2012: The Year Analytics Means Business

Timo Elliott


The real trend this year is not the technology. It’s about helping business people make better decisions, and actually change the way companies do business. Analytics has always been about transforming business, but the recent huge changes in analytic technology have created interesting new opportunities for business innovation.

Most organizations are now starting to understand the technical opportunities, but many struggle to apply those new opportunities to their business processes. This blog post attempts to explain what’s going on in the analytics market and give concrete examples of how other companies have implemented the new technologies in “game-changing” ways (sorry kittens).

Wrenching Change and A Foggy Outlook

The chart below illustrates the wrenching effects of recent financial problems on the world gross domestic product: companies today have to be ready to react to unprecedentedly fast changes to their economic environment.


And the economic environment is fraught with extreme uncertainty. This year, the people who run the world will change, and so will many of the policies of the countries they manage. Financial markets have still not completely stabilized, notably with the future of the Euro still not assured.

Companies have reacted to this uncertainty by slashing costs and accumulating cash, and now need to start investing that cash into future development. Since interest rates are low and the business outlook is still uncertain, many of them are using the money for new technology that can help them prepare for the future.


In particular, companies want better visibility about what’s going on in their market, and increased organizational agility in order to be able to deal with change fast. It’s like driving in the fog without a map – in order to survive, you should invest in better visibility, brakes, and steering to be able to spot and avoid fast-moving objects looming out of the fog.

Analytics provides these capabilities: business intelligence to peer into the road ahead, risk-management to provide fast alerts to new obstacles, and flexible financial planning systems to help swerve around them.

Analytics: Hotter Than Ever

Companies are investing heavily in analytics:

Fast-Moving Technology

Analytics technology has been changing fast. On the back end, new technologies have come together to provide what Gartner calls “extreme data performance”. These include in-memory, column data stores, in-database calculations, massively parallel architectures, complex event processing, Big Data / NoSQL / Hadoop, and cloud architectures.

The combination of these technologies provides a opportunity to access massive amounts of a greater variety of data, faster, and more flexibly. The key opportunity is that these new platforms “collapse the stack” so that organizations can implement and update analytic projects much faster than ever before.


And on the front end, various technologies are coming together to provide unprecedented levels of context-based “actionable insights”, including self-service data discovery, advanced visualization including maps, mobile analytics, predictive analytics, collaborative decision-support. They help provide more action-oriented interfaces optimized for the context of the users, both inside and outside the organization.


These technology advances are clearly important, and we’re going to continue to see great improvements this year. The new opportunities have reached a tipping point similar to the rise of digital cameras vs. analog photography – and you don’t want to leave it too late to make the change, like Kodak, which recently filed for bankruptcy protection!

However, the real opportunity is using these new possibilities not only to improve analytics but fundamentally rethink key business processes.

High Resolution Management

high-resolution-management[3]University researchers have pointed out that today’s management techniques are based on the limitations of information scarcity:

“How many times has someone in your company uttered, “We don’t have that level of accuracy in the information, so we have to make aggregated estimates”? Under the current paradigm, it is sometimes impossible to drill down and understand what is happening at a highly detailed level.”

They coined the term “High Resolution Management” to describe what becomes possible with the new technology opportunities:

“We contend that these technologies will change drastically how management makes decisions. Why? Because with access to the finest granularities of information, management will be able to move freely from macro to micro levels and will be able to measure, plan and act accordingly. With increased resolution come more options to drill down, eliminate inefficiencies and cut costs.”

Lets take a look at three different types of High Resolution Management opportunity, letting companies:

  • Remove bottlenecks
  • Rethink business
  • Flip business models

Remove Bottlenecks

Better technology always means business opportunity, but the new analytic platforms are rapidly eliminating some of the key bottlenecks that have prevented organizations from getting value from their data:

Faster, more flexible data access. Companies like Red Bull have been able to speed up and simplify their data warehousing environments. Using the HANA in-memory database, the company can now load detailed data twenty-five times faster into their data warehouse, and they were able to eliminate several levels of data staging, increasing the flexibility of the solution.

Data volumes and complexity. Companies like Colgate-Palmolive, Provimi, and Danone have long had access to vast amounts of detailed data about their production facilities and sales channels – but the quantity of data meant that they were unable to run full analytics in a reasonable time frame. That has now changed. For example, according to Colgate-Palmolive CIO Tom Greene:

“We will be able to run analytics at a local level on specific brands and locations, and at the lowest level of detail in real time”

And Danone can now measure the carbon emissions of 35,000 different products, with new systems that:

“collect, measure, and analyze data across the entire product life-cycle, from sourcing through production, transport, retail, distribution, consumption, and end of cycle”

New forms of data: ‘unstructured’ data such as text has long been difficult to effectively analyze and incorporate into mainstream corporate analytics. The new systems make it much easier for companies like Medtronic to access and analyze the large amount of complaints and feedback data they receive about their products, combine it with other data sources, and provide it to business users with dynamic interfaces:


New interfaces and users. Companies like Altron have been able to get the data to their users where they needed it. As Debra-Lynn Marais, Group Information Manager explains:

“The days of our users and execs being in the office have gone. They work from home or on the road. We had to develop a solution that gets information out to where our people are. Everything we do is mobile first. In addition, it’s less cumbersome and cheaper to buy and use a tablet than any other form.”

Rethink Business

Many companies are going beyond “just” improving their existing analytic capabilities, using analytics in new ways to change the way they do business. Instead of analytics being something that is used to monitor and eventually improve a business process, analytics is becoming a more fundamental part of the business process itself.


Proactive Analytics. Instead of using analytics only to assess previous performance, companies are using the new capabilities to get data fast enough to make a real difference. For example, online grocer Fresh Direct, instead of just understanding what problems happened yesterday, can now understand what problems will happen in the next few hours, so they can actually fix them before a customer is impacted:

“FreshDirect has an operations center that manages its fleet of delivery trucks. In a large metropolitan area like New York, traffic doesn’t always flow predictably. A traditional approach to BI would be to print a report showing the level of on-time deliveries (OTDs) the day before and then ask the transportation department what went wrong for the orders that were delivered late. FreshDirect uses analytics in a more impactful way.”

“The company monitors the delivery rate of every truck and enters that data into the BI system on an ongoing basis. Every hour, it uses the previous hour’s data to predict how many deliveries will be on-time in the next hour. If the predicted OTD rate is below FreshDirect’s target, the company sends out an auxiliary truck or trucks to help make deliveries. The company holds 10 trucks in reserve for just this purpose.”


Integrated Risk Assessments. Among other products, publisher Houghton Mifflin Harcourt produces educational books. Schools pass orders in June or July after the end of the school year, and then expect delivery for the start of the next school year in September. Getting books printed during the summer is expensive, as many publishers compete for the limited supply of printers available.

To avoid these extra costs, Houghton Mifflin Harcourt uses using sophisticated, risk-based forecasting. The company prints books in January or February, when printing is much cheaper. In order to minimize of excess inventory, it has carefully analyzed all the causes of previous forecasts, and now takes account of all the different things that influence book obsolescence.

Before, the buying team just ordered based on the volume forecast from sales. Now they have much greater context for their decisions. For example, if there’s a vote coming up on schools funding that may result in the canceling of a math adoption program for the year, they can decide to hold back on those purchases until the outlook is clearer. The fast, more accurate forecasting mechanism has saved them tens of millions of dollars, and they have more of the products their customers want.

New Customer Services. International grocery chain Casino is rolling out a new mobile shopping application for its customers. It provides data from its enterprise systems directly to its customers, resulting in increased shopping convenience and increased customer loyalty.


German healthcare provider AOK (“the good health organization”) is committed to helping its members avoid illnesses in the first place. It is planning to introduce a new, market-differentiating service: personalized healthcare advice for each customer, with tools that:

“Conduct real-time analyses of the tremendous amounts of medical data we receive, recognize potential health risks, assemble various preventive care programs and respond to those risks appropriately and ahead of time.”

As an added bonus, they also believe that this tailored prevention program will result in significant cost reductions by preventing expensive unneeded treatments.


BC Hydro is saving $70 million dollars a year through the installation of new smart electricity meters, using SAP systems, and offering new services to commercial customers based on the new data possibilities. Companies like Centrica are planning to use SAP’s Smart Data Analytics, giving them deep understanding into consumer consumption.

Flip Business Models

The really interesting opportunity for businesses is where companies have managed to use analytics to fundamentally flip the way their businesses work: instead of analytics being part of a process, it “becomes the business model”.

Tim Ferriss, author of the 4-hour workweek, is an interesting example of this. He didn’t do what most authors do: write a book, and then figure out how to publicize it. He used an analytics-first approach: he bought Google Ads, with mockups of book covers, with a variety of titles of books that he might be interested in writing – and then wrote the book that got the most clickthroughs! This is one step beyond using analytics such as focus-groups, which are typically there to validate existing products. The next generation of products and services are being created “on the fly” based on an analysis-first approach.

The clothing brand Zara shook up fashion retailing with “analytics first” – instead of having a designer creating clothes and then trying to sell them six months later, they realized new manufacturing techniques meant they could create clothes “in the moment”. They could observe what people were wearing in the street, quickly make small batches of variations on that theme, and get them into the stores. If they sold well they made more, if they didn’t sell they discounted quickly. Instead of a season-oriented, “batch” business, they switched to a flow-oriented business, using new technology capabilities.

The new analytic platforms mean that this analytics-first approach is available to many more businesses than in the past. For example, T-Mobile is in the process of transforming the way they attract customers. Instead of laboriously creating a range of rate plans, promoting them, and analyzing the results, they now use analytics to automatically create hundreds of more complex, personalized rate plans. They then throw them out into the market, monitor in real time, and quickly cull any that aren’t successful. It’s a way of doing business that would have been inconceivable in the past, and a lot more common in the future.


2012 is the year to rethink your analytic technology to take account of new opportunities:

  • On the back end, for extreme data performance
  • On the front end, for actionable insights

And it’s time to rethink your business:

  • Remove today’s bottlenecks to successful analytics caused by data volumes, data variety, or data access
  • Rethink business processes by embedding real-time decisions
  • Create new products and services that could only exist because of today’s analytic power

Organizations are using this technology to change the way they do business. If you run an analytics project, you are in the forefront of these changes – it’s your job to help explain to the rest of the business how these technologies should be changing their existing processes. Good luck!


If you’re interested in slides that go along with this article, please see this post about the recent Gartner BI Summit in London that includes a download of my presentation at the conference.


About Timo Elliott

Timo Elliott is an innovation evangelist and international conference speaker who has presented to business and IT audiences in over forty countries around the world. A 23-year veteran of SAP BusinessObjects, Elliott works closely with SAP development and innovation centers around the world on new technology directions. His popular Business Analytics blog at tracks innovation in analytics and social media, including topics such as big data, collaborative decision-making, and social analytics. Prior to Business Objects, Elliott was a computer consultant in Hong Kong and led analytics projects for Shell in New Zealand. He holds a first-class honors degree in Economics with Statistics from Bristol University, England.



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13 Scary Statistics On Employee Engagement [INFOGRAPHIC]

Jacob Shriar

There is a serious problem with the way we work.

Most employees are disengaged and not passionate about the work they do. This is costing companies a ton of money in lost productivity, absenteeism, and turnover. It’s also harmful to employees, because they’re more stressed out than ever.

The thing that bothers me the most about it, is that it’s all so easy to fix. I can’t figure out why managers aren’t more proactive about this. Besides the human element of caring for our employees, it’s costing them money, so they should care more about fixing it. Something as simple as saying thank you to your employees can have a huge effect on their engagement, not to mention it’s good for your level of happiness.

The infographic that we put together has some pretty shocking statistics in it, but there are a few common themes. Employees feel overworked, overwhelmed, and they don’t like what they do. Companies are noticing it, with 75% of them saying they can’t attract the right talent, and 83% of them feeling that their employer brand isn’t compelling. Companies that want to fix this need to be smart, and patient. This doesn’t happen overnight, but like I mentioned, it’s easy to do. Being patient might be the hardest thing for companies, and I understand how frustrating it can be not to see results right away, but it’s important that you invest in this, because the ROI of employee engagement is huge.

Here are 4 simple (and free) things you can do to get that passion back into employees. These are all based on research from Deloitte.

1.  Encourage side projects

Employees feel overworked and underappreciated, so as leaders, we need to stop overloading them to the point where they can’t handle the workload. Let them explore their own passions and interests, and work on side projects. Ideally, they wouldn’t have to be related to the company, but if you’re worried about them wasting time, you can set that boundary that it has to be related to the company. What this does, is give them autonomy, and let them improve on their skills (mastery), two of the biggest motivators for work.

Employees feel overworked and underappreciated, so as leaders, we need to stop overloading them to the point where they can’t handle the workload.

2.  Encourage workers to engage with customers

At Wistia, a video hosting company, they make everyone in the company do customer support during their onboarding, and they often rotate people into customer support. When I asked Chris, their CEO, why they do this, he mentioned to me that it’s so every single person in the company understands how their customers are using their product. What pains they’re having, what they like about it, it gets everyone on the same page. It keeps all employees in the loop, and can really motivate you to work when you’re talking directly with customers.

3.  Encourage workers to work cross-functionally

Both Apple and Google have created common areas in their offices, specifically and strategically located, so that different workers that don’t normally interact with each other can have a chance to chat.

This isn’t a coincidence. It’s meant for that collaborative learning, and building those relationships with your colleagues.

4.  Encourage networking in their industry

This is similar to number 2 on the list, but it’s important for employees to grow and learn more about what they do. It helps them build that passion for their industry. It’s important to go to networking events, and encourage your employees to participate in these things. Websites like Eventbrite or Meetup have lots of great resources, and most of the events on there are free.

13 Disturbing Facts About Employee Engagement [Infographic]

What do you do to increase employee engagement? Let me know your thoughts in the comments!

Did you like today’s post? If so you’ll love our frequent newsletter! Sign up here and receive The Switch and Shift Change Playbook, by Shawn Murphy, as our thanks to you!

This infographic was crafted with love by Officevibe, the employee survey tool that helps companies improve their corporate wellness, and have a better organizational culture.


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Supply Chain Fraud: The Threat from Within

Lindsey LaManna

Supply chain fraud – whether perpetrated by suppliers, subcontractors, employees, or some combination of those – can take many forms. Among the most common are:

  • Falsified labor
  • Inflated bills or expense accounts
  • Bribery and corruption
  • Phantom vendor accounts or invoices
  • Bid rigging
  • Grey markets (counterfeit or knockoff products)
  • Failure to meet specifications (resulting in substandard or dangerous goods)
  • Unauthorized disbursements

LSAP_Smart Supply Chains_graphics_briefook inside

Perhaps the most damaging sources of supply chain fraud are internal, especially collusion between an employee and a supplier. Such partnerships help fraudsters evade independent checks and other controls, enabling them to steal larger amounts. The median loss from fraud committed
by a single thief was US$80,000, according to the Association of Certified Fraud Examiners (ACFE).

Costs increase along with the number of perpetrators involved. Fraud involving two thieves had a median loss of US$200,000; fraud involving three people had a median loss of US$355,000; and fraud with four or more had a median loss of more than US$500,000, according to ACFE.

Build a culture to fight fraud

The most effective method to fight internal supply chain theft is to create a culture dedicated to fighting it. Here are a few ways to do it:

  • Make sure the board and C-level executives understand the critical nature of the supply chain and the risk of fraud throughout the procurement lifecycle.
  • Market the organization’s supply chain policies internally and among contractors.
  • Institute policies that prohibit conflicts of interest, and cross-check employee and supplier data to uncover potential conflicts.
  • Define the rules for accepting gifts from suppliers and insist that all gifts be documented.
  • Require two employees to sign off on any proposed changes to suppliers.
  • Watch for staff defections to suppliers, and pay close attention to any supplier that has recently poached an employee.

About Lindsey LaManna

Lindsey LaManna is Social and Reporting Manager for the Digitalist Magazine by SAP Global Marketing. Follow @LindseyLaManna on Twitter, on LinkedIn or Google+.


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Data Analysts And Scientists More Important Than Ever For The Enterprise

Daniel Newman

The business world is now firmly in the age of data. Not that data wasn’t relevant before; it was just nowhere close to the speed and volume that’s available to us today. Businesses are buckling under the deluge of petabytes, exabytes, and zettabytes. Within these bytes lie valuable information on customer behavior, key business insights, and revenue generation. However, all that data is practically useless for businesses without the ability to identify the right data. Plus, if they don’t have the talent and resources to capture the right data, organize it, dissect it, draw actionable insights from it and, finally, deliver those insights in a meaningful way, their data initiatives will fail.

Rise of the CDO

Companies of all sizes can easily find themselves drowning in data generated from websites, landing pages, social streams, emails, text messages, and many other sources. Additionally, there is data in their own repositories. With so much data at their disposal, companies are under mounting pressure to utilize it to generate insights. These insights are critical because they can (and should) drive the overall business strategy and help companies make better business decisions. To leverage the power of data analytics, businesses need more “top-management muscle” specialized in the field of data science. This specialized field has lead to the creation of roles like Chief Data Officer (CDO).

In addition, with more companies undertaking digital transformations, there’s greater impetus for the C-suite to make data-driven decisions. The CDO helps make data-driven decisions and also develops a digital business strategy around those decisions. As data grows at an unstoppable rate, becoming an inseparable part of key business functions, we will see the CDO act as a bridge between other C-suite execs.

Data skills an emerging business necessity

So far, only large enterprises with bigger data mining and management needs maintain in-house solutions. These in-house teams and technologies handle the growing sets of diverse and dispersed data. Others work with third-party service providers to develop and execute their big data strategies.

As the amount of data grows, the need to mine it for insights becomes a key business requirement. For both large and small businesses, data-centric roles will experience endless upward mobility. These roles include data anlysts and scientists. There is going to be a huge opportunity for critical thinkers to turn their analytical skills into rapidly growing roles in the field of data science. In fact, data skills are now a prized qualification for titles like IT project managers and computer systems analysts.

Forbes cited the McKinsey Global Institute’s prediction that by 2018 there could be a massive shortage of data-skilled professionals. This indicates a disruption at the demand-supply level with the needs for data skills at an all-time high. With an increasing number of companies adopting big data strategies, salaries for data jobs are going through the roof. This is turning the position into a highly coveted one.

According to Harvard Professor Gary King, “There is a big data revolution. The big data revolution is that now we can do something with the data.” The big problem is that most enterprises don’t know what to do with data. Data professionals are helping businesses figure that out. So if you’re casting about for where to apply your skills and want to take advantage of one of the best career paths in the job market today, focus on data science.

I’m compensated by University of Phoenix for this blog. As always, all thoughts and opinions are my own.

For more insight on our increasingly connected future, see The $19 Trillion Question: Are You Undervaluing The Internet Of Things?

The post Data Analysts and Scientists More Important Than Ever For the Enterprise appeared first on Millennial CEO.


About Daniel Newman

Daniel Newman serves as the Co-Founder and CEO of EC3, a quickly growing hosted IT and Communication service provider. Prior to this role Daniel has held several prominent leadership roles including serving as CEO of United Visual. Parent company to United Visual Systems, United Visual Productions, and United GlobalComm; a family of companies focused on Visual Communications and Audio Visual Technologies. Daniel is also widely published and active in the Social Media Community. He is the Author of Amazon Best Selling Business Book "The Millennial CEO." Daniel also Co-Founded the Global online Community 12 Most and was recognized by the Huffington Post as one of the 100 Business and Leadership Accounts to Follow on Twitter. Newman is an Adjunct Professor of Management at North Central College. He attained his undergraduate degree in Marketing at Northern Illinois University and an Executive MBA from North Central College in Naperville, IL. Newman currently resides in Aurora, Illinois with his wife (Lisa) and his two daughters (Hailey 9, Avery 5). A Chicago native all of his life, Newman is an avid golfer, a fitness fan, and a classically trained pianist

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Five Reasons Why Social Collaboration Should Be Part Of Your Digital Transformation

Daisy Hernandez

Digital collaboration technology has revolutionized how we communicate and live our lives. The digital network – powered by search, social, and gamification technologies – has enabled the easy and rapid sharing of knowledge globally. Now it is easy to communicate and collaborate with others no matter their location, time zone, or geography.

In a business context, these same technologies are powering benefits across an organization. By connecting business areas, vital information needed to make critical decisions is no longer siloed and disjointed. Add to this the ability to incorporate business data, and decisions are now not only made collaboratively, but are informed by the latest business-critical information and data, whether it is back-end customer or financial data. This is where the real business benefits start to emerge.

Gartner predicts that 50% of large organizations will use internal social networks resembling Facebook by 2016. Thirty percent of these technologies will be considered to be as essential as email and telephones. Digital transformation is underway, and by using collaboration technology with integrated business data, businesses are starting to see staggering benefits.

Social collaboration: Going beyond information sharing

One of the most well-known benefits of social collaboration in a corporate environment is faster and tighter alignment during a project or process. However, a recent study conducted by Forrester Consulting indicates that the advantages run deep, and run throughout the enterprise. The following are five business benefits collaboration can deliver to your business today.

  1. Boost win rates and accelerate the sales cycle. The average sales deal requires a team effort, with individuals and knowledge that live outside the sales department. A Web-based network, accessible through any device, helps win new business and generate more revenue. By pulling expertise, information, and customer data together in one place, sales reps are able to collaborate within and outside of their organization to respond more quickly and accurately to incoming customer questions and needs.
  1. Improve the quality of onboarding and speed new hires’ time to productivity. Social solutions bring together people from across the organization as they collaborate on projects or teams. When a new hire joins the company, this community enables quick ramp-up as the new hire is able to quickly locate and connect to the experts and information they need to complete their job responsibilities. Add to this the fact that this solution houses the collective genius and lessons learned of the organization, and the result is a dynamic, continuous learning culture.
  1. Deliver unparalleled customer experience – every time. Whenever you can provide anyone on the front lines with the full customer story, everyone wins. Knowledge networks ensure that no matter who is interacting with the customer, they have the complete picture. Integrating backend data with real-time collaboration ensures that they are prepared with the latest data at their fingertips to understand the status of a current or prospective customer. For the customer, this means a seamless experience that is always informed, relevant, and meets their needs.
  1. Support business processes that are truly efficient, transparent, and accessible 24×7. Whether you are involved in marketing, IT, finance, or supply chain operations, it is not uncommon for employees to get lost in email chains and outdated spreadsheets and reports. If the ability to collaborate resides in a central location, existing business processes can be improved and supported. More important, taking this network into the mobile world helps ensure that employees have the information they need any time and anywhere.
  1. Create a future of work that appeals to young talent. Knowledge networks can be a cultural tool that not only serves the business, but also answers the needs of our youngest talent. For Millennials, operating in a digitally connected world is a normal part of life – and they could not imagine anything different in their workplace. In the Forrester report, one hiring manager stated, “Millennials would not like to work at [a] company that doesn’t have a collaboration tool. It’s unimaginable — we can’t hire without it.” Could you? Most likely not.

Now you can be part of shaping how organizations adopt and find value in social collaboration technology. Tell us what obstacles you are facing and the benefits you are reaping by taking part in this survey to help SAP develop our future perspective on social collaboration and how it affects us all as employees, managers, and businesses.


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