Imagine if you and ready access to all available data…or what the industry is now calling Big Data and includes both structured and unstructured data)...and you could get it faster and at less cost…how could that help your organization make better decisions? Sometimes it’s using Big Data to A) Doing something you were already doing – but better Fraud Detection more precision by using predictive analytics to analyzing a large volume of data (risk) and dectect fraudelent claims as well as provider fraud (eg. -Accurate and Timely Threat Detection eg. TSA – Secure Flight system (passenengers) plus Crew Vetting System Analyze, Predict and Act on the Battlefield eg. In the battle theatre….drone images, ground sensors B) Doing something you weren ’t doing before but its related to an existing objective …. Better understanding citizen sentiment by leveraging social media objective Social media allows rapid formulation of consensus opinion (vs. everyone needing to get in a room), and mobilize resources rapidly. eg. Arab Spring, occuby wallstreet, Egypt. 3. Doing something truly transformative – - real-time traffic flow optimization………..monitoring traffic with sensors and connect to to create less conjestion and polution. Did a POC with Caltrans where we used a Smartphone app to customize route advice to an individual RT Traffic Flow Optimization Stockholm, Singapore…..sensors in roads..monitor traffic flow and tie it to highway access and toll fees to reduce conjestion and polution POC with CalTrans in Silocon Valley……smart phone app ..customized guidance based on your driving patterns. Examples.
So what do we mean by the term Analytic? Providing people with trusted, relevant, and timely information in order to optimize business Outcomes These outcomes typically involve lowering cost, increasing revenues, or reducing risk. What’s different? Since analytics isn-t new…What new is that, with the help of Big Data and much more powerful yet less expensive and easier to use tools, leading organization are taking a much different approach to analytics: - sense and respond to predict and act eg. IRS Tax fraud Real time/fact driven, experts to everyone eg. Law enforcement …eg. NYC Crime Data Warehouse……show up at apartment before criminal arrives home Point of Impact Eg. Watson technology to mine incredible volumes of medical journals and studies to help diagnose a patience No where is the need for Analytics more necessary than with Government
No where is the need for analytics more critical then in Government where a number of key drivers are intensifying the need more Better information The key drivers include - Changing demographics – older and more diverse population strain on Social services Growing threats to stability around the world Rising environmental concerns Combine with extreme budget pressues Are resulting in a need to Maximize compliance and revenue Strengthen public safety Manage resources more effectively Provide more transparency and accountability ‘ This results in better information in order to Provide better services to citizen, soldiers, vts, patients Improve insights and predict future demands Anticipate threats and take quick action eg. GNR technology recognize permutations of names…..easier in English but in Aral Slavic, Eastern Asia you can have hundreds of different permutations of the same name. Eg. 911…4 of the 19 terrorists actually flew under their own name but didn’ t get picked up because they used different permutations. Eg. Cyberthreats – on Energy Department several weeks ago but suspected Chinese hackers…….. Better share information across agencies eg. DH@ 22 component agents but need to share outside with DoJ, State Dept There are many great examples in the Federal Government where they are leveraing Big Data and Analytics to address key busines outcomes….
Outcome – Claims process…..US Veterans Administration . delay in processing medicat claims fo soldiers….1.8M clams backlog…..up to 18 months to get a claim paid out. …was manual/paper based…….we helped them automate VA automate with IBM CM/workflow technology and used predictive analytics to determine which claims may have need further investigation and then fast track the rest. …now down from 18 to 6 months. Outcome – Increase Tax Revenue – US Internal Revenue Services – pay and chase model replaced with proactive approach leveraging analytics. . Scan returns before payout…use Identity Insight technology to uncover unique relationships (eg. Business files for bankruptcy and opens up under another name but uncover through phone number matching that it’s the same person). And predictive modeling to determine which claims are likely fraudulent and investigate before payout. Example 2 – divorce situation……..alimony tax deductible to husband and taxed as income to ex-spouse. Use analytics to determine that the husband is claiming more than he actually paid and his ex-wife is claiming that she received less. Examples that are difficult to fine anually eg. 3. Deductions vary based on where you live/age/income…eg. someone claiming 50K charitable deduction but makes $100K. Outcome – Smarter Social Services reduce Fraud and provide better service to citizens eg 1. . US Medicare/Medicaid – single view of provider (using our IBM MDM Initiate technology) …some double dipping….plus some citizen not taking advantage of benefits they are due. Eg. 2 - Alameda county – SS Case Workers - 300+ active cases…analytics to help determine where to focus based on likely high risk welfare situations Outcome – improved security through Single View – eg. DHLS - spent years getting clean data: TSA, CIS/Citizen Immigration Services (II + Info Server), Customs and Border Protection (eg. Identity Insight) and ICE (Immigration & Customs Enforcement).. Outcome – improved security through better Information Sharing - focused on Centralized Sharing Hub – with governance around who gets to see what, how long it can be retained etc. …eg. FBI National Data Exchange…provide info to S&L law enforcement ….20 different sources So if the technolgy is here, the benefits are so compelling, why isn’t there more widespread use of analytics??
Bridging the gap also requires a good understanding of the obstacles preventing widespread analytics adoption. This chart highlights the key organizational, data and financial concerns preventing adoption. It is taken from a study we released in late 2010, called Analytics: The new path to value. It was jointly run by IBM and the MIT Sloan Management Review. Organizational concerns top the list: Understanding how to apply analytics Management bandwidth to focus on analytics due to competing priorities Lack of skills internally in the line of business Data didn ’t make the top three as an obstacle to adoption, and data quality falls even further down the list. Financial concerns were a distant third, suggesting organizations will invest when they see the value
Decision Management stands on the shoulder of giants and fits within the full spectrum of IBM technologies. Decision services are first being fed by data and events being handles by IBM IM Big Data Platform capabilities, leveraging its full strength, including Hadoop for large scale model development or streaming for very fast real-time scoring. The data (large volume, structured and unstructured) is then fed into the Decision Management layer that leverages the smart techniques offered across IBM through a single orchestration layer – those techniques include: from WebSphere (Rules and Event analytics), Industry Solutions (Optimization and trade-offs techniques), Business Analytics (Predictive and text analytics – as well as sentiment analytics), from IM (Entity Analytics). Those are combined in a business-user friendly environment to produce Decision Services. Those Decision Services are being consumed by existing business applications by either feeding decision points inside business processes directly, or, they are informing existing business logic that resides within those applications (like in Unica for example). The BPM layer is crucial to deliver decision services across applications or within applications in delivering the insight where it is needed in a custom-developed application.
Slide #13: IBM Smarter Analytics – A Holistic Approach TRANSITION: To capitalize on the transformative opportunities that Bridget talked about requires a different approach to analytics, one that is holistic in its ability to turn information into insight and insight into business outcomes. In the era of Big Data, organizational leaders will be distinguished by their ability to make all decisions – big and small, strategic and tactical – based on a complete view of the world around them. This is not a one-time- or one-size-fits-all exercise. Transformation doesn ’t happen in a vacuum. It’s a constant cycle of optimizing and refining your data sources, learning from the outcomes of previous actions, and applying that knowledge to transform how you achieve those outcomes in the future. To embrace Big Data requires a virtuous cycle of data aggregation, instrumentation and deep analysis that unlocks real insight to drive the best organizational decisions.
IBM IOD 2010_GS Day 1 02/18/13 Presenter name here.ppt IBM IOD 2010_BDD 02/18/13 Bob Picciano.ppt IBM has been on a sustained journey for several years on the way to the most comprehensive portfolio of BAO software, hardware and services today. We have spent billions of dollars in internal R&D in this area and over $12B since 2005 acquiring leading organizations in this space, as this slide illustrates. We have over 10,000 technical professionals who can bring you this technology. We have over 7,000 consultants who can help you plan your strategy and help implement it. We have 27,000 business partner certifications creating an ecosystem around our technologies. And we have the largest research department, in mathematics, in private industry, all of it to enable delivering this technology for your benefit. Business Analytics & Optimization is in fact one of the top four focus areas in the entire IBM company. We realize that the heart of a Smarter Planet is in fact analytics. Let ’s take a look at how Business Analytics is transforming organizations around us. Stats on Canadian acquisitions: Cognos (Canada ’s largest software company at time of acquisition - $1.1B in revenue), largest acquisition in IBM history - $5B Close to 5,000 BAO employees in Canada when Algorithmics closes
Slide #24 : Signature Solutions Based on our insight into our the agendas of client executives… we ’re “doubling down” on three areas to address with what we’re calling “Smarter Analytics Signature Solutions” Customer “Next Best Action” CFO Performance Insight And Anti-Fraud, Waste and Abuse. Point to hold in mind… extracting insights from data is required, but not sufficient. Despite a lot of the rhetoric… the end game here isn ’t insight. In fact, at some point… and I don’t think that point is all that far off… insight becomes a commodity . It’s the table stake price of entry to the real end game… which is a different kind of outcome. The question then becomes… not what you know… but what you can do with what you know. CUSTOMER NEXT BEST ACTION Next generation integration of insight into the customer… what to do… and then how to deliver… what action to take… once you make that decision. Starting with a real 360 degree view of customer… what ’s in your traditional databases… combined with what you can know by tapping into social networks, customer service interactions, web click paths. Then, real-time analytics to predict behavior. If you ’re a telco… is that mobile subscriber happy, or are they about to leave you… and either way… what’s your next best action. Finally, which channel… contact center, email, SMS… is the best choice for that recommended action. What's new here? Next generation integration, and embedded capability from IBM Research. Up till now, the technology components weren ’t integrated well enough to give a client this combined view of marketing and service actions….real time… across channels. This solution embeds IP from Research with an analytics engine that recommends the next best actions, in order of priority, across channels. CFO PERFORMANCE INSIGHT Again, all about next-generation integration… and IBM Research. A lot of financial dashboards can do finance analytics; or predictive analytics; or reporting analytics. This integrates all three to create much more accurate insight into sources of profit and sources of cost. The algorithms from Research reveal relationships among key performance indicators… guide root cause analysis and calculate baseline forecasts. FRAUD MANAGEMENT This builds on what… by any measure… is already industry-leading capability… implemented more than 50 times… with financial impact ranging into the billions. In effect… the solution we call the Fraud and Abuse Management System… is about finding the fraudulent “needle in a haystack” of millions of healthcare claims… or tax returns.... And making recommendations on the best method of collection. The key word there is collection . Somebody was paid who shouldn ’t have been. This new solution is fraud detection – before a payment is made -- integrating the existing fraud asset with new capabilities from IBM Research… and our SPSS acquisition. It still detects overpayments… but now “learns” from experiences with the data… and stops payments before they’re made in suspicious, high-risk instances. The first pilot with a major US insurance provider reduced “false positives” from around 80 percent to less than 30 percent.
It starts with trying to get a more complete picture of your customers … Social media has become an important input for attitudinal data, but it needs to be integrated with other sources: Behavioral data, descriptive data and interaction data. This provides a 360 degree customer view and allows organizations to understand motivations and preferences that can support stronger loyalty with customers.
We brought them “feature vectors”
IBM IOD 2010_GS Day 1 02/18/13 Robert Leblanc Once you're there, apply business analytics, anticipate what's going to go on, look at trends, predict what's going to happen. So business analytics is not just about getting information, but it's also about becoming much more predictive. Imagine if I could spot the trends and I could be to market first before my competitors in a new product or a new service. Imagine what that would do to your business. Or you can provide a new product or a new service that's never been provided before. That's about adding business value. So plan an information agenda, make sure you have all of the capability and structure to master and manage that information, and then apply business analytics. If you can do those three things, you will move your businesses forward.
Smarter Analytics for Government
Smarter Analytics for Government -Turning Information Into Insight to Improve Government Performance Neil Isford VP, Smarter Analytics IBM North America
Data is the Next Natural ResourceForbes CNBC Financial Times“Big Data has arrived at “Data is the new oil.” “Increasingly, businesses areSeton Health Care Family, Ann Winbald, Co-founder applying analytics to social mediafortunately accompanied Hummer Winbald such as Facebook and Twitter, asby an analytics tool that Venture Capital well as to product review websites,will help deal with the to try to “understand wherecomplexity of more than customers are, what makes themtwo million patient tick and what they want”, sayscontacts a year…” The New York Times Deepak Advani, who heads IBM’s “At the World Economic Forum last predictive analytics group.” month in Davos, Switzerland, Big Data was a marquee topic. A reportThe Wall Street by the forum, “Big Data, Big Impact,” Los Angeles TimesJournal declared data a new class of economic asset, like currency or The Oscar Senti-meter — a tool“Companies are being gold. developed by the L.A. Times,inundated with data— IBM and the USC Annenbergfrom information on Forbes Innovation Lab — analyzescustomer-buying habits to opinions about the Academysupply-chain efficiency. “…now Watson is being put to work digesting millions of pages of Awards race shared in millionsBut many managers struggle of public messages on Twitter.”to make sense research, incorporating the bestof the numbers.” clinical practices and monitoring the outcomes to assist physicians in treating cancer patients.”
Imagine the Possibilities of Analyzing All Available DataFaster, More Comprehensive, Less Expensive Real-time Traffic Fraud & Risk Understand and Act Flow Optimization Detection on Citizen Sentiment Accurate and Timely Analyze, Predict and Low-latency Network Threat Detection Act on the Battlefield Analysis
Analytics -- Providing people with Trusted, Relevant, and TimelyInformation to Optimize Business Outcomes…… Analytics Approach Traditional Approach Sense and respond Predict and Act Lack of Insight Instinct and intuition Real-time, Fact-driven Velocity Volume Everyone Skilled analytics experts Inability Varietyto Predict Back office Point of Impact Inefficient Access Automated Optimized
Government Must Lead In The Face of Global Challenges –Key Drivers Of Transformation Creating New Expectations Key Drivers of Transformation Required Business Intensifying Information Outcomes Requirements Changing Demographics Recognize and optimize service to the citizen, soldier, veteran, Maximize compliance and patient at any point of EXTREME BUDGET PRESSURE & revenue contact Accelerating Globalization Improved citizen Leverage improved insight to services & experience manage effectiveness, predict Growing Threats to Social future demands and requirements Stability and Order Manage Resources Effectively Evolving Societal Enabling defense and law Relationships enforcement organizations to achieve Strengthen public situational awareness, increased safety and defense speed of command, execution and Rising Environmental combat superiority Concerns Transparency and Provide transparency to an Expanding Impact of accountability ever more demanding public Technology Share information across and between agencies
Leading The Way…Delivering Better Outcomes with AnalyticsSmarter Social Services: US Veterans Greatly enhance veterans care through Administration advanced Case ManagementClaims Processing US Internal Advanced return review analyticsRevenue & Tax Compliance Revenue Service through Fraud Analytics US Medicare Enhanced citizen service, and improvedSmarter Social Services outcome through Single View of CitizenNational Borders & Security: Multiple Gov’t Connecting the dots, predict and preventPerpetual Vetting Agencies threats through Single ViewNational Border & Security: National Registry of identities, objects and events 7 Law Enforcement through Single ViewInformation Sharing
Federal Big Data Commission ReportKey FindingsBig data has the potential to profoundly transformGovernment and the society that it serves.The great paradox is that as Big Data is continuallyproduced and information is create, we struggle tokeep pace. Our ability to make sense of it isreduced.Leaders across government, academia and privateindustry have made investments, havedemonstrated success, and we now know whatsuccess looks like.These experiences reveal a great irony -- that whilethe impact of Big Data is transformational, the pathto effectively harnessing it is not. The journey isevolutionary versus revolutionary.It starts with understanding the businessrequirement, the data available, and the “Art of thePossible”
Leading The Way…Government Agencies Beginning To Harness Big Data… State of the art covert surveillance systemNational Border & Security based on Streams platformSmarter Social Services: Optimized Neo-Natal care through earlySmarter Health Care Analytics detection, prevention, testing hypothesesNational Borders & Security: Real-time network intrusion detection, sub-Cyber Security millisecond analysis and response High performance analytics across a vastSmarter HealthCare Analytics volume of data to spot hidden trends and relationshipsNational Borders & Security: Real-time threat detection & preventionThreat Prediction & Prevention through Big Data & Watson
Information Lifecycle Governance and Defensible Disposal MISSION Effectiveness Excess data, cost and risk today from ILG lowers cost and risk by Silos in records, IT and legal function with Enabling process transparency across business, legal, inconsistent communications, poor transparency records and IT Misguided assumptions about the number of Ensuring precise and automated decision obligations for information, its diversity and the management on information obligations and its business utility of it business value Default practices of retaining data indefinitely Continuously aligning information management to IT’s lack of insight on legal duties and value of legal obligations and business value assets Defensibly disposing of unnecessary data
Applying Advanced Analytics to Improve Decision Making What is happening What could happen? Simulation How many, how often, where? What if How can we these achieve the best trends What outcome? continue? exactly is Optimization Forecasting the problem? How can we What will Deep insights achieve the best Extracting happen to improveStructured Made What outcome and insight, next if? web sites andData & consumable actions are address variability? concepts and Predictive marketing needed? Stochastic relationshipsUnstructured and accessible Modelling Optimization interactionsContent to everyone Descriptive Predictive Prescriptive Content Social Media & Analytics (BI) Analytics Analytics Analytics Web Analytics
Social Media Analytics (Citizen Insight) Analytics that listen, measure and analyze social media performance to more effectively:Enhance Service Understand citizens’ needs to target new services cost- effectively through different social media channelsOutcomes Evaluate your reputation and make evidence-basedEnhance citizen decisions that target the right stakeholders at the rightrelationships timeImprove citizen Respond more quickly with accurate, timely and relevant insight into citizens requests to ensure aexperience consistent experience across all channels Create Relationships. Build Advocacy. Improve Service.
Organizations are now combining multiple advancedanalytics techniques to optimize decisions Processing credit card Cross-selling banking Crew scheduling settlements products Business Rules Predictive Analytics Optimization Predictive Analytics Optimization Business Rules (Detecting (Targeted marketing (Cross-national transactional fraud) budgets) regulations for crew management) Copyright 2012 IBM 14
Integrated Platform for Optimizing Decisions Business Context Business & Enterprise Solutions Custom Marketing Risk Operations Smarter Cities Watson Management Management Management Solutions Solutions BPM O OO Decision Services Evidence- Business Business Trade-offs Predictive Text Entity Sentiment Optimization based Rules Events Analytics Analytics Analytics Analytics Analytics Analytics Enterprise Context Business Rules Optimization Predictive Analytics IBM Software for Decision Management Hadoop Stream Computing Data Warehouse Information Big Data Integration & Platform Governance Core Database Enterprise Content Management Events
IBM Smarter Analytics is a Holistic Approach that TurnsInformation into Insight to Improve Government Performance Transform through analytics for breakaway results Align Anticipate Act your organization see, predict and shape with confidence at the around information business outcomes point of impact to optimize outcomes Learn from solutions that get smarter with every outcome
IBM Investment in Analytics More than $16B in Acquisitions 2012 Since 2005 More than 10,000 Technical Professionals Social Analytics/Consumer Insight More than 7,500 Dedicated Crime and Fraud Analytics Consultants Workload Optimized Systems Largest Math Department Advanced Case Management in Private Industry Content Analytics More than 27,000 Business Decision Management Partner Certifications Stream Computing Pervasive Content pureScale pureXML Deep Compression Developer ProductivityAutonomic Operations2005 Copyright 2012 IBM Confidential 17
IBM Smarter Analytics Signature SolutionsIndustry Expertise and State of the Art Analytics Applied to Real World ProblemsHow can I enhance How can I anticipate How can I minimizevalue for the citizen? the impact of losses stemming from financial decisions? fraud?Citizen Finance FraudNext Best Action CFO Performance Insight Fraud, Waste, and Abuse
360 Degree View of Customer, Citizen or Person of Interest Interaction data Attitudinal data - E-Mail / chat transcripts -Market Research - Call center notes -Social Media - Web Click-streams - In person dialogues Descriptive data Behavioral data - Attributes - Orders - Characteristics - Transactions - Self-declared info - Payment history - (Geo) demographics - Usage history
Advanced Analytics: Action Cluster Segmentation • Start with 30-60 modeled variables – “Feature Vectors” – The customers response to the firm’s value proposition • Each feature vector is like a gene strand, which describes a facet, or set of customer behavior traits Most segmentation Time until approaches only focus here Repurchas Econometric: Annual Annual Age + e in Key Real-estate & Unemployment Spend Transactions Income + Level Geography Preferred Categories Product Preferred Categories Length of Channel Time as Customer Participation Use of In- in Loyalty Return / Use of House Program Breadth of Exchange Service Behavior Programs Credit Card Categories Response Shopped Recency + to Media Frequency + Value 20 20
Case Study: Accelerating New Product Adoption for a Pharma Company The overall business From this…. objective for the project is to change the business outcome of the product To this….. launch… This will be achieved through development of action clusters…. … enabled by predictive … delivered across models…. both Sales and The Overlooked Marketing applications Loyalists
Next Best Action: The five key components Advanced Analytics Market-leading tools for predictive and advanced analytics Integrated optimization techniques that combine analytic output for the “best answer” Decision Management Mature technology combining analytics and business rules creation, integration, and execution Real-time recommendations beyond just marketing offers Cross Channel Real Time Action Actions include customer service, issue resolution, account mgt. response/billing—all touch points managed in real time through appropriate channel Big Data Platform Integrate and manage the full variety, velocity, and volume of data Phased approach for enhanced “360 customer view” Apply advanced analytics to information in its native form Multiple Entry Points Analytics, Decision, and Information Management all provide quantitative starting points for Next Best Action project
Transforming an Organization with Smarter Analytics Master Plan an Information Apply Analytics Information Agenda to ensure it is accurate, to anticipate and optimize to support the business relevant and governed business outcomes strategy Create a Culture that Takes Action Copyright 2012 IBM Confidential
Q&A withRobert Bectel Neil IsfordCTO, Office of Energy Efficiency & VP, Smarter AnalyticsRenewable Energy, DOE IBM North America