Today I presented at the first of the SAP Analytics Innovation Tour events, in Manila, the capital of the Philippines. We had better-than-expected attendance and a standing-room-only crowd, dominated by local business leaders and IT executives. The event started with a welcome and short introduction to the opportunities of big data and analytics by Darren Rushworth, SAP Managing Director for the Philippines and Emerging Markets. I then presented on the topic of “Big Data Analytics – Drive Data to Decision”. The big themes are:
- How companies can take advantage of “big data” to run their business using forward-looking “signals” rather than just backwards-looking transaction and financial data
- How information frameworks are radically changing, to combine operations and analytics on a single in-memory platform, and breaking down many of the barriers that have plagued BI projects
- How businesses should empower business users to freely access information using data discovery tools – but without creating new disconnected analytics silos and new data governance problems.
- How packaged, best-practice analytics-focused applications can align these new technologies with the highest-priority problems in various industries and lines of business.
I was followed by Charles Gadalla, responsible for SAP’s new Predictive Analysis product, who examined the changing market for data mining and advanced analytic processing. He gave an excellent demo of the technology in action and gave examples of how customers have been using the technology to accelerate their businesses.
After the main event, I had a series of meetings with CIOs of companies in the region. Interestingly, the one constant across the different interviews was that the analytics projects being discussed all touched on the customer experience, not just internal efficiencies. This is a trend that I see around the world, as organizations realize the information is no longer just a “byproduct” of your products and services, but an essential asset that is used to create personalized, real-time interactions that optimize customer satisfaction and profit.
To prepare for the tour, I downloaded some data from the World Bank and put it into SAP Visual Intelligence for analysis. This quickly showed that the Philippines is a fast-growing country, with fast-growing infrastructure, especially mobile telephone use (it is the texting capital of the world).
The first customer I talked to was a bank with a series of projects aimed at improving the customer experience, using a combination of CRM systems, traditional data warehousing, advanced analytics/data mining, and a brand monitoring system. They were looking to extend this to move beyond loyalty- and product-based campaigns to more “event-based” interactions with customers. They would like to have the ability to make appropriate offers to customers each time they interact with the bank, or based on changes in customers’ lifestyles (new child, moving house, retirement, etc.) This would require augmenting existing customer records with more non-transactional information, such as social media, and combining information across different systems – including information currently only stored on account manager’s index cards.
Today, providing a targeted, personalized customer experience while the person is still on the phone is extremely difficult/expensive with slow, disk-based systems. With in-memory systems, the best offer can be calculated in real-time using embedded advanced analytics based on the very latest transaction and “signal” data – and the feedback can be used to continuously tune the algorithm with real-time results.
One interesting regional specificity is that the Philippines has recently passed a strict (and commendable!) consumer data privacy law. This includes the provision that data is collected for “specific and legitimate purposes determined and declared before, or as soon as reasonably practicable after collection, and later processed in a way compatible with such declared, specified and legitimate purposes only.” This essentially forces organizations to obtain an explicit opt-in from customers if information is being used for more than basic operational efficiency – and this potentially applies even to a data warehouses that brings information together from different divisions. The bank is in the process of working with legal teams to assess the implications.
I also talked to a water utility in the process of rolling out mobile dashboards to senior executives using SAP BusinessObjects directly on top of their SAP ERP systems. The company explained that the focus of analytics is mainly on efficiencies: it is a natural monopoly with little incentive to market directly to consumers: demand for domestic water use is generally inelastic, and the price is regulated by the government (they are currently undergoing an audit of the figures they provide to the regulators to negotiate future prices and network development).
But one opportunity is the renovation of the water network, parts of which date back to the era of Spanish colonial rule. Fixing these part of the networks leads to a triple benefit: first, it sharply reduces the water leakage and cuts costs; second, it allows higher water pressures to be used, which increases customer satisfaction (today, the higher floors of certain buildings may only get a trickle of water), and increases average customer water consumption (people spent more time in a comfortable shower where water is gushing at a higher rate).
Finally, one customer believes they have a unique opportunity to cross-sell to their high-value premier customers across several different – and otherwise unrelated– divisions of a conglomerate, and gave some wonderful examples of the synergies and services that could be possible, providing a personalized “luxury customer experience”. The initiative has a strong executive mandate, in the belief that there are indeed strong cross-selling possibilities, but the project is made difficult by the history of strong autonomy for each of the divisions, and the data privacy laws that prevent the group’s different divisions from sharing information before getting customer opt-in.
After jumping on yet another plane, I’m now writing (and uploading, using the onboard wifi) on the excellent Klia ekspress airport train to central Kuala Lumpur in Malaysia, for the next Analytics Innovation event tomorrow in the Hilton Hotel. I hope to see you there!