Central Michigan University Research Corporation bringing big wins to major companies with SAS®

Making Ideas Work." It's the perfect slogan for Central Michigan University Research Corporation (CMU-RC). Using SAS as its primary analytical tool, CMU-RC has helped dozens of companies gain a competitive advantage by conducting studies in predictive intelligence, data mining, value creation, customer relationship management, and competitive analysis.

• What opportunities exist to up-sell and cross-sell within our current customer base?
• What can we learn about our current customers that helps target new customers?
• What impact will a rumored competitor moving into our market have?
• What are my staffing requirements in the future based on my business plan?
• What initiatives are our competitors undertaking that will impact their market position?

Questions like these keep top executives up at night. Thankfully for major companies that call Michigan home, such as The Dow Chemical Company, SAS and CMU Research Corporation have been great places to turn for the applied research and advanced analytics capabilities and resources that can help answer crucial business questions.

Despite its obvious benefits, business analytics are being underutilized, or worse, not even practiced at all, at many of the world's largest organizations, explains Timothy Pletcher, the director of applied research at CMU Research Corporation. "Even the most innovative companies, the ones that are committed to analytics and have used business intelligence for a number of years, are just scratching the surface of the discipline's full potential," Pletcher explains. It's a trend Pletcher, with help from SAS and other collaborators, hopes to reverse.

Established in 2002, CMU-RC is a not-for-profit applied research organization that promotes and facilitates applied research projects between academia and business organizations. Drawing from the diverse skill set of more than 700 CMU faculty members, CMU-RC builds a customized team specifically tailored to address an individual company's unique business challenges and answer critical business questions for them. CMU-RC's initiatives typically include gathering large volumes of data; identifying known and previously unknown relationships among factors in the data; interpreting these relationships (advanced analytics); using predictive modeling (data and/or text mining); and visualizing these patterns (GIS) to address a targeted business need.

As a result of the organization's partnership with SAS, CMU-RC is able to offer its clients the benefits of advanced analytics, specifically predictive intelligence. To augment the power of SAS, the organization partners with IBM for its powerful computing hardware and ESRI for its spatial analysis tools. The result is a unique blend of cutting-edge technologies and domain expertise individually tailored to address the specific needs of many of Michigan's top companies.

Forging a relationship with SAS
"Central Michigan University has always been a leader in business intelligence," says SAS' Director of Higher Education Consulting Jerry Oglesby. In fact, Oglesby credits CMU with being the first university to approach SAS with a request to build a joint CMU/SAS data mining certificate program. That was about the same time the concept of CMU-RC was developed. As the market leader in the field, SAS was immediately identified as the analytical provider of choice and Oglesby added to the board of directors.

Jerry Oglesby, Director of Higher Education Consulting

"SAS is impressed with the way CMU-RC has made a difference within the business and academic communities that surround Central Michigan," explains Oglesby. "It's a partnership I see SAS continuing for quite some time."

Executing CMU-RC Projects
CMU-RC assists companies by providing an effective, timely and extremely low risk opportunity to answer some of their most important business questions.

"CMU-RC operates by the data warehouse's definition of business intelligence – to gain insight from data for the purpose of taking action," says Pletcher. "This means that our definition is very broad and encompasses the entire spectrum of analytical technologies and methodologies including predictive modeling, data or text mining, geographic information systems, statistical analysis, operations research, simulation, and advanced data visualization." You can't overstate the benefits CMU-RC clients can potentially realize.

One of CMU-RC's frequent requests, for example, is to analyze customer loyalty data and retention attraction results to predict how these factors could impact a company's bottom line profitability. The results can be startling: "A 5 percent increase in customer retention can increase lifetime value from $5.5 billion to $22.5 billion for The Dow Chemical Company," said D.E. Kepler, Corporate Vice President of Electronic Business and Chief Information Officer for Dow, one of CMU-RC's clients.

Business Insight Services is the unit that helps apply advanced analytics at CMU-RC. The initial contact with a company interested in CMU-RC's offering includes a brainstorming session where CMU-RC staff, CMU faculty and the company will discuss specific business challenges and ways that business intelligence may provide effective solutions to the business problems.

"Through this brainstorming session, companies receive input from a group of knowledgeable, and innovative, professors who bring expertise that is often not located within a company in the business setting. They bring that extra spark to the process," said Pletcher. Very often these meetings result in a number of projects the three groups agree to pursue.

Each project is assigned a project manager (a full-time staff member of CMU-RC), a senior research fellow, and faculty from the university. Very often, the project will enlist the help of CMU students to assist in the research and analysis efforts.

"Because the projects use SAS to analyze the data, SAS gains exposure at some of the country's largest corporations," said Oglesby. "Once these companies learn about the usefulness and ROI potential of our analytical tools and business intelligence, they invariably continue the relationship with us."

Oglesby is equally excited about exposing university faculty and students to SAS' analytical products.

"The mission of my group is to increase awareness and use of SAS at universities around the country. Central Michigan University is a staunch supporter of SAS and is graduating some very strong students with a foundation of solid SAS knowledge. It's a great program and CMU is an excellent university to work with."

Expanding interest in business intelligence
In addition to helping companies solve important business problems and increasing awareness of SAS, CMU-RC is proving to be a tremendous resource for the BI community as a whole by bringing together leaders in industry, academia and technology to discuss the latest business intelligence research. CMU-RC hosts four regional seminars every year covering a variety of business intelligence topics. The Corporation also hosts an annual Business Insight Forum (now entering its fifth year) that brings together high-level speakers from a number of corporations to share their innovative uses of business intelligence. Last year's event, co-sponsored by SAS and others, attracted CEOs, CMOs, presidents and others from more than 50 of Michigan's largest companies and featured speakers from the Ford Motor Company, Henry Ford Health System, IBM Watson Research, Lubrizol, Proctor & Gamble, and Steelcase.

The future of the CMU-RC
As CMU-RC approaches its fourth anniversary Pletcher says the corporation has accomplished many of the goals it had set for itself. "CMU-RC has developed working relationships with some of the state's largest companies and has even expanded to serve companies outside of Michigan. We expect a 60 percent growth in the number of projects we'll undertake in 2006 and have already begun planning to open up a Detroit office to better serve the metropolitan area." CMU-RC's relationship with faculty has also expanded as the corporation begins to tap into professors at other Michigan-based universities.

The organization has also built strong relationships with SAS and some of its other primary partners like IBM and ESRI to take full advantage of their powerful technologies and domain expertise. "CMU-RC is able to draw upon the intellectual assets of some of the brightest faculty and graduate researchers. With the expertise of our partners we are well equipped to address almost any business question a client might pose," Pletcher concludes.

CMU-RC is a model Oglesby and many others at SAS hopes other academic institutions around the country try to replicate.

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