Cognitive computing enables new ways of understanding vast amounts of structured and unstructured data. This document discusses how cognitive systems can be applied across industries to enhance customer experience by discovering new insights, making evidence-based recommendations, and engaging with customers in natural language. It provides examples of how cognitive computing is being used in healthcare to help oncologists develop personalized treatment plans, in banking to power virtual assistants and fraud detection, and in retail to better understand customers and guide personalized shopping experiences. The document argues that cognitive systems can augment existing analytics and software solutions to continuously learn from new data and interactions.

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© 2016 IBM Corporation
Cognitive Future in Customer
Experience
A new era of thinking

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 Cognitive Computing in Enterprise
 Putting Cognitive Computing to Work
 Adoption Challenges to Consider
 Charting the Way Forward
Welcome to the Cognitive Era

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We all know this
“The last, best experience that anyone has anywhere becomes
the minimum expectation for the experiences they want
everywhere.”
– Paul Papas, Global Leader, IBM Interactive Experience

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of companies say they
have or are close to
having a holistic view
of their customers
of consumers say
their favorite retailer
understands them
Source: The Consumer Conversation – eConsultancy Report
The Great Customer Experience Divide

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Advancements in technology and their convergence are creating unprecedented
opportunities to improve customer experience and stay relevant
Source: 2015 Retail Outlook, page5. http://www.cit.com/wcmprod/groups/content/@wcm/@cit/documents/images/2015-retail-outlook-report.pdf
CONSUMER
INDUSTRY Social
Mobil
e
Cloud
3-D Printing
Internet
of things
Analytics
Organizations must adopt new technologies and
embrace new operating models to stay relevant
The consumer industry is vulnerable to
disruption
5x
58% of retailers predict that brick – and –
mortar only stores will not survive in
future1
72% believe one or more prominent
retailers will likely disappear in the next 1-3
years, or at least decline in value1
Cloud

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Harnessing these technologies are critical to overcome the challenges a
consumer industry faces today
Customer expectations
Self-serve retail
Technology progress
Eroding margins
Security breaches
Falling margins and returns for shareholders
Expanding customer expectations fueled by
awareness around technology
Rising instances of identity theft and credit card
fraud
Increasing self-serve retail, and customers taking
greater ownership of their consumption journey
Accelerating technology progress, redefining
the way people and organizations interact

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Data that’s
coming
Customer records
Transactional systems
Predictive models
Institutional expertise
Operational systems
News
Events
Geospatial
Weather
Social media
Internet of Things
Sensory data
Images
Video
Data outside
your firewall
Data you
possess ++
Structured and active Unstructured and dark
Digital Intelligence is your competitive advantage to uplift your customer
experience

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Three distinct areas of focus to create a differentiating customer experience
using digital intelligence
Provide better
collaboration between
with suppliers, partners
and customers and
enables seamless
experience across
channels
Engage DecideDiscover
Provide ability to digest
vast amounts of data to
identify new avenues and
implement new ideas
Provide contextual,
evidence-backed
recommendations, with
changing business
models, cost structures
and customer behavior

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Data sources
Call center
Web
Mobile Apps
Transactional
data
Customer
interaction history
Customer
demographic data
Twitter
Weather
Location
Multiple customer
touchpoints
SMS
E-mail
Direct mail
Chat
Call center
Social
Mobile Apps
Web
IBM’s Predictive customer analytics provide the foundation for customer centricity

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IBM Behaviour Based Customer Insight delivers intelligence by industry
Behavior-based Customer Insight for Banking
Behavior-based Client Insight for Wealth Management
Behavior-based Customer Insight for Telecommunications
Behavior-based Customer Insight for Insurance
Behavior-based Audience Insight for Media & Entertainment
Customer Experience Analytics for Telecommunications
Behavior-based Fan Insight for Media & Entertainment

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Only cognitive unlocks the potential in all data
Think of all that has been
accomplished using only
a fraction of the
available data
Unlock the
possibilities.
What answers
lie in the 88%
that is dark?1
By the year 2020, about
1.7 MB of new information
will be created every
second, for every human
being on
the planet.2
SOURCES cited in notes

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Cognitive systems are fundamentally different from what you have today
1
Adapt and make sense of all data;
“read” text, “see” images and “hear”
natural speech with context
Understand
Reason Interpret information, organize it
and offer explanations of what it
means, with rationale for the
conclusions
Learn Accumulate data and derive insight
at every interaction, perpetually

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Programmable
computing
responds to requests and
makes determinations,
analyzing data according
to predefined parameters.
Cognitive
systems
interact with humans
naturally to interpret data,
learning from virtually every
interaction and proposing
new possibilities through
probabilistic reasoning.
Cognitive systems differ from traditional analytics

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Cognitive computing can augment or supplement these offerings to enrich the
consumer and user experience
Engage DecideDiscover
Source: IBM Institute for Business Value Analysis 2015
 Expert assistance to
human users
 In natural language
 context- and evidence-
based reasoning
 discover insights far above
human levels
 Discover patterns and
connections
 Generates hypothesis and
validates theories like experts
 Offers evidence-based
recommendations
 Evolves continually towards
more accuracy based on
new information, outcomes,
and actions
 Provides traceability to
audit why a decision is
made

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Cognitive systems adoption in industry is happening at three different levels
Industry transformation through moon shot
application of cognitive technologies
Deep Industry
expertise
Customers and Ecosystem partners leverage
Cognitive functional APIs on IBM Development
platform (Bluemix) to build new capabilities or
enhance existing solutions
Cognitive function
APIs
IBM product suite including solutions like
Behaviour Based Customer Insight enriched with
Cognitive technologies
Embedded in
software solutions

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Bumrungrad International Hospital – Elevate the ability of physicians
The vision
We can improve the effectiveness
of Bumrungrad oncologists
overloaded with patients and
strapped for time to customize
treatments based on the latest
medical research.
The disruption
The expertise of the very best
oncologists from Memorial Sloan
Kettering is now in the hands of
physicians.
The result: More than one million patients received more informed,
personalized treatment plans.
Patient data Memorial Sloan Kettering
cancer expertise
IBM Watson for
Oncology+ +
Decide

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Growing library of cognitive functions that enable understanding, reasoning, and
learning to enhance, scale and accelerate human expertise
20152014 2016
© 2016 International Business Machines Corporation

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EMPOWERED
ADVISORS
TRANSFORMED
INTERACTIONS
OPTIMIZED
OPERATIONS
Self Service Reduce call center volume & expense, improve customer satisfaction
Digital Virtual Agent Increase success rate of online transactions results in increased sales
Call Center Rep Assist Decrease call durations/transfers. Consistent and accurate responses
Knowledge Advisor Improves knowledge of best practices
Sales & Service Advisor Increased effectiveness of sales and service
Wealth Advisor
Improves effectiveness of wealth advisors through more complete
understanding of clients
Relationships & Impacts Hypothesis free discovery of casual relationships the possible impacts
Underwriting
Reduction of underwriting expenses, consistency of decision making,
democratization of experience
Regulatory Policy
Compliance
Reduced time and expense incurred in meeting regulatory and
internal requirements.
Use Case Value Proposition
Banking usage categories with Watson API’s
© 2016 International Business Machines Corporation
Engage
Decide
Discover

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Retailers can leverage cognitive to guide shoppers and provide a delightful
personalized experience
Retailers use cognitive to
understand shoppers behavior,
search intent and guide them
with personalized advice and
accurate product
recommendation
Retailers need to provide
better shopping experience
to customers by guiding
them in their shopping
journey and providing
personalized experience
Retailers get deep insights
using data from disparate
sources that helps them to
provide highly tailored
experiences to the
customers
BENEFITSOLUTIONNEED
Source: See notes
Engage

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Retailers can use cognitive to have a complete view of customers across
demographic, affinity, and personality insights
Retailers use cognitive to
analyze diverse types of
customer data (e.g.,
psychographic, behavior,
purchase etc.) in constructing
360°view of customers and
finding personality insights
Based on the personality
type and segments, retailers
can run campaigns and
promotions effectively
BENEFITSOLUTIONNEED
Retailers do not understand
their customers thus struggle
to create campaigns and
promotions that target right
segment of customers and
maximize return on
investment.
Source: See notes
Discover
Visualization of Personality data

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IBM Watson Trend – Gift guide to holiday heroes
Engage
Driven by the power
of Watson
ibm.com/watsontrendhub
IBM Watson Trend
IBM is putting the cognitive power of Watson into the hands of shoppers this holiday season with
the IBM Watson Trend app.

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Key Metrics
Attrition Rate New Customer Acquisition Products per Customer
Filters
Tree Map – Predicted Events
Regional Management Dashboard
Easy Going Highway Warriors OtherFamily Feud Hi Fliers Homebodies Students
Enhance capabilities of existing solutions through cognitive adoption

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Regional Management Dashboard
Customer Insight Dashboard
Enhance capabilities of existing solutions through cognitive adoption

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Game to infuse Cognitive in Fashionista?

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There are three critical factors for cognitive computing success
Lay the foundation Manage the changeDefine the value
1 2 3
Find the right
opportunities
For cognitive
Define the value
proposition and
chart a course
for cognitive
Be realistic about
value realization
Invest in specialist
human talent
Build and ensure a
quality data corpus
Consider impacts,
business
processes, and
policy requirements
Ensure executive
involvement along
the cognitive journey
Communicate the
cognitive vision at all
levels
Continue to raise
the cognitive IQ level
of the organization

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Organizations should follow a structured road map that nurtures optimism
and reduces complacency
1
2
3
4
Chart the course
• Identify candidate opportunities across mission and functional areas
• Define business benefits case
• Develop organization’s cognitive computing journey/road map
Experiment
• Prototype use cases
• Test and validate use case scenarios with users
• Test business case hypotheses
Develop and train
• Develop and train the system
• Build and improve required
corpus
• Train and educate solution end
users and the organization
Deploy, explore
and evolve
• Deploy baseline solution
• Continuous learning and
corpus improvement
• Further use case
exploration

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Key takeaways
 Cognitive computing is coming of age and finding commercial applications across
industries to enable improved engagement, discovery and decision support.
Cognitive computing use cases are evolving through industry specific applications
or through adoption of functional APIs.
Cognitive computing adoption in enterprise calls for an experimentation approach
with rapid prototyping and testing before investing in development and training.

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Learn more:
• IBM Analytics Solutions: http://www.ibm.com/analytics/ae/en/
• IBM Marketing Solutions: http://www.ibm.com/commerce/ae-
en/marketing/?lnk=WH_marketing
• IBM Customer Experience Solutions:
http://www.ibm.com/commerce/ae-
en/customeranalytics/?lnk=WH_customeranalytics