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How companies are achieving competitiveadvantage through analyticsTony BoobierInsurance Leader EMEAIBM Business Analytics1...
Dramatic changes across industries require new  approaches…                                               Channel manageme...
A need for change is a need for smarter planet.       ‘We have entered the decade of Smart’                               ...
Our world is becoming    INSTRUMENTED    Our world is becoming    INTERCONNECTED    Virtually all things, processes and wa...
INSTRUMENTED    We now have the ability to measure,    sense and see the exact condition of    everything.    •Today, ther...
INTERCONNECTED    People, systems and objects can    communicate and interact with each other in    entirely new ways.    ...
INTELLIGENT    We can respond to changes quickly and     accurately,and get better results by     predicting and optimizin...
+             +          =    An opportunity to think and act in new ways—        economically, socially and technically. ...
We are Already Integrating Location with Analytics•       Postal delivery optimisation•       Movement analytics for touri...
Examples of Spatial Analytics in UseUsing IBM DB2 database with Spatial Extender:     BNSF - incredibly complex spatial qu...
IBM and ESRI      2011 ESRI wins Global Technology Alliance        Award : IBM partner conference Las Vegas      2011 Spot...
What smart things are happening         in your industry today?         Where are the greatest       opportunities for pro...
Where does the location element of a ‘Smart Planet’ fit in….?New Intelligence:A smarter planet gives organizations the vis...
Where does the location element of a ‘Smart Planet’ fit in….?Green and Beyond:A smarter planet empowers organizations to d...
Where does the location element of a ‘Smart Planet’ fit in….?Smart Work:A smarter planet puts organizations in position to...
Where does the location element of a ‘Smart Planet’ fit in….?Dynamic Infrastructure:A smarter planet enables organizations...
The Roadmap to Success  IBM Research with MIT Management Research shows the  urgency to act on analytics and tells about t...
The Journey from Aspirational to Transformed3 Key Analytic Segments of Ability                                            ...
Finding competitive advantage using analytics has  increased in 12 months           Respondents who say             analyt...
Transformed or ‘Leading’ companies are getting greatercompetitive advantage by expanding the use of analytics             ...
Transformed (‘leading’) organizations are creatingadvantage by intensely focusing on applyinganalytics in three key areas ...
Where can Analytics help – and where best is the location component?                                                      ...
How to Implement Analytics : 3 areas of competence    Manage, Understand, Act on the data                                 ...
Implementation Transformed ‘leading’ organizations take either an enterprise or specialist path                           ...
Collaborative organizations have to resist the urge    to perfect the data                           Key characteristics r...
Specialized organizations face problems aheadMost view organizational challenges as more difficult to resolvethan technolo...
Three Steps to Transformation                                   1                                             Assess your ...
Summary      • Welcome to the decade of ‘Smart’      • Analytics provide measureable differentiation      • Location analy...
42 Page 42   11/29/2011   © 2011 IBM Corporation
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How companies are achieving competitive advantage through analytics

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Presentation by Tony Boobier from IBM on Esri European User Conference.

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Transcript of "How companies are achieving competitive advantage through analytics"

  1. 1. How companies are achieving competitiveadvantage through analyticsTony BoobierInsurance Leader EMEAIBM Business Analytics1 © 2011 IBM Corporation
  2. 2. Dramatic changes across industries require new approaches… Channel management Need to simplify back-office processes so that distribution channels can be more efficient and profitable Economy Customers Investment income is no Customers are more price longer a dependable conscious and less loyal source of profit and demand personalized, high service levels Competition Regulation Competition is intensifying Regulatory reportingwith increased mergers and requirements and a demand acquisitions, divestitures, for transparency are and new entrants increasing Growth Risk Growth market segments have Technology investments driven become the focus of expansion by regulatory requirements need with a need to grow the current to be leveraged in other business customer base areas 2 © 2011 IBM Corporation
  3. 3. A need for change is a need for smarter planet. ‘We have entered the decade of Smart’ Sam Palmisano, CEO IBM 20103 © 2011 IBM Corporation
  4. 4. Our world is becoming INSTRUMENTED Our world is becoming INTERCONNECTED Virtually all things, processes and ways of working are becoming INTELLIGENT4 © 2011 IBM Corporation
  5. 5. INSTRUMENTED We now have the ability to measure, sense and see the exact condition of everything. •Today, there are 1 billion transistors for each person on the planet. 1 •By 2010, 30 billion RFID tags will be embedded into our world and across entire ecosystems.1 Everything will become instrumented: supply chains, healthcare networks, cities and even natural systems like rivers.5 1 Sam Palmisano speech, November 12, 2008 © 2011 IBM Corporation
  6. 6. INTERCONNECTED People, systems and objects can communicate and interact with each other in entirely new ways. • The internet of people is 1 billion strong. Almost one third of the world’s population will be on the web by 2011.1 • There were nearly 4 billion mobile phone subscribers worldwide by the end of 2008. 1 The Internet of things—cars, appliances, cameras, roadways, pipeline, pharmaceuticals and even livestock—is headed to 1 trillion.6 1 Sam Palmisano speech, November 12, 2008 © 2011 IBM Corporation
  7. 7. INTELLIGENT We can respond to changes quickly and accurately,and get better results by predicting and optimizing for future events. • Every day, 15 petabytes of new information are beinggenerated. This is 8x more than the information in all U.S. libraries.1 • An average company with 1,000 employees spends $5.3 million a year to find information stored on its servers. 1 New computing models manage the massive amounts of data generated by the proliferation of end-user devices, sensors, and actuators. Combined with advanced analytics, these technologies are making us smarter.7 1 New Intelligence White Paper from ThinkForward website © 2011 IBM Corporation
  8. 8. + + = An opportunity to think and act in new ways— economically, socially and technically. ‘Location’ is a key component of thinking in different ways8 © 2011 IBM Corporation
  9. 9. We are Already Integrating Location with Analytics• Postal delivery optimisation• Movement analytics for tourists• Minority integration support• Law enforcement• Railroad track analysis• Cancer research• Insurance fraud analytics• Flood prediction Welcome to the world of ‘Geo Analytics’ 9 © 2011 IBM Corporation
  10. 10. Examples of Spatial Analytics in UseUsing IBM DB2 database with Spatial Extender: BNSF - incredibly complex spatial queries for railroad analytics Emory University - Dr. Fusheng Wang - cancer research Irish insurance company - analysis of insurance flood risk Medicare Australia – analysis of healthcare fraud analysis10 © 2011 IBM Corporation
  11. 11. IBM and ESRI 2011 ESRI wins Global Technology Alliance Award : IBM partner conference Las Vegas 2011 SpotOn Systems Inc (acquired by ESRI last week) wins ISV Achievement Award Las Vegas12 © 2011 IBM Corporation
  12. 12. What smart things are happening in your industry today? Where are the greatest opportunities for progress?14 © 2011 IBM Corporation
  13. 13. Where does the location element of a ‘Smart Planet’ fit in….?New Intelligence:A smarter planet gives organizations the vision to see withoutbeing there.Matiq: Employs RFID tags to trace meat and poultry from German supermarket: Uses smart RFID labels tothe farm to store shelves to ensure safety and freshness manage inventory with real-time sales data, improvingand provide more transparency to consumers.1 product availability and enhancing the consumer experience.2U.S. power company: Saves $1.2 million annually IBM Deep Thunder: Leverages computing power,by using an RFID-based fleet optimization system to visualization and data analytics to generate high-reduce the amount of repair work on their vehicles.2 resolution weather forecasts for areas as fine as 1 to 2 square kilometers.3 1 Approved Smart Planet Client References 2 Smarter planet sales deck15 3 Sam Palmisano speech, November 12, 2008 © 2011 IBM Corporation
  14. 14. Where does the location element of a ‘Smart Planet’ fit in….?Green and Beyond:A smarter planet empowers organizations to do more,using less.Landmark: Revolutionizes petroleum frontier StatoilHydro: Links advanced real-time sensingexploration in Texas by integrating data sources to capabilities in the field to collaborate and analyzeincrease the likelihood of finding profitable sources resources across the enterprise for an expected 5%of oil.1 boost in oil and gas production and 30% cost reduction.1Stockholm, Sweden: An intelligent toll system in the IBM’s Carbon Tradeoff Modeler: Manages andcity center resulted in 20% less traffic, 40% lower performs analytics to help companies reduceemissions and 40,000 additional users of the public emissions and make smarter, more cost-effectivetransportation system.1 energy choices.2 1 Approved Smart Planet Client References 2 Smarter planet sales deck16 © 2011 IBM Corporation
  15. 15. Where does the location element of a ‘Smart Planet’ fit in….?Smart Work:A smarter planet puts organizations in position to be firstand be right.Canadian airlines: Use passenger information to British Airways: Uses mobile device check-in andpredict the number of no-shows for each flight, so they other self-service technologies to help facilitate acan strategically overbook while minimizing the risk of trouble-free travel experience and save the airlinebumping passengers.1 $3.50 per passenger.2Max Bahr: A Dynamic Inventory Optimization Solution IBM Research Zurich Lab: Uses visualization softwareenables the retailer to meet demand for any of 40,000 to render a 3D model of each patient, allowing doctorsproducts in more than 80 outlets with low replenishment to interact with data that improves patient care.2and storage costs—boosting customer service ratingsto 99%. 2 1 Smarter planet sales deck17 2 Approved Smarter Planet Client References © 2011 IBM Corporation
  16. 16. Where does the location element of a ‘Smart Planet’ fit in….?Dynamic Infrastructure:A smarter planet enables organizations to solve the problembefore the problem occurs.British banks: Utilize real-time data analytics of Bank of Montreal: Created a synchronized secondarycomplex financial models to help understand and data center 100 kilometers from its primary facility tomanage their exposure to risk.1 meet government regulations and ensure the safety and availability of data in the event of a disaster.2River and Estuary Observatory Network: Will create IBM Fire Program Analysis: Uses unique mathematicalthe first technology-based real-time environmental algorithms to determine where wildfires will likely occur,monitoring and forecasting network to guide better and helps optimize government funds and resources forpolicy, management and education for the Hudson battling those fires.1River and estuaries worldwide.2 1 Original deck18 2 Approved Smart Planet Client References © 2011 IBM Corporation
  17. 17. The Roadmap to Success IBM Research with MIT Management Research shows the urgency to act on analytics and tells about the paths organizations are taking to transformation Research findings Competitive Competitive There are two advantage being analytics requires paths to analytic created by analytics mastery of three sophistication is widening key competencies19 19Page 11/29/2011 Source: The New Intelligent Enterprise a joint MIT Sloan Management Review and IBM Institute of Business Value analytics research partnership. © 2011 IBM Corporation Copyright © Massachusetts Institute of Technology 2011.
  18. 18. The Journey from Aspirational to Transformed3 Key Analytic Segments of Ability Transformed (Leading) Experienced (Learning) Aspirational (Growing)20 20Page 11/29/2011 Source: The New Intelligent Enterprise a joint MIT Sloan Management Review and IBM Institute of Business Value analytics research partnership. © 2011 IBM Corporation Copyright © Massachusetts Institute of Technology 2011.
  19. 19. Finding competitive advantage using analytics has increased in 12 months Respondents who say analytics creates a Organizations achieving competitive advantage a competitive advantage with analytics are 2011 58% 2.2x more likely to substantially outperform 2010 37% 57% their industry peers increase Ratio of respondents who indicated analytics creates a competitive advantage to those who indicated it did not and the likelihood they also indicated their organizations was “substantially outperforming their competitive peers”. The ratio was 2.0 to1 in 2010.22 22Page 11/29/2011 Source: The New Intelligent Enterprise a joint MIT Sloan Management Review and IBM Institute of Business Value analytics research partnership. © 2011 IBM Corporation Copyright © Massachusetts Institute of Technology 2011.
  20. 20. Transformed or ‘Leading’ companies are getting greatercompetitive advantage by expanding the use of analytics Respondents who cited a competitive advantage using analytics year-over-year 2011 80% Transformed / Leading 23% 2010 65% increase 2011 63% Experienced / learning 66% 2010 38% increase 2011 Aspirational / Learning 5% 2010 39% decrease23 23Page 11/29/2011 Source: The New Intelligent Enterprise a joint MIT Sloan Management Review and IBM Institute of Business Value analytics research partnership. © 2011 IBM Corporation Copyright © Massachusetts Institute of Technology 2011.
  21. 21. Transformed (‘leading’) organizations are creatingadvantage by intensely focusing on applyinganalytics in three key areas of business Speed of decisions Enterprise risk Customers Transformed Transformed Transformed 72% 86% 62% Experienced Experienced Experienced 49% 6% 49% Aspirational Aspirational Aspirational 22% 0% 34% Percentage indicates those who exhibited an intense level of focus on a particular subject area.25 Page 25 11/29/2011 Source: The New Intelligent Enterprise a joint MIT Sloan Management Review and IBM Institute of Business Value analytics research partnership. © 2011 IBM Corporation Copyright © Massachusetts Institute of Technology 2011.
  22. 22. Where can Analytics help – and where best is the location component? Majority of respondents 10% 20% 30% 40% 50% 60% 70% Enhancing customers’ overall experience Customer Optimizing the match of sales reps to customers Defining marketing campaigns Identify target customers Allocating employees’ time and efforts HR Evaluating employee performance Establishing organizational strategic objectives Strategic Developing / refining new products or services Streamlining operational processesOperational Managing supply chain or logistics Allocating annual budget Financial Establish financial forecasts Aspirational Experienced Transformed Percentage of respondents who indicated their organization relies on data and analytics to execute these activities. The question choices ranged from 1= Intuition /Experience, 3= Equal parts experience / data to 5= Data / Analytics. Respondents above selected 4 or 5. 27 Page 27 11/29/2011 Source: The New Intelligent Enterprise a joint MIT Sloan Management Review and IBM Institute of Business Value analytics research partnership. © 2011 IBM Corporation Copyright © Massachusetts Institute of Technology 2011.
  23. 23. How to Implement Analytics : 3 areas of competence Manage, Understand, Act on the data Analytic Competencies 1.Manage the data 2.Understand the data 3.Act on the data Information management Analytic skills and tools Data-oriented culture Solid information Skills developed as a Fact-driven foundation core discipline leadership Enabled by a Analytics used as a Standardized data robust set of tools management practices strategic asset and solutions Delivers actionable Strategy and Insights accessible and insights embedded operations guided by available in processes insights28 Page 28 11/29/2011 Source: The New Intelligent Enterprise a joint MIT Sloan Management Review and IBM Institute of Business Value analytics research partnership. © 2011 IBM Corporation Copyright © Massachusetts Institute of Technology 2011.
  24. 24. Implementation Transformed ‘leading’ organizations take either an enterprise or specialist path Paths to transformation High Enterprise driven Transformed Collaborative path Information Governancemanagement approach proficiency Specialized path Aspirational Line-of-business Low driven Low High Analytic skills and tools proficiency 33 Page 33 11/29/2011 Source: The New Intelligent Enterprise a joint MIT Sloan Management Review and IBM Institute of Business Value analytics research partnership. © 2011 IBM Corporation Copyright © Massachusetts Institute of Technology 2011.
  25. 25. Collaborative organizations have to resist the urge to perfect the data Key characteristics respondents said would increase confidence in data used for decisions More timely data 31% More relevant data 31% Better data collection 24% Better traceability of data 22% More precise data 21% Respondents were able to select up to three choices from a longer list of options. These are the top five answers.35 Page 35 11/29/2011 Source: The New Intelligent Enterprise a joint MIT Sloan Management Review and IBM Institute of Business Value analytics research partnership. © 2011 IBM Corporation Copyright © Massachusetts Institute of Technology 2011.
  26. 26. Specialized organizations face problems aheadMost view organizational challenges as more difficult to resolvethan technology Respondents who rate these challenges as extremely difficult to resolve Organizational challenges 44% Technology challenges 24% 1.8x more difficult36 Page 36 11/29/2011 Source: The New Intelligent Enterprise a joint MIT Sloan Management Review and IBM Institute of Business Value analytics research partnership. © 2011 IBM Corporation Copyright © Massachusetts Institute of Technology 2011.
  27. 27. Three Steps to Transformation 1 Assess your analytic sophistication 2 Focus on improving your analytic competencies Establish a strong Develop a robust Create a culture information set of analysis that takes action foundation skills and tools on analytics 3 Tie approach together with an information agenda which includes a location component37 Page 37 11/29/2011 Source: The New Intelligent Enterprise a joint MIT Sloan Management Review and IBM Institute of Business Value analytics research partnership. © 2011 IBM Corporation Copyright © Massachusetts Institute of Technology 2011.
  28. 28. Summary • Welcome to the decade of ‘Smart’ • Analytics provide measureable differentiation • Location analytics can be a critical component41 © 2011 IBM Corporation
  29. 29. 42 Page 42 11/29/2011 © 2011 IBM Corporation
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