Narrowing your options to visualise the future
How advances in analytics make it easier for businesses to forecast the future
Dublin / Ireland, 08. Nov. 2013 - Big Data has made Irish firms more aware of the need to find value in the growing volume and velocity of data that has been stirred up by social networking and increased web activity, according to John Farrelly, general manager, SAS Ireland.
The ability to capture, process and analyse data is essential but what it's really about it the value piece – that's where you start the analytics journey," he said. "If you can't prove the value and quantify it, then why make the investment?"
A sector that sees considerable return on its analytics investments is financial services, according to Farrelly, where companies typically realise cost savings of between 10 and 12 per cent when they use analytics to tackle risk and fraud. An equally lucrative endgame is evidence-based decision making.
"Permanent TSB is a client of ours that designs products and services based on insights from customers. They market those products to the customer that want them. That is exactly the pattern you want to see, where analytics is used impact positively on the business," he said.
Farrelly said there are three elements on the journey towards more informed decision making: data management, BI and analytics. The first piece is about taking data out of operational systems and preparing it for analysis. This involves ETL (extract, transform, load), data cleansing and master data management. BI is the reporting layer, disseminating data for reports and dashboards, giving the business a rear view of its immediate past.
Analytics is about predicting the future, building models and scenarios from the information you have to forecast what's likely to happen next. "It's the hardest part that has been and much more successful with better data visualisation. Products like our Visual Analytics allow business people to run models without understanding how to build them. It makes analytics much more accessible," said Farrelly.
Run in-memory, data visualisation allows organisations to build models using all their data in seconds. Previously they relied on sample data that would take hours to assemble and was not always accurate. "It's a big game changer. Banks are leading the way in this, taking milliseconds to make risk decisions that give them significant business advantage," he said.
The complexity is still there in the background, however, where data scientists and statisticians prepare the data in the lab, making sure the models are technically accurate and valid. There is a skills gap in this area that has been highlighted by SAS and others.
Another gap Farrelly identifies is evidence-based decision-making, particularly in the public sector. "Collected in day-to-day operations, there is fantastic data out there that should be treated as an asset rather than a liability. You have to stop looking at data as a storage and management problem for IT and drive value through insights that will support better businesses decisions."
The good news is that more businesses can avail of this opportunity thanks to the cloud, SAS runs Visual Analytics from Amazon-type computing platforms and through service providers like Dakia.ie. The old analytics entry-point cost of€200,000 has tumbled to around €10,000 with the move to on-demand, pay-as-you-go services. This means, for example, that smaller credit unions can now avail of analytics that were once the sole preserve of big banks.
"In the past it was large companies that had the maturity of infrastructure to support analytics. The cloud gives small and medium-sized businesses access to processing power and storage that lets them be more flexible, and able to scale up and down to deal with different seasonal demands," said Farrelly.
He challenges concerns that cloud analytics puts sensitive data in an insecure place. "First of all, it's now recognised that you will get a better level of security from a cloud provider like Salesforce that you will from you own on-premise infrastructure. Secondly, you can obfuscate the data so that it retains statistical validity without exposing personal details."
Another hot topic is social media, responsible for a proliferation of data that a business may have good cause to mine.
Remember that it's just a subset of your total market, warns Farrelly, and calculate carefully what you react to. "Figure out who are the influencers; who is doing the re-tweeting. You have to build a picture of the sentiment being expressed and work out if it's going to be a real issue or just disappear into the noise," he said.
SAS is the leader in business analytics software and services, and the largest independent vendor in the business intelligence market. Through innovative solutions delivered within an integrated framework, SAS helps customers at more than 50,000 sites improve performance and deliver value by making better decisions faster. Since 1976 SAS has been giving customers around the world
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