Organizing for BI, Analytics and Big Data: CoE, Federated or Departmental

• Data-as-a-Service:  Data Provisioning, Management, Lineage, Quality
• Reporting-as-a-Service:  Dashboards, KPIs, Drilldowns/Aggregates…. Descriptive
• Analytics-as-a-Service:  Predictive  Modeling and BI… Prescriptive analytics
• Information-as-a-Service:  Threshold based Alerts, Exceptions, Mobile Prompts
• Insights-as-a-Service:   ML/AI based…automated learning – ambient intelligence, Next best Offer/Action

Which strategy are you implementing?

Data is valuable. Data is plentiful. Data is complex. Data is in flux. Data is fast moving. Capturing and managing data is challenging.

So, if you are a senior leader in a Fortune 2000 company.  How do you structure your group to deliver effective BI, Analytics or Big Data projects? Do you have the right structure,  toolset, dataset, skillset and mindset for analytics and Big Data?

Organizing for effective BI, Analytics and Big Data is becoming a hot topic in corporations.  In 2012, business users are exerting  significant influence over BI, Analytics and Big Data decisions, often choosing analytics and visualization platforms and products in addition to/as alternatives to traditional BI platform (reporting and visualization tools).

Bloomberg on Business Analytics

Interested in slicing, dicing, measuring, and analyzing data for customer and business insights?

According to a recent survey by Bloomberg, 97% of companies with revenues of more than $100 million are using some form of business analytics, up from 90% just two years ago.

While businesses have embraced the idea of fact-based decision-making, a steep learning curve remains. Only one in four organizations believes its use of business analytics has been “very effective” in helping to make decisions. Data is not just ignored but often discarded in many organizations as the business users can’t figure out how to extract signal from data noise.

Spend BI and Analytics

What is your spend IQ or data maturity?

Procurement organizations tend to swim in data. One of the most important strategies for any best-in class procurement organization is spend analytics. In conjunction with sourcing, category, contract management and purchasing, spend analytics provides a window into spend behavior to drive cost reduction and cost avoidance efforts.

As a result, we are seeing a lot of interest around Spend BI and Analytics projects. Chief Procurement Officers and other Sourcing/Procurement leaders of Global, large and even mid-market firms are increasingly focusing on spend data analytics as part of a new wave of spend rationalization projects.

Proctor & Gamble – Business Sphere and Decision Cockpits

Data-driven DNA is about having the right toolset, mindset, skillset and dataset to evolve a major brand and seize today’s omni-channel opportunities. Whether it’s retooling and retraining for the multiscreen attention economy, or introducing digital innovations that transform both retail and healthcare, P&G is bringing data into every part of its core strategies to fight for the customer.

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Striving for market leadership in consumer products is a non-stop managerial quest.  In the struggle for survival, the fittest win out at the expense of their rivals because they succeed in adapting themselves best to their environment. 

CMOs and CIOs everywhere agree that analytics is essential to sales & marketing and that its primary purpose is to gain access to customer insight and intelligence along the market funnel – awareness, consideration, preference, purchase and loyalty.

In this posting we illustrate a best-in-class “run-the-business” with Data/Analytics Case Study at P&G. The case study demonstrates four key characteristics of data market leaders:

1. A shared belief that data is a core asset that can be used to enhance operations, customer ser­vice, marketing and strategy
2. More effective leverage of more data – corporate, product, channel, and customer –  for faster results

3. Technology is only a tool, it is not the answer..!

4. Support for analytics by senior managers who embrace new ideas and are willing to shift power and resources to those who make data-driven decisions

This case study of a novel construct called Business Cockpit (also called LaunchTower in the Biotech and Pharmaceutical Industry) illustrates the way Business Analytics is becoming more central in retail and CPG decision making.

Here is a quick summary of P&G Analytics program:

• Primary focus on improving management decisions at scale – did the analysis to identify time gap between information and application to decision making
•  “Information and Decision Solutions” (IT)  embeds over 300 analysts in leadership teams
• Over 50 “Business Suites” for executive  information viewing and decision-making
• “Decision cockpits” on 50,000 desktops
• 35% of marketing budget on digital
• Real-time social media sentiment analysis for  “Consumer Pulse”
• Focused on how to best apply and visualize information instead of discussion/debate about validity of data

 

P&G Overview

IBM CIO Study: BI and Analytics are #1 Priority for 2012/2013

“Running a company is an endless quest to find out things you don’t know“

– Jeff Immelt, CEO GE

What will 2012 bring?  Recently, I attended the CIO Executive Leadership Summit in Greenwich, Connecticut. I was particularly intrigued by the presentation by the new CIO of IBM, Jeanette Horan where she presented the projects she was tackling and how IBM is thinking about business analytics.

IBM is making a bet that “true leaders” will develop the capabilities required for making good and timely decisions in unpredictable and stressful environments.

IBM is adapting to this new data analytics reality by a rapid-fire acquisition strategy:  Cognos,  Netezza, SPSS, ILog, CoreMetrics, Algorithmics, OpenPages, Clarity Systems, Emptoris, DemandTec (for retail).  IBM also has other information management assets like Watson, DB2 etc.  They are building a formidable capability around the value chain: “Raw Data -> Aggregate Data -> Intelligence ->Insight -> Decisions” . They see this as a $20Bln opportunity.

Wanted: CIO – BI/Analytics

In a tough economy, a new tech-fueled BI and analytics arms race is on to create the next competitive advantage.

Everyone is beginning to look beyond the status quo in BI, analytics, Big Data, Cloud Computing etc to fundamentally change how they discover fresh insights, how they can make smarter decisions, profit from customer intelligence and social media, and optimize performance management.

The headache for corporations is not the technology aspects but the leadership side. Who is going to lead this effort, corral the vendors and formalize and execute a more structured program.  

Who is going to lead the effort to create the right toolset, dataset, skillset and mindset necessary for success?

As BI and Analytics moves from “experiment and test” lab projects to commercial deployments, companies are going to need more leadership and program management capabilities.  They need leadership that can provide strategic, expert guidance for using powerful new technologies to find patterns and correlations in data transactions, event streams, and social media.

Some firms are making moves.  In insurance, AIG – Chartis Inc. unit appointed Murli Buluswar to the new post of chief science officer.  This aims to enhance Chartis’ focus on analytics… he “will be responsible for establishing a world-class R&D function to help improve Chartis’ global commercial and consumer business strategies and to deliver more value for customers.”  This focus on analytics involves “asking the right questions and making science-driven decisions about strategies—whether it’s related to underwriting decisions, product innovation, pricing, distribution, marketing, claims or customer experience—with the end result of improving the scope of what Chartis delivers for customers”.

As a result of where we are in the maturity cycle and to support the business units better, we are seeing a new emerging role “CIO – BI” that is dotted lined to the global CIO or a shared services leader.  Let’s look at a representative job posting from GE Capital, which always seems to be a step ahead of most companies.  

Do you have BI Performance Anxiety ?

BI is key to enabling companies to turn oceans of data into predictive models and actionable decisions. However, a survey of 353 executives in large companies, reported that their chief BI concern was the performance of various BI solutions.

Development, support and enhancement teams are typically deployed to address BI performance challenges with varied success.  But most companies don’t have a dedicated focus on performance.

A BI Center of Excellence (BI CoE) measured by performance KPIs and service metrics is one solution to this problem. This is not an area that traditionally draws high-level attention or is featured in a dedicated CoE initiative, yet in the right circumstances it offers unique value.

Is Your BI Project in Trouble?

Enterprise Business Intelligence (BI) project failure can happen for a variety of reasons.  Sometimes it’s due to frequent scope changes with a fixed schedule constraint, unexpected and unplanned-for “must-have” requirements changes, loss of key team members onshore or offshore,  chronic effort under-estimation, lack of proper work breakdown structure, lack of QA, and so on.

Regardless of the causes, BI, Analytics, performance management failed projects waste billions of dollars (and hours) each year.

Over the years, I have seen a lot of well-intentioned custom development, commercial, off-the-shelf package customization – SAP, Oracle, Peoplesoft ERP, CRM, SCM – and other enterprise data-warehouse projects get into trouble for a variety of reasons.  Troubled projects usually need triage, recovery, and turn-around skills to straighten things out quickly.

I am afraid that BI and Corporate Performance Management is reaching a phase in its hype cycle where we are beginning to see growing demand for troubled project recovery. It doesn’t take genius to realize that BI/Analytics project demand is growing as it is one of few remaining IT initiatives that can make companies more competitive. However, demand doesn’t imply project success.

Analytics-as-a-Service: Understanding how Amazon.com is changing the rules

“By 2014, 30% of analytic applications will use proactive, predictive and forecasting capabilities”  Gartner Forecast

“More firms will adopt Amazon EC2 or EMR or Google App Engine platforms for data analytics. Put in a credit card, by an hour or months worth of compute and storage data. Charge for what you use. No sign up period or fee. Ability to fire up complex analytic systems. Can be a small or large player”    Ravi Kalakota’s forecast 

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Big data Analytics = Technologies and techniques for working productively with data, at any scale.

Analytics-as-a-Service is cloud based… Elastic and highly scalable, No upfront capital expense. Only pay for what you use, Available on-demand

The combination of the two is the emerging new trend.  Why?  Many organizations are starting to think about “analytics-as-a-service” as they struggle to cope with the problem of analyzing massive amounts of data to find patterns, extract signals from background noise and make predictions. In our discussions with CIOs and others, we are increasingly talking about leveraging the private or public cloud computing to build an analytics-as-a-service model.

Analytics-as-a-Service is an umbrella term I am using to encapsulate “Data-as-a-Service” and “Hadoop-as-a-Service” strategies.  It is more sexy 🙂

The strategic goal is to harness data to drive insights and better decisions faster than competition as a core competency.  Executing this goal requires developing state-of-the-art capabilities around three facets:  algorithms, platform building blocks, and infrastructure.

Analytics is moving out of the IT function and into business — marketing,  research and development, into strategy.  As result of this shift, the focus is greater on speed-to-insight than on common or low-cost platforms.   In most IT organizations it takes anywhere from 6 weeks to 6 months to procure and configure servers.  Then another several months to load, configure and test software. Not very fast for a business user who needs to churn data and test hypothesis. Hence cloud-as-a-analytics alternative is gaining traction with business users.

Proactive Risk Management – New KPIs for a Dodd-Frank World

The financial crisis of 2007–2011 is driving widespread changes in the U.S regulatory system. Dodd-Frank Act addresses “too big to fail” problem by tightening capital requirements and supervision of large financial firms and hedge funds. It also creates an “orderly liquidation authority” so the government can wind down a failing institution without market chaos.

Financial institutions will be spending billions to strengthen, streamline and automate their recordkeeping, risk management KPIs and dashboard systems. The implications on Data Retention and Archiving, Disaster Recovery and Continuity Planning have been well covered. But leveraging Business Analytics to proactively and reactively manage/monitor risk and compliance is an emerging frontier.

We believe that Business Analytics and real-time data management are poised to play a huge role in regulating the next generation of risk and compliance management in Financial Services industry (FSI).  in this posting, we are going to examine the strategic and structural challenges, the dashboards and KPIs of interest that provide feedback, and what an effective execution roadmap needs to be for every organization.