll accept from vendors and partners. Establish a steering committee and charter with guidelines if need be.
Meeting flow: Be clear about the flow of your meetings, the types of activities you�ll cover and how much time you�ll dedicate to each. Is there time for networking? Announcements? Be sure to include breaks during longer meetings.
Content: Live demos, member presentations, case studies and success stories are perennially popular. The same goes for tips and techniques, new product features (provided you allow vendors to participate) and stories about how you solved a particular problem. �Customers learn from customers,� said Dean.
Funding: Most groups need a small amount of funding for refreshments, name badges, giveaways, even meeting space. So do you charge a fee? The only right answer is the one that makes your group successful. Sometimes the vendor or partner is willing to take on some of the funding. Again, it�s up to your members.
Ongoing communication: It�s important to keep your group on your members� collective radar in the weeks or months between meetings, so be sure to build and maintain a reliable web presence. Keep your database current and provide your members with a regular cadence of news and information about upcoming events. These communications are also great tools to recruit new speakers, explore new topics and even drive new membership. A variety of free tools (EventBrite and eVite spring to mind here) and LInkedIn communities are ideal vehicles here.
Steps you can take right now:
Visit the Customer Reference Lounge in the EXPO to learn more about user groups that are available to you and how to join.
Add session BDS-2466a: to your agenda. The title is, "CAB & User Groups and How the Help."
T-minus eight hours before I'm off to the Mandalay Bay, so I'll make this one short and sweet.
One thing to watch
We've just released a new video called 'From Information to Analytics: The IBM Story.' It outlines our history of helping you wrangle and make sense of your increasingly messy data and features most of the IBM Software Executives you'll see on-stage next week.
Two things to read
The first our research report, 'Analytics: The new path to value' produced by our Institute for Business Value in partnership with the MIT Sloan Management Review. Its findings propose solutions to the different pieces of your information-and-analytics value puzzle, based on surveys of nearly 3,000 executives, managers and analysts working across more than 30 industries and 100 countries.
What's better than starting your day with bacon and a muffin?
How about bacon ON a muffin?
Yep, that's much better, indeed. The muffins were courtesy of Cara Rowlands; fuel, so to speak, for a speaking opportunity at Social Media Breakfast Ottawa organized by Simon Chen, Rob Lane and Ryan Anderson. Some months ago, this august trio had asked me to share the IBM perspective on social media. Specifically, how was a century-old company grappling with such a sea change in communications? How does IBM see social media affecting the way IBM develops and markets its products? What was my role in all of this?
Yesterday, I presented to about 100 Ottawa-based social media practicioners based on the following abstract:
Can Elephants Tweet? Building the Social Business at IBM
It's OK. We know "IBM" and "social media" probably aren't too closely linked in your mind. Truth is, though, Big Blue is incredibly social -- and incredibly successful because of it. From tip sheets and tagging to worldwide jams, IBMers are rapidly redefining the way they engage with customers and prospects, and they're driving the business forward as a result. Join Delaney Turner as he outlines the rationale and tactics IBM uses to transform itself into a social business and shares stories of some recent big wins. You'll discover:
Why IBM encourages employees to "get social"
How IBMers are making their marketing programs more social and interactive
How to build an enablement and education strategy for your own organization
All my life I've felt a little "different" from others. Odd. Atypical. Now, thanks to National Geographic, I have proof that I'm right. The society analyzed the faces in 190,000 of its photos and came up with a composite image and statistical rendering of the most "typical" person in the world.
As it turns out, the most typical person in the world is a right-handed 28-year old ethnically Han Chinese male. With a cel phone.
I come nowhere close to this guy, or the 9,000,000 guys just like him. But, the findings did lead me to think: In the West at least, 28 is just on the cusp of one's prime earning years. China has the world's fastest-growing economy. There are a lot of consumers over there. IBM recently published a major survey of global CMOs that shows shifting consumer demographics as a pressing - and perplexing - issue. They're looking to analytics - the kind you'll see demonstrated on-stage at next week's Information On Demand - to help them figure all of this out. I don't know about you, but I see a lot of interesting dynamics in this mix.
This may or may not be my last post before heading down to Vegas, so be sure to watch for tweets with the #iod11 tag to keep in touch with all the news and fun.
Guest post from Erick Brethenoux, Executive Program Director, Worldwide Predictive Analytics at IBM
In 1978, an emotional and dramatic award-winning documentary film was released titled �Scared Straight!� It profiled troubled teens who were taken into maximum security prisons to stand face-to-face with inmates who �explained� the harsh realities of life in prison.
The goal, according to the documentary, was �to keep at-risk teens from becoming tomorrow�s prisoners.�
Consider this an analytic scared straight moment.
We have a serious skills gap in the analytics field�and it�s getting worse.
A recent McKinsey Global Institutereportindicates that over the next seven years the need for highly skilled business analytics workers will exceed the available workforce by as much as 60 percent.
And by 2018, an additional 190,000 "deep analytical talent" workers plus 1.5 million more "data-savvy managers and analysts" will be needed to take full advantage of big data.
In conversations with customers and prospects, it has become apparent that there is a significant widening of their overall performance � both in terms of increased revenue and lower operational costs. It�s amazingly disproportional and not linear.
Organizations that are outperforming their peers, through the use of analytics, are making quicker progress, capitalizing on their growing experience while monopolizing an increasing amount of analytical talent.
This creates a wider gap, making talents even more difficult to secure for those companies jumping on the analytical bandwagon � therefore delaying their progress.
These are the harsh realities of analytical life. It�s time to make a change�and soon. Those organizations that don�t will be forced into a life of using Excel spreadsheets. Talk about doing hard time.
Spreadsheets, while fine for certain tasks, aren�t the answer to keep up with the ever-growing amount of data being created and the more and more complex decisions that have to be made.
Nor are they capable of handling the pressures of customer demand. The ability to respond to customers at the right place and right time, and with the right offer based on a customer�s current mood and sentiment, is a job for those that know how to navigatedecision management solutions.
It�s becoming an arms and skills race segmented among �The Haves,� �The Have Nots,� and the �Never Will.�
��The Haves�� These commercial and government organizations have taken the time to understand the value of analytics, hired the right people, received the proper training, identified the business issues, and deployed business analytics technology to create opportunities to drive the business.
They have been doing it for a number of years and will only keep advancing.
��The Have Nots�� These organizations are just beginning to implement analytics, or will soon. Unfortunately, they will also have to spend more money to catch up, in terms of services, training and domain knowledge. But, at least they are getting into the game.
The pool of analytics talent, however, is rather shallow at this point�either already hired by the �Haves,� or on the verge of retirement, so analytics projects will be limited or outsourced to technology vendors.
��Never Will�� These organizations will soon be destitute and on the street struggling to find anyone with basic statistics knowledge.
By the time these organizations even think about an analytics solution, even IBM might not have the resources and services to help them. The market will be so desolate that what even looks like a mirage won�t have any water. And what few professionals are available won�t come cheap.
But, all is not lost. There is hope as many of you will learn at theIBM Information on Demand(IOD11 and BAForum) conference next week in Las Vegas (Oct. 23-27).
There are many programs already in place to help ensure that organizations will reach their full analytic potential:
�Over the past five years,IBM has initiated academic programswith leading universities around the world, includingYale,DePaul,Ottawaand others, to provide analytics technology and training resources so students can be prepared for 21st century jobs in analytics.
�IBM is continually innovating to make analytics technology easier to use, such as the aforementioned decision management. Business professionals can now build a predictive model in just three clicks.
�Even business intelligence solutions are made-to-order nowadays�for everyone (from the individual to the mid-market to the enterprise�and anywhere (with the newCognos Mobile for the iPad). It�s true analytic freedom.
�And, IBM�sGlobal Business Servicescontinues to expand its pool of talent as it will have almost 9,000 card-carrying analytics experts by the end of the year.
Become an Analytics Champion
Engage today. Don�t wait. IBM has been helping organizations deploy analytics and get the most from their data for almost half a century. We would love a chance to discuss, and then we can advise on the right training and education.
And if you need a quick start to find out how mature your organization is with analytics�take ourAQ quizthat will guide you through the steps needed to continue on the analytics journey.
IT professionals -- and I say this with compassion, having been one myself -- tend to think way too much about the T, and not nearly enough about the I.
What do I mean by that? I mean that while technology certainly drives business services, it is not, ultimately, the most valuable player on the IT team. Information -- data -- is.
Data suggests new strategies, quantifies their success or failure, and informs virtually every operational decision (whether it's made by a person or a processor). It's probably not going too far to say that, in a large sense, the fundamental mission of IT is get the best possible use from data throughout its lifecycle.
Think of all those Word files, presentation decks, spreadsheets, and PDFs. Think about case notes written up hastily during a phone call; they may never make their way into a database, yet can contain incredibly powerful information. Think of the sum total of data created daily in internal communities, forums, wikis and other collaborative social platforms -- an area that's certainly hot and getting hotter by the day.
Is the enterprise really getting, as I put it earlier, the best possible use from that data?
The answer is almost certainly no, and the consequence is almost certainly diminished agility, creativity, innovation and responsiveness -- all key for the enterprise to succeed.
This is the heart of the argument for Enterprise Content Management (ECM) solutions. By acknowledging the crucial importance of unstructured data, and leveraging it for as much value as possible, organizations can put themselves in a much stronger, more informed, more competitive position going forward.
ECM solutions must evolve with the changing times
Not all ECM solutions are created equal, though. And not all ECM solution providers have the depth of insight, or provide the mature capabilities, that the enterprise will need for best results.
I recently had a chat with Craig Rhinehart, Director of ECM Strategy and Market Development for IBM, (check out Craig�s ECM blog) and he agreed on that point, calling out that IBM has been developing leading ECM solutions for nearly 30 years and first published research on the topic in 1957, over 50 years ago. That�s longer than most IT professionals have even been alive.
And as enterprise infrastructures, content types, strategies and goals continue to evolve, he told me, IBM Software is continuing to evolve its ECM capability and portfolio in parallel, keeping close pace with the changing times.
�Actually, ECM has never been more relevant than it is today,� said Rhinehart. �These solutions can drive value in an organization's most valuable processes. Think of insurance claims, for instance, they're really the make-or-break center of everything an insurance organization does. And claims processing typically revolves around many forms of unstructured data in the context of case management. All driven from the need to deliver better service to their customers in a highly competitive market. So our ECM solutions are a perfect match.�
That's a value proposition that's becoming more and more applicable over time, too. As unstructured content continues to expand in volume, and diversify in nature, major challenges for enterprises emerge in managing it all -- challenges that will often demand a new approach to ECM.
Five great ways to squeeze more value out of your unstructured data
�These challenges really come down to five different areas where we're seeing customers have problems,� explained Rhinehart. �It's within them that content management gets applied and customers are seeing value.�
One such challenge is document imaging and capture -- basically, grabbing data from non-digital sources, like faxes or snail-mail, then sharing it and managing it in all the ways that digital solutions do best.
This is the sort of thing that can really generate tremendous value if it's done right. I once worked at a state government office where a team of more than 50 lawyers was chartered with responding to all snail-mail questions in two days or less -- no matter how complicated those inquiries might be. Given a turnaround time like that, efficient imaging and capture tools were critical to getting the job done, both right and on time.
And that's just scratching the surface, according to Rhinehart. �There's a global logistics company using IBM ECM production imaging technology to process 600,000 pages per day,� he said. �They expect to process 4 million per day when the rollout is completed. And already, they move shipments across borders with 30 percent fewer resources than before. Really, any company has too much paper -- it's a great opportunity for enterprises to reduce cost and risk.�
Social content management is another area where ECM capabilities can pay off in a major way -- partly because most of this content is extremely unstructured by nature. Collaborative platforms have typically been developed with a focus on empowering user communication, and rightly so, but it's important that all their content still be connected effectively to the organization's repository of record.
�It's the Wild West right now,� said Rhinehart. �If customers don't have a social content strategy today, they need to get one pretty soon. And we at IBM are certainly investing in that area. We think of it as a sea change in business and we plan to continue to lead the way.�
Information lifecycle governance is a third area where ECM solutions can play a hand. Here, the focus falls on how information is managed throughout its lifecycle, in accordance with its business needs and other variables such as regulatory and legal obligations.
For instance, by identifying information of lower priority, then moving that to storage infrastructure of similarly lower cost -- migrating it from, say, disk arrays to tape or optical media -- organizations can preserve what they need, yet drive down the associated operational overhead. It also becomes possible to identify what isn�t needed at all, eliminating it from the complete information infrastructure and freeing up much needed storage resources in the process. Rhinehart adds that �our solutions help our customers dispose of information in a defensible manner. You can�t just hit the delete key�
ECM solutions can add value by automating and optimizing those processes that are content centric. This is Advanced Case Management (ACM). According to Rhinehart, �ACM helps by addressing the ad-hoc, exception-oriented business processes where collaboration is key and where getting the right decision made is the desired outcome. Traditional BPM solutions aren�t the right approach for these processes. You wouldn�t want to use a shovel to drive in a nail. ACM enables a more dynamic solution development process avoiding many of the issues that make rolling out new applications a lot slower, harder and costlier than it should be.�
Some organizations may describe ACM solutions as dispute management, customer service resolution, care coordination, interventions or even claims processing. These cases are not a typical straight-through process. They involve invoices, contracts and other forms of enterprise content and tend to be customer centric. We have a major retailing chain that's doing this and they're now saving US$2.1 million a year in their call center on labor savings alone.�
Finally, content analytics can provide some of the most interesting, and potentially explosive, possibilities for unstructured data in the enterprise today. Just as traditional analytics tools focus on database-driven content, ECM analytics capabilities focus on unstructured content -- surfing through it for patterns or trends, that (once implemented as strategies) can create new business value.
Rhinehart seems particularly impressed with the strides IBM has taken in this area in recent years, as exemplified by the success of the Watson project -- best known for having defeated Jeopardy champions in head-to-head, real-time competition.
�Watson uses IBM Content Analytics technology that is commercially available today for natural language processing. It�s being used to leverage and exploit enterprise content by understanding business insights currently trapped in content. Content Analytics is being used to detect fraud, solve crimes, improve healthcare research, find new business opportunities, understand the voice of the customer and more. Think Business Intelligence for content.�
I share his appreciation on both Content Analytics and Watson. Watson not only comprehends natural language queries, but also leverages many different analytics algorithms, running in parallel, to arrive at answers deemed likely to be accurate. This is well beyond the scope of ECM, or even enterprise IT as a whole, as it exists today.
�When you can pose questions to a computer in natural language, that's just a whole new ballgame --that�s something IT has never even tried to do before,� said Rhinehart. �I've heard it said that every computer before Watson is nothing but a big calculator. And I think there's a lot of truth in that.�
About the author Guest blogger Wes Simonds worked in IT for seven years before becoming a technology writer on topics including virtualization, cloud computing and service management. He lives in sunny Austin, Texas and believes Mexican food should always be served with queso.
If you�re not aware of Moneyball, it�s a behind-the-scenes story of the Oakland Athletics and how they changed the game and leveled the playing field through the innovative use of analytics that allowed the team with the lowest budget to consistently compete against the big market, deep pocket teams.
Moneyballtook the veil off a much-treasured secret and demonstrated that new ideas could produce positive results in the traditional world of Major League Baseball.
The book was also recently made into a major motion picture � in theaters now � starring Brad Pitt as Billy Beane. It is receiving rave reviews.
The Information On Demand social media team had the opportunity to speak with Michael Lewis about his book, the movie and the parallels between baseball and business.
Who Is Going To Read A Book About Analytics?
In the late 1990s, Lewis was living in Berkeley, Calif., and started to pay attention to the local baseball team, the Oakland Athletics.
He had some awareness of the payroll discrepancies in baseball and thought it was strange how many games the Oakland A�s were winning given how little money they had in relation to the competition.
�The answer was so shocking to me that this team, in response to its financial disadvantage, was rethinking the game of baseball that I launched into Moneyball,� said Lewis. �This was a weird book for me. I had never written a word about sports and if you asked me what �Sabermetrics� was, I�d have guessed it would have had to do with fencing. I didn�t have any idea this world existed and didn�t realize how rich the environment was until I got into it as a writer.�
Beane, however, wasn�t worried about his secrets getting out. He was more concerned about what his mother might think of the way he spoke, mainly his profanity.
When Lewis asked him if he was going to be upset for giving away his secret formula, Beane laughed and said, �Do you really think people in baseball are going to read your book?�
Leveling the Playing Field
Today, every team in baseball has turned its sights to the once dark art of analytics and the playing field has been leveled. Now big budget teams like the Boston Red Sox are using this strategy to draft players and identify free agents.
�When the book came out, the markets were poised to become a lot more efficient,� said Lewis. �And, when the Red Sox decided they were going to apply this new way of thinking to players and baseball strategies�that was the beginning of the end for the A�s advantage. Now it�s normal. The war is over.
�If you�re a team that isn�t trying to be on the cutting edge of using data to better value players and strategies, you�re at risk of being exploited in the marketplace and everyone understands that.�
Don�t Let Statistics Become Fetishized
If baseball can take analytics to the field, why don�t more organizations use the technology in their game plans? The benefits are endless.
Lewis believes that any organization � from sports to business to government � �needs to be looking for new ways to mine their data, and new ways to think about their data.�
But he also warns that baseball provides a great best practice for any business thinking about deploying an analytic solution.
�The funny thing about this story,� said Lewis, �is that it�s true the Oakland A�s set about trying to create new data and generate new information that wasn�t on the baseball field.
�But, a lot of the inefficiency in the game came from the misuse of the data that existed. The data was there, but people were just not thinking about it properly. So you could easily calculate a player�s on base percentage, but baseball was not appreciating the value of the statistic.
�And, to me the story is not just the importance of the data, it�s a story of being careful how you use it once you have it. Because the minute you start to measure something and have a statistic, it has a tendency to become fetishized, like a player�s batting average.
�Unfortunately, it wasn�t a key offensive statistic and it led players to be misunderstood.�
It�s like a marketing department only doing simple segmentation to identify customers for a direct mail offer. This analysis provides a somewhat superficial view of the customer and leads to one-to-some direct marketing (and lot of junk mail).
Basically, it perpetuates accepted wisdom that all customers (and baseball players for that matter) are created equal.
Change is Good; Don�t Be Scared to be an Innovator
For baseball teams (and businesses and government agencies), now comes the hard part � continually innovating to find new statistics that have hidden meaning.
Lewis says the low-hanging fruit has been plucked because it was relatively easy to assign statistical credit and blame to what happens on the baseball field.
However, if athletes weren�t so expensive nowadays no one would care about the ramifications of clean data and in-depth analysis.
Nor would the business world � except in today�s environment, where acquiring a new customer is that much more expensive than proactively keeping one.
�The business decisions become extremely important,� said Lewis. �It�s worth investing in complicated ways of evaluating them [players and customers] because if you find a slight edge it means saving millions of dollars.�
That is why those in the C-suite (and in many instances IT organizations) need to become more accepting to analytical techniques and not be afraid of what the data often reveals, or how it might change business processes.
In Beane�s case, he had to change if his ballclub was going to be competitive and survive. He challenged baseball�s traditionalists and angered the gods of conventional wisdom.
Sometimes the world isn�t flat.
Sometimes it�s white, round and has 208 stitches.
For more information:
Listento an audio interview of Michael Lewis discussing the movie and his upcoming session at the conference.
Reada recent IBM interview with the head of statistical analysis for the Chicago Cubs.
Registernow for IOD11 and BAForum; and start building your schedule.
Scott Laningham's latest video interview about Information On Demand has been making the rounds on Twitter, but in the spirit of oversharing, I've included it below. It's his interview with Eric Sall, VP of Product Marketing for IBM Information On Demand.
Scott and Todd will be interviewing IBM Champions, partners and executives from the floor of IBM's largest EXPO over the course of the conference, so keep an eye on our Livestream channel (or watch it through our IOD Social Media Aggregator) to see your friends, colleagues and, perhaps, yourself (in the on-demand version.
Yesterday (October 12) we published the first-ever Power Software Edition of the IBM Software Newsletter � a special issue �front-loaded� with Power Systems-related software news and content. You can read it on the web here.
We plan to publish two (2) of these Power Software Editions every year � and starting next month (November), we�ll be adding Power Systems-related content to our regular monthly issues � and offering additional Power content to subscribers who want it. Here�s all you have to do:
If you�re already an IBM Software Newsletter subscriber (thank you!), update your subscription to include the new �Software for Power Systems� interest category.
If you�re not a subscriber yet, subscribe today � and make sure you check the �Software for Power Systems� interest category when filling your subscriber profile.
Thanks � and watch for news about other special editions of the IBM Software Newsletter on the horizon!
Arthur makes the argument that digitization is creating a vast, automatic and invisible "second" economy that's driven entirely by data, systems and by systems of systems. It's also driving the biggest change to our world since the Industrial Revolution:
Every so often�every 60 years or so�a body of technology comes along and over several decades, quietly, almost unnoticeably, transforms the economy: it brings new social classes to the fore and creates a different world for business.
Can such a transformation�deep and slow and silent�be happening today?
We could look for one in the genetic technologies, or in nanotech, but their time hasn�t fully come. But I want to argue that something deep is going on with information technology, something that goes well beyond the use of computers, social media, and commerce on the Internet. Business processes that once took place among human beings are now being executed electronically. They are taking place in an unseen domain that is strictly digital. On the surface, this shift doesn�t seem particularly consequential�it�s almost something we take for granted. But I believe it is causing a revolution no less important and dramatic than that of the railroads. It is quietly creating a second economy, a digital one.
A Second Economy on a Smarter Planet?
As I read through the piece I was struck by how closely Arthur's Second Economy mirrors the attributes of a Smarter Planet - that is, one that's increasingly instrumented, interconnected and intelligent. Take, for example, the dramatic transformations we've seen in air travel:
Twenty years ago, if you went into an airport you would walk up to a counter and present paper tickets to a human being. That person would register you on a computer, notify the flight you�d arrived, and check your luggage in. All this was done by humans. Today, you walk into an airport and look for a machine. You put in a frequent-flier card or credit card, and it takes just three or four seconds to get back a boarding pass, receipt, and luggage tag.
What interests me is what happens in those three or four seconds. The moment the card goes in, you are starting a huge conversation conducted entirely among machines. Once your name is recognized, computers are checking your flight status with the airlines, your past travel history, your name with the TSA1 (and possibly also with the National Security Agency). They are checking your seat choice, your frequent-flier status, and your access to lounges.
This unseen, underground conversation is happening among multiple servers talking to other servers, talking to satellites that are talking to computers (possibly in London, where you�re going), and checking with passport control, with foreign immigration, with ongoing connecting flights. And to make sure the aircraft�s weight distribution is fine, the machines are also starting to adjust the passenger count and seating according to whether the fuselage is loaded more heavily at the front or back. [...]
Is this the biggest change since the Industrial Revolution? Well, without sticking my neck out too much, I believe so. In fact, I think it may well be the biggest change ever in the economy. It is a deep qualitative change that is bringing intelligent, automatic response to the economy. There�s no upper limit to this, no place where it has to end. [...] I think that for the rest of this century, barring wars and pestilence, a lot of the story will be the building out of this second economy, an unseen underground economy that basically is giving us intelligent reactions to what we do above the ground.
It's perhaps the paradox of an invisible economy that its will bring about effects that we can all see. As befits an economist and "pioneer in the science of complexity," Arthur doesn't shy away from examining the disruption these changes will bring to the job market and to the very nature of work. The second economy will bring about new kinds of work, while others will disappear completely:
Nowadays, fewer people are required behind the desk of an airline.
Much of the work is still physical�someone still has to take your luggage and put it on the belt�but much has vanished into the digital world of sensing, digital communication, and intelligent response.
Physical jobs are disappearing into the second economy, and I believe this effect is dwarfing the much more publicized effect of jobs disappearing to places like India and China.
Still, Arthur sees new opportunities for growth as well. The challenge in the coming years won't be to create prosperity, but rather to better distribute it:
The second economy will certainly be the engine of growth and the provider of prosperity for the rest of this century and beyond, but it may not provide jobs, so there may be prosperity without full access for many. This suggests to me that the main challenge of the economy is shifting from producing prosperity to distributing prosperity. [...] For centuries, wealth has traditionally been apportioned in the West through jobs, and jobs have always been forthcoming. When farm jobs disappeared, we still had manufacturing jobs, and when these disappeared we migrated to service jobs. With this digital transformation, this last repository of jobs is shrinking�fewer of us in the future may have white-collar business process jobs�and we face a problem.
What's your role?
As the architects of your organization's own information networks, I'd argue that you have a direct hand in building this second economy. You may have already been affected one way or another by the disruptions and transitions it's driving in the real world. As the largest conference in the IBM Software universe, I'd also argue that Information On Demand is the ideal forum to discuss these transitions. You'll come away with a better understanding of how they impact your organization, and you'll discover new ways to harness the technologies that drive it to drive better outcomes on all fronts.
What's the face of business today? Just 15 years ago, the answer to that question might have been �the retail presence� or, in a few rare cases, �the celebrity CEO.�
But today, the best and most common answer is, quite simply, the web.
Doubt my conclusion? Consider the numbers. Recent statistics suggest that there are now more than two billion Internet users worldwide -- and as new platforms emerge, that number is rapidly escalating. Cell phone subscriptions have topped five billion (and you can be sure that before long, every cell phone on Earth will be web-capable).
If you really want to engage your customers, you have to go wherever your customers are -- not just pull them in the direction you want them to go.
More, you have to provide a compelling, consistent experience for them, one that focuses on value as they define and perceive it, not as you do.
That means a lot more than just the company site (at least, the company site as it exists at most businesses today). It means leveraging the web as a whole to attract and interact with past, current and future customers. And it means connecting with them in a much broader sense than simply e-commerce. I'm talking about actually learning from them and using that information to serve them better, as well as empowering them to interact with each other.
Pursuing all those goals in parallel, though, will typically require more capabilities than organizations have at present. What's needed is a core platform that's smart enough, and flexible enough, to support business strategies, link customers, scale to unpredictable demand levels and expand over time to address new ideas going forward.
And I'm not alone in thinking that -- which is why leading IT providers are quickly introducing powerful new software solutions designed to deliver exactly those capabilities.
Compelling and differentiated. �Compelling� is often used in modern marketing simply to mean �good.� But in this case, the original definition applies as well: capable of beckoning, of bringing customers in. Toward that end, one key factor is personalization.
�Organizations can really differentiate themselves from the competition, and improve customer loyalty via an experience that is personalized to customer needs, to their behaviors, to their preferences, as well as the language of their choice,� said Carrier.
If you want an example of what she has in mind, consider Lufthansa Airlines -- an IBM customer. This organization has moved away from delivering a stock, one-size-fits-all web experience to an experience carefully tailored to each specific customer�and in every respect Carrier described.
�The first time you get there, it asks you for your country, your language; it's personalized for more than 80 countries and 12 languages,� she said. �If you log in, you can then see your information, [such as] your flights, your awards, all your content tailored to your preferences.�
Why is this crucial? It stands to reason that when sites understand customers better, they can serve customers better. And with better service, better business outcomes will emerge for organizations.
Mobile-aware. Another important form of personalization: the Lufthansa site is now device-and-mobile aware. It now recognizes which type of device a customer is using, then renders to that device a version of the site that has been tailored to the device's strengths and weaknesses
So, for instance, if the user happens to be on a smart phone -- typically characterized by both limited screen resolution and lower-bandwidth connection rates -- the Lufthansa site knows that and takes steps to compensate.
�You're not going to see a huge site that you need to scroll around with, that's hard to use,� said Carrier. �You'll get an experience optimized for the form factor of your phone.�
Socially infused. Beyond customer-by-customer personalization, though, another angle to consider is the social web. Sites that engage with customers, Web 2.0-style -- instead of simply selling to customers -- will almost by definition deliver a better customer experience.
You can think of this in terms of service management theory, if you like. Service management is all about aligning your products and services as closely as you can to what your customers need and want. But how can you do that if you don't know what they need and want
Socially aware sites answer that question by providing a microphone for customers to speak up.
�The social web has really been a great equalizer in terms of getting customers' voices to be heard,� said Carrier. �It could be as simple as allowing users to express their feedback by commenting or rating or participating in forums and communities on your site.�
Simple trumps pretty
Customers, just like water and electricity, will typically follow the path of least resistance. That means no site, however powerful or sophisticated it may be in theory, will satisfy customer needs if it's hard to use. Just as the GUI replaced the command line a generation ago, easy-to-use sites are rapidly replacing those that seem to customers to amount to a barrier of entry.
In my own experience, this principle is so powerful, it can even outweigh another -- that unusually good-looking sites attract more user attention and create more business value for organizations.
Carrier sees things in much the same terms.
�I've seen a large number of sites where they're absolutely beautiful, they're like completely flashy, and you go there and try to get something done, but it's so hard to navigate; it's really hard to get the task accomplished,� she said. �Organizations need to focus on ease of use and making sure that the actions people want to take when coming to your site are as easy [for them] to execute as possible.�
Open pudding, find proof
So what, exactly, has been the business outcome for organizations that have deployed customer-experience web solutions with the capabilities of the type Carrier cites from IBM Software -- solutions that �provide a foundation for very compelling, differentiated, socially infused, mobile-aware experiences�?
�There is a large county government located here in the US that basically needed to make it a lot easier for citizens and various associations to do business with the county without having to drive all the way into offices or fill out tons of paperwork,� said Carrier. �They built this really exceptional web experience and eliminated a bunch of information silos and presented information in a really nice, aggregated citizen's view instead.�
And what kind of bottom-line benefits are they getting?
�Well, just last year from January to April, they had 10 million visits and collected $468 million in revenue.�
About the author Guest blogger Wes Simonds worked in IT for seven years before becoming a technology writer on topics including virtualization, cloud computing and service management. He lives in sunny Austin, Texas and believes Mexican food should always be served with queso.
Today's post comes from Perry Swenson, Market Manager, IBM Security.
As a company, IBM faces the same security threats and attacks that other organizations face in protecting its endpoints, infrastructure and data for over 425,000 employees. And of course, like other organizations, IBM continues to look for ways to reduce costs and increase efficiency.
Likewise, other organizations may also be seeing the number of nonstandard endpoints increase significantly, like IBM has through:
Partnering with other companies for joint development projects
Increasing the pace of acquisitions and divestitures
Increasing the percentage of workers connecting from or working in an unprotected infrastructure
Increased prevalence of non-Windows computing devices
So why not use your own products to address these challenges? IBM is doing just that. IBM has begun a worldwide internal deployment of IBM Tivoli Endpoint Manager software, built on BigFix technology, initially to address challenges of patch management, security configuration and software distribution.
Some results from the internal IBM pilot deployment of the Tivoli Endpoint Manager solution included:
Improving patch availability to within 24 hours, compared to typically three to 14 days previously
Achieving 98 percent compliance with internal policies within 24 hours, compared to 92 percent compliance with internal policies within five days previously
Identifying that 35 percent of the pilot participants were missing at least one previous patch
David Merrill, Senior Technical Staff Member, IBM Chief Information Security Office has indicated that �Leveraging this solution internally will deliver an outstanding ROI while very rapidly transforming and strengthening IBM�s endpoint security.�
IBM had already deployed Tivoli Endpoint Manager to over 550,000 endpoints within six months, out of a total of 750,000 Windows, Mac, and Linux endpoints targeted by the end of 2011. This is the largest and fastest internal deployment within IBM�s history.
There's little I can add to the virtual ink that's been devoted to his passing. So instead I've compiled another list of articles from around the web. Feel free to scan, share or add your own views.
From the Financial Times Tech Hub,Chris Nuttall has compiled a list of responses from business and world leaders including Bill Gates, Larry Page, UK Prime Minister David Cameron and U.S. President Barack Obama: "The world has lost a visionary. And there may be no greater tribute to Steve�s success than the fact that much of the world learned of his passing on a device he invented. Michelle and I send our thoughts and prayers to Steve�s wife Laurene, his family, and all those who loved him. "
On HBR Blogs,Eddie Yoon writes a thank-you letter to Jobs: "Thank you for showing us that in all of what we do in business, that the mission can be more than just margin. For showing us that creation much more fun than just conquest. For showing us that the $3 billion you have paid out to developers via the App Store is what a real job creation program looks like. For showing us that pursuing artistry brings more lasting joy than just adulation. And for showing us that fractional thinking about just market share is more likely to limit your future, while an exponential mindset around category growth will expand your horizons."
Over on Quora, a growing number of contributors including Apple co-founder Steve Wozniak are answering the question "What are some great stories about Steve Jobs?" Here's the answer from Jarin Udom: "I read somewhere that the night before the iPod launch Steve Jobs was playing with one of the demo units and felt the headphone jack didn't feel solid enough when he plugged in the headphones. So he made the engineers stay up all night replacing the jacks on 100 demo units until they clicked right. I think about that every time I plug my headphones into my iPhone.
On the tech Culture blog Paleofuture, Matt Novakcompares Jobs not only to Thomas Edison, but also to Walt Disney: "Jobs was truly a futurist in the tradition of talented showmen and a storytellers like Walt Disney. It�s one thing to understand what the future might hold, as I believe both Jobs and Disney did, but it�s another thing entirely to be able to communicate that vision of the future with both passion and poise to a broad audience. Jobs, like Disney, brought into our homes that passion for innovation and a confidence in technology�s ability to improve our lives."
On the Silicon Valley blog, Chris O'Brien answers why people feel the loss of a stranger so deeply: "From the start, he had the remarkable insight that he should be building products for real people, not engineers or investors or himself. That sense of humanity set Apple apart in its early days, when the original Macs became a sensation. And he restored that sense of purpose when he returned from the wilderness in the mid-1990s. The clamshell powerbooks, then the iPod, the iPhone, and at last, the iPad, brought instant delight and surprise the very first moments you touched them. "It just works," he repeated, like a mantra, in his final years [...] He knew us and understood us, it seems, better than we understood ourselves [...]Yes, he was human and he had his flaws, both personally and professionally. But he showed us how to learn from our shortcomings, and to become better at the home and at the office."
On Mashable,Stephanie Haberman has created a photo slideshow of letters to Jobs. One anonymous entry reads: "You inspired me to care deeply about the things I make, people I spend my time with, and choices I make every day. I learned about thinking different and embracing it. Your innovations have changed me and our world. I hope we can continue your legacy by continuing to work in your likeness by being overwhelmingly passionate about what we do and caring about the people around us"
In "The Tao of Steve," Om Malik of GigaOm writes of the lessons he's learned from watching Jobs: "The idea of Steve led me to follow my heart, make tough choices, be brutally honest with myself (and sometimes annoying to people I love) and always remember that in the end, it is all about making your customers happy. There are simple ways to get along with everyone. There are easier ways to get things done. There are compromises. But to me Steve Jobs meant try harder, damn it, your customers (readers) expect better than that. Steve taught me to care about the little things, because in the end, little things matter."
And on Wired, Stephen Levy waxes both eloquent and philosophic: "The full legacy of Steve Jobs will not be sorted out for a very long time. When employees first talked about Jobs� �reality distortion field,� it was a pejorative � they were referring to the way that he got you to sign on to a false truth by the force of his conviction and charisma. But at a certain point the view of the world from Steve Jobs� brain ceased to become distorted. It became an instrument of self-fulfilling prophecy. As product after product emerged from Apple, each one breaking ground and changing our behavior, Steve Job�s reality field actually came into being. And we all live in it."
A few months back, the CTO of IBM�s WebSphere technologies was shopping for a washing machine. His family had a washing machine, but a disturbing string of higher-than-usual energy bills hinted at the impending need for a more energy-efficient model.
Cuomo suspected his daughter had something to do with it.
An IBM Fellow, Cuomo brought his considerable tech chops to bear on the buying process. He studied Energy Star ratings in detail. He engaged in lengthy conversations with sales reps about heating capabilities. He compared water use per minute across all makes and models, all in the hopes of trimming a few kilowatt hours off his burgeoning energy bill.
None of this impressed his wife.
�You�re missing the point,� she said.
�What do you mean?� he asked.
�Well,� she replied, �a more efficient machine might help us save a few dollars here and there. But it won�t solve the problem. We do too much laundry. We need to cut down.�
That�s when the light went on.
Cuomo realized it was a question of perspective. On his business agility bloggers briefing call yesterday, he admitted to taking a �narrow IT view� of the problem; his wife saw it in broad strokes. Yes, a more efficient washer would solve a short-term pain; but a lasting solution lie in changing behavior � specifically, curtailing his daughter�s new proclivity for using �permanent press.�
The same dynamic plays out in business, Cuomo explained, and often with similarly isolated or short-term gains: �Efficiency on its own is an important goal,� he said, �but driving lasting improvements in business outcomes demands a prescriptive, top-down approach. The more global your perspective is, the more potent your activities will be about driving effectiveness.�
It would be odd, if not downright heretical, in our age of persistent and pervasive disruption to make a case against greater business agility. Scan the headlines from any of your favorite business publications (or walk past the boarded-up windows of your local Borders and Blockbuster) and you�ll see what happens to business that don't adapt. CEOs repeatedly name the level of complexity and the pace of change as the key challenges in today�s business environment. According to McKinsey's Global Economic Conditions Snapshot for September, most executives think a double-dip recession will hit advanced economies over the next six months, and nearly three-quarters say there is at least some chance of the eurozone splintering within the next two years.
Sitting on the sidelines and hoping the storm will blow over isn�t much of a strategy. The question instead is, how do you deal with planned and unexpected change amidst all this marketplace complexity? What�s going to make that lasting difference?
Organizations can start by taking a systematic, strategic look at improving outcomes in three key areas:
Agility Levers for Innovation, Transformation and Growth
Today�s business agility announcement focuses on three core attributes � Agility Levers � that, together, enable organizations to not only stand up to whatever the market throws at them, but improve business outcomes through continued innovation and growth. Rather than see your organization succumb to complexity and change, Business Agility solutions from IBM help you transform them into competitive advantage. They're also the latest example of the seamless integration of the broad set of capabilities within the IBM Software portfolio, bringing together no fewer than 10 all told.
The Business Agility Levers � and their supporting capabilities � are as follows:
Better business decisions driven by analytics and business rules. Through Decision Management, Predictive Business Service Management and Business Planning and Alignment, you can better automate, govern and improve operational decision-making for better outcomes. You can make more profitable decisions with real-time detection of opportunities and risks, and increase decision accuracy by applying predictive analytics throughout your organization.
A smarter approach to process and integration. Through Business Process Management (BPM), Connectivity and Integration and Collaborative Development and Operations, you can enable business-led, collaborative transformation by linking execution to strategy; accelerate innovation with a collaborative, agile approach to software and service life cycle management. And gain insight across interconnected processes, applications, information and multiplatform systems.
Accelerated application, service and information delivery with SOA and extended reach into cloud and mobile. With IBM capabilities for Application Infrastructure and Messaging, Cloud and Virtualization Management, Security and Compliance and Enterprise Modernization, you can securely integrate information, applications and workloads between public and private clouds and traditional IT; automate service delivery to improve economics, reduce risk and accelerate innovation. Finally, you can streamline multiplatform development, deployment, and information delivery for mobile web and cloud.
Three client examples
Organizations around the world are already benefiting from IBM Business Agility solutions. Here�s a mere sampling from a very lengthy list:
Real-time, intelligent decision automation: Using IBM Decision management capabilities, Santiago Stock exchange improved real-time securities fraud surveillance by 100 percent.
Faster process change and integration: With Business process management and SOA, the City of Madrid reduced emergency response times by 25 percent.
Secure information delivery: With universal connectivity, U.S. retailer Stein Mart saves 500 labor hours worth of data recovery.
How to get agile
There�s no one way for you to increase your business agility. Like Cuomo�s washing machine dilemma, it demands a broad perspective on your biggest challenges and a deep understanding of your long-term goals. But that�s not to say you can�t have quick wins. In fact, they�re essential in building the momentum you�ll need to convince your colleagues and your C-suite to get started.
The beauty of today�s announcement and the IBM solutions is that we can work with you to implement an initial project, establish a broader program and build a roadmap to extend your successes across your organization. All you need to know is where you�re hurting the most.
For Cuomo, that pain was squarely in his pocketbook. He finally did replace the old machine, but says he �hasn�t found the right moment� for the conversation with his daughter.
Unfortunately, we can�t help with that.
Want to learn more about the power of Business Agility?
Today, IBM not only announced its intention to acquire Q1 Labs, but also to form a new division of Software Group called IBM Security Systems. There�s a press release you can read here that will cover why IBM went down this path and what we�re hoping to accomplish with the new acquisition and division. Given this announcement, as well as it being IBM�s centennial year, I also decided that this was an appropriate time to reflect on some things about technology and security.
When I first came to IBM a few years ago, I started off in cloud computing and on my first day someone spent about twenty minutes going through the basics of how computing had evolved over the years. Just as the internet had pushed human beings closer to one another, cloud was the next step in pushing computing resources closer together. Security, I was told, was the biggest roadblock in cloud adoption.
However, what I have come to realize in the few years since then, is that cloud is probably only the beginning of these new, more acute discussions and concerns around the relationship between security and openness/connectivity. I went to the THINK exhibit in NYC and I was struck by a few key things. Much of what we are working on now is not only changing the way we connect and compute (examples would be applying technology to social interaction and sharing resources in the cloud), but also adding to a growing list of things falling under the category of �what we compute.� We are applying technology to water, traffic, the grid, agriculture and perhaps most significantly, personalized medicine.
Yet, these innovations rely on the technology doing what we have programmed it to do. For those of you unfamiliar with what hackers do, hackers look at ways to make technology do things it wasn�t originally designed to do. In the recently released IBM X-Force Trend and Risk Report we called 2011 the �Year of the Security Breach.� So, computer criminals have been pretty successful recently at making software and systems do things that they aren�t supposed to do. In the context of more computing and connectivity, this rightfully raises some eyebrows.
As a result, security has, and will continue to become more important, because the impact of a breach, or of malware, or an insider threat, has the potential to become increasingly more significant. This is why IBM�s commitment to a vision of a Smarter Planet really isn�t complete without a focus on security, and thusly what makes today�s announcement both exciting and perhaps even predictable. We�ve been doing security for a long time, and the size of our portfolio certainly reflects that. The significance of today�s announcement really comes down to driving closer product integration and the belief that improved security will only become a more urgent requirement in years to come. The addition of Q1 Labs to the portfolio helps us to take information and events related to networks, applications, databases, users, servers, etc and develop meaningful intelligence about what is happening across disparate systems and environments. This combination of security and analytics seems a natural fit for IBM.
To me, it does not seem like much a stretch to suggest that our ability to realize the value of new computing models will come down to how proficient security capabilities and processes ultimately become. There is a lot more work to be done, and today what I am most optimistic about is that IBM is taking another important step forward.
Finally, I look forward to introducing some of my new colleagues to you all shortly.
*In the post I mentioned the THINK exhibit in NYC, and I�d encourage anyone in the area to check it out. It�s on 65th and Broadway. Here�s a video IBM produced as well as some pictures I took. The one suggestion I�d make is to try allotting enough time to stay for two sessions. You get 25 minutes at the end to interact with the screens and there is more than 25 minutes worth of content available. You certainly don�t have to stay, but I ran out of time on a few things I was interested in.
In November of 2010, IBM completed its acquisition of Netezza, a maker of data warehouse appliances -- integrated sets of servers, storage resources and software specifically designed for data warehousing. The acquisition raised a few eyebrows, but given the value IBM Software and its clients received, the buy looks to me to be a bargain... especially when you consider that at many organizations, data warehousing works less like magic, and more like a Magic Eight Ball.
Perhaps you�re not familiar with this classic children�s toy? Essentially, it was a source of quick but dubious wisdom. The idea behind it was simple: begin with a question, shake the eight ball, and get your answer.
So you could ask it things like: Who stole my cookies during recess?
Then the toy would deliver an answer that was usually both wonderfully vague and wholly unrelated to your question. Example: Signs point to maybe.
This is not an answer steeped in obvious business value. Still, it did have the virtue of arriving in five seconds flat.
And what the Magic Eight Ball lacked in predictive accuracy it made up for in management complexity -- which is to say, it had none. Unless you threw it violently against a wall, as my friend Steve did on two separate occasions in the third grade, the Magic Eight Ball would continue to function without maintenance. So it was both fast and trouble-free.
Unfortunately, that statement doesn�t always apply to today�s enterprise-class data warehousing and analytics architectures.
Too frequently, the architecture is simply too slow, too complex and much too difficult to develop from scratch. Even just keeping it running properly requires excessive time, effort and money. So you get higher operational costs, clumsier business agility and a less competitive and efficient response to market dynamics.
As a result, business leaders could be forgiven if, at times, they feel an urge similar to my childhood friend Steve's.
Transactions-based systems can't match architectures that are designed for analytics
How did this situation come about? Often, it stems from the fact that the data analysis architecture was never designed properly for data analysis in the first place. Instead, it was cobbled together from existing database systems, which were originally intended for a fundamentally different purpose (business transactions).
And while this jerry-rigged design may have worked reasonably well at first, its shortcomings have, over time, become increasingly exposed. In part, this is because both the need for quality analytics and the scope of the data being analyzed have grown to levels unimaginable when the system was originally implemented.
Recently I had an opportunity to speak with Michael Kearney, Senior Product Marketing Director for IBM Netezza, about these and related issues, and he confirmed my suspicions on this topic.
�Big data creates challenges and opportunities for the warehouse,� said Kearney. �Database systems designed to process transactions cannot perform at the scale of systems designed exclusively for advanced analytic processing -- and organizations can create value from their data by processing analytic algorithms.�
What, exactly, is meant by the phrase �designed exclusively for advanced analytic processing?�
In short, systems that were created with huge data volumes and advanced analytics in mind from day one. Instead of general-purpose systems that would be just as well suited as e-mail servers or web hosts, in other words, systems that really take into account what businesses want to achieve via data warehousing and analytics and make that happen. With incredible speed and efficiency.
So, for instance, imagine having this capability: A fleet of as many as a hundred different server blades, each of which has multiple processors, each of which has multiple processing cores. Together, these blades form a vast analytical engine that is both (a) load-balanced to handle unpredictable demand levels, and (b) optimized for performance via massive parallel processing technology.
To that, add even more intelligence in the form of query analysis and execution that is physically close to where data is stored, unlike older architectures that attempt to move data to the query.
Get the answers you need -- not just faster, but orders of magnitude faster
That doesn't sound like your father's data analytics architecture, does it? It's not.
It is, in fact, so much better than the traditional approach that many organizations find the difference almost shocking -- whole orders of magnitude faster than the transactions-based systems that are being replaced.
XO Communications has had a similar experience. Every day, this business telecommunications provider faces a situation typical to the telecom sector: razor-thin margins and the need to establish, in quantified terms, whether its operations and business strategies are actually making money or not.
Obviously, the faster that kind of determination can be made, the better. But the company's prior analytics architecture, which took some two months to finish a profitability analysis, wasn't exactly fast.
Thanks to XO's new architecture and IBM Software, all that has changed�dramatically. How dramatically?
�Netezza gave us the ability to determine profitability on a day-to-day basis,� said Danny Sangster, Senior Manager of Enterprise Business Intelligence at XO Communications.
Old system: two months delay. New system: immediate result. That's quite a change.
True data warehousing appliances deliver far more business value, yet require far less ongoing maintenance
Of course, some of that acceleration stems from the fact that the ongoing maintenance they used to have to perform is simply no longer required. �With Netezza, there are no indexes, no summary tables, no partitioning,� said Sangster. �Just load and go.�
And vastly reduced ongoing maintenance contributing to far superior performance isn't limited to XO Communications, either. Ideally, in fact, analytics architectures should be de facto turnkey appliances, requiring as little tuning or management as possible.
When they are, it frees time-challenged IT team members to attend to more critical tasks. It also accelerates the business's ability to implement new strategies to respond to customer interests or needs.
�Sure,� said Kearney. �Before Netezza disrupted the market with its appliances, operating a data warehouse required a team of administrators dedicated to the care and feeding of the data management system.�
�Care and feeding� I found an interesting phrase, suggesting as it does a high-maintenance beast likely to devour almost as much business value as it creates.
What kinds of results can organizations get by moving to a far more autonomous architecture?
Guest blogger Wes Simonds worked in IT for seven years before becoming a technology writer on topics including virtualization, cloud computing and service management. He lives in sunny Austin, Texas and believes Mexican food should always be served with queso.