Big Data business insight from IT shows telcos ahead of the pack

Bob Tarzey, Quocirca, July 2014

First published in Global Telecoms Business in July April 2014
Quocirca Comment


Big Data business insight from I T
shows telcos ahead of the pack
http://www.quocirca.com 2014 Quocirca Ltd

Recent research conducted by Quocirca and
published in a new report, Masters of Machines:
Business insight from IT operational
intelligence (commissioned by Splunk, to find
out how businesses in various sectors are
harnessing the power of operational intelligence)
shows that the average volume of daily
commercial transactions driven by a European
enterprises IT systems is over 40,000. For a
telco this figure almost triples to 110,000. Such
transactions may be automated or customer
initiated and can include account creations,
device activations, call routing, records and so
on. This is a big number to be impacted if the
supporting IT systems fail or underperform in
some way. Not surprisingly, the more
transactivea business is, the more it is reliant on
IT with telcos being some of the most IT-reliant.

In many cases, supporting such high transaction
rates requires flexible IT infrastructure. The
more transactive a business is, the more likely it
is to have changed the way that infrastructure is
provisioned to serve the requirement. Highly
transactive organisations are more likely to turn
to virtualisation to enable the flexible
provisioning of the customer workloads; they are
also more likely to use cloud-based services as a
primary or secondary resource to support such
applications.

However provisioned, maintaining the
performance and availability of the IT systems
requires insight in to what is and has been
happening. Historic insight allows systems to be
retuned in anticipation of future requirements,
whilst real time insight can address issues as
they occur. Such insight relies on access to
operational intelligence which in itself relies on
data collected across an organisations IT
infrastructure. This is so-called machine data and
its use, alongside data collect about customer
activity, is the key to linking the performance of
IT systems to commercial activity and success.

The ability to gather and act upon operational
intelligence varies widely, but the bottom line is
that more transactive organisations recognise the
need more than their less transactive
counterparts. Telcos, more than any other sector
recognise this, with 90% saying quality access to
machine data is essential to deliver operational
intelligence. This does not mean other
organisations cannot benefit; in fact their
inability to do so may be one of the reasons they
are less transactive. Furthermore, most
organisations are likely to become more reliant
on IT to drive more transactions over time and
they need to be prepared for that and realise the
long term benefits to be gained.

Of course, one of the most obvious benefits is be
able to better provision and tune IT systems to
support customers. However, the most advanced
users of operational intelligence go well beyond
this and use it to provide real business insight
beyond the IT department to other parts of the
business and in some cases on to business
partners. For many, the intelligence is provided
direct to executive management; over 60%
already do this to some extent, although many of
these would like to improve their capability to do
so and 22% would like the ability to do so in the
first place.





Big Data business insight from I T
shows telcos ahead of the pack
http://www.quocirca.com 2014 Quocirca Ltd

Examples of the sort of insight that can be
provided include:
A call centre can monitor actual call volumes
and/or waiting times and see if these correlate
with other data, such as customer type or
geographic location. Early warning of arising
issues is thus possible.
Recognition of username/password attempts on
a system that do not match normal usage
patterns may identify a potential breach.
Attempted systems updates can be checked
against configuration change requests; if there is
no match a change may be unauthorised and
can be blocked.
Key performance indicators (KPIs) can be
monitored; for example, are response times for
customers transacting on web sites acceptable?
In what circumstances are targets not being met
and at what times of day or in which regions?
The challenges should not be underestimated.
Machine data needs to be gathered from a wide
range of devices and on-demand services that
support any given organisations IT
infrastructure. Processing all this data to provide
real time insight is a great example of a big
data problem. Big data has been an overused
term in the IT industry of recent, so lets put this
in context by looking at the five Vs often used to
characterise it:

Volume each commercial transaction driven by
an organisations IT infrastructure will touch
multiple parts of the supporting infrastructure
generating log records at every stage. If each
transaction generates tens of such records,
based on the average of 40,000 transactions a
day, which likely lead to an average 10 million
plus items of machine data a day. For telcos you
may as well triple this; the annual figure will be
in hundreds of billions. This is truly big data
volumes!
Variety the data comes from a range of
different systems; servers, storage systems,
routers, on-demand services, end user devices,
application and database logs etc. To turn this in
to true operational intelligence requires
correlating all this with data about the users
themselves, their device and browser activity
and experience and their transaction records.
Velocity to respond to issues as they occur
means processing this data in real time, often
providing historic context to current events
though cross correlation.
Veracity in-depth insight in to customer
activity, will give true and timely information
about their actual experience and how IT issues
are impacting business performance. Only with
such an accurate view can an IT department be
responsive to business requirements and deliver
expected service levels.
Value hopefully, the value of being able to do
this goes without saying; the evidence can be
seen through Quocircas research as the
remainder of this article will show. However,
that value is only delivered if the supporting
technology and tools for processing huge
volumes of machine data and turn in to true
operational intelligence are available.
The top challenge identified in the research was
the ability to collect, search and analyse the
volume of data involved (i.e. volume), followed
by the integrating data from multiple sources
(i.e. variety). To gauge how well organisations
were disposed to gather and use operational
intelligence, Quocirca developed an operational
intelligence index (OI Index).





Big Data business insight from I T
shows telcos ahead of the pack
http://www.quocirca.com 2014 Quocirca Ltd

This was based on an organisations ability to
achieve the following:
1. Search and investigate (machine data)
2. Proactive monitoring (of service levels)
3. Operational visibility (of customer
experience)
4. Real-time business insights
The report lists more details, but each of these
had three sub-categories (so 12 overall) and
depending on an organisations ability in each
area an OI index score of between 0 and 3 was
assigned to each organisation, where a score of 3
would rate as excellent and 0 would be non-
existent. Telcos led the way with an average
score of 2.23, compared to an overall average of
1.92.

The correlation of OI index with aspiration in
other areas was very strong. These organisations
were gathering machine data from 65% of their
infrastructure compared to 45% of those with a
median OI score and 15% of those with the
lowest score. Over 80% of those with a
maximum OI-Index of 3 were able to provide a
comprehensive insight of business performance
at a board level, for those with a median score it
was 48% and just 3% for those with a low score.

For Splunk, which commissioned the research,
one of the most interesting findings was the sort
of tools organisations had in place for gathering
and analysing machine data to provide
operational intelligence. 64% were using
traditional business intelligence tools, whilst
57% were using spreadsheets (hardly tools for
processing billions of machine data record of
varying formats). Only 27% were using custom
designed tools, such as those provided by
Splunk, which provides a software platform for
real-time operational Intelligence.

There could be two reasons for this; first it could
be that such tools do not deliver, but this is not
what the research showed. Those using purpose
built tools were gathering machine data from
more of their infrastructure (52%) then those
using other methods, for example just 44% with
business tools and 43% with spreadsheets. For
many, these will just reflect their early
achievements with purpose built operational
intelligence tools as the market is still maturing
(compared to the long history of business
intelligence and spreadsheet use).

So, the message from Quocircas new research is
clear machine data is a key resource for
providing operational intelligence and
understanding business performance. However,
achieving the goal of providing such intelligence
across the business in real time requires tools
that are up to the job and only those that with the
highest operational intelligence capability are
achieving this and it is telcos that are leading
the way.






Big Data business insight from I T
shows telcos ahead of the pack
http://www.quocirca.com 2014 Quocirca Ltd



About Quocirca
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