kim escherich - how big data transforms our world

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Kim Escherich Executive Innovation Architect, IBM Global Business Services

HOW

BIG DATA TRANSFORMS OUR WORLD DDC, Data Visualization Academy Kick-Off, March 12, 2013

© 2011 IBM

IBM Global Business Services The purpose of this session is to discuss trends shaping the journey towards the smarter planet – driven by big data

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What is data? Trends and technologies, by example.

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© 2011 IBM

IBM Global Business Services

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INSTRUMENTED

Billions of RFID-‐tags embedded into our world and across ecosystems

Ze-abyte Internet

Petaflop Super computers

+2 billion Internet-‐subscribers

+20 billion Connected devices

INTERCONNECTED INTELLIGENT

Billions of Smartphones, and GPS-‐devices

5

0

10

20

30

40

50

2003 2010 2015 2020

Billion

Source: Cisco IoT 2011 infographic

340.282.366.920.938.463.463.374.607.431.768.211.456

People

Connected things

2009 800,000 petabytes

as much Data and Content Over Coming Decade

44x

Of world’s data is unstructured

80%

Explosion of Data Means a Lot of Information … But we are lacking Insight

2020 35 zettabytes

Business leaders frequently make decisions based on information they don’t trust, or don’t have

1 in 3

83% of CIOs cited “Business intelligence and analytics” as part of their visionary plans to enhance competitiveness

Business leaders say they don’t have access to the information they need to do their jobs 1 in 2

of CEOs need to do a better job capturing and understanding information rapidly in order to make swift business decisions

60%

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Neurowear Necomimi hPp://en.necomimi.com/

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!tbit ”Let's make !tness a fun, achievable part of everyday life” http://www.!tbit.com

Big data, de!ned

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Variety

Volume Velocity

Veracity

of Tweets created daily

12 terabytes

trade events per second

5 million

Of video feeds from surveillance cameras

100’s

“We have for the first time an economy based on a key resource [Information] that is not only renewable, but self-generating. Running out of it is not a problem, but drowning in it is.”

– John Naisbitt

Decision makers trust their information

Only 1 in 3

We’ve Moved into a New Era of Computing

What can you do with big data?

Innovate new Products Speed and Scale

Know Everything About your Customers

• Social Media - Product/brand Sentiment analysis

• Brand strategy • Market analysis • RFID tracking & analysis •  Transaction analysis to create insight-

based product/service offerings

• Social media customer sentiment analysis • Promotion optimization • Segmentation • Customer profitability • Click-stream analysis • CDR processing • Multi-channel interaction analysis •  Loyalty program analytics • Churn prediction

Run Zero Latency Operations • Smart Grid/meter management • Distribution load forecasting • Sales reporting •  Inventory & merchandising optimization • Options trading •  ICU patient monitoring • Disease surveillance •  Transportation network optimization • Store performance • Environmental analysis • Experimental research

Instant Awareness of Risk and Fraud

• Multimodal surveillance • Cyber security •  Fraud modeling & detection • Risk modeling & management • Regulatory reporting

Exploit Instrumented Assets • Network analytics • Asset management and predictive issue resolution • Website analytics •  IT log analysis

PURPOSEFUL

Behavior pattern analysis delivering insights for effective marketing decisions

EXPLORATORY REAL-TIME & ACTIONABLE

PREDICTIVE

Customer Buying Behavior

Explore patterns that to uncover customer acquisition and retention behavior patterns across all data sources

Score customer behavior analysis and create models around newly discovered buying patterns. Accurately predict likely next best action for the customer.

Actionable insight supporting applications & processes –campaign execution, CRM, ecommerce, call center, etc. Next best action offer can be modeled and predicted in real-time based on customer interaction and transactions.

Product Offers, Enhancement & Development

Identify, analyze and visualize feedback about your product

Score product sentiment and create models that would predict cross-sell and up-sell opportunities and insight into product enhancement and development of future portfolio

Ad effectiveness

Actionable insight for localized product promotions that can be executed for maximum impact. Insight is fed into product enhancement and portfolio decisions

Collect and analyze social data to assess awareness, reach and reaction to on and offline ads

Create predictive models to test and fine tune ad campaign to maximize effectiveness

Real-time ad analysis drives fast reaction to optimize campaign strategy and maximize ROI

© 2012 IBM Corporation

IBM Mobile Solutions

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Vestas optimizes capital investments based on 2.5 Petabytes of information.

•  Model the weather to optimize placement of turbines, maximizing power generation and longevity.

•  Reduce time required to identify placement of turbine from weeks to hours.

•  Incorporate 2.5 PB of structured and semi-structured information flows. Data volume expected to grow to 6 PB.

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Dublin City Centre Increases Bus Transportation

Performance

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•  Public transportation awareness solution improves on-time performance and provides real-time bus arrival info to riders

•  Continuously analyzes bus location data to infer traffic conditions and predict arrivals

•  Collects, processes, and visualizes location data of all bus vehicles

•  Automatically generates transportation routes and stop locations

Results: •  Monitoring 600 buses across 150 routes •  Analyzing 50 bus locations per second •  Anticipated to Increase bus ridership



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Barnes & Noble helps suppliers track sales and inventory in real time

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Need •  Publishers absorb the losses on returns when

they print too many books, and have stock-outs when they print too few

•  To provide publishers with the ability to get real-time insight into sales and view inventory trends over time

Benefits •  Decreased time to run queries from weeks to

seconds and enabled an 80% reduction in time to run compared to its previous system

•  Reduced inventory levels and inventory carrying costs

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Watson: From Jeopardy winner to healthcare provider

The challenge for the chief marketing officer

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Information Channels Across Time Note the drop-off for traditional broadcast channels (including websites)!

http://www.baekdal.com/articles/Management/market-of-information

© 2011 IBM Corporation 21

50% 71%

68%

65%

63%

59%

57%

56%

56%

56%

55%

54%

50%

The vast majority of CMOs are underprepared to manage the impact of key changes in the marketing arena

Underpreparedness Percent of CMOs reporting underpreparedness

IBM Institute for Business Value

Data explosion

Social media

Growth of channel and device choices

Shifting consumer demographics

Financial constraints

Decreasing brand loyalty

Growth market opportunities

ROI accountability

Customer collaboration and influence

Privacy considerations

Regulatory considerations

Source: Q8 How prepared are you to manage the impact of the top 5 market factors that will have the most impact on your marketing organization over the next 3 to 5 years? n=149 to 1141 (n = number of respondents who selected the factor as important)

Global outsourcing

Corporate transparency 47%


Most CMOs are still focusing on understanding markets versus understanding individuals to shape their strategy


Source: Q15 What sources of information influence your marketing strategy decisions? n=1733

Sources used to influence strategy decisions Percent of CMOs selecting all sources that apply

50% Market research Corporate strategy

Competitive benchmarking Customer analytics

Marketing team analysis Customer service feedback

Financial metrics Campaign analysis

Brand performance analysis Sales/sell-through numbers

Test panels/focus groups R&D insights

Consumer-generated reviews Third-party reviews & rankings

Retail and shopper analysis Online communications

Professional journals Blogs

Supply-chain performance

82% 81%

80%

69%

68% 65%

61% 54%

52%

41%

74%

48%

40%

42%

68% 68%

37%

25% 26% Key sources to

understand individuals


CMOs are overwhelmingly underprepared for the data explosion and recognize need to invest in and integrate technology and analytics


Source: Q8 How prepared are you to manage the impact of the top 5 market factors that will have the most impact on your marketing organization over the next 3 to 5 years? n=149 to 1141; Q20 To what extent will the opportunity to collect unprecedented amounts of data require you to change? n=1629 to 1673

Underpreparedness Percent of CMOs selecting as “Top 5 Factors”

Data explosion 71%

Social media 68%

Channel & device choices 65%

Shifting demographics 63%

Financial constraints 59%

Decreasing brand loyalty 57%

Growth markets 56%

ROI accountability 56%

Customer collaboration 56%

Privacy considerations 55%

Global outsourcing 54%

Regulatory considerations 50%

Corporate transparency 47%

Need for change to deal with data explosion Percent of CMOs indicating high/significant need

Invest in technology

Understand analytics

Collaborate with peers

Validate ROI

Address privacy

Integrate insights

Rethink skill mix

73%

69%

65%

64%

52%

49%

28%


What’s inhibiting them? Building the business case, IT-marketing alignment/integration issues and marketing technology skills


Lack of ROI certainty

Cost

Tool implementation issues

Lack of IT integration with organization

Lack of marketing and IT alignment

Lack of IT skills

Lack of skills of (potential) users

Lack of technological ownership in marketing

Ease of use

Reliability

Barriers to using technology in marketing Top 5 selected by CMOs

Source: Q23 What are the top 5 barriers to using technology? n=1733

61%

72%

47%

43%

45%

25%

46%

34%

37%

18%

Business case

IT related

Marketing related

IT and marketing related

Usability

The innovation aspect

1770 1875 1920 1830 2010 1970

Inno

vaHo

n

1st Wave

2nd Wave

3rd Wave

4th Wave

5th Wave

6th Wave

Smarter Products §  Instrumented, interconnected, and intelligent

§  Building blocks for a smarter planet

§  Sustainability

The Industrial RevoluTon

Age of Steam

and Railways

Age of Steel, Electricity and Heavy Engineering

Age of Oil, Cars and Mass ProducTon

Age of IT & Telecom

Source: “Next GeneraTon Green: Tomorrow’s InnovaTon Green Business Leaders”, Business Week, Feb 4, 2008 and Nicolai KontraTev: “The Major Economic Cycles” (1925)

We are ushering in a new wave of innovaHon

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Sixth Wave Thinking

1. Waste = Opportunity 2. Sell the Service, not the Product 3. Digital and Natural Converge 4. Bits are Global, Atoms are Local 5. If in Doubt, Look to Nature

6th Wave

James Bradfield Moody & Bianca Nogrady: The Sixth Wave – How to succeed in a ressource-limted world

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Price

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Price

Organic

Production method

Biodynamic

Conventional

Pesticides

Production environment

Chemicals

Herpacides

Child labor

Sustainability

GMO

Environmental footprint

Climate change Geosphere

Biosphere

Sociosphere Health impact

Health consequences

Positive

Negative

Profiled

Packaging

History/Origin

Transport

Track

Sustainability

Thank you Kim Escherich IBM Global Business Services [email protected] +45 2880 4733 internetoghings.dk escherich.biz

@kescherich

/escherich

/in/escherich

[email protected]

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kim escherich - how big data transforms our world

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