Sap Hana Real Time Enterprise Stories PDF

Real Time
Research
REPORTS
Real-Time
Enterprise Stories Adobe Systems eBay Maple Leaf Foods
Alliander EMC Mercedes-AMG
ARI Florida Crystals NFL
CareFusion Globus Nomura Research Institute

City of Boston, Massachusetts Hewlett-Packard Norwegian Cruise Line
City of Cape Town, South Africa HSE24 Southern California Edison
Commonwealth Bank of Australia Johnsonville Sausage T-Mobile
ConAgra Kaeser Compressors
More than 20 detailed case studies from Bloomberg

Businessweek Research Services and Forbes Insights
featuring leading-edge enterprises across industries to explore
the real value of the in-memory platform: SAP HANA.
Sponsored by:
October 2014
Real-Time Enterprises
A Research Collection
Contents
Forward: Making Decisions in the Moment.................................................. 5
Adobe Systems: Adobe Gets Personal With Customers (high tech)........ 6
Alliander: Alliander Energizes Its Business with Real-Time Analytics

(utilities)...................................................................................................... 10
ARI: In-Memory Computing Drives Fleet Savings at ARI

(automotive)................................................................................................ 14
CareFusion: Real-Time Business Leads to Healthy Performance at

CareFusion (healthcare) ........................................................................... 18
City of Boston, Massachusetts: Bostons Better Community Connections

Through Big Data and Analytics (public sector) ...................................... 22
City of Cape Town, South Africa: Real-Time Data Speeds Services in

The Mother City of Cape Town (public sector) ...................................... 25
Commonwealth Bank of Australia: CBA Offers More Personalized Banking

Through Big Data and Analytics (banking)................................................ 28
ConAgra: Real-Time Business Leads ConAgra to Profitable Insights

(consumer products).................................................................................. 31
eBay: Big Benefits from Big Data at eBay (high tech)............................ 35
Page 2
Contents
EMC: The Key to EMCs Technology Growth: Integrated Acquisitions
(high tech)................................................................................................... 39
Florida Crystals: Real-Time Business Sweetens Performance at Florida

Crystals (consumer products)................................................................... 44
Globus: Globus Is Always in Style with In-Memory Technology (retail).. 48
Hewlett-Packard: HP Paves the Future with Real-Time Insights

(high tech)................................................................................................... 51
HSE24: Using Real-Time Insights, HSE24 Gets Closer to Customers

(retail).......................................................................................................... 55
Johnsonville Sausage: Johnsonville Cooks Up a Real-Time Recipe

(consumer products).................................................................................. 59
Kaeser Kompressoren: Kaeser Puts Customers First with Big Data and
Real-Time Business (industrial machinery & components)...................... 63
Maple Leaf Foods: Maple Leaf Foods Turns Over a New Leaf with
Up-to-the-Minute Insights (consumer products)...................................... 67
Mercedes-AMG: Mercedes-AMG: A Showcase for Real-Time Business

Decisions (automotive).............................................................................. 71
National Football League: The NFLs Advanced Analytics Score with

Football Fans (sports & entertainment) .................................................... 75
Page 3
Contents
Nomura Research Institute: Tokyo Drivers Avoid Traffic Jams with NRIs
Big Data and Analytics (high tech)............................................................ 79
Norwegian Cruise Line: Norwegian Cruise Line Sets Its Course for
Real-Time Insights (travel & transportation).............................................. 82
Southern California Edison: How Southern California Edison Harnesses

Big Datas Power (utilities)........................................................................ 86
T-Mobile: Using Social Media to Improve Customer Loyalty at T-Mobile

(telecommunications)................................................................................. 90
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Page 4
Forward: Making
Decisions in the Moment
Many different factors impact the decisions companies make everyday. Being a real-time business
means being able to make those decisions when they matter most. For most companies today, how-
ever, batch processes must run before any decision can be made. In retail, for example, personalized
offers in stores arent common. Instead, stores offer a generic 25 percent off. But what if something
personal and relevant for individual shoppers could be delivered when they walk in the door?
There will be a time when Real-time planning, for example, is the game
we walk into a store and our changer for one SAP customer. Using HANA
experience will be radically has reduced the time it takes to process one
different. Thats why the SAP financial report from 40 hours to 20 seconds
HANA platform exists: to a 7,000 times improvement.
enable companies to do busi-
ness in the moment. I envision the SAP HANA platform not only
Steve Lucas, enabling customers to make todays decisions
President For large companies, three but also providing them a powerful predictive
Platform
main drivers deliver value. engine for tomorrows choices. Most compa-
Solutions,
First, simplify: Reduce the nies make decisions by looking in the rearview
SAP
complexity of the systems mirror, but a rearview mirror offers only a tiny
required to produce existing results. In fact, piece of the puzzle versus the forward view
massive IT simplification was one of the key a windshield provides. Eventually, operating
design motivations behind SAP HANA. You models will include built-in forward-looking
can use the platform to feed data from all decisions.
different sources into one system. Second,
enable agility: Give customers insights in real Real-time business transformations are not
time to aid decision-making. Third, innovate: just about technology, though. SAP HANA is
Unlock the true potential of real-time business extraordinarily innovative, but the first thing
innovation through new business processes we do is look at where the opportunities are
and models. to transform business processes. Then, SAP
helps customers rethink how those processes
SAP HANA deployments began more than are designed and how they can be remodeled.
three years ago. Since then, companies have You have to start at zero. If you dont have to
added the SAP Business Suite powered by wait for information, theres an opportunity for
HANA. Now there are more than 4,000 SAP massive reinvention and value creation across
HANA customers. So far, business transforma- industries. n Steve Lucas
tions have been process by process based on
the time it takes to get data and then analyze
it. When you eliminate the latency, you have to
think through how you want to work differently.
Page 5
Adobe Systems at a glance

Producer of desktop publishing and graphics editing
programs as well as a wide array of products made
for creative and marketing professionals
Industry: high tech
Founded: 1982
Headquarters: San Jose, Calif.
2013 revenue: $4.06 billion
Employees: More than 11,000 worldwide
Products: Software for creative and

marketing professionals
www.adobe.com
Source: Adobe Systems
Page 6
RESEARCH UPDATE | Real-Time Enterprise Case Studies
Adobe Gets Personal

With Customers
With in-memory computing and predictive analytics tools, the high-tech company is
anticipating customer needs and developing more personalized programs.
BY JOE MULLICH
T hroughout high-tech, long-time business models are falling by the wayside as

products become digitized, customer demands rise and the need for speed
increases. Few companies know this better than Adobe Systems, best known for its
Adobe Systems at desktop publishing and graphics editing programs Acrobat and Photoshop, as well as
a Glance a wide array of products made for creative and marketing professionals.
} Founded: 1982
} Corporate headquarters:
San Jose, Calif.
Over the past few years, Adobes business model FIGURE 1 Changes to Adobes
} Revenue: $4.06 billion,
has fundamentally changed. Instead of selling Business Model
boxed software, its business is now driven by The companys business model has
fiscal 2013
cloud-based subscriptions. And instead of products fundamentally changed.
} Employees: More than
11,000 worldwide being released every 18 months, new offerings and Past Present
} Products: Software for upgrades are a constant. The companys customer Offerings Sold by the Sold by the
creative and marketing interactionsonce periodic and performed through box subscription
professionals
resellers or partnersare now continuous and Distribution Sold through Sold directly
occur across multiple channels, including social partners
www.adobe.com
Source: Adobe Systems
media, display ads, e-mail, the call center, direct Product 18-month Continuously
releases cycles updated
sales and the Web (see Figure 1, Changes to
Adobes Business Model). Customer
Source: Adobe Systems Periodic Ongoing
interactions relationship
These shifts have transformed the types of Source: Adobe Systems
customer, product and sales data to which Adobe

has access. Whereas customer information used to the exact data they needed rather than sorting
be limited to name, address and billing information, through data dumps. To accomplish both of these
Adobe now collects data on how customers use goals, Adobe needed to enable cross-functional
its products, and in what context. Used correctly, collaboration, integrate silos of data, deliver one
such data can lead to a better understanding of version of performance metrics, react to customer
customer behavior and even future needs. signals in milliseconds and enable data-driven action.
The problem was, while each of its engagement According to Prasad Bhandarkar, director
channels provided customer insights, the views of Adobe Information Services, these goals
were fractured and channel-specific. Adobe needed were accomplished by leveraging in-memory
to gain a more holistic view of customers, as well computing,1 which rapidly aggregates and analyzes
as real-time insights into their behavior to deliver a vast amounts of numerous types of data. The
highly personalized, engaging experience. It had use of in-memory computing and analytics tools
also become essential for the company to quickly is the centerpiece of the companys vision of
obtain up-to-the-moment business performance revolutionizing the way Adobe engages with
1. Prasad Bhandarkar spoke at a
recent Webinar. information so that workers could quickly find information, Bhandarkar said.
FEBRUARY 2014 | Copyright 2014. Bloomberg L.P. All rights reserved.

RESEARCH UPDATE | Real-Time Business Case Studies
A Fractured Data Environment FIGURE 2 Channel Quagmire

Adobes Photoshop software is currently installed on Respondents were asked, How would you
rate your ability to quantify the impact of one channels
600 million desktops, and 90 percent of the worlds
performance on another (e.g., online display advertisings
creators use the graphics program. The company impact on search marketing)?
also offers Creative Cloud, which enables access to
I dont know Very good
Adobe applications, and Adobe Marketing Cloud, 4.8%
7.7%
which provides analytics and other marketing tools.
Adobes Business Good
Challenges Adobe faced many of the issues common to Poor 16.8%
} Transforming into a 18.8%
technology businesses grappling with this new age
cloud business
of producing and marketing software. Although the
} Using real-time data Fair
to tailor personalized
company could see how a customer responded to a 51%
customer experiences specific marketing initiative, for instance, it could not
} Creating company-wide easily combine that information with that customers
performance KPIs and e-mail messages and social media sentiment. A *Total does not equal 100% due to rounding
holistic customer views recent study found that most marketers do not Source: The CMO Club 2
} Enabling consistent
have a holistic view across channels (see Figure 2,
messaging across
Channel Quagmire). and dynamic access to data. Real-time data
numerous marketing
channels acquisition puts instant decision-making at the
} Aggregating structured Further, performance reports were often fingertips of people throughout the organization.
and unstructured data inaccurate and inconsistent. Analytics was highly Versatility. The platform enables employees to
from multiple sources fragmented across the company, with different visualize data using a wide variety of charts and
groups producing different numbers. And because graphs, so they can make connections in the
executives relied on IT to query data, they had to data more easily and share their insights readily
wait for results. The time delay was increasingly throughout the enterprise.
unacceptable for an Internet-based business in
which second-by-second customer activity can To ensure that the dashboard optimizes
influence marketing and sales efforts. decision-making, the team drew inspiration for
its visualization techniques from the Louvre in
Developing a Dashboard Paris. There is art and poetry to make this work,
A key piece of Adobes data strategy is Adobe Bhandarkar said. Users now get answers and
Dash, a business intelligence platform that connects insights rather than tables and numbers, enabling
data across multiple sources in real time. Because them to discover something new about the
traditional databases cannot aggregate data on the business every time they use the system.
fly, the company turned to in-memory computing.
Adobe had used in-memory computing in the past to Presenting data effectively is a key component of real-
analyze large data sets to stem software piracy, and
3 time analytics. In a 2013 study by TDWI Research,
the effort had quickly uncovered enough information respondents named several business benefits of
2. The CMO Club and Visual IQ.
Building Bridges to the Promised about software misuse to suggest that the technology data visualization technologies, including improved
Land: Big Data, Attribution
offered significant revenue opportunities. Adobe Dash operational efficiency (77 percent), faster response to
& Omni-ChannelA CMO
Perspective. 2014 offers several benefits: business change (62 percent) and the ability to identify
http://goo.gl/DaItYQ
3. SAP. Adobe: HANA Customer Trust. Business performance KPIs are now timely, new business opportunities (59 percent).4
Testimonial Video.
http://goo.gl/LD5Yxx accurate and undisputed. With a single set of
4. Stodder, David. Data
Visualization and Discovery for
KPIs, Adobe can now work from a single version New Business Insights
Better Business Decisions. TDWI of the truth. With the ability to quickly aggregate information
Research, 2013.
http://goo.gl/xBYyLi Speed. Business leaders now have direct from all channels via in-memory computing, Adobe
2 Bloomberg Businessweek Research Services

FIGURE 3 Preference for promotions. In the past, it was necessary to wait

Personalization 24 hours to ascertain a promotions impact. With
Consumers increasingly expect in-memory computing, that data is available within
personalized interactions.
minutes, enabling Adobe to tweak the promotion
(Percent of respondents)
immediately to improve results. Knowing what is
Would trust businesses more if they explained how
they are using personal information to improve happening with promotions within a 15-minute
their online experience window is far more powerful than having a one-day
77% delay, and the agility for executive decision-making
Adobes IT
Solutions Get frustrated with Web sites that display content,
is game changing, according to the company.
} Fully integrated and real- offers, ads, promotions, etc., that have nothing to
time customer profiles do with their interests The best forward-looking measure for any cloud
across channels 74% business is how actively customers are using
} Easy-to-use dashboard
the product. For example, if a customers usage
with a variety of Are OK with providing personal information on a
visualization tools Web site as long as it is for their benefit and being of the Marketing Cloud or Creative Cloud starts
} In-memory computing used in responsible ways to decrease a few months before the annual
for instantaneous data
57% subscription ends, that is a clear warning sign,
aggregation and analysis Source: Janrain/Harris Interactive, 2013 and the sooner that Adobe can see this trend
happening and respond to it, the better chance it
can now provide more personalized customer has of retaining customers.
interactions and a consistent experience across
channels. For instance, when customers click on Adobe executives can easily see everything in the
e-mails or display ads, the company can create an digital pipeline, including top customer issues, and
identity composite for them, and tailor the message for further information, they can drill-down on the
based on that information, as opposed to providing fly. The company plans to enable this capability on
them with generic messaging. Such personalization mobile devices in the future, as well. In fiscal 2013,
aligns with customer preferences; in a recent Adobe saw an uptick for its efforts. Creative Cloud
study, consumers said they prized personalized subscriptions grew by 1.1 million, and subscriptions
marketing that catered to their interests (see Figure to Document Services doubled to more than 1.6
3, Preference for Personalization). million.Adobe Marketing Cloud achieved a record
$1.02 billion in annual revenue, representing 26
On the business performance side, when percent year-over-year growth.
Adobe employees have questions about order
management and booking, they can slice and dice Using in-memory computing, data visualization
data in many wayssuch as by financial quarter and advanced analytics, Adobe is able to fully
or certain geographiesand receive an answer operate as a cloud-based company. It can see a
in three seconds. That capability never existed complete and updated view of customers across
before, Bhandarkar said. As our business changed channels, personalize customer interactions and
to a subscription model, its become even more make profitable business decisions based on in-
important for us to know on a day-to-day basis the-moment data. By leveraging real-time big data
what customers are doing inside the product. analytics, high-tech companies such as Adobe are
With Adobes in-memory system, an order that laying the foundation needed to compete today and
was booked five seconds before shows up in the in the future.
aggregated numbers.
Joe Mullich is a freelance business and technology
writer based in Sherman Oaks, Calif.
Additionally, Adobe can quickly analyze customer
acquisition and usage patterns to optimize This research project was funded by a grant from SAP.

Alliander at a glance
A regional grid operator for gas and electricity
in the Netherlands
Industry: utilities
Headquarters: Arnhem, Netherlands
Business units: Alliander manages the gas
and electricity grids in many areas of the Neth-
erlands; Liandon works on energy infrastruc-
tures for high-voltage, complex medium-volt-
age and industrial installations
2013 Revenues: 1,744 million
Employees: 6,000
www.alliander.com
Source: Alliander
Page 10
Alliander Energizes Its Business

with Real-Time Analytics
A Netherlands utility is using real-time business insights based on big data to boost reliability, lower
costs and transform customer relationships.
BY JOE MULLICH
A lliander, a regional grid operator for gas and electricity in the Netherlands, is
grappling with an issue that is becoming widespread among utilities:
unpredictable demand due to rapid changes in customers energy consumption
Alliander at a behavior. Energy-hungry devices such as plug-in electric vehicles (PEVs), as well as
Glance
Headquarters: Arnhem, unconventional energy sources such as solar and FIGURE 1 Wide Range of Analytics Value
Netherlands wind, have fundamentally changed the energy Respondents were asked in which areas they
Business units: Alliander see analytics having the greatest impact on smart solutions
landscape. Case in point: There are now over
manages the gas and deployment. (% responding)
1,030 public charging points for PEVs in the
electricity grids in many
regions where Alliander is active, of which more Grid operations
areas of the Netherlands;
96%
Liandon works on than 300 were realized just last year. 1
energy infrastructures for Asset management

high-voltage, complex Such changes are heightening the need for Alliander 92%
medium-voltage and
to improve peak load forecasting in its networks
industrial installations Outage management
quickly and accurately. Failing to do so could lead to
2013 Revenues: 1,744 85%
million (US$2,386 million) higher operating costs or, worse, network outages
Employees: 6,000 that leave customers angry and without power. AMI operations
www.alliander.com 77%
Source: Alliander Consequently, a good part of Allianders future
Demand response
hinges on using real-time data to make
73%
unpredictable demand more predictable by
leveraging the information that smart meters, smart Customer operations
grids and enhanced customer relationship 73%
management systems provide. The utility is applying
Revenue protection/theft reduction
this great mass of data to other real-time uses, as 52%
well. Jill Feblowitz, vice president at consultancy IDC
Base: 54 utilities in 13 countries
Energy Insights, said that as utilities work to realize Source: Accenture, 2013. http://goo.gl/mwjiLS
more value from their smart meter implementations,
analytics will be the trend that has the most impact Lots of Data, Big Payoff
over the next five years. In the utility industry, lots of data is accumulating rapidly:
Smart meters in consumer homes gather usage data;
Indeed, a 2013 Accenture survey revealed a broad the smart grid collects data from the devices in the
array of business functions that utilities say would network; and a significant amount of data comes
1. Alliander. Alliander is working benefit from better analytics (see Figure 1, Wide
2
courtesy of those who generate energy with solar
on a sustainable future. Alliander
Range of Analytics Value). The need to use panels or wind power. And utilities expect a big return
press release, Feb. 14, 2014.
2. Accenture. Unlocking the Value dynamic and granular data to make decisions in the from all this data. A 2013 survey by Tata Consultancy
of Analytics. Research report,
2013. http://goo.gl/mwjiLS. moment is fast becoming an industry imperative. Services found that both utilities and energy/resources
MARCH 2014 | Copyright 2014. Bloomberg L.P. All rights reserved.

companies have the highest expectations for FIGURE 2 Big Data Expectations
generating returns on investment in big data3 (see Of all industries, utilities expects the biggest
Figure 2, Big Data Expectations). returns on its big data investment. (mean percentage of
expected ROI for 2012 big data investments)
Alliander itself has been on a data quest. The utility Utilities

73.0%
dramatically increased the number of sensors
Allianders throughout its grid, enabling it to gather larger data Energy/resources
Business volumes for analysis. Measurement data is sent at 60.6%
Challenges five-minute intervals, and the sensors generate 3.15
High tech
} Improve forecasting of
billion records every yeara huge repository to mine 52.4%
peak energy usage.
for information and insights.4
} Provide customers with
Average
greater insight into 45.5%
energy consumption. To analyze the data quickly enough to apply insights
} Gain fast access to large in a timely fashion, Alliander turned to in-memory Banking/financial services
volumes of 43.7%
computing, technology that enables very large
measurement data for
volumes of diverse sources of data to be rapidly and Insurance
analysis.
easily analyzed. The utility has seen a number of 38.9%
Allianders IT benefits, including more accurate forecasting of

Travel/hospitality/airlines
Solutions energy demand, greater efficiency by automating 37.9%
} Expanded network to manual tasks, improved auditing and reduced
22,000 sensors spread Telecommunications
energy costs for customers.5
37.9%
across 400 substations.
} Implemented in-memory
Transforming Customer Relations Source: Tata Consultancy Services, 2013
computing to speed
data analysis. According to a 2013 IDC Energy Insights study, the
} Set up wireless mobile highest business priority for utilities today is meters send granular data on energy consumption directly
telecommunications increasing customer satisfaction, followed closely by to utility companies, and some utilities use small wireless
network. reliable service delivery and operational cost displays to show people how much energy and money
reductions. Analytics helps utilities achieve this goal
6
they are spending in real time. A survey by uSwitch, an
by changing the customer relationship to a energy price comparison service in the United Kingdom,
partnership. For instance, using smart meter data, found that consumers with smart meters are more likely
utilities can work with customers on using energy to partake in energy-saving behaviors 8 (see Figure 3,
more efficiently and reducing their bills. Satisfaction with Smart Meters).
Customers can also play a role in helping utilities At Alliander, customers who have real-time access to
achieve their own conservation goals. Robin data about their energy usage have reduced energy bills
3. Tata Consultancy Services.
The Emerging Big Returns from
Hagemans, manager of grid information and control at by 10 to 20 percent per month. We need to help our
Big Data. Research report, 2013. Alliander, noted the utilitys aggressive goals of reducing customers at the household level to use their energy
http://goo.gl/NhEUgW.
4. Tekurkar, Shailesh. Leveraging carbon emissions by 20 percent by 2020 and boosting much more wisely, said Jeroen Scheer, manager
the Smart Grid for Smart
Decisions on Network Asset renewable energy use by the same amount. That taskforce energy transition IT at Alliander.9
Replacements. Analytics from
SAP blog, Nov. 13, 2012.
goal, he said, can be reached only if consumers
http://goo.gl/E5PD6V. become more active participants in the process of Forecasting Peak Loads
5. Shailesh Tekurkar.
6. Feblowitz, Jill. The Digital conserving energy and balancing their energy use. 7
Perhaps an even bigger advantage of analyzing data from
Utility. IDC Energy Insights
executive summary. September smart grids and smart meters in real time is the capability
2013.
7. Koster, Stefan. How Alliander
The rapid speed of in-memory computing produces to accurately forecast demand, which enables utilities to
is accelerating its load forecasting the insights needed to do just that, and it helps predict and head off likely outages, as well as to identify
process using SAP Analytics. SAP
presentation. May 28, 2013. Alliander better engage with its customers. Smart leaks and fraud. Better forecasting enables utilities to plan

future investments that prevent network overloads. FIGURE 3 Satisfaction with Smart Meters
Such forecasts are tricky, though, because the Customers with smart meters report high
substation load depends on numerous variables satisfaction with their provider. (% responding)
demographic growth, seasonality, consumption

Are happy with their smart meter
forecasts, specific events and more. 92%
Would recommend having a smart meter installed

Real-Time In the past, collecting and analyzing the enormous
87%
Business Benefits amounts of data required 10 weeks of effort. As a
at Alliander result, Alliander would only perform forecasting and Use it to monitor energy usage and reduce
} Reduced time for grid optimization once a year. With in-memory consumption
forecasting and grid 81%
computing, that process can be accomplished in a
optimization from 10
mere three days. Consequently, the utility can Are more likely to turn off lights when not in use
weeks to three days.
} Implemented 85 new monitor the transformer stations, detect sensor 51%
business models to problems automatically and forecast future power
Better understanding of which actions consume
analyze operations. loads once a month. This provides a more
the most energy
} Helped customers accurate forecast, much deeper insight and greater 41%
reduce monthly energy
opportunities to drive efficiency.10
bills by 10 to 20 percent. Base: 5,057 U.K. households with a smart meter installed
Source: uSwitch, 2013
We can optimize our grid and create new models
we couldnt think of a year ago, Scheer said. Such efforts include setting up a wireless mobile
Indeed, as a result of the efforts, Alliander has telecommunications network to facilitate the exchange
created 85new models to analyze its operations of all information within the utilitys grids. The impact of
more effectively. We found out that 5 percent of the energy transition is becoming increasingly visible,
the peaks determined last year were inaccurate, he said. For instance, more and more renewable
according to Stefan Koster, BI & analytics solution energy is being generated, and this will have major
architect at the utility. The new algorithms help consequences for the networks in the long term.14
detect more errors, leading to more efficiencies. 11
In the IDC Energy Insights report, Feblowitz

Business Reinvention recommended that utilities fortify their information
8. Martinelli, Michele. New Market analyst firm GTM Research predicted and telecommunications infrastructure and
research shows consumers are
happy with smart meters. USwitch global utility company expenditures on data and applications so they can support advanced analytics
news, Dec. 12, 2013. such as forecasting, predictive load, simulations and
analytics will grow from $700 million in 2012 to
http://goo.gl/0UDnUi.
9. Scheer, Jeroen. Alliander $3.8 billion in 2020, with gas, electricity and water optimization. One specific capability she cited is
and SAP HANA. SAP customer
testimonial video. suppliers in all regions of the world increasing integrating demand information with geospatial
http://goo.gl/cS0CoV.
10. Courtney, Martin. How their investment. This will result in a complete visualization tools. Alliander is already going down
utilities are profiting from Big this track. 15
reinvention of the utility business, according to
Data analytics. Engineering and
Technology Magazine, Jan. 20, analyst David J. Leeds. 12
2014. http://goo.gl/r60uhi.
11. Stefan Koster. As Pieter den Hamer, manager of business intelligence
12. Martin Courtney.
13. Alliander press release. As Alliander looks to the future, it is seeking to boost and analytics at the utility, put it: In the current utility
14. Alliander press release. landscape, Innovation is not just something extra, but
the insights gained from network data. Peter
15. Hagemans, Robin. Alliander
Smart Grid Analytic Use Cases Molengraaf, Alliander CEO, said the companys main its a necessity.16
Based on a Live Mid-voltage Grid
Lab. OSIsoft EMEA industry focus is making the right choices for the future of
session, 2013. Joe Mullich is a freelance business and technology writer
http://goo.gl/ubKnOy. our networks. Whilst continuing to maintain and
16. Szirtes, Tamas. Business
based in Sherman Oaks, Calif.
replace our existing electricity and gas networks, we
Innovation Experience a
resounding success. Intenzz blog, are also preparing for the radically changing energy This research project was funded by a grant from SAP.
Feb. 6, 2013.
http://goo.gl/O9D3Wc. landscape of the future. 13

ARI at a glance
Largest privately held fleet management services
company in the world
Industry: automotive
Parent company: Holman Automotive Group
Employees: 2,400 worldwide
Headquarters: Mount Laurel, New Jersey
www.arifleet.com
Source: ARI
Page 14
In-Memory Computing Drives

Fleet Savings at ARI
The worlds largest privately held vehicle management company is turning big data into
real-time insights and predictions that deliver unprecedented business value to customers.
BY ESTHER SHEIN WISHNOW
A n employee driving a company car or truck may think he is doing the business a big
favor by purchasing gas at a low-cost fuel station a few miles out of his way. What he
cannot know is that the station has a higher incidence rate of accidents because it is located
at a dangerous intersection. But ARI knows. Thanks to can be made in minutes, not months. With its data
AN EXCLUSIVE in-memory technology, the company is quickly turning volume doubling every 14 months, that has become an
RESEARCH REPORT seemingly unrelated datapoints into insights its customers ever-greater challenge, which is why ARI invested in an
FROM BLOOMBERG can use to optimize fleet efficiencybefore they make a in-memory database. The solution has reduced response
BUSINESSWEEK wrong turn. times on delivering information to customers and solved
RESEARCH SERVICES its data latency problem, says Tony Candeloro, vice
ARI manages more than 950,000 vehicles in North president of product development (see Figure 1, In-
America and the United Kingdom. With its two million Memory Computing: The Payoff for ARI).
AT A GLANCE worldwide associates, the company collects up to 14,000
datapoints on each vehicle, including specifications, Real-time analysis of very large date sets is possible with
ARI at a Glance maintenance, fuel, safety and value. It also captures high-performance, in-memory database technology, says
Industry: telematics information through onboard computers, Hyoun Park, principal analyst at Nucleus Research. HANA
Vehicle fleet management including how fast a vehicle is moving, when it makes a from SAP, for example, provides orders of magnitude
Company description: left- or right-hand turn and where it has stopped. performance increases by accelerating information delivery
Largest privately held fleet and queries, he says. A lot of processes that have slowed
management services In the past, ARI used this information to provide reports down as companies deal with huge amounts of data
company in the world and recommendations to customers. But staying are now being brought back to operational levels where
Parent company: competitive today means delivering insights so decisions companies can get data quickly again.
Holman Automotive Group
Employees:
FIGURE 1 In-Memory Computing: The Payoff for ARI
2,400 worldwide
Headquarters:
Running a report or query before in-memory Up to two hours; some reports were so complicated
Mount Laurel, N.J.
technology they would time-out after 24 hours
Web site: www.arifleet.com
Running a report or query with in-memory technology Three seconds
Number of datapoints captured per vehicle 14,000 (late 2011 into early 2012)
Number of vehicles in ARIs fleet Roughly 950,000 in North America
ROI 5% efficiency improvement in the call center
Source: ARI
JULY 2013 | Copyright 2013. Bloomberg L.P. All rights reserved.

Speed Equals Value Moving those large silos into a real-time environment was
This was the situation at ARI: the need to drive the a challenge, says Bob White, senior vice president of
information it captured to its fullest potentialquickly. client and fleet relations at ARI. Before we implemented
Once you have all the data, its about how you analyze this technology, working with the data on a real-time
and correlate it to make better decisions, Candeloro basis to draw correlations and spot trends was difficult,
says. While we have always helped our clients manage he says. The in-memory system provides employees
ARIs Data their fleets efficiently and worked to deliver the lowest with new real-time insights to create more value for
Challenges total cost of ownership possible, the time it took to customers. [We can] leverage that data in a timeframe
Manage data growth: decipher all of the data and make day-to-day decisions that meets the business need, White says.
With 14,000 datapoints was becoming more difficult as our data volumes grew.
collected per vehicle, ARIs Now, if a technician is told that a brake fix on a truck
data volumes are doubling For example, to manage the cost of vehicle repairs, will cost $500, he can see 25 similar repairs on similar
every 14 months. ARIs technicians need to authorize the right repair at the vehicles within an identified geographical radius. This
Speed decision-making: right cost. Historically, a vendor would call us seeking information makes negotiating on the fly a lot easier.
Data volumes were authorization for a repair. If our techs agreed with the Before, we were doing millions of transactions, so we
increasing the time it took to diagnosis, they would negotiate the best possible price didnt even attempt it, White says. When customers
run reports and queries. for that repair by using their own expertise and the best needed more granular data, it required a lot of manual
Improve insights: information they had on hand at that time, Candeloro says. work. Now, we can leverage more data to make better
ARI wanted to arm fleet decisions, he says, and weve also improved the overall
managers with real-time As time went on, he says, ARI wanted a solution transaction time by a little more than five percent.
insights so they could make that would enable better and quicker decisions. The
decisions that optimized company implemented a data warehousing strategy A majority of ARIs employees are using the system on
efficiency. that ported data from its transactional database into a a daily basis, and 80 customers are using it through
real-time in-memory database, built some data models the customer portal, ARI insightsTM. When customers
and conducted a pilot with one of its customers. Then, submitted inquiries in the past, employees would search
with the help of HP, ARI moved the system in-house in for information in the various systems and create reports,
December 2011. By the start of 2012, Candeloro says, which could take several days to produce. Now, our
ARI was up and running, building queries and data frontline employees can run the queries themselves,
universes based on detailed data previously segmented White says. By putting the tool in a customers hands,
into separate silos on disparate systems. we are empowering our clients to make better decisions.
FIGURE 2 ARIs In-Memory Technology: What the Future Holds
Capability Example
Predictive data mining: Spotting trends and patterns Recommending a repair before a failure occurs.
ahead of time to be proactive rather than reactive.
Benchmarking: Designing models that gather trend data Calculating a cost-of-ownership baseline across
on all vehicles to create a baseline and then identifying fleets with similar vehicles and identifying those that
outliers. exceed the baseline.
Changing driver behavior: Finding correlations between Discovering a link between fueling locations and
events that seem unrelated at first glance and using that accidents.
information to make recommendations.
Source: ARI

ARIs salespeople can also work more effectively with FIGURE 3

customers and prospects, he adds. And in its call
centers, which include about 400 employees, ARI has A Surge in Predictive Analytics
increased efficiencies by about 5 percent, White says. Primarily using predictive analytics
That one area alone has probably more than covered our 12%
investment, and weve just begun to discover all of the 33% 2009
Elements of ways to leverage it, he says.
Primarily using retrospective analytics
2012
ARIs Real-Time
31%
Analytics Solution Looking Ahead 29%
In-memory database: Candeloro says the company has only skimmed the
Using an in-memory Using both equally
surface in terms of realizing the full potential of in-
50%
database, ARI can quickly turn memory technology (see Figure 2, ARIs In-Memory
28%
data into insights that help Technology: What the Future Holds). ARI is planning
its customers optimize fleet to use data mining capabilities to spot trends and Dont know
efficiency. patterns so we dont just react to a phone call but
1%
Integrated data: 10%
get ahead of it and use the predictive angle, he says.
Data universes, created For example, White says, employees have already
Base: 600 companies in the United States and United Kingdom
within the in-memory detected trends that predict needed repairs on a truck with 1,000-plus employees
Source: Accenture
database, integrate data from before a major failure occurs. We can recommend to
disparate systems. our customer that they preemptively have that repair
Customer portal: done, he says. station example. If, for example, you know a driver
A majority of ARIs employees fuels at a particular gas station, and you also know this
use the system daily, and Another goal is to begin benchmarking, building models group of vehicles has a higher percentage of accidents,
select customers run their to look at all similar vehicles managed by ARI and once you look at those two together, you may make a
own queries using the determining their baseline cost. This way, the company recommendation not to fuel at that location depending on
customer portal. can easily identify the outliers and take corrective action, what the data actually reveals, he says.
Data mining: Candeloro says.
ARI plans to use predictive According to a 2013 study by Accenture, more than
analytics to spot trends and Keeping up with all of the variables involved in the cost twice as many respondents are now using analytics
patterns among seemingly of fleet managementwhere vehicles are used, who is primarily as a predictive tool than in 2009 (see Figure 3,
unrelated data points. driving them, the environment in which they operate, the A Surge in Predictive Analytics). This surge reflects
time of day, accidents, driving patterns and the amount a growing sophistication in analytics capabilities that
of idle running timeis ARIs main challenge. We try anticipate tomorrow rather than explain yesterday,
to track and manage those variables, but a lot of them according to Accenture.
interact with and impact each other, Candeloro notes.
If youre idling a vehicle a lot, you may need to do White says ARI is continuously thinking about whether the
preventive maintenance more often. And because we data it is collecting can predict an outcome. The ability
have the ability to look at that information, we can push has always been there, he says. Until now, we just
out recommendations to our customers. That was very didnt have the tools to unlock it.
difficult to do in the past.
Esther Shein Wishnow is a freelance writer and editor
whose work has appeared in several online and print
As the company moves further into predictive analytics,
publications including Computerworld, Information-
Candeloro says ARI hopes to find the not-so-obvious
Week, BYTE, Network Computing and CIO.
correlations between seemingly unrelated events, such
as how fuel patterns impact accidents, as in the gas This research project was funded by a grant from SAP.

CareFusion at a glance
Makes products that help reduce medication errors
and reduce health-associated infections
Industry: healthcare
Headquarters: San Diego, California
Customers: more than 25,000 worldwide, including
hospitals, surgery centers, long-term care facilities,
outpatient and ambulatory clinics, governments and
insurance providers
Focus areas: medication management; infection pre-
vention and surveillance; operating room effectiveness;
device connectivity; data and analytics; respiratory care
Revenues: $3.55 billion (fiscal 2013)
Employees: more than 14,000
www.carefusion.com
Source: CareFusion
Page 18
Real-Time Business Leads to Healthy

Performance at CareFusion
CareFusion employs in-memory computing to transform its business, improve operating
margins and accelerate revenue growth.
BY JOE MULLICH
CareFusion at a
Glance
Headquarters:
A round the globe, demands for healthcare reform are causing the life sciences
industry and its customers, the care providers, to look for efficiencies. CareFusion,
the $3.5 billion maker of products that help reduce medication errors and reduce health-
San Diego, Calif.
Customers: More than
25,000 worldwide,
associated infections, intends to be at the front line FIGURE 1 Meeting the Challenge to Change
of this transformation, promising quality and safety Life sciences CEOs view data and analytics
including hospitals,
at reasonable cost. among the initiatives that are critical to transformation.
surgery centers, long-
(% responding)
term care facilities,
outpatient and ambulatory In its efforts to achieve this goal, CareFusion has Channels to market
clinics, governments and 57%
averaged one major acquisition annually since its
insurance providers
spinoff from Cardinal Health in 2009. To date, the Use and management of data and data analytics
Focus areas: Medication
acquisitions have bolstered CareFusions product 56%
management; infection
prevention and line with technologies that improve respiratory care
M&A strategies, joint ventures or strategic alliances
surveillance; operating and deliver intravenous drugs to patients. But they 55%
room effectiveness; have also created management challenges.
device connectivity; data Customer growth and retention strategies
and analytics; respiratory 50%
Each of the acquired companies had its own
care
systems for strategic planning, which made it Approach to managing risk
Revenues: $3.55 billion
difficult for CareFusion to get a global view of its 50%
(fiscal 2013)
Employees: More than data. Yet comprehensive planning was essential for Source: PricewaterhouseCoopers, 2014. http://goo.gl/QgoZwG
14,000 the company to reach its aggressive goals. The first
www.carefusion.com two years of growth we called a standup phase, CareFusion found a way to assemble a global view of its
Source: CareFusion which was the separation from Cardinal Health, operations to improve the collection and consolidation of
CareFusion CEO Kieran T. Gallahue told analysts in information it needs for better planning and strategic
2013. The last two years began what we call the decision-making. The company is using financial
building the foundations for growth stage, which, forecasting and planning software in combination with
he said, could only be achieved by streamlining the in-memory computing, a new database and analytics
organization and reducing costs.1 platform that enables very large volumes of data to be
aggregated and analyzed quickly to answer any question
The same theme resonates throughout the life almost instantly. Organizations frequently use in-memory
sciences industry. An annual global survey of technology to make more accurate budget forecasts, run
pharmaceutical and life sciences CEOs by what-if scenarios faster and gain better insight into
PricewaterhouseCoopers found transformation on customer relationships.
1. Nasdaq information on their corporate agendas, including new business
CareFusion. http://goo.gl/1Ncrfb.
2. PricewaterhouseCoopers Global
structures, technology investments, and the use of The entire healthcare industry has been inefficient
CEO Survey: Pharmaceuticals and data and analytics2 (see Figure 1, Meeting the relative to other industries, observed Mike Zill, executive
Life Sciences. 2014.
http://goo.gl/QgoZwG. Challenge to Change). vice president and CIO at CareFusion. That needs to
MAY 2014 | Copyright 2014. Bloomberg L.P. All rights reserved.

change, and we are dedicated to being a force that FIGURE 2 CareFusions Complex Operations
helps lead the change. The company needs to consolidate and analyze
data about two dozen major brands in four product areas.
A Unified View Product area Number of brands

More than 14,000 CareFusion employees around the
world manufacture products purchased by more than Infection prevention 4
CareFusions 25,000 healthcare providers. That makes the
Respiratory care 6
Challenges companys operations complex to manage, Zill
} An acquisition spree explained (see Figure 2, CareFusions Complex Medication management 8
resulted in disparate
Operations). Meanwhile, the pace of business
ERP systems that could Operating room effectiveness 6
demands that CareFusion be able to run multiple
not share data.
} Financial, employee business scenarios quickly, using the most accurate Source: CareFusion. http://goo.gl/rtgQkn
and customer data was data possible.

difficult to consolidate and it would take to run one, Zill said. Current numbers
analyze in a timely way. Yet data from each unit had to be pulled out manually. lead to better estimates, more precise analysis and
} Executives lacked
Only averaged, historical numbers were available for improved decisions. CareFusion can determine
confidence in the
analysis. As a result, reports were produced slowly, within minutes how departments are performing and
accuracy of the data
used to make decisions. and their reliability was hard to assess. Data is a the potential impact of adjustments. Michael DeLeo,
reflection of the organization, said Wayne Eckerson, financial manager for financial systems at
CareFusions director of the research, business applications and CareFusion, said the companys efforts are in line
Solutions architecture group at consultancy TechTarget. If you with an industry trend to compile and consume data
} Deployed real-
have fragmented, autonomous business units, youll more rapidly.3
time planning and
have fragmented data.
consolidation software
that automates and More Timely Action
streamlines planning, So the CareFusion finance team led the charge to What is more, because CareFusion executives can
budgeting, forecasting unify the company using real-time analytics. There is now accurately track, in real time, how their
and consolidation a saying: Time kills all deals, Zill continued. If the adjustments play out, they can more quickly agree on
activities.
executives are having a discussion, they wont accept specific actions that different groups need to take to
} Adopted in-memory
waiting while you pull together the data they need. achieve financial goals.
computing to speed
data collection and A survey by IDG Enterprise found improving the
analysis. quality of decision-making, making quicker decisions, When building a budget or forecast, for example,
and improving planning and forecasting to be the top CareFusion often needs to model changes to
business drivers for investing in analytics (see Figure employee-related costs, like benefits, tax rates and
3, Better Decisions Through Data). international currency changes. Previously, adding a
new benefit or calculating the impact of a health
During each fiscal year, CareFusion compiles and insurance cost increase required a lot of manual
reviews several iterations of its budget, adjusting for work. Information would be gathered from local
business results. Before the company was able to controllers and payroll groups to determine which
quickly assemble and analyze its financial data, it employees would be affected. The financial
was difficult to determine whether departments were department then would forecast the impact of the
meeting their individual targets. Without this proposed changes and apply the anticipated cost for
information, CareFusion could not make timely each group to its budget.
course corrections.
3. Controlling 2013 Speaker
Profile: Michael DeLeo, Finance
The process took a week or more, and verifying the
Systems Manager at CareFusion, With real-time data, however, the company can run accuracy of the data was difficult. There was no easy
Inc. ERP Corp. blog, 2013.
http://goo.gl/PZGAZx. moreand more sophisticatedmodels in the time method to ensure that all required employees and cost

centers have been accounted for in the adjustment, FIGURE 3 Better Decisions Through Data
Zill said. If the actual costs turned out to be different Business drivers for investment in analytics
than the forecast, it was equally challenging to include the following. (% responding)
determine exactly why. The variance could be due Improving the quality of decision-making
to one or more factorsincluding incorrect 59%
calculation methods or changes in expected
Making quicker decisions
Benefits of Real- employee headcount or benefit eligibility. 53%
Time Business at
CareFusion Now, the company can make more precise Improving planning and forecasting
} Increased availability: 47%
forecasts at the enterprise level, and make them in
Information to make
near real time. And when variances between Developing new products, services and
key decisions that took
planned and actual costs occur, CareFusion can revenue streams
more than a week to
determine the reason more easily, according to Zill, 47%
pull together can now
be delivered in minutes. and decide quickly the best way to bring the budget Source: IDG Enterprise Big Data Study, 2014. http://goo.gl/BNImWX
} Deeper insight: back in line. That is essential to achieving the
Analysts can explore efficiencies the life sciences industry seeks, he said. big payoff, both to expanding margins and the
questions of profitability
bottom line.4 Now that the company has proven that
in detail at both the
New Perspectives and Insights the in-memory platform and advanced analytics
customer and the
product level, as well Zill added that the most valuable benefit of having models enable it to understand its costs at a greater
as run more what-if real-time data is obtaining new insights. For level of detail, with more accuracy and in less time, it
scenarios. example, CareFusion can model profitability down to intends to expand these capabilities to other models
} Improved forecasts: both product and customer levels, giving it a more and other data sources, Zill said.
By using real-time data,
granular view to aid decision-making.
and gaining flexibility
For example, he added, for consumable products,
to include more data
sources in its analyses, In the past, Zill said, the company might have only CareFusion plans to model sales based on historical
CareFusion can been able to get a partial view of its relationship trends and seasonality.
create more accurate with a customer. Now that it can consolidate and
forecasting models. analyze all the data from different units, These revenue models will provide us with a basis
CareFusion will use this technology to discover, in for forecasting manufacturing costs and profit
the moment, which units customers purchase margins, Zill said. They will allow us to further
from and how best to allocate company resources improve our accuracy, efficiency and ability to plan
to properly serve customers. for changing business needs.
We can approach the model-making at a much Zill envisions expanding the use of in-memory
greater level of detail, Zill explained. This happens computing to many additional areasincluding
because we no longer have to worry about the size mergers and acquisitions, research and
of the data anymore. In the old days, you had to development, sales and marketingwhich will bring
think in terms of the minimum amount of data you the enterprise-wide improvements that are needed
could bring together and still answer the question. to propel CareFusion, and its healthcare customers,
Now we dont have to be so smart about eliminating to a new era of higher efficiency.
information, so we dont throw away nuggets. Thats
mind-freeing and time-freeing.
Consider More Data This research project was funded by a grant from SAP.
According to CareFusions Gallahue, the intense
4. Nasdaq information on
CareFusion. http://goo.gl/1Ncrfb. business integration work has already produced a

City of Boston, Massachusetts at a glance

Capital of the State of Massachusetts, founded in
1630
Industry: public sector
Population: 626,000
Size: 48 square miles
City employees: 16,173
Education: 53 institutions of higher education
Firsts: U.S. public school, subway system
www.cityofboston.gov
Source: City of Boston
Page 22
Bostons Better Community Connec-

tions Through Big Data and Analytics
With in-memory computing and analytics tools, the City of Boston is providing better service to
citizens and engaging more with the community.
BY JOE MULLICH
M
any government agencies talk about the transformational power of big data and analytics.
Bill Oates, chief information officer for the City of Boston, is doing something about it. He says
this starts with making better connectionsbetween citizens and the community, multiple government
departments and even other cities.
Business process change is table stakes at this point,

Boston at a Glance Oates says. The importance of the technology is its Citizens Connect: Empowering
} Founded: 1630
ability to engage and empower our constituents.
Constituents with Big Data and
} Population: 626,000 Analytics
} Size: 48 square miles } 34% of citizen reports via mobile and online app
For Boston, a new form of engagement began in 2008
} 89% of citizens would recommend it
} City employees: 16,173 with the launch of Citizens Connect1, a system that
} 21% rise in constituent satisfaction
} Education: 53 institutions enables citizens to report potholes, graffiti, damaged } Pothole repair time cut in half
of higher education signs and other issues through the Internet and, later,
} Firsts: U.S. public their smartphones. A unique twist of the technology,
school, subway system then and now, is that citizens do not simply report Like many cities, Boston has a growing number of sources
www.cityofboston.gov/ the problems to the government. Rather, reports and of data to analyze. To help it cope, the city is ahead in
Source: City of Boston photos are published anonymously online, spreading taking visual analytics to a new level. For example, in 2010
word of the issues and inviting discussion and the Boston Police Department opened a real-time crime
participation in Citizen Connect. center that receives dozens of feeds from street cameras
around the city. The resulting data gives researchers
Since then, Boston has introduced Street Bump , 2
the potential to visually analyze and match videos from
which enables people to use their smartphones incidents to help identify suspects, mobilize resources and
accelerometera motion detector in the deviceto even map evacuation routes during emergencies.
record road conditions and send data to public works
employees. Unlike Citizens Connect, the Street Bump Big Data Makes More Satisfied Citizens
app does not require a citizen to take action to report Bostons experience with in-memory computing and
issues. He simply turns on the app and, as he drives, big data analytics reveals intriguing insights about
data is automatically collected and sent to the city. the opportunity for collecting and using big data. For
example, residents were polled on why they failed to
Street Bump was expected to identify the location of contact the city about maintenance issues before the
potholesa top concern of Boston residents. Thanks to Citizens Connect app. Their answer: When they call the
analytics, the early data has provided some unexpected city, they feel like they are complaining; when they use the
insights: trouble spots are eight times more likely to be app, they feel like they are helping.
castings, those manhole covers, grates and other cast-
metal lids that are supposed to be flush with the roadway The ability to rapidly share data and analytics has had a
1. Citizens Connect: Making Boston surface but instead heave up due to the extreme cold of measurable effect. Today, 20 percent of citizen reports
Beautiful.
http://tinyurl.com/642ymk3 a New England winter. Hundreds of these castings have come through the Citizens Connect app and another
2. Street Bump.
http://tinyurl.com/mjeb4q8 been repaired as a result. 14 percent through the citys Web site. The number of
SEPTEMBER 2013 | Copyright 2013. Bloomberg L.P. All rights reserved.

citizen reports has doubled, as well, from 40,000 a year

prior to the technology to 80,000 a year today. A reason Bostons IT Challenges
for the greater participation may be the quick results that } Quicken innovation
follow. Since the city implemented Citizens Connect, the } Encourage citizen involvement
response time to fill a pothole has been cut from three } Share big data across departments
} Speed repair of potholes and other issues
days on average to half that amount.
Bostons IT Solutions
We met with interested Similarly, the original prototype of Street Bump could not
} Formed the Office of New Urban Mechanics
distinguish between potholes, manhole covers, bridge
researchers, technol- an incubator that pilots new ideas quickly
surfaces and other obstacles, so the app generated a lot } Partnered with citizen groups, businesses and
ogists and community of false positives in the field.3 A crowdsource challenge universities to share data and ideas
members to figure out enabled the city to implement a new algorithm to analyze } Developed apps that enable citizens to report
how we could use data the big data coming in more accurately. issues easily
} Developed apps that enable citizens to collect data
to improve quality of life about road conditions automatically as they drive
In Oates view, big data is all about information sharing in the
issues. Being able to
public sector. He has found that the combination of the right
connect newly available data, timely analysis and visualization is most effective when
city data with some of information and analytics are shared across departments. It also indicates the new thinking that is needed to
the real big data out In the past, an agency might crunch its own data to leverage the power of big data. Oates points to the Office
get a historical comparison on how quickly it is fixing of New Urban Mechanics, an initiative that began in
there in the world can
potholes, he says. Now, by combining data, we can see Boston and is now shared with the City of Philadelphia
make city government what areas of the city arent getting phone calls, which and serves as each citys innovation incubator. The
more proactiveand may indicate problems no one knows about yet. office builds partnerships between city agencies, outside
more effective. institutions and entrepreneurs to pilot projects in the two
Boston has put significant effort into making data and cities that address resident and business needs.5 Several
BILL OATES, CHIEF
INFORMATION OFFICER, CITY analytics available to both agencies and the community. projects have involved data sharing and analytics, such
OF BOSTON
Oates points to the Boston Area Research Initiative4 as as the Street Bump initiative.
an example. Here, the city confers with the many
universities in the area about original urban research on Government agencies on the whole arent great in
the cutting edge of social science and public policy. For responding to unsolicited ideas and opportunities, and
us, this is a matter of digging a little deeper, Oates says. they are engineered to put tightly prescribed solutions out
We met with interested researchers, technologists and to bid, Oates says. But we have a model that allows
community members to figure out how we could use data us to respond quickly to opportunity. The city is now
to improve quality of life issues. Being able to connect collaborating with the Commonwealth of Massachusetts
newly available city data with some of the real big data to deliver a Citizens Connect-like mobile app that will
out there in the world can make city government more engage citizens and produce important performance data.
proactiveand more effective.
Boston officials are also talking with cities around the
Planning for Tomorrow world about similar initiatives. All of us in city govern-
Oates contends that what has been accomplished so far ment are looking at ways to our data move valuable,
is just the beginning. By using information to interact better Oates says, and to be part of these exciting cross-ju-
3. Bertolucci, Jeff. Smartphones, with neighborhood leaders and citizens, for example, the risdictional initiatives.
Big Data Help Fix Bostons Potholes.
InformationWeek, July 25, 2012. city can respond faster and better to local events, enabling
http://tinyurl.com/a9nfkdp Joe Mullich is a freelance business and technology
4. Boston Area Research Initiative. it to more efficiently deploy police to ensure public safety.
http://tinyurl.com/kgu2q46 writer based in Sherman Oaks, Calif.
5. New Urban Mechanics: a city Our ability to engage in those conversations is a critical
movement focused on civic innovation.
http://tinyurl.com/a3jodpv part of successfully using technology, he says. This research project was funded by a grant from SAP.

City of Cape Town, South Africa at a glance

Second largest city in South Africa, whose government
was forged in 2000 by a consolidation of seven
municipalities into one unicity
Industry: public sector
Population: 3.7 million
Size: 950 square miles
City employees: 25,500
Number of police stations: 60

Number of fire stations: 29
www.capetown.gov.za
Source: City of Cape Town
Page 25
Real-Time Data Speeds Services in

The Mother City of Cape Town
With in-memory computing and analytics tools, Cape Town is improving public safety and
energy/water management at the same time.
BY JOE MULLICH
C ape Town, the second largest city in South Africa, has long been called The Mother City.
Andre Stelzner, chief information officer for Cape Town, provides a tongue-in-cheek explanation
for the nickname: People say thats because everything here takes nine months to accomplish.
Jokes aside about the slow pace of government, Cape FIGURE 1

Cape Town at a Town realized that many pressing issuessuch as Tech Hit Parade
improving public safety and managing water and energy Respondents were asked: Currently, how important are each
Glance of the following capabilities to your agency, institution or
use more effectivelyrequired faster action than is
} Population: 3.7 million organization now and in two years? (percent of respondents
typical of large bureaucracies. Research by the citys IT
} Size: 950 square miles indicating important)
team indicated that success could only be achieved by
} City employees: 25,500
collecting and analyzing real-time data. Currently Important Important in Two Years
} Number of police stations:
Share data and analytics across organization
60
85% 89%
} Number of fire stations: Cape Towns government, which was forged in 2000 by a
29 consolidation of seven municipalities into a single unicity, Provide field staff with data from internal systems on
www.capetown.gov.za/ delivers all the services that are used by its population apps
Source: City of Cape Town of 3.7 million. This includes electricity, water, healthcare, 84% 87%
sanitation, transportation, refuse collection, libraries, and
Offer constituents access to operational systems
police and fire protection, to name a few. 83% 85%
Ability to understand stakeholder sentiment via social

In 2003, the city started down a path toward better
media analysis
use of information by implementing an enterprise 72% 81%
resource planning (ERP) system. It is now one of the
largest ERP deployments in any city government in the Ability to correlate location and other asset data
73% 77%
world, encapsulating 450 business processes. Tangible
benefits include providing insight for reducing debt and Communicate with stakeholders via social media
enabling Cape Town to achieve an A+ credit rating. The 73% 74%
need for faster response times has led the city to big
Real-time sensor feeds from assets
data analytics and in-memory computing, which can
61% 71%
analyze huge amounts of data quickly.
Base: 103 executives at small, midsize and large public agencies worldwide
Source: Bloomberg Businessweek Research Services 2013 Agency Analytics Study
It Starts with Smart Metering

Cape Towns initial foray into in-memory computing For example, If we have real-time information about
will most likely come from the need to analyze large the supply and demand for water and power, we
quantities of data gathered by smart meters that can keep them in sync with dynamic tariffs, Stelzner
monitor water and energy use. Currently, the system is says. By raising tariffs in times of rising demand, the
limited to large corporate users, but over the next two city can encourage conservation and reduce the risk
years it will expand significantly and result in a host of of unstable power supplies that can lead to national
new services. blackouts. We need to find ways to get people to
DECEMBER 2013 | Copyright 2013. Bloomberg L.P. All rights reserved.

change their behavior about the amount of water and

electricity they use, he says. Cape Towns Challenges
} Improve water/energy conservation
Real-time access to water and energy data will provide } Provide better waste management to over one
other benefits, as well. We will be able to pick up a leak million households
in a main water line immediately, Stelzner says. In the } Increase citizen safety and provide intelligent
policing
past, it could take us days to identify a leak in a remote
area, which resulted in a significant amount of spillage.
Cape Towns IT Solutions
Cape Towns } Implement real-time smart metering
Government For waste management, trash containers will be } Equip trash containers with RFID tags
Milestones equipped with RFID tags so the citizens can be charged } Consolidate emergency services/data into a
} Fiscal management for garbage collection based on the weight of their refuse. single platform
and A+ credit rating At the moment, everyone pays the same, so the costs } Implement big data analytics and in-memory
are not divided equitably and there is no incentive for computing
} Use of big data
analysis to conserve people to behave more efficiently, Stelzner points out.
water and energy

} Use of RFID tags Consolidating Emergency Information are many of the types of activities already underway in
to optimize waste Stelzner sees what may be an even bigger payoff by Cape Town, including sharing data and analytics across
management applying in-memory computing to emergency services. the organization and correlating location with other data
} Near-real-time At present, the citys emergency servicesfrom law assets (see Figure 1, Tech Hit Parade).
response to public- enforcement to disaster managementtend to operate
safety events in silos. As a result, information from one department that In Cape Town, the use of in-memory computing is being
could potentially be used by another is not shared. To expanded to also enable more intelligent policing,
solve the problem, the city is developing an emergency meaning the city can use more data sources to respond
control platform that will consolidate data sets, leveraging more clinically to security events. In some areas, security
the power of in-memory computing across agencies. issues are a perception, Stelzner says, and in some
cases, they are a reality. If by using real-time sensors
As an example, the city currently collects information and other sources we have the ability to get a better
on 1.5 million non-emergency events a year. There understanding of the true situation, then well be able to
is a lot of information that is not now visible to the apply resources more effectively, he says.
emergency controller, even though this information is
interrelated to the work they do, Stelzner says. He As an example of future public safety benefits, Stelzner
goes on to explain: A traffic probe that shows highway uses a fireman and a burning building. The fire captain
traffic has slowed to almost zero speed could inform back at headquarters will be able to pull up the
you of another event, like a major accident before the building plan from the land-use management system,
accident is reported. By consolidating this information instantly locate potentially dangerous gas cylinders in
on a single platform, we can be more proactive and not the structure, note how to avoid them and then alert
depend entirely on the community to report events. the fireman on his handheld device as he enters the
building. That is the future we envision, Stelzner says.
The idea of sharing access to real-time public data and Its a future that depends on enormous and rapid
analytics across public agencies is not unique to Cape computing powerbecause you cant wait for a batch
Town. In fact, some 81 percent of managers among job to run when a building is on fire.
government entities around the world responding to
a 2013 global survey by Bloomberg Businessweek
Research Services strongly agree that big data is crucial
to meeting their mission. High on their list of requirements This research project was funded by a grant from SAP.

Commonwealth Bank of Australia at a Glance

Australias leading provider of integrated financial
services
Industry: banking
Profits: $7.09 billion
Number of employees: 51,000
Markets: Australia, New Zealand, China, Vietnam and
Indonesia, with branches in New York, Tokyo and
Hong Kong
www.commbank.com.au
Source: Commonwealth Bank of Australia
Page 28
RESEARCH UPDATE | Real-Time Banking Case Studies
CBA Offers More Personalized Banking

Through Big Data and Analytics
With new data sources and tools, Commonwealth Bank of Australia is providing more personalized
service to customers and building loyalty within the community.
BY TOM GROENFELDT
C ommonwealth Bank of Australia (CBA) knows a lot about its customers. That is partly because
it has a huge footprint in the countryit processes nine million transactions per day, handles 40
percent of the card transactions in Australia and maintains 12 million account profiles. More important
than company size or number of transactions is how CBA uses its wealth of customer data, along with
real-time analytics, to build loyalty and provide superior

Commonwealth customer service. Key Features of CBAs New Web Site
Bank of Australia } Magazine-style section provides content based
at a Glance on customers key life events
Like CBA, Most banks have incredibly rich data sets,
} Description: Australias } Integrates data from social interactions, on-site
especially those derived from payments and credit data, behaviors and browsing history
leading provider of
integrated financial notes Andy Lark, CBAs outgoing chief marketing officer. } Support forum where customers seek support
services Far fewer have learned how to combine this big data and advice about the banks products and
with other information resources and then put it to work to services
} 2012 Revenue: $47.2
} Uses principles of responsive Web design to look
billion create better products and services.
good on all devices, including PCs, smartphones
} Profits: $7.09 billion and tablets
What has put CBA out front in this area is a recent
} Number of Employees:
51,000 modernization of its IT systems, followed by strategic
investments in social media, analytics and mobility. All of that prospect has been looking at properties, the site is able
} Markets: Australia, New
this has unified the banks data foundation and put us to display more relevant offershome loan, insurance and
Zealand, China, Vietnam
and Indonesia, with in an enviable position, Lark says. Thanks in part to big other related product information. The site can even analyze
branches in New York, data and real-time analytics, CBA has reduced check a customers Web searches to provide a very specific offer
Tokyo and Hong Kong fraud by 50 percent and Internet fraud by 80 percent. on the spot, in real time.
www.commbank.com.au Equally important, he says, is how analytics now gives our
Source: Commonwealth Bank customer service the advantage of clarity of purpose. The CBA site is a good example of how customers want
of Australia
to communicate with banks on their terms, when and
All banks strive to provide superior customer service. where they are ready. According to Andrew Hagger,
CBA made real progress once it realized customers general managerhead transformation and analytics at
want individualized attention. I guess one of the largest CBA, Analytics underpins the ability to offer the right
surprises to us was the extent to which customers wanted products to clients.1
the site personalized to them, Lark says of the banks
Web service, NetBank. So the strategy became making More Than a Smarter Web Site
the entire site relevant and meaningful for the customers. But CBAs focus on customer service extends well beyond
the Web. The more accounts a customer has with the
Visitors can see the difference. For example, say a prospect bank, the more helpful CBA can be with pricing and
has been viewing properties online and then visits the CBA advice. If a household has its mortgage, checking, savings
site. Not too long ago, you might have gotten a banner with and credit cards with CBA, the banks analytical tools can
1. Wisniewski, Mary. 5 Takeaways from
SAPs Client Conference: Reporters a standard offer for a travel money cardsomething far from suggest the most appropriate products and offer pricing to
Notebook. American Banker, October 25,
2012. http://goo.gl/noH0qI interesting at that point in time, Lark says. Today, knowing fit the customers needs, both in person and online. CBA

can even offer them a report on their spending through a

visual and interactive hub site called Signals.2 CBAs Products and Services
} Retail Banking: Home loans, credit cards,
personal loans, transaction accounts, and
To be customer centric, it is important to provide access
demand and term deposits
to data across the enterprise to individual users at the } Commercial Banking: Business loans,
point of decision-making, in addition to having clean equipment and trade finance, and rural and
data and an integrated analytics platform that enables agribusiness products
collaboration across the various departments and } Corporate Financial Markets Services:
processes. CBAs IT infrastructure demonstrates this well. Securities underwriting, trading and distribution,
corporate finance, equities, payments and
We have the strength of the relationship data and the
transaction services, investment management
customer-centric architecture, which I believe will set us
and custody services
apart from the competition on an enduring basis, says
CBA CIO Michael Harte.3 CBA has also been working on
incorporating innovations such as in-memory computing
to power up its strategy. that, together with analytics, runs well and looks good on
desktop, tablet and smartphone devices.
Harte says the bank has developed a strategy to collect
transaction and other data, analyze it and use it to determine Conclusion
the right pricing and financial strategies for an individual or As CBA demonstrates, the future is bright for banks that
an entire household. As Lark puts it, The more information learn to use big data and analytics to gain a competitive
you have, the more inclined you will be to make better edge. However, dealing with all that data is not always
informed financial decisions. The ability to forecast trends, easy and progress can take time, says David Tanis,
model options and predict outcomes is another important manager of information systems and frontline analytics at
aspect of gaining customer trust and loyalty. CBA. At the Gartner Business Intelligence & Information
Management Summit 2013 in Sydney in February, Tanis
Increasingly, more customer and prospect data is coming said every analytics project is a learning experience,
from sources outside the bank. An early and active user of especially when it involves big data.4
social media, CBA has dedicated social media teams who
monitor social sites 24 hours a day looking for prospects Were still trying to understand what the capabilities and
who might be dissatisfied with another bank and seeking skills are in terms of pulling as much out of the big data
a new financial services home. The teams also look for as we can, Tanis says. CBA deals with the wide varierty
potential problems within CBA and respond to them of big data sources every day as it tries to derive business
quickly. I was surprised at how much benefit we could get intelligence from that data.
from social data, Lark says.
According to Lark, many institutions are still in the early
Skyrocketing use of smartphones and other mobile stages of being able to fully utilize their data to develop
devices is also quickly filling the banks data coffers. CBA insights and better meet customer needs. Its not just the
saw its mobile users jump from 19 percent to 32 percent new data sets, or the size of the data, that is driving this,
in less than a year. Mobile is going to be even more he says. Its also the awareness that in the future, youll
significant in the future, as more and more happens on need to meet the customer before they start the search.
2. Langlois, Christophe. BIG DATA: Top
Australian Banks Launch Social Media the smartphone, Lark predicts. Being relevant isnt just Thats where the winners will win.
Spending Comparison Sites. Visible
Banking, March 7, 2013. going to be about the relevant offer; it also means being
http://goo.gl/0MEoxE
Tom Groenfeldt is a freelance writer in based in
3. Were changing the game: contextually relevant to where I am and what I am doing.
CommBank. The Sydney Morning Herald, Sturgeon Bay, Wis., who has written for many financial,
May 29, 2012. http://goo.gl/zEq8w
4. Lui, Spandas. Half of analytics business and technology publications.
investments will be a waste: CBA uses a combination of ad serving, smart media
Commonwealth Bank. ZDNet, February
25, 2013. http://goo.gl/h385jv buying and personalization engines on its mobile Web site This research project was funded by a grant from SAP.

ConAgra at a glance
Consumer products giant produces brand-name foods
such as Healthy Choice, Marie Callenders and Orville
Redenbachers, among others
Industry: consumer products
Category leaders: 27 of its consumer brands are
No. 1 or No. 2 in their category; 23 consumer brands
generate more than $100 million in retail sales
each year
Founded: 1919
Headquarters: Omaha, Nebraska
Sales: $18 billion
Employees: 36,000
www.conagra.com
Source: ConAgra
Page 31
Real-Time Business Leads

ConAgra to Profitable Insights
The consumer products giant is reducing costs, improving pricing and forging closer
relationships with retailers using in-memory computing.
BY JOE MULLICH
ConAgra at a
Glance
C onAgra, the $18 billion consumer products (CP) giant, produces brand-name
foods such as Healthy Choice, Marie Callenders and Orville Redenbachers,
among others, that can be found in almost everyones refrigerator or pantry. Yet it
Segments: Consumer
foods, private brands,
commercial foods faces the same challenges that pressure the entire FIGURE 1 How Analytics Contributes to
Category leaders: 27 of food industry: figuring out the optimal pricing for its Business Decisions
its consumer brands are products in an environment where consumers are Areas where food and beverage companies use data and
No. 1 or No. 2 in their analytics to support strategic decisions (percent responding)
hyper-sensitive, while coping with the ever-
category; 23 consumer
fluctuating costs for 4,000 raw materials used in Customer insights
brands generate more
some 20,000 products. 59%
than $100 million in retail
sales each year Brand and product management
Founded: 1919 According to a 2013 study by KPMG,1 51 percent of 58%
Headquarters: food industry executives said pricing pressures
Omaha, Neb. remain the highest barrier to growth, up from 42 Pricing decisions
Sales: $18 billion 56%
percent a year earlier. Volatile commodity prices
Employees: 36,000
the amount manufacturers pay for ingredientsare Operating model optimization
www.conagra.com
another major obstacle. 52%
Source: ConAgra
Market expansion
If the price of beef goes up on the commodity 43%
exchange, what is that going to do to our margin?
asked Mindy Simon, ConAgras vice president of IT. Portfolio rationalization
42%
Being able to answer such questions is of
paramount interest to the company, because Source: KPMG 2013 Food and Beverage Industry Outlook Survey.
http://goo.gl/me3va8
commodity prices affect its earnings and its stock
price. In the past, ConAgra has warned that ConAgra decision-makers have real-time insight into
earnings would be impacted by materials prices that the companys costs and consumers demands.
were rising faster than expected.2
Weve developed much better capabilities in pricing
So ConAgra puts great emphasis on optimizing its analytics as part of an overall revenue growth
prices, which in turn requires getting ever better management approach, ConAgra CEO Gary
1. KPMG. 2013 Food and
Beverage Industry Outlook Survey.
prices for commodities such as wheat, corn, oats, Rodkin told analysts in February 2014.3 Rodkins
PDF. http://goo.gl/me3va8. soybean meal, soybean oil, meat, dairy products and remarks echoed the KPMG survey findings: Food
2. Rappeport, Alan. ConAgra hit
by surging raw material costs. sugar. The company turned to in-memory computing, and beverage executives reported they rely more on
Financial Times. Sept. 20, 2011.
http://goo.gl/yih35b. which loads extremely large volumes of data from data and analytics to support their pricing decisions,
3. Thompson Reuters Streetevents.
ConAgra Foods at CAGNY
multiple sources into one database and enables understand customers better, and support brand
Conference. Edited transcript. users to answer questions almost instantly. Access to and product management decisions (see Figure 1,
Feb. 18, 2014.
http://goo.gl/QGrc9a. great volumes of rapidly processed data means How Analytics Contributes to Business Decisions).
March 2014 | Copyright 2014. Bloomberg L.P. All rights reserved.

ConAgras Real-Time Data Means Faster Decisions FIGURE 2 Consumer Products Companies
Challenges ConAgra has priced products appropriately when it Data Challenges
} Gain in-the-moment delivers value to consumers and earns a profit. For They want timelier information. (percent responding)
insight into the cost of
example, the company has 140 meal products, such as Timeliness for decision-making
raw materials.
potpies, that sell for less than $3. Banquet potpies sell 69%
} Acquire more accurate
consumer purchase for less than $1, and Marie Callenders potpies are
Quality
information to improve around $2.50, Rodkin explained.4 Having a variety of
67%
merchandizing. products at different price points makes ConAgra
} Forge closer ties with competitive within the categories it serves, as does Integration
retailers.
doing a better job of getting retail prices right than its 57%
ConAgras competitors. Any price increases prompted by rising

Availability
Solutions manufacturing costs have to take into account 53%
} Implemented in-memory consumer expectations, observed Bob Nolan,
Source: Accenture, Building an Analytics Driven Organization, 2013.
technology to speed ConAgras vice president of customer insights and http://goo.gl/KBfJnv
analysis.
analytics. Consumers might be willing to pay 10 percent
} Gathered new sources
more for a gallon of gas, he said, but not for popcorn.5 Improving their ability to model alternative business
of data about consumer
behavior. scenarios is becoming a critical goal for CP
} Shared data-driven CP companies have traditionally approached key companies that want to stay ahead. A recent
insights with retailers. business decisions, such as pricing, through a Aberdeen Group study10 looked at how behavior
periodic planning process. However, as the cost of differs among companies that are aware of the
manufacturing and consumer demand become more business drivers, such as costs or pricing, that
volatile, so do revenues. Business risks also impact their performance compared to those who
increase. Companies now realize that planning are not aware. The results found companies that
should be a continuous activity based on real-time take business drivers into account when creating
information. Yet the majority of CP companies are their business plans are nearly three times as likely
failing, thus far, to put real-time analytics at the heart to make what-if analyses a priority.
of their decision-making processes, according to a
new Accenture study.6 The top challenge for CP By focusing on a key pain pointcostsConAgra
companies, cited by 69 percent, is lack of timely has convincingly demonstrated the business value of
4. Thompson Reuters data (see Figure 2, Consumer Products Companies its in-memory computing investment, observed Chris
Streetevents.
5. Nolan, Bob. ConAgras VP of Data Challenges). Cicarello, senior director, pricing and customer
Analytics on Big Data & Careers in
analytics at ConAgra.11 Choosing an important
Retail. Video. Jan. 9, 2014.
http://goo.gl/PS1ozI. To gather more timely data and enable faster business problem to address, as ConAgra did, is a
6. Accenture. Building an
Analytics-driven Organization: decision-making, ConAgra turned to in-memory savvy strategy for CP companies that are engaging in
Organizing, Governing, Sourcing
and Growing Analytics Capabilities computing in numerous areas of its business. The cutting-edge analytics. According to Accenture,
in CPG. PDF. Feb. 19, 2014.
most revolutionary use now is forecasting materials companies often launch such efforts without knowing
http://goo.gl/KBfJnv.
7. Henschen, Doug. Can SAP costs, Simon offered. 7 what they want to accomplish, and they end up
Master Cloud & On-Premises?
InformationWeek. Feb. 5, 2014. spending a lot of timeand money on technology
http://goo.gl/G1yJoA.
8. SAP. SAP HANA: An In- ConAgra has been able to speed up the collection of without having much impact on the business.12
Memory Data Platform for Real-
Time Business. PDF. 2012.
its data related to commodities purchases from 9 hours
http://goo.gl/gDicpN. to 20 minutes8 and to reduce its month-end forecasting Capitalizing on New Data Sources
9. Doug Henschen.
10. Castellina, Nick. Dont Fly process by three days. By collecting and analyzing the Another reason why ConAgra needs to process
Blind When Budgeting and
Forecasting: The Value of Being data more quickly, the company is able to consider massive amounts of data quickly: the company
Driver-Conscious. Aberdeen PDF.
timelier what-if scenarios, giving it more ways to adjust uses more types of data in its analysis. For
November 2014.
http://goo.gl/7VWSGj. its strategies for buying materials, observed Simon 9 example, the CP giant is adding shopper-specific
11. Bob Nolan.
12. Accenture. (see Figure 3, Better Decisions Through Data). data that it gets directly from retailers and

analyzing that data in new ways to better FIGURE 3 Better Decisions Through Data
understand consumers and respond to their Business drivers for investment in analytics
needs. That goes beyond how ConAgra uses include the following. (% responding)
internal data to forecast demand and increase Improving the quality of decision-making
sales, and speaks to how it applies aggregated 59%
retail data to plan promotions and strengthen its
The Benefits of supply chains. 53%
Real-Time
Business at As ConAgra searches these new data stores, it is Improving planning and forecasting
ConAgra finding surprising insights that enable better
47%
} Expanded options:
product merchandizing. For example, the Developing new products, services and
ConAgra is able to
company learned that people who buy one type revenue streams
analyze multiple what-if
of single-serving frozen food tend to buy several 47%
scenarios when
considering its strategies other single-serving varieties at the same time. Source: IDG Enterprise Big Data Study, 2014. http://goo.gl/BNImWX
for purchasing Because of that, ConAgra suggested that retailers
commodities. group the packages with smaller portions Enhancing Relationships
} Better merchandizing:
together, instead of stocking single-serve pizzas To develop a strong relationship with retailers,
Using external data,
with family-size pizzas. ConAgra realized that it could not simply provide
such as consumer data
provided by retailers, self-serving data about its own products. Nolan
delivers real-time insight Such findings enable ConAgra to forge stronger pointed out that data sharing requires
into how to merchandize ties with retailers: The company is giving the transparency: Retailers should fully understand
products more effectively retailers data that, in turn, enables them to improve why ConAgra is making recommendations about
and increase margins.
their own operations. The deeper understanding which products to put on the shelf. In some cases,
} Closer relationships
about prices ConAgra gains not only helps the the companys recommendations might even
with retailers: Sharing
data-driven company manage itself efficiently, it also helps include adding a competitors products. We try to
recommendations with ConAgra guide retailers on how to price products be objective and give recommendations that allow
retailers helps ConAgra on the shelf. That, along with controlling costs, is [retailers] to grow their entire store, not just our
build trust and become the other crucial element in maximizing profits, business, he said. Its almost like being a
an indispensible partner.
according to ConAgra executives. 13 consultant. We want to become the indispensable
partner to our customers.14
Aberdeen Group Analyst Nick Castellina said
best-in-class companiesthe ones that shape Nolan said this objectivity demonstrates to
their plans around business driversare twice as supermarkets and retailers that ConAgras data-
likely to share information with suppliers, driven suggestions are based on what will most
customers, resellers and regulatory bodies. But the benefit the retailers bottom lines. This tactic builds
data has to be accurate and recent, or it is not trust as ConAgra develops relationships with the
useful. The high-performing companies that retailers. As a result, he thinks ConAgra will profit and
Aberdeen identified as sharing information are win the ties when retailers debate whether to add
nearly three times more likely to have real-time ConAgra products or those from another company.15
financial metrics.
It is another innovative way that data drives
Having accurate demand forecasting and ConAgras sales and boosts the bottom line.
inventory is important in consumer goods,
Castellina said. This is especially important in
writer based in Sherman Oakes, Calif.
13. Bob Nolan. the food industry because of shelf life and the
14. Bob Nolan.
15. Bob Nolan. capability for materials to go bad. This research project was funded by a grant from SAP.

eBay at a glance
Leading online retailer provides consumer-to-
consumer sales services via the Internet
Industry: high tech
Founded: 1995
Headquarters: San Jose, California
Brands: eBay, PayPal, eBay Enterprises, StubHub
Buyers worldwide: 145 million
Active users worldwide: 128 million
Number of items listed for sale: 650+ million
www.ebay.com
Source: eBay
Page 35
Big Benefits from Big Data at eBay

Online marketplace provider eBay uses predictive analytics and in-memory computing to better
serve customers and bolster the bottom line.
B Y L A R RY L A N G E
O nline retailers face two big challenges: improving customer service, and keeping
partners and suppliers satisfied. Both are vital, because online competition is fierce. If
shoppers arent happy with their site experiencefrom browsing to buyingthey can easily
eBay at a Glance
} Founded: 1995
} Headquarters: San Jose, go elsewhere; competitors are just a click away. Its FIGURE 1 Predictive Analytics:
Calif.
} Brands: eBay, PayPal,
the same for an online retailers suppliers. If they What Is It Good For?
eBay Enterprises,
dont like certain terms and conditions, or consider (percentage of survey respondents)
StubHub technical features too basic, they wont stay loyal.
Achieve competitive advantage
} Buyers worldwide: 145 68%
million The stakes for online retailers are huge. Worldwide
} Active users worldwide:
B2C ecommerce sales will increase more than 20 New revenue opportunities
128 million
percent this year, reaching $1.5 trillion, predicts 55%
} Number of items listed for
sale: 650+ million research firm eMarketer. 1
Increased profitability
} Revenue (fiscal 2013):
52%
$16.0 billion
Leading online retailer eBay is meeting both
www.ebay.com challenges by deploying business analytics to provide Increased customer service
Source: eBay
online sellers with real-time information about their 45%
eBay-enabled sales. Sellers can use this information
Operational efficiencies
to sell more goods more efficiently and effectively.
44%
Because eBay is better serving its sellers, it is able to
indirectly better satisfy buyers with a speedier, Source: Ventana Research predictive analytics benchmark research, 2012.
http://goo.gl/k5lkGk
optimized shopping experience. As for eBays bottom
line? It gets a cut of every sale, regardless of which and services that empower customers to perform a variety
customer is buying or selling. Simply put, the new of business tasks (see Figure 1, Predictive Analytics: What
analytics program is a win-win-win. Is It Good For?).
Analyzing Analytics Many organizations use predictive analytics (see Figure

The move is significant for another reason: 2, Predictive Analytics: What It Is Used For). Netflix
Although many ecommerce companies find the commissioned two TV shows, Orange Is the New
promise of big data compelling, few have realized Black and House of Cards, knowing beforehand,
its business benefits. Now, though, early adopters thanks to predictive analytics, that a big chunk of its
like eBay are achieving new revenue streams, customer base would loyally watch them.2
greater speed-to-market and enhanced business
flexibility. Among the approaches yielding results, A mining company uses predictive analytics to better
predictive analytics stands out. maintain equipment. The company, as described by Henry
1. eMarketer. Global B2C Ecommerce Morris, senior vice president of software and services
Sales to Hit $1.5 Trillion This Year Driven
by Growth in Emerging Markets. Feb. 3. Predictive analytics helps companies extract research at market researcher IDC, deploys Caterpillar
2014. http://goo.gl/K8l0Vt.
2. Carr, David. Giving Viewers What information from mountains of data, forecast customer machinery that, in the past, was manually checked and
They Want. The New York Times, Feb.
24, 2013. http://goo.gl/Tr4wAw. trends and patterns of behavior, and create products maintained only on an infrequent and irregular basis.
AUGUST 2014 | Copyright 2014. Bloomberg L.P. All rights reserved.

Now equipment is continuously monitored. The FIGURE 2 Predictive Analytics:

company can detect a signal, or datapoint anomaly, on What It Is Used For
a machine that predicts when the machine is likely to fail, (percentage of survey respondents)
Morris explains. Then they can send someone out to Currently using Plan to add in future
Forecasting
repair it.
72%
24%
Speed is an important benefit of predictive analytics. A
new, faster technology, known as in-memory computing, Marketing
Benefits of 67%
In-Memory keeps data in a computer systems RAM rather than
22%
Computing at eBay storing it on traditional physical disks (see Figure 3,
} Sellers get relevant, In-Memory vs. Disk: The Shootout). In-memory Customer service
real-time information 45%
computing helps predictive analytics systems aggregate
about their own
34%
customers and eBay and analyze vast amounts of data from multiple data
buyers sources in nearly real time. Anand Rao, a principal at Product offers
} More in-depth data consultancy PricewaterhouseCoopers (PwC), says 43%
analysis; faster 22%
in-memory computing can deliver increased innovation,
anomaly detection and
notification
improved productivity, enhanced customer experience Fraud detection
} Dashboard lets and loyalty, and lower costs.3 34%
analysts visualize 31%
relevant information in Many enterprise software providers offer automated
Source: Ventana Research predictive analytics benchmark research, 2013.
several categories
platforms based on in-memory computing. These http://goo.gl/1kUhOz
} Tasks that previously
took a month can now systems run data through myriad preconfigured
be done in one day metrics, quickly send those metrics to users and To stay competitive, eBay employs 5,000 data analysts
} Data is delivered provide dashboards for users to disseminate data. worldwide who sift through as much as 100 petabytes of
to the entire team
Researchers at audit and consulting firm Deloitte say data. Until recently, analysts used Microsoft Excel
of eBay analysts
new in-memory platforms offer query response times spreadsheets. But the process wasnt scalable, and
instantaneously
that are thousands of times faster than more errors were common.6 Given the huge amount of data
conventional approaches; transactions can be and eBays pressing business needs, the case for
processed as much as 20,000 times faster. 4
automation was easily made.
These and other related benefits are making predictive eBays first test project, launched in 2013, combined
analytics a serious business. Research firm predictive analytics and in-memory computing. The
MarketsandMarkets forecasts the global market for result empowered the North American marketplace
predictive analytics systems reaching $5.24 billion in team of 300 data analysts to provide sellers with
2018, up from $1.7 billion last year. 5
forecasts, as well as relevant and real-time information
about sellers own customers or eBay buyers.
Up, Up and eBay Information was provided as actionable metrics,
3. PricewaterhouseCoopers. 6th Annual
Digital IQ Survey. http://goo.gl/1dQiyn. eBay recognizes the value of predictive analytics and including customer tastes and preferences, market
Comments by Anand Rao in Digital IQ
2014 10 Technology Trends for Business. in-memory computing. It uses the technology to score conditions, and timely supply and demand information.
http://goo.gl/IpJsLw.
4. Deloitte University Press. Tech Trends both business and technology benefits.
2014: Inspiring Disruption.
http://goo.gl/E3f6z3. Consider the popular category of collectible mens
5. MarketsandMarkets. Predictive
Analytics Worldwide Forecasts Data at eBay is certainly big: It serves some 20 million basketball sneakers. If we know that collectible
(20132018). http://goo.gl/4fEhBg.
6. SAP. Optimizing eBays Signal sellers offering wares in more than 4,500 product sneakers for the Olympics are selling really well, we
Detection with SAP HANA.
http://goo.gl/UFHy7j. categories and 145 million active buyers in 100+ want to tell our sellers as soon as we know it, says
7. Schwarzbach, David. SAP
Sapphire Conference Presentation: countries. Now eBay is feeling pressure to keep David Schwarzbach, vice president and CFO of eBay
Target Business-Critical Processes for
Transformation. http://goo.gl/uIv6Zu. business competitive and customers loyal. North America. Thats the value of speed.7 The

sellers, equipped with this FIGURE 3 In-Memory vs. Disk: The Shootout
knowledge, can then run special How these two technologies compare on two important factors.
promotions for those sneakers.
Infrastructure Finding Data
In-memory Data is stored in the Streamlined data retrieval
Keys to the Kingdom computing machines main system and processing means no
The eBay team had worked alone on a
memory, enabling mechanical parts, no
scalable and configurable automated in-line processing and movement and no need
eBays Business predictive analytics system for two years. manipulation. for alignment.
Challenges But the payoff came when
} Data analysis was Schwarzbachs team began working Disk-based Data is mechanically For data to be read or
manual; the process recorded on a spinning written, the correct
with an in-memory platform vendor.
wasnt scalable, and disk, often on a large address must first be
There was a thrilling, magic moment,
errors were common array of networked found on the physical
} Difficult to coordinate he says, when the team knew they storage appliances. disk. Overhead for input/
analysts efforts, could transfer their data analysis output activities can
diagnose problems operation over to an in-memory platform. cause delays to jobs that
and make accurate are large or complicated.
Schwarzbach adds: Wed cracked it.
decisions on seller
recommendations Source: Deloitte, Tech Trends 2014: Inspiring Disruption
By deploying the in-memory platform,
eBays Solutions eBay honed in on two core requirements: greater a method to deliver items before a customer orders
} Deploy advanced analysis of data, and faster detection and notification of them. In deciding what to ship, Amazon will leverage its
business analytics
anomaliesor signal detection. The platform delivered trove of customer dataand its predictive analytics
} Combine predictive
analytics and in-
several tools, including a dashboard that lets eBay systemto take into account a customers previous
memory computing North Americas analysts visualize relevant information in orders, product searches, wish lists and more.10
} Partner with in-memory several categories and that flashes data anomaly alerts.
platform vendor Similarly, UPS wants to deploy prescriptive analytics on
Thanks to in-memory computing, tasks that previously all its data feeds, including GPS tracking, driver routes
took a month now take a day. Gagandeep Bawa, a and workloads, traffic patterns and delays, and
manager in eBay North Americas financial planning customer delivery requirements. The goal: a real-time,
group, says this real-time speed frees up data constantly adapting operational system that optimizes
analysts time, and he calls the system inherently any task performed by the companys drivers.11
intelligent and configurable.8
PwC says the future of enterprise applications will
Next, eBay will offer this data directly to sellers, either combine predictive analytics with mindflowsbasically,
on their personalized Web pages or via a mobile app. a persons thoughtsto create mindful apps. These
Schwarzbach says his team is taking this to apps will combine data generated by tracking what
production right now. Morris of IDC expects this will
9
people think, their behavior patterns and data already
8. Bawa, Gagandeep. eBays Early
Signal Detection System Runs Machine give eBay a big competitive edge. Other auction firms being aggregated by a firms predictive analytics
Learning & Predictive Powered by SAP
HANA. http://goo.gl/282uJB. dont offer this kind of data analysis as a service, he program. That information will help employees make
9. David Schwarzbach.
10. Bensinger, Greg. Amazon Wants to explains. So this makes eBay very compelling for optimal decisions, all served up via a mobile app.12
Ship Your Package Before You Buy It.
The Wall Street Journal, Jan. 17, 2014. customers to use for selling their goods.
http://goo.gl/Vz1U9i.
11. Hemsoth, Nicole. UPS Delivers on If you were using one of these programs, youd already
Prescriptive Analytics. Datanami, Feb.
23, 2013. http://goo.gl/PP4GjV. Schultz, The Future Is Predictive know that!
Beth. Inside Analytics: UPS Delivers
the Goods. All Analytics, May 9, 2013. Impressive as these gains are, several companies are
http://goo.gl/iEfm4U. Larry Lange is a freelance business and technology
12. Baya, Vinod, Galen Gruman and Bo pushing new developments that will make data
Parker. The future of enterprise apps:
writer based in Jacksonville, Fla.
Moving beyond workflows to mindflows. analytics even more useful. Amazon was recently
PricewaterhouseCoopers.
http://goo.gl/GqCOLH. granted a patent for what it calls anticipatory shipping, This research project was funded by a grant from SAP.

EMC at a glance
IT as a service, cloud computing. 25 distinct product
families span hardware, software and services,
addressing storage, trusted infrastructure, cloud
computing and big data
Industry: high tech
Headquarters: Hopkinton, Massachusetts
Founded: 1979
2013 revenues: $23.2 billion
Acquisitions to date: 70
Employees: 60,000 in 86 countries
www.emc.com
Source: EMC
Page 39
The Key to EMCs Technology

Growth: Integrated Acquisitions
Integrating the systems and business processes of acquired companies is often overlooked. EMC,
with its 70 acquisitions and counting, has a winning formula.
BY ALAN RADDING
T he rise of so-called SMAC technologiessocial, mobile, analytics and cloud

presents a new challenge to large technology suppliers. On the one hand, these
companies must respond to their customers rising demands for these new technologies.
EMC at a Glance Yet on the other hand, doing so is costly, time-consuming and complicated.
Industry: IT as a service,
cloud computing To meet this challenge, many large technology FIGURE 1 Acquisitions Do Not
Company description: 25 companies are turning to mergers and acquisitions Always Deliver
distinct product families (% reporting deal objective was very important and
(M&A). They are buying smaller suppliers that have
span hardware, software completely achieved)
developed solutions in one of these areas, and
and services, addressing Very important Completely achieved
storage, trusted then integrating them into their product mix and
All respondents All respondents
infrastructure, cloud operations. Among the firms that have spent
Very important Completely achieved
computing and big data millions, even billions, of dollars to acquire SMAC
Technology respondents Technology respondents
Headquarters: suppliers are IBM, Google, Microsoft and EMC.
Hopkinton, Mass. Access to new brands, technologies or products
Founded: 1979 56%
Rob Fisher, U.S. technology industry deals leader at
Revenues: 82%
$23.2 billion (2013) PricewaterhouseCoopers (PwC), an audit, tax and
40%
Acquisitions to date: 70 consulting firm, said these companies essentially
47%
Employees: have no choice. SMAC, he said, changes the
60,000 in 86 countries nature of the business, especially when software is Access to new markets
www.emc.com involved. Acquisitions are also a way for large 70%
Source: EMC technology suppliers to enter new markets at lower 75%
risk. Upstarts are prepared to lose hundreds of 58%
millions of dollars of venture capital before becoming 38%
profitable, Fisher explained. But established
Access to management or technical talent
players cannot absorb those kinds of losses.
43%
59%
PwC recently completed a three-year study of
36%
mergers and acquisitions in technology,
31%
information, communications and entertainment.
As part of the study, the firm asked C-level Source: PricewaterhouseCoopers, 2014 original rendering
executives to name their most important deal

objectives. Among executives in the technology percent of the technology executives (see Figure 1,
sector, two goals came out on top: access to new Acquisitions Do Not Always Deliver).
brands, technology and products, cited by more
than 80 percent of respondents; and access to However, simply acquiring a smaller technology
new markets, also cited by 75 percent. The next company is not a panacea. The acquired company
closest was access to talent, cited by nearly 60 must also be integrated into the larger company, and

that includes its IT architecture, systems and FIGURE 2 Transformation via Acquisition
applications. This work is far from simple. PwCs (% of acquisition type, based on the largest
survey identified IT integration as the number one acquisition in the past three years)
post-M&A closing difficulty. It was followed by the All respondents Technology respondents
related challenge of integrating operating
Transformational
procedures and business processes.
44%
EMCs Challenges 53%
} Support both current This is essentially an information-platform challenge.
and anticipated future The acquiring company must meld disparate Absorption
businesses. 29%
processes and technologies, most originally 29%
} Manage a large number
intended to support different business models,
(70+) of acquisitions, Source: PricewaterhouseCoopers, 2014
and integrate business customer bases, development cycles and product-
and operational systems. release expectations. And with cloud technology
} Enable current products enabling a software supplier to shift its business Originally founded as a provider of data-storage
with mobility and cloud model from licensed products to hosted services, systems to large enterprises, EMC is today a $23.2
computing. billion (revenue) supplier of 25 distinct product families
even the most basic accounting systems may
} Update legacy ERP
require major adjustments. that span hardware, software and services. These
system to support
variable pricing,
products address not only storage, but also what the
especially pay-as-you-go As a result of this complexity and difficulty, many company calls trusted infrastructure, cloud computing
models. acquisitions fall short of achieving their goals. and big data.
PwCs survey found that fewer than one-third of
executives at acquiring technologies companies EMCs customer base has expanded to now include both
reported competence in integration. The results small and midsize companies. As a result, it engages both
were striking: Fewer than half (47 percent) of the direct and in-direct sales channels. But its typical order
executives said their acquisitions actually size has shrunk. In response, EMC embarked on a leaner
delivered access to new brands, technologies and operating strategy, methodically cut costs and adopted a
productsgoals the deals were created to deliver. high-volume/low-touch business model, much like the
As for gaining access to new markets and new best SMAC players. And at the manufacturing end, EMC
talent, the results were even worse; only 38 operations now rely on more than 50 suppliers worldwide,
percent said their acquisition met expectations for up from a small handful in 2004, as well as several
new markets, while a mere 31 percent said it met contract manufacturers.
expectations for talent. Transformational deals
are much harder due to the increased complexity Internally, EMC is a very different company, too. As of
of the integration, said Gregg Nahass, U.S. M&A 2013, EMC had 60,000 internal users, more than twice
integration leader at PwC (see Figure 2, the number it had in 2004. The company now has more
Transformation via Acquisition). than 400,000 customers and partners, six times the
number it had when a previous ERP system was
The Integration Hurdle deployed. Similarly, EMCs roster of applications and tools
Integrating systems, therefore, is a key differentiator has grown to 500, up from 400 in 2004. Even more
between acquisitions of SMAC companies that important, the way the company handles its workload has
succeed at meeting their goals and those that fail. changed dramatically; EMC now operates more than more
One company aware of this challenge, and working than 10,000 virtualized systems, amounting to 93 percent
hard to master it, is EMC. Over the past decade, of all its servers (see Figure 3, EMCs Evolving IT).
EMC has acquired no fewer than 70 companies.
What is more, these acquisitions have enabled EMC With all these changes, EMC found it also needed to
to radically change the nature of its business. change its internal IT environment. The ERP system

that had suited the company so well in 2004 was FIGURE 3 EMCs Evolving IT
by 2013 no longer serving the business. EMC
now needed to accommodate dozens of business 2004 2013
units supporting varied product families being
Internal users 24,000 60,000
sold via multiple channels to different types of
customers. A new system was clearly needed, IT environment 5 datacenters, 5 datacenters,
960 terabytes ~13 petabytes
EMCs Solutions one that could support myriad types of pricing,
of storage of storage
} Move to an open ERP from conventional on-premises licenses to various
Business ~400 ~500
system. subscription and pay-as-you-go modelsand applications
} Create six new whatever might come next. And the company
principles for any future Virtualization 2,000 physical 93%, ~10,000
would need to help its staff work seamlessly. No servers OS images
system.
matter which EMC business units they were in,
} Launch Project Propel, Source: EMC Corp.
an enterprise system workers needed to be able to share information,
initiative designed to collaborate and innovate with one another.
transform 125+ The EMC team began with a question inspired by one of
business processes. Beyond Integration its acquisitions: What if the same principles that
} Deploy a set of
Clearly, EMC needed a solution that went far transformed a single acquisition, delivering
virtualized enterprise
beyond merely upgrading its existing ERP system unprecedented value for customers, were applied to the
apps that can be
adapted to changing with a few cloud or mobile capabilities. Instead, the entire company?
future needs. company needed a system that would integrate its
} Plan to add new acquired companies and support its new business In answering that question, EMC officials realized they
capabilities, including would need to abandon their legacy ERP system. The
CRM, scheduled for
Now that were in the hardware replacement, they realized, would need to be based on
2015 deployment.
open systems. It would need to enable widespread
business, the software business,
virtualization. And it would need to support EMCs
and very much into mergers journey to cloud and mobile computing. Above all, EMC
and acquisitions, we needed needed a system that could integrate everything and
share information, even with future acquisitions.
to reinvent our ERP system to
support not just the business To find the right solution, EMC highlighted six key
that we had evolved into but the principles:
Design for the future state of the business.
businesses that we will continue
Minimize customizations and commit to the vendors
to evolve into going forward. upgrade path.
Move fast to mitigate system risk.
M I C H A E L H A R D I N G , P R O J E C T L E A D
T E C H N I C A L A R C H I T E C T, E M C Use a phased approach to realize value as quickly
as possible.
processes, customer types and business models. A Recognize and manage the cultural change and
conventional upgrade would not suffice. Now that transformation the new system entailed.
were in the hardware business, the software Prepare the staff with new skills and competencies.
business, and very much into mergers and
acquisitions, we needed to reinvent our ERP system After a careful search, EMC settled on a solution supplied
to support not just the business that we had evolved by an industry-leading enterprise systems vendor. The
into but the businesses that we will continue to solution would support from the outset open systems,
1. HANA Customer Spotlight. evolve into going forward, said Michael Harding, virtualization and cloud computing. To do that, while
SAP, 2013.
http://goo.gl/UtnxDU. project lead technical architect at EMC. 1 ensuring performance and flexibility, the new vendor also

Project Propel at brought a slew of the latest technology advances, acquired vFabric, GemFire, Cetas and Cloud
a Glance including in-memory processing. Foundry). The combined service now provides data
} Overall mission: warehouse protection, data deduplication and
Support both EMCs Transformation Project backup services.
current and anticipated
The new enterprise system initiative, referred to
future businesses.
internally as Project Propel, was designed to The new integration and innovation capabilities of
} Key dates: Phase
1 launched in 2013; transform more than 125 EMC business processes Project Propel have also helped EMC provide
Phase 2 (adding RSA by deploying 65 integrated, multi-module enterprise real-time financial reporting. The end-of-quarter
and services groups) applications. Project Propel has also enabled EMC to process [is] a huge amount of pressure, Tony
is scheduled for 2014; deploy an integrated set of virtualized enterprise Pagliarulo, EMCs senior VP and chief operating
Phase 3 (adding CRM
applications that can be adapted to support both the
capabilities) is scheduled
way EMC works now and the way it is likely to work The key to innovation is to
for 2015.
} Business benefits in the future as it pursues ongoing innovation. leverage technology for multiple
include: Reduced
capital and operating
departments. Its being informed
Project Propels initial rollout in 2013 involved some 20
expenses, improved modules. These included core ERP, business that creates the basis for
business performance,
intelligence (BI), supplier relationship management sustainable innovation.
the ability to leverage
(SRM) and advanced planning and optimizing (APO),
commodity IT hardware,
G R E G S C H U L Z , S E N I O R A N A LY S T A N D
improved security and as well as some portals and various third-party
FOUNDER, STORAGEIO
easy information sharing applications. Despite the projects massive scale, it
to facilitate innovation. was deployed to EMCs internal users in just four days. officer, said at a recent investment analyst briefing.
} Business applications: So it was critical for us to have real-time reporting
approximately 500.
The effort was intended from the start as a at a very detailed level. Thanks to Propel, he
} Transformation: More
multi-stage rollout. The last stage, expected to go added, We were able to make that available to
than 125 EMC business
processes have been live in 2015, will add customer relationship users so they can make real-time decisions about
added; 65 legacy management (CRM) capabilities to bring the sales which customers got what product. It was hugeit
applications have been groups under the same information-sharing really saved our bacon.2
retired. umbrella, enabling all groups to see the same
} In-memory processing:
information. At that point, information should flow Project Propel is the largest IT transformation in
Four third-party
efficiently and seamlessly through major swaths of EMCs history. It delivers new technology, enables
appliances.
} Product families: the sprawling company, with innovation following EMC to redesign key business processes and
More than 24, including right along. ensures an agile approach to deployments. This, in
hardware, software and turn, helps EMC respond quickly and completely to
business services. This information flow will facilitate another EMC customer requests, provide a better mix-and-
} Training: 103 classes
objective, sustainable innovation, said Greg Schulz, match of products and services, and share
have been completed,
senior analyst and founder of StorageIO, an IT information internally.
training 1,200 super
users. consulting firm. The key to innovation is to leverage
} Phase 1 technology for multiple departments, he added. These types of capabilities are important, not only to
implementation: 40,000 Its being informed that creates the basis for EMC but to the entire IT industry. As the market
users at 316 sites in just sustainable innovation. leaders continue to grow and gain capabilities with
four days.
acquisitions, the need to create open, integrated
Source: EMC Corp.
An early example of that type of innovation is EMCs systems will only grow.
creation of Pivotal, its agile infrastructure service.
2. Transform Business Alan Radding is a freelance business and technology
with an Innovation-Driven
EMC formed Pivotal by combining capabilities it
Enterprise. SAP Webcast,
writer based in Newton, Mass.
gained through the acquisitions of Pivotal Labs,
2013.
http://goo.gl/trhTSI. Greenplum and VMware (which, in turn, had This research project was funded by a grant from SAP.

Florida Crystals at a glance

A subsidiary of Fanjul Corp., Florida Crystals is the
worlds largest sugar refiner. A vertically integrated
company, it operates two sugar mills, a sugar refinery,
a packaging and distribution center, a rice mill and a
renewable energy power plant
Industry: consumer products and agriculture
Headquarters: West Palm Beach, Florida

Farmland: 155,000 acres
Products: organic and natural sugar; refined sugar;
organic and premium rice
Raw sugar production: 800,000 tons per year
Refined sugar production: 500,000 tons per year
Annual revenues: $5.5 billion (Fanjul Corp.)
Employees: 2,000
www.floridacrystals.com
Source: Florida Crystals
Page 44
Real-Time Business Sweetens

Performance at Florida Crystals
In-memory computing leads to more effective decision-making and energizes an aggressive
growth strategy at the worlds largest sugar refiner.
BY STEPHANIE OVERBY
Florida Crystals At
a Glance
Industry: Agriculture and
E arly in 2014, due to global oversupply, sugar prices sank to less than 15 cents a
pound on the IntercontinentalExchangethe lowest price in three-and-a-half
years.1 But unlike manufacturers in other industries, Florida Crystals cannot cut
consumer products
Company Description:
A subsidiary of Fanjul
production or hold back supply to compensate FIGURE 1 Real Time vs. Reality
when prices fall. Sugar cane, once planted, Many companies struggle to deliver
Corp., Florida Crystals
produces a crop for several years, and mills must in-the-moment business data in real time. (% of global
is the worlds largest
companies with one-day or near-real-time visibility)
sugar refiner. A vertically extract the raw sugar from the freshly harvested
integrated company, cane soon after each new crop ripens. Cash positions/liquidity
it operates two sugar 57%
mills, a sugar refinery,
Meanwhile, in a commodity industry such as sugar Customer information/business volume
a packaging and
that is dominated by a few large players, it is difficult 43%
distribution center, a rice
mill and a renewable- for firms to differentiate their products, noted Simon
Working capital
energy power plant. Ellis, practice director of supply chain strategies at 39%
Headquarters: West Palm IDC. As a result, profit margins for sugar companies
Beach, Fla. are tight and cost efficiencies are key to profitability. Supplier base/spend volume
Farmland: 155,000 acres 28%
Florida Crystals faces another challenge, too:
Products: Organic and
business complexity resulting from an aggressive Financial performance
natural sugar; refined
growth-by-acquisition strategy and vertically 24%
sugar; organic and
premium rice integrated operations that cover every step of sugar
Operational risk
Raw sugar production: production, from planting to distribution. 17%
800,000 tons per year
Refined sugar production: Source: The Hackett Group, 2013
What began as a family-run sugar farm in Cuba in
500,000 tons per year
the 1850s is now the largest sugar refiner in the could quickly deliver the real-time capabilities
Annual Revenues: $5.5
billion (Fanjul Corp.) world. The company is involved in planting, necessary for increased flexibility and better
Employees: 2,000 harvesting, processing, packaging, marketing and decision-making.
www.floridacrystals.com distributionall within its own farms and facilities.

Source: Florida Crystals Recently, Florida Crystals expanded operations to A Way to Stay Ahead
Europe and Latin America via acquisitions and Florida Crystals likes to be out front. More than a
investment. It is also looking at opportunities in decade ago, it was the first to mill certified organic
China and Africa. sugar to be sold in the United States. That has
been true of its approach to using information
To improve agility in its competitive cost- technology, too. The company has always situated
1. International Sugar and conscious industry, as well as to better manage itself on the leading edge of IT, from being among
Sweetener Report. Raw sugar
futures fall below 15 cents/lb for
its broad range of business activities and the first to roll out an ERP system in 1995 to its
the first time since June 2010. aggressive growth strategy, Florida Crystals early adoption of cloud computing when it rid itself
Informa, Jan. 23, 2014.
http://goo.gl/OFuOKu. leaders looked to information technology that of its datacenter in 2010.
March 2014 | Copyright 2014. Bloomberg L.P. All rights reserved.

Florida Crystals But in 2013, Florida Crystals was like many companies FIGURE 2 Better Decisions Through Data
Challenges struggling with the limitations of its existing applications Business drivers for investment in analytics
} Standardize and simplify and analytics environment: It was running numerous include the following. (% responding)
infrastructure and batch processes that delayed data delivery and analysis, Improving the quality of decision-making
applications. 59%
and it had devised workarounds that further complicated
} Create agile processes
already complex business processes. Also like others,
to facilitate growth Making quicker decisions
through acquisition. Florida Crystals lacked real-time visibility into key 53%
} Deliver data and enable business information. A study of global companies by
analysis in real time. The Hackett Group found that fewer than half have Improving planning and forecasting
47%
real-time data about customers, suppliers or financial
performance (see Figure 1, Real Time vs. Reality). Developing new products, services and
Florida Crystals
revenue streams
Solutions 47%
} Deploy an in-memory
Furthermore, more than 40 percent of IT managers
suite of enterprise responding to a recent IDC survey say that users Source: IDG Enterprise Big Data Study, 2014. http://goo.gl/BNImWX
applications to speed could not perform predictive analysis or work with

information delivery to real-time data because they have to wait between from re-imagining business processes to take advantage of
business users. two and 10 days for their data to be processed. 2
it, noted business transformation expert Behnam Tabrizi,
} Move mission-critical
consulting professor at Stanford Universitys department of
business applications to
a managed cloud service
Managers at Florida Crystals used to spend much of management science and engineering.
with flexible capacity their time waiting for reports to run or devising their
to support geographic own spreadsheet analyses. But Vice President and No More Waiting for Data
expansion. CIO Don Whittington chose to move the companys It took two months for Florida Crystals to migrate its full
} Use real-time analytics most important business systems to an in-memory stack of ERP software, from finance and materials
to enable employees to
platform that could deliver data to employees much management to sales and distribution, to a managed
make better operational
decisions.
more quickly than overnight batch processing. He 3
cloud service. Then the company switched over to the
also chose to run those systems using a managed in-memory platform during a long weekend, keeping
cloud service with the capacity to process petabytes terabytes of data in sync with no disruption to the
of data. The flexible capacity would accommodate thousands of employees who use that data in three
the companys expansion plans more cost effectively. countries on a 24-hour basis. The migration began late
But Florida Crystals goal goes beyond merely on a Friday and, Whittington said, it was literally
producing reports faster. Ultimately, business leaders business as usual on Monday.
plan to transform the way the company operates.
Only it was more than business as usual. Key
With in-memory computing in the cloud, business performance processes such as accounts payable
users can process reports on-demand, on their own analysis doubled in speed. Cost center reports that used
and in real timewithout waiting for IT to provide to take minutes took milliseconds. Programs that ran for
data. Employees can now devote their days to the hours finished in minutes. End-of-month workloads that
analysis and business decision-making that will took three days to complete now run in about four hours.
underpin the companys growth and differentiation In fact, response times for most business transactions
2. Olofson, Carl W. and Henry D.
Morris. Blending Transactions and
strategy. As batch jobs are replaced by real-time have improved by anywhere from 50 percent to 500
Analytics in a Single In-Memory processing, the company can get information from its percent, according to Whittington. We dont just make
Platform: Key to the Real-Time
Enterprise. IDC, February 2013. supply chain faster than ever before, and thus get work faster, he said. Work goes away.
http://goo.gl/e0vZP3.
answers to customers more quickly.
3. SAP Technology. Florida
Crystals Speeds Up Supply Chain
When employees do not have to download data to a
With Enterprise HANA Cloud. Eliminating batch processes is only the beginning, spreadsheet, format it, upload it again and then
YouTube, July 8, 2013.
http://goo.gl/1KVrEy. however. The greatest benefits from real-time data come reconcile it with the four or five other reports their

Benefits of Real- colleagues have created, they have more time to

FIGURE 3 Real-Time Businesses
Time Business at study the data and use it to make decisions. Outperform Peers
Florida Crystals Research by Erik Brynjolfsson, director of the MIT Compared to other companies in their industries, firms using
} Self-service: Business advanced analytics are:
Center for Digital Business, and his colleagues, found
users can process
that among companies using data in their decision- 200% a s likely to be in the top quartile of financial
reports on demand,
making, productivity increases by 5 percent to 6 performance
without going through IT.
} Faster analysis: Most percent.4 Meanwhile, a survey of IT decision-makers
300% as likely to execute decisions as intended
business transactions by publisher IDG Enterprise found that companies are
are 50 percent to 500 investing in analytics primarily to improve the quality 500% a s likely to make decisions much faster than
percent quicker, so and speed of their decision-making (see Figure 2, market peers
business users have
Better Decisions Through Data). Source: Bain and Company Insights, 2013. http://goo.gl/lY1IvA
more time to study
their data.
} Improved flexibility A Real-Time Transformation There have been benefits for IT, as well, in line with Florida
to support growth: Now, Florida Crystals executives are on the way to Crystals cost-cutting goals. Total cost of ownership for
A scalable cloud transforming the company into a real-time computing and storage is down by an average of 30
infrastructure business. Your day is no longer spent running percent. And by embracing the cloud, Whittingtons
helps mergers and
transactions, Whittington explained. Its [spent technology group does not need dedicated resources or
acquisitions go more
taking] the results of those transactions and [using] expertise to manage the in-memory platform. That will
smoothly and reduces
IT costs. that to a business advantage. empower IT groups to become that part of the business
} New value creation: and not worry about the technology, he said. We leave
With access to real-time When it comes to implementing new technologies, that to our partners.
data, Florida Crystals such as in-memory and cloud computing, said
can focus more on
Narendra Mulani, senior managing director at And the more flexible systems will make the technology
value-added work,
Accenture Analytics, the greatest value will come transitions for future corporate acquisitions and mergers
such as improving
inventory management; from the ability to enable decision-making at the go more smoothly. In the past, some of the acquired
developing new right time. companies did not come with their technology
formulations, products applications, requiring Florida Crystals to get off the
or packaging; or It is not so much that such new business systems are sellers technology in as little as 90 days. A flexible
planning expansion into
simpler, said Robert Parker, vice president of research analytic model and underpinning technology can
new markets.
at IDC Manufacturing Insights; it is that they are more actually be hugely beneficial by allowing the company to
flexible. The same core technology can be used to evaluate performance even if systems arent fully
meet varied and changing business demands, converted yet, IDC Manufacturing Insights Parker said.
without having to reprogram them constantly. These
approaches create the necessary resiliency that That should give Florida Crystals a leg up in its industry.
allows a company to be more responsive to market A 2013 global survey of 400 large companies by Bain &
conditions, he said. They enable more data-driven Company found that firms using advanced analytics are
decision-making at the strategic level and greater more likely to be in the top quartile of financial
agility when responding to events in real time. performance within their industries, to execute decisions
as intended, to use data very frequently when making
4. Brynjolfsson, Erik, Lorin Hitt and
In a highly competitive and constrained market, decisions and to make decisions faster than market
Kim Heekyun. How Does Data-
Driven Decisionmaking Affect Firm having flexible technology means Florida Crystals peers5 (see Figure 3, Real-Time Businesses Outperform
Performance? 2012.
http://goo.gl/Wkav0C and http:// can focus on value-added activities that will Peers). Said Whittington, Its a game changer.
goo.gl/9VUMG6.
distinguish it from the rest, whether it is better
5. Pearson, Travis and Rasmus Stephanie Overby is a freelance business and
management of inventory; new formulations,
Wegener. Big Data: The technology writer based in Boston.
Organizational Challenge. Bain and products or packaging; or planned expansion into
Company Insights, Sept. 11, 2013.
http://goo.gl/lY1IvA. emerging markets. This research project was funded by a grant from SAP.

Globus at a glance
Globus is the premier department store subsidiary of
The Federation of Migros Cooperative, the largest re-
tailer and employer in Switzerland. The cooperative has
more than 40 business enterprises that are divided
into five strategic business units: Cooperative Retailing,
Commerce, Industry & Wholesale, Financial Services
and Travel
Industry: retail
2012 revenue: $849 million
Headquarters: The Spreitenbach, near Zrich,
Switzerland
Products: high-end fashion, beauty, living and
gourmet products
Employees: more than 3,000
www.globus.ch/en/index.html
Source: Globus
Page 48
Globus Is Always in Style with

In-Memory Technology
Real-time insights enable Switzerlands high-fashion department store to keep up with
fast-changing consumer preferences and optimize its supply chain.
BY JOE MULLICH
Globus at a Glance
} Industry: Retail
T he Federation of Migros Cooperative, the largest retailer and employer in
Switzerland, has long been noted for its supply chain excellence and creative
thinking about logistics. Last year, for example, the company was honored with a
} Company description: prestigious Swiss Logistics Award for determining the best transport routes for its
Globus is the premier
department store sub-
sidiary of The Federation goods. It is not surprising that a company recognized FIGURE 1
of Migros Cooperative, Ready for Mobile Offerings
the largest retailer and as the most innovative retailer in Switzerland,
Respondents were asked which of the following
employer in Switzerland. according to a survey by the University of St.
they would use if offered on their mobile device
The cooperative has
Gallen, would also be a leader in finding better while in-store.
more than 40 business
enterprises that are ways to leverage data to improve its supply chain Gather loyalty points or savings as you shop,
divided into five strategic and merchandizing techniques.2 based on current promotions
business units: Coopera- 88%
tive Retailing, Commerce,
Industry & Wholesale, A prime example is Globus, Migros Cooperatives Real-time promotions
Financial Services and 88%
premier department store subsidiary. Founded in
Travel
1907, Globus operates 14 big retail stores that sell Order out-of-stock items in-store for home
} Annual Revenue: 2012 delivery or put items on a wish list
clothing, cosmetics, jewelry, household supplies and
gross revenue was $849 82%
million using current other upscale goods. The retailers need for continual
exchange rates1 supply chain improvement is driven by higher Shopping list, item locator and store navigator
79%
} Headquarters: The production costs, a weak Euro and rising raw material
Spreitenbach, near
prices. Consumers, meanwhile, are more demanding Scan products as you put them in your
Zrich, Switzerland
and harder to please, which requires Globus to stay shopping cart
} Products: High-end 77%
on top of retail and fashion trends that can change as
fashion, beauty, living
and gourmet products fast as someone posts a new YouTube video. Base: 6,000 consumers from eight countries
Source: Accenture Seamless Retail Study, April 2013
} Employees: More than
3,000 Like many worldwide retailers, Globus operates
http://www.globus.ch/en/ in a competitive landscape, in which consumer sales performance data to identify merchandise
index.html expectations are increasingly influenced by mobile that is selling slowly. Such goods are a costly
Source: Globus device capabilities such as comparing competitive issue for many retailers. Studies have shown the
offerings and sharing their opinions on social media cost of owning excess inventory is approximately
(see Figure 1, Ready for Mobile Offerings). 2.5 percent per month, or 30 percent per year,
according to consulting firm The Retail Management
Insights at the Shelf Level Advisors.Costs include interest, insurance, buying
With this relentless pressure, Globus depends on expenses, receiving department expenses, property
1. Globus Web site.
http://tinyurl.com/myfoz4k timely, accurate reporting and analysis of sales taxes, markdowns and shrinkage, the firm says.3
2. Migros Web site.
http://tinyurl.com/m3f5o7s performance data to identify consumer trends so Another issue is customer satisfactionif store shelves
3. Carter, Linda. What Is Stock Turn Rate,
And Just Why Is It So Important? The it can change its pricing and marketing strategies contain too many items that customers do not want,
Retail Management Advisors.
http://tinyurl.com/mg5urrh as the market changes. In particular, Globus uses that leaves less room for the goods they do want.

Globus needed to find a way to track slow-sellers FIGURE 2 Speeding Insights with
so it could then discount or promote those products In-Memory Computing
to clear precious shelf space for hot products. Globus has seen quantifiable speed benefits from its
Enabling this type of analysis was no easy matter, in-memory computing system.
considering the large data volumes involved. Globus Before After

offers roughly 800,000 products through a network Data 550 gigabytes 60 gigabytes
Globus Data of some 3,500 suppliers. With increasing sales warehouse (due to data
Analytics volumes and transaction data, the amount of time it capacity compression)
Challenges took Globus to generate reports used for inventory
Time to 22 minutes 17 seconds
} Speed reporting. The
decisions was spiraling out of control.4 generate a (reports did (including all
retailer wanted to
generate reports more report on not include all product lines)
quickly so it could slow-selling product lines)
Analytics at the Speed of Business
stay on top of rapidly items
changing fashion trends. To get quicker insights, Globus implemented
} Minimize excess inventory: in-memory database technology. By leveraging Time to 7 minutes 60 seconds
Globus wanted to in-memory computing, Globus can now instantly generate a
reduce the amount of sales report
explore and analyze data from numerous sources.
slow-selling inventory to
make more shelf space Operational data is captured in-memory as Source: IBM
for hot items. transactions occur, permitting analytics to be
} Improve efficiency: The performed against rich data sources and providing
retailer wanted to reduce
the volume of data it the type of real-time insights that were simply not
stored while increasing possible before. Sales promotion reports, which once took seven
the insights and minutes to complete, can be produced in a mere
information that data
provided. This approach has provided numerous benefits. 60 seconds. Previously, if we needed sales
For example, Globus used to store 550 gigabytes figures of our 14 big stores, [we] had to generate
Elements of Globus 14 separate reports and then combine the results
of data in its data warehouse. Thanks to its in-
Analytics Solution manually, Weiss says. Now we can simply
memory approach, that has decreased to only
} An in-memory
60 gigabytes, one-ninth the original size. This is create one report at the touch of a button. He
technology-based
analytics platform important, because the less memory we need, the adds, we can now process more complex and
that helps to quickly comprehensive requests within seconds, providing
lower our licensing fees and maintenance costs,
generate insights,
resulting in better says Alexander Weiss, team leader, processes and a range of new insights that were simply not
demand planning, business warehouse at the company. 5 available without in-memory processing.9
merchandizing and
marketing in real time.
Queries and even forecasts that call up archive data The insights culled from this approach have
are now faster than ever, dramatically improving the increased employee readiness to embrace
speed of insights (see Figure 2, Speeding Insights
6 analytics. Before the use of in-memory technology,
with In-Memory Computing). Previously, it took acceptance of the companys key performance
22 minutes to generate a basic slow-seller report indicator dashboard was low among managers,
that did not include the whole product line, Weiss Weiss says. With the new solution, the figures are
says. Access to these reports had to be planned referred to and used regularly, helping the company
in advance because of the processing time.7 But to manage its retail business more efficiently.10
after implementing the in-memory database system,
Globus can generate a slow-seller report for the entire All this leads to better inventory decisions, a
product line in just 17 seconds. Employees obtain stronger bottom lineand happier customers.
4., 5., 6. SAP Web site.
http://tinyurl.com/lqvgz4k needed information 98 percent faster, eliminating the
7., 8., 9., 10. IBM. Swiss Retailer Migros Joe Mullich is a freelance business and technology
Spots Consumer Trends in Real Time with wait time by two hours per employee per day, so
SAP HANA. March 21, 2013.
http://tinyurl.com/lfvruwk decisions can be made on up-to-the-minute data.8

Hewlett-Packard at a glance
Provides hardware, software and services to
consumers, small and midsize businesses, and large
enterprises, including customers in the government,
health and education industries
Industry: high tech
Products: computer hardware and software; IT ser-
vices; IT consulting
Founded: 1939
Headquartered: Palo Alto, Calif.
Sales: $112 billion
Employees: 331,800
www.hp.com
Source: Hewlett-Packard
Page 51
HP Paves the Future with

Real-Time Insights
For the high-tech giant, in-memory-enabled speed is a business game changer.
BY JOE MULLICH
F or the past several years, the high-tech industry has faced the challenges of
rising customer demand, shortened product lifecycles and constant innovation.
Now that technology has become a fundamental element of not just the workplace
but also everyday consumer life, however, the pressure to execute quickly against
these traditional challenges has never been greater.
Succeeding in this pressurized environment FIGURE 1 Big Returns From Big Data
requires high-tech businesses to acquire real- High tech expects above-average
Hewlett-Packard returns on big data investments.
time intelligenceabout customer tastes and
at a Glance
preferences, market conditions, supply and Utilities
} Products: computer
demandand to take immediate action. For all of
73.0%
hardware and
these reasons, the high-tech industry has become Energy & resources
software; IT services;
one of the leading users of big data and analytics, 60.6%
IT consulting
} Founded: 1939
gleaning insights from the huge volumes of data High tech
produced internally, by the business, as well as 52.4%
} Headquartered:
externally, from its customers and partners. Average
Palo Alto, Calif.
45.5% (Mean percentage
} Sales: $112 billion of expected ROI
Technology firms are seeing a payoff from their for 2012 big data
} Employees: 331,800 Banking/financial services investments.)
initiatives. In a study by Tata Consultancy Services, 43.7%
www.hp.com
high tech was among the top four industries in Insurance
terms of spending on big data and in the top three 38.9%
for expected return on investment (see Figure 1,
Travel/hospitality/airlines
Big Returns From Big Data). 37.9%
Telecommunications
Hewlett-Packard, the $112 billion technology giant, 37.9%
is a leading proponent of the value of big data. We
Retail
eat, sleep and drink very large databases and big 36.4%
data as a present reality, said Dave Carlisle, chief
Life sciences
architect and strategist for HPs Enterprise Group.1
35.3%
We are under increasing pressure. Business
Manufacturing
expectationsand particularly user experience
28.9%
expectationsare increasing significantly.
Source: Tata Consultancy Services.
The Emerging Big Returns From Big Data. 2013
Consider, for instance, HPs supply chain. Every
60 seconds, HP delivers 120 PCs, 100 printers, servers. Every one of those shipments is the
1,200 ink and toner cartridges, seven network result of countless actions and decisions made
1. Dave Carlisle spoke recently in a
recorded Webcast. devices, seven terabytes of storage and five throughout the global supply chain. The question
FEBRUARY 2014 | Copyright 2014. Bloomberg L.P. All rights reserved.

FIGURE 2 In-Memory Initiatives

HP is focused on three strategic initiatives, powered by in-memory computing.
Strategic Initiative Business Innovation Data Consumption
Financial planning Drive accelerated and sophisticated scenario 12 terabytes of data and 400
planning in real time business intelligence users
Engage users with instantaneous results when
executing simulations and what-if scenarios
Quote-to-cash Accelerate core ERP processes in key areas, 28 terabytes of data and 1,000
such as order management administration, business intelligence users
month/quarter/fiscal year-end processing and
live operational reporting, delivering modern
experience at scale to users
Next-generation Drive on-demand visibility and improved 710 terabytes of data; 1,500
business warehouse inventory leveling in the product supply chain business intelligence users;
analytics Enable near-real-time account visibility in the 3 predictive users
global quote-to-cash process
the tech giant faces is, how to coordinate all those After running numerous tests, HP discovered query
Hewlett-Packards
Business decisions to optimize pricing, reduce out-of-stocks speeds had improved from an average of two hours
Challenges and shift manufacturing to align with customer using traditional databases to just 88.23 seconds using
} Respond quickly to demand. To succeed, organizations need to in-memory computing. As a result, HP employees will
changing conditions via no longer experience radical swings in processing times
make fast, informed decisions by extracting large
fast analysis of real-time
amounts of raw data from their systems to turn it that vary depending on where data is stored. With user-
information
into information that is meaningful, said Bill Veghte, driven, powerful analysis and simulation capabilities, HP
} Enable employees to
analyze data quickly and chief operating officer at HP.2 workers will obtain immediate answers to virtually any
intuitively business questionwith minimal help from IT.
} Optimize the use of data To succeed in this endeavor, HP is embracing
volumes generated by The increased speed will have a wide-ranging impact
in-memory computing, which enables real-time
the supply chain
decisions through instantaneous analysis of big on employee satisfaction and on meeting market demands
data sets. In-memory computing will enable HP to and customers changing expectations. With built-in
take immediate action based on up-to-the-second analytics, dashboards and reporting tools, data can be
insights into its financial planning, ERP and inventory digested and presented intuitively, enabling employees to
processes (see Figure 2, In-Memory Initiatives). quickly take corrective action and seize opportunities.
From Hours to Seconds At the end of the day, speed is a business enabler,
The ability to analyze massive amounts of fast- Carlisle said. Its cool from a technical standpoint
changing data in real time provides numerous benefits, that a report that used to run in three hours can now
according to Carlisle. What HP employees will really be done in 30 seconds. But the key is using speed to
notice is the unprecedented speed of accessing rethink business experiences and processes in ways
2. Hewlett-Packard. HP Opens
information to make decisions, he said, particularly not possible before. For instance, employees will gain
New Center of Excellence for
In-Memory Computing. HP press given the vast size of HPs underlying databases and self-service access to financial information, enabling
release, Jan. 10, 2013.
http://goo.gl/P80n5J. the global scale of its multifaceted business. more rapid analysis and reporting capabilities and

significantly reducing the time needed for closing FIGURE 3 Order Management
processes at the end of the month, quarter and Complexity
fiscal year. For each process, respondents were asked how many
IT systems are required to support it.
One System Two Systems
With betterand fastervisibility into financial,
Three or More Systems
inventory and supply-chain information, HP will Order management
Hewlett-Packards be able to detect and respond to issues and 55% 21% 21%
IT Solutions exceptions more quickly, in addition to proactively
Demand management
} Use in-memory managing risk and forecasting demand. HP could 53% 19% 15%
computing to analyze potentially accelerate inventory turns and ensure
vast amounts of data ERP
profitable service delivery by instantly evaluating
quickly 56% 9% 21%
and making granular changes in supply and
} Begin with a critical
demand, reducing out-of-stocks and lost sales.
Warehouse management
system involving small
34% 21% 28%
data sets
} Develop next-generation Transforming processes and enabling new Price management
business warehouse capabilities are at the core of what manufacturers
32% 15% 23%
analytics
are looking to achieve with analytics. In our Production planning
research, only 10 percent of manufacturing 32% 11% 30%
companies are satisfied with their what-if Tactical supply planning
capabilities, and only 24 percent of companies can 36% 17% 15%
easily determine the profitability of decisions, said Transportation planning
Lora Cecere, founder of Supply Chain Insights. 36% 9% 15%
Manufacturing execution systems

Tackling Order Management 23% 15% 23%
HPs in-memory computing efforts began with
Product lifecycle management
a focus on its largest single ERP environment,
34% 9% 11%
which includes order management administration,
month/quarter/fiscal year-end processing and live Source: Supply Chain Insights. Go Big or Go Home? July 2012.
http://goo.gl/p3x8B
operational reporting, accounting for over $41 billion
in revenues. The HP Account Management Portal Throughout 2014, HP will use in-memory computing
is used by thousands of HP order administrators to provide better data visualization, and it will begin
worldwide. In-memory computing slashed the to incorporate mobile capabilities. Taking a staged
time required to run a report from upwards of approach to in-memory computing enabled HP to
seven minutes to 40 seconds. Users can get their scale out its knowledge from both a technical and a
display in real time while they talk with customers comfort level standpoint. We are starting to deliver
on the phone, Carlisle said. What made this so disruptive capabilities now, Carlisle said, while
compelling, he added, is that there was no need to understanding and planning for even larger scale
retrain users, which increased the time to value. It is changes over the coming years.
a good first step that brings material change without
disruption. With the combination of its real-time big data anlytics
foundation and strong 2013 performance,3 HP seems
Streamlining order management is a challenge for poised to do just that.
many companies. According to a study by Supply
Chain Insights, order management often requires
3. Meola, Andrew. Why Hewlett- writer based in Sherman Oaks, Calif.
Packard is Up Today. The Street, more than one system (see Figure 3, Order
Jan. 13, 2014.
http://goo.gl/v8OtZs. Management Complexity). This research project was funded by a grant from SAP.

HSE24 Germany, Austria, Switzerland at a glance

A leading home-shopping network based in Germany
Industry: retail
Founded: 1995
2012 sales: 515 million
Employees: 725 at HSE24; approximately 2,100
external (call center, logistics)
Customers: 8 million people have shopped at HSE24,
equivalent to more than 10 percent of Germans over the
age of 18
Products: 20,000 different products are sold each year

Product segments: fashion (35 percent), beauty/well-
ness (23 percent), jewelry (21 percent) and home living/
household and DIY (21 percent)
www.hse24.de
Source: HSE24
Page 55
RESEARCH UPDATE | Real-Time Big Data Analytics Case Studies
Using Real-Time Insights, HSE24

Gets Closer to Customers
With in-memory computing and predictive analytics tools, Europes home-shopping network can
offer a personalized experienceand solve costly issuesin real time.
BY JOE MULLICH
HSE24, a leading home-shopping network based in Germany, measures its business

HSE24 Germany, in milliseconds. The 18-year-old company reaches 41 million households in Germa-
Austria, ny, Austria and Switzerland, and it has now expanded into Italy and Russia. All of its
Switzerland at a
Glance home-shopping channnels must stay aware of customer buying patterns and behav-
} Founded: 1995 iors and respond to them in real time. For example, if it appears that a sales spike is
} Sales: 515 million
(2012)
depleting inventory after one of the channels FIGURE 1 Sharpening Insights in a
} Employees: 725 at
displays a red shirt, it must immediately switch to Digital Shopping World
promoting a blue shirt to encourage purchases of Retailers understand the value of data but struggle to
HSE24; approximately
stock on-hand. turn it into profitable insights. (percent of respondents)
2,100 external (call
Proprietary data can help differentiate the
center, logistics)
Considering that a new customer call comes retailers products and services
} Customers: 8 million 67%
through every two seconds, it is easy to
people have shopped
understand the companys need for speed. Harvesting customer insight from data is a
at HSE24, equivalent
Retailers generally are moving to real-time key challenge
to more than 10
strategies. But because home-shopping networks 58%
percent of Germans
are based on selling live, the growing trends
over the age of 18 Data collection is a key challenge
of big data analytics and real-time retailing are 52%
} Products: 20,000
particularly crucial for this retail niche.
different products are Active users of analytics that extensively use their
sold each year data to generate new ideas and opportunities
The amount of data available to retailers is 25%
} Product segments:
enormous, said Don Peppers, an author and
fashion (35 percent), Source: Accenture. Seamless Analytics: Three Imperatives for the Retail
founding partner of Peppers & Rogers Group, Digital Marketplace. 2013. http://goo.gl/aFFy85.
beauty/wellness (23
a marketing consultancy that specializes in
percent), jewelry (21
customer-centric practices. Retailers are working immediate action on the insights gleaned. The
percent) and home
to find ways of using their data to improve approach enables the company to engage more
living/household and
operations and gain insights into what customers personally with its customers and create highly
DIY (21 percent)
want at the exact moment of need (see Figure 1, targeted marketing campaigns. Additionally, it
Sharpening Insights in a Digital Shopping World). will help reduce product returns significantly
www.hse24.de
Source: HSE24 an historically costly issue, particularly for
As HSE24 continues its rapid expansion across omnichannel retailers.
Europeand fortifies its increasingly omnichannel
strategy, including mobile, social networks and A Complex and Growing Business
the Webthe company is turning to in-memory In the German-speaking market, HSE24 operates 18
computing as a foundation for success. This call centers and four logistics centers. It processes
technology is enabling HSE24 to rapidly analyze orders for more than 1.5 million customers each year
huge stores of customer information and take with strong partners such as DHL. For each hour of
JANUARY 2014 | Copyright 2014. Bloomberg L.P. All rights reserved.

live broadcasting, the retailer offers two to three new FIGURE 2 A Day in the Life
products that range in price from 20 to 150, on On any given day in 2013, HSE24 serviced
thousands of customers.
average, and up to 35,000. In 2013, the company
fielded 14.6 million calls and shipped 11.2 million Calls Received Parcels Shipped
packages (see Figure 2, A Day in the Life). (Daily) (Every Weekday)
We are running seven days [a week], 365 days a year, Average 40,000 37,000
HSE24s said Christian Schnetzer, CRM team lead at HSE24. 1

Peak 100,000 74,000
Challenges We need our systems every minute, every day.
} Capture, analyze and Source: HSE24
respond to customer
The challenge for HSE24 is developing deep
data in real time.
relationships with its customers to both attend to In-memory computing enables companies to
} Build highly targeted and
and even anticipate their needs, despite no face-to- quickly analyze very large volumes of up-to-the-
personalized marketing
campaigns. face interaction. Doing so is becoming even more second and fast-changing data from diverse
} Provide marketers with complex as the company expands (see Figure 3, sources, including sales and customer data from
do-it-yourself tools to Geographic and Channel Expansion). internal systems and social media sentiment from
reduce IT overhead. the Web. As such, in-memory computing seemed
} Reduce costly product
HSE24 increasingly interacts with customers on like an ideal way for HSE24 to keep pace with
returns.
digital channels, including online, mobile apps the increased complexity of doing business by
} Maintain a consistent
customer experience and social media. In fact, its electronic and mobile gleaning insights from its growing data volumes in
across channels. commerce segments have grown at nearly twice the real time.
rate of the companys business as a whole.
Because nontechnical users can ask complex
These developments have caused an exponential questions of current data and receive answers in
increase in customer data, as well as the need real time, they can take meaningful action during
to keep up with dramatic shifts in taste from one small windows of opportunity, when the chance of
country to the next. Michael Kuenzl, senior vice success is greatest. Additionally, these users can
president of IT systems at HSE24, described obtain a complete picture of customer desires,
the channel expansion as moving from simple enabling them to provide a personalized experience
multichannel to complex multichannel. They are and avoid costly errors in how they sell or market.
a community buying with us and open to sharing More and more, the value of big data is finding an
their experience with the community, whether on immediate reaction, Peppers said. Retailers want
Facebook, Twitter or YouTube, he said. 2 to be living in the now moment.
The Now Moment HSE24 applied in-memory computing to some of its

It is now critical for HSE24 to monitor customers most pressing challenges in campaign optimization
opinions, likes and dislikes, because the digital and product returns. Before, when the marketing
footprints that Web shoppers leave behind can department wanted to target the customer
profoundly influence marketing, inventory and segments that would be most likely to respond to
customer service. Not to mention customers specific campaigns, it would need the business
themselves, who express comments on social media intelligence group to analyze this information. That
1. Christian Schnetzer spoke at and expect service representatives to listen and process could take a week or more.
a July 23, 2013, SAP Webinar
titled HSE24 Runs SAP HANA. respondquickly. It is fast becoming a necessity to
http://goo.gl/jTgTNq
2. Michael Kuenzl spoke at a develop an intimate understanding of customers Now, using customer engagement intelligence
July 23, 2013, SAP Webinar
diverse and changing tastes, as well as to act applications running on in-memory computing,
titled HSE24 Runs SAP HANA.
http://goo.gl/jTgTNq instantly on these insights. marketers can perform the analysis themselves.

Through an intuitive user interface, they can query FIGURE 3 Geographic and Channel
the data in real time to detect customer buying Expansion
patterns based on granular demographics, such HSE24 has grown by establishing businesses in new
countries, new TV channels and new digital platforms.
as age or where they live, Kuenzl said.
New Business Launch
The tools represent the analysis in graphics and
Germany October 1995
charts, making it easy to see data patterns.
Marketing staff can now drill down into millions Austria October 1996
HSE24s Solutions
} Implement a new of customer records in seconds, using recent Switzerland December 1997
in-memory customer data from a wide variety of sources. We can do
16 hours of live May 1998
engagement intelligence the selection in seconds, and we dont need the shopping each day
solution.
business intelligence department, Kuenzl said.
} Provide marketers with Online store December 1998
We can play with the data.
intuitive and user-friendly
customer segmentation HSE24 Digital (renamed September 2005
tools. Reducing Costly Returns HSE24 EXTRA) as a
} Implement predictive HSE24 is also looking to in-memory computing second TV station
analytics to uncover to reduce return rates and improve margins. HSE24 TREND lifestyle September 2010
hidden customer trends. TV channel
According to global management consultancy
Kurt Salmon, the cost of processing a return
Shopping app for November 2010
can be two or three times that of an outbound smartphones
shipment of the same item.3 The National Retail Italy June 2011
Federation, meanwhile, found that 40 percent of
buyers intend to return a product when they order Russia April 2012
it, 40 percent order more variations of a product Shopping app for iPad November 2011
and 40 percent of all product returns are due to
Shopping app on June 2013
poor product information.4 Google TV
Source: HSE24
For Web and phone- or mail-order companies, the
freight and handling costs of returned goods are Once it detected this pattern, HSE24 could take
particularly high. For HSE24, reducing returns by appropriate action. For example, it could improve
one percent can lead to a seven-digit improvement its product descriptions to help customers more
in the bottom line. Given these high stakes, the accurately select the right products on the very first
company demonstrated how it could study clusters order. It also could develop a promotional campaign
of customers who exhibit similar returns behavior to reward high-return customers if they lower their
with the goal of reducing return rates. return rates over a specific period of time.
In the demo, HSE24 identified different groups of Best of all, Kuenzl said, marketers can e-mail
customers who frequently return products. Using information to campaign managers so insights can be
predictive analytics and in-memory computing, translated into action immediately. This is something
it analyzed a particular group based on two HSE24 expects to do frequently in the future, as
3. Morrell, Liz. The Value of
elements: how many products they order and it explores more real-time uses for in-memory
Returns: What Does it Mean for how quickly they pay for those products. It soon computing and its ever-growing mounds of data.
your Business? RetailWeek,
Feb. 19, 2013. became clear that these customers tend to
http://goo.gl/4SPGz1 Joe Mullich is a freelance business and technology
4. Informatica. How Rich Data order products in a variety of sizes or colors to
Sells in Multichannel Commerce. writer based in Sherman Oaks, Calif.
On-demand Webinar.
determine which they want to keep and which
http://goo.gl/6jZkog they would return. This research project was funded by a grant from SAP.

Johnsonville Sausage at a glance

Family owned company produces fresh, precooked
and smoked sausage
Headquarters: Sheboygan Falls, Wis.
Founded: 1945, family owned, privately held

Employees: 1,400
Presence: 6 manufacturing facilities in the United
States; products available across the U.S. and in 30
other countries; sales offices in Canada, China, Japan
and Mexico
www.johnsonville.com
Source: Johnsonville Sausage
Page 59
Johnsonville Cooks Up a
Real-Time Recipe
Real-time business enables the nations leading sausage brand to continuously innovate,
optimize performance and plan for the future.
BY MICHAEL S. GOLDBERG
I nnovation and consumer products go hand-in-hand. In todays global

marketplace, new offers, products and services need to be well-targeted,
and they need to be implemented quickly. That is the mindset that drives
Johnsonville
Sausage at a Johnsonville Sausage, a family-owned enterprise promotions, according to a recent study by AMG
Glance that has built a leading brand of sausage products in Strategic Advisors.1 Immediate insights from analytics
Industry: Fresh, precooked the United States, to invest in real-time analytics. would enable Johnsonville to track special offers, such
and smoked sausage
as coupons. With real-time data, Johnsonville could
Headquarters: Sheboygan
To become more agile and ready to optimize correlate the offers with sales performance and adjust
Falls, Wis.
Founded: 1945, family- opportunities, the company is working to shift toward the programs based on those insights.
owned, privately held an analytics-driven culture, says Ron Gilson, CIO and
Employees: 1,400 vice president at Johnsonville. The goal, he says, is to The IT foundation for Johnsonvilles analytics
Presence: 6 manufacturing embed real-time data-driven decision-making capabilities, which will be built over multiple years, is
facilities in the United
throughout the enterprise to anticipate future business based on real-time processing, enabled by in-memory
States; products available
needs rather than just respond to past events. computing. In-memory computing allows very large
across the U.S. and in
30 other countries; sales volumes of data, from multiple sources, to be rapidly
offices in Canada, China, One high-profile example is trade promotions. On and easily analyzed. The deployment also extends
Japan and Mexico average, consumer products (CP) companies spend data visualization to mobile devices, to maximize
www.johnsonville.com 13.7 percent of their gross sales on trade end-user interaction. But the strategy goes well
FIGURE 1 Most Consumer Products Companies in Early Analytics Stages

(adoption rates of new technologies, %)
Completed Implementing Piloting or budgeting No plans

100
26% 4% 7% 4% 4% 11%
90 44% 33% 19%
45% 67%
80
55%
70 48%
60 44%
50 15%
41%
40
37%
30
20 22% 22% 22%
19%
1. AMG Strategic Advisors. 10
The Trend Behind the Spend: 7%
0 4%
A Study of Trade Promotion and
Merchandising Spending in the Software as a Digital media Mobile Social network Advanced Big data
Consumer Packaged Goods (CPG) service (SaaS) platforms collaboration analytics
Industry. Acosta, 2012.
Base: 27 leading CP companies
http://goo.gl/Lnwhsg.
Source: Grocery Manufacturers Association and The Boston Consulting Group, 2013. http://goo.gl/dFnylX

FIGURE 2 Analytics Vision A Quest for Growth

J ohnsonville Sausage expects to gain more visibility into its operations by collecting Johnsonville is pursuing its growth strategy
and analyzing data in real time for all sources. Areas targeted for improvement include:
from a position of market leadership in the
Trade promotion management Track performance of retail promotions in real time, respond to United States. Three out of four bratwurst sold
and optimization market trends, measure results and optimize outcomes. in the U.S. are Johnsonville. Its also the No. 1
Integrated data repositories Provide sales, marketing, supply chain and other functions with a national brand of Italian sausage, smoked-
consistent view of key performance indicators. cooked links and fresh breakfast sausage links.
Mobile device dashboards Deliver and update results quickly to encourage users to explore Johnsonvilles reach expands across North
data trends on devices such as tablets.
America and to about 30 additional countries.
Pricing Analyze retail point-of-sale activity in real time to optimize prices
and maximize revenue based on demand fluctuations and supply.
Even with its strong market posture, the
Product launches Collect data on new product sales to analyze sales trends and
anticipate future performance. company was spending 80 percent of its
Supply chain management Gain real-time visibility into inventory, tracking movement from report-building efforts on preparing data for
factory to store to consumer. analysis. Data was primarily historical in nature,
Manufacturing operations Analyze shop floor data to predict when machines will need with limited forward-looking or predictive
maintenance.
capabilities. Shop floor data was collected but
not queried, analyzed or combined in an
Benefits of beyond IT, as business leaders and managers efficient or standard manner. Promoting business
In-Memory transition from a mindset of making gut-based intelligence reports using advanced data visualization
Computing at decisions, based on decades of experience, to what was in its infancy. Viewed as a whole, the companys
Johnsonville Gilson calls fact-based decisions. analytics efforts were a collection of disconnected silos
} Improved query
that made it difficult to share information across
performance time
We get new insights when we can put different business functions.
} Positive executive
response to tablet-based people with different perspectives in front of our
visual data presentations data. That is what its all about: How can we An example is Johnsonvilles efforts to understand data
} Ability to meet business generate new insightsbecause insights are the about market demand, Gilson says: When we talk about
objectives, such as more catalyst for innovation, Gilson says. That can be a demand signals, we have different languages. Marketing
accurate sales forecasts
new product innovation; it can be a new service. It speaks in marketing speak. Supply chain speaks in
and marketing plans,
could be a new process innovation within our supply chain speak. Sales speaks in sales speak. Weve
optimized promotions,
visibility into competitive facilities or in our support groups. got to get rid of that. Unifying its approach to analytics
posture, increased agility means creating an integrated and harmonized view of
and responsiveness, and Throughout the CP industry, businesses are data, so everyone can examine the same data.
increased profitability harnessing new IT capabilities like real-time big data
analytics to pursue growth and innovation initiatives, The catalyst for investing in new IT capabilities was
notes the Boston Consulting Group (BCG). In a 2013 Johnsonvilles need to optimize its trade promotions
BCG study, 75 percent of CIOs at CP companies program. Timely tracking of its retail promotional activities
said a top IT objective was supporting business is essential to managing its relationships with retailers,
growth, compared with fewer than 20 percent in analyzing revenue and spending trends, and evaluating
2010. That said, the industry as a whole is still in the promotion effectiveness. This requires combining different
early stages of incorporating analytics into data sets to derive insights about sales, correlated with
operations, with most respondents piloting big data special offers like coupons and other retail promotions.
and advanced analytics projects and few having Until recently, it has been an extremely manual and
completed their implementations (see Figure 1, time-consuming effort to connect these dots in a way
Most Consumer Products Companies in Early that enables decision-makers to assess performance and
Analytics Stages). plan for the future.

Johnsonvilles Gilson says the company chose systems that enabled FIGURE 3 Better Decisions Through Data
Business it to modernize existing business intelligence and data Business drivers for investment in analytics
Challenges warehouse systems with the in-memory platform and include the following. (% responding)
} Optimize spending on relevant applications that collect and prepare data for Improving the quality of decision-making
trade promotions by 59%
analysis. Adding on to existing systems also enables
measuring results and
the IT staff to develop new skills in managing the Making quicker decisions
making adjustments in
systems. Other business use cases add to the 53%
real time to maximize
returns expected return on investment (see Figure 2, Improving planning and forecasting
} Create an integrated Analytics Vision). 47%
and harmonized view
of information across Developing new products, services and
Future Opportunities revenue streams
business functions
The first phase of the in-memory platform went live in 47%
} Enable decision-makers
to assess performance May 2014, and Gilson says early indications are
Source: IDG Enterprise Big Data Study, 2014. http://goo.gl/BNImWX
and plan for the future positive. He has seen performance improvements in
query times, and the new tablet-based visual data processes to design, build and deliver products and
Johnsonvilles presentations are popular among executives. services, Morris says.
Solutions
} Modernize existing
business intelligence
Johnsonville plans to build on these early successes, Picking Up Signals
and data warehouse using a more centralized approach to analytics. Johnsonville exemplifies these trends by working to
systems with real-time Establishing a harmonized data repository will enable speed the collection of market demand signals and
analytics, enabled by an the company to track retail point-of-sale data, as develop truly real-time capabilities. It can analyze
in-memory computing well as provide views into supply chain operations, product and promotion performance data by collecting
platform
such as shipments and inventory. Adding third-party market data from sales systems, retailers point-of-sale
} Centralize data in a
data sets, such as syndicated market data, will systems and syndicated research data. The analytics
harmonized repository
to track retail point-of- enable business analysts to gauge market trends. All platform lets Johnsonville test promotions, measure the
sale data and provide of these activities are tied to critical business results and improve execution to maximize returns.
views into supply chain objectives: improving sales forecasts and marketing They can continually fine-tune things, Morris says,
operations plans; optimizing promotions to occur at the right and make adjustments based on the outcome.
} Extend data visualization
time and value; simplifying and integrating market
to mobile devices
analysis and Johnsonvilles competitive posture; With Johnsonvilles program underway, Gilson says the
setting prices; increasing business agility and company believes in an all-in approach. Weve got to
responsiveness; and increasing profitability. be able to be generating these insights daily, bring them
through the innovation pipeline and execute on them.
Efforts at Johnsonville to inject more and better data This is a critical point, the CIO says. Its not about giving
more quickly into business decision-making are an elite few the opportunity to do the analysis and do the
emblematic of the real-time business and big data analytics and create insight. Its about every member in
analytics trend, says Henry Morris, senior vice Johnsonville on a daily basis, whether that is a small
president of worldwide software and services at IDC insight driven through some predictive analytics for
(see Figure 3, Better Decisions Through Data). maintenance, or some other transactional-oriented
Companies across industries are pursuing strategies analytics, or its in sales and marketing going after the big
to measure and improve the performance of wins. Really, its about orienting the entire organizations
business processes and to experiment with analytics on the future.
opportunities to cut costs or drive revenue, using
Michael S. Goldberg is a business and technology writer
data to assess value and make changes in real time.
and editor based in the Boston area.
Data analytics is being targeted at financial
processes, risk assessment, relationships and This research project was funded by a grant from SAP.

Kaeser Kompressoren SE at a glance

One of the largest providers of compressed air
systems and compressed air consulting services
in the world
Industry: industrial machinery & components

Headquarters: Coburg, Bayern, Germany
Year founded: 1919
Number of employees: 4,800 worldwide
Countries of operation: 91
www.kaeser.com
Source: Kaeser Kompressoren SE
Page 63
Kaeser Puts Customers First with

Big Data and Real-Time Business
The privately held German maker of air compressor systems and services taps predictive
maintenance to drive ROI and a better experience for its customers.
B Y L A U R E N G I B B O N S PA U L
Makers of heavy industrial goods arent exactly famous for their focus on the
Kaeser customer experience. But a leading maker of compressed air systems is trying to
Kompressoren SE
at a Glance change that perception. Family-owned since 1919, Kaeser Kompressoren SE is
Industry: Manufacturing
and services solutions improve after-sales service. The company
one of the largest providers of compressed air
Headquarters: Coburg,
systems and compressed air consulting services implemented a real-time business solution powered by
Bayern, Germany
Year founded: 1919 in the world. Its roughly 4,800 employees operate an in-memory computing platform, which is able to
Number of employees: in nearly 100 countries across the globe. analyze vast amounts of granular, real-time data
4,800 worldwide produced by a machine-to-machine (M2M) interface.
Countries of operation: 91 For a company that sells an industrial product in a This platform enables Kaeser to automatically monitor air
www.kaeser.com compressors in use at customer sites. Kaeser is hardly
business-to-business (B2B) environment, Kaeser
Source: Kaeser Kompressoren SE
is uncommonly focused on customers. The the only company using this technology: Companies are
companys Web site says its goal is to provide forecast to step up their investments in M2M technology
exceptional customer service coupled with over the medium term (see Figure 1, Global M2M
innovative products and progressive system Market Growth).
solutions. Privately held Kaeser stands out in
another way, as well, as the site makes clear: FIGURE 1 Global M2M Market Growth
You are doing business with a company with a Use of the technology that underlies predictive
maintenance, machine-to-machine communication,
family tradition of producing quality equipment,
will expand along with maintenance analytics.
not a company focused on meeting Wall Street (total annual revenues, M2M tech producers)
estimates. Thomas Kaeser is proud to put his
2011 $21.52 billion
name, his fathers name and his fathers fathers
name on every product.
2017 $85.96 billion

The Kaeser line of air compression systems
includes machines many have never heard of:
rotaryscrew compressors, vacuum packages, Source: MarketsandMarkets.com. http://goo.gl/l1QTsO
refrigerated and desiccant dryers and

condensate management systems, as well as The Kaeser system is capable of running analytics
portable compressors, filters andblowers. As against the vast amounts of M2M data generated from
important as the quality of those products is the systems sensors and meters, including energy
Kaesers commitment to after-sale service. consumption, operational status and compressed air
quality. The objective: to predict which equipment will
Predictive Maintenance need service, and when. Predictive analytics gives
Powered by Big Data customers the luxury of planning downtime and
In fact, Kaeser recently made a significant avoiding unexpected outages, which can cause
investment to harness the power of big data to grievous injury to the bottom line.
September 2014 | Copyright 2014. Bloomberg L.P. All rights reserved.

Kaeser Our customers simply cant afford any FIGURE 2 Advanced Maintenance Analytics to Rise
Kompressoren unplanned system downtime, noted Kaeser ABI Research forecasts predictive and prescriptive
Business Kompressoren AG CIO Falko Lameter in a maintenance analytics will dominate the analytics market
within five years. (advanced maintenance analytics
Challenges recent article.1 The companys predictive percentage of total analytics market)
} Make maintenance and
maintenance ensures that its superior products
other services offerings 23%
more cost-efficient
stay that way even after years of use. Our 2014
and more valuable to products are built for a lifetime, Lameter said.
customers But to get optimal longevity and performance,
} Streamline the supply 2019 60%
they must be maintained properly. Kaesers
chain real-time predictive maintenance services help
} Innovate through new
customers achieve nearly 100 percent reliability. Source: ABI Research. http://goo.gl/9oJm67
technologies and
business models
Crucially, customers no longer have to monitor breakdown gets to occur, so over time both
Kaeser their mission-critical air compressors around the parties can save money.
Kompressoren
clock. Kaeser handles that chore through its M2M
Solutions
} Implement a real-time interface, with resources on call to address issues Were always thinking of new ways to run things
business solution swiftly. The system has direct, M2M connections better and innovate new technologies and business
powered by an in- and real-time alerts, so potential failures can be models, Lameter explained. Case in point: Kaesers
memory computing detected before they occur, with corrective action transformation into a real-time business that puts the
platform to enable
undertaken before business is affected. customer at the center and focuses on delivering
automatic monitoring
solutions, not mere products. The services-based
of customer site air
compressors Lameter believes the addition of predictive analytics business model not only secures the companys
} Use predictive analytics for its equipment sets Kaeser apart from the market position and keeps it one step ahead of
to help customers plan competitiona belief that is driving investment increasing customer demands, it also improves
downtime and avoid across the business spectrum (see Figure 2, margins and revenues. In fact, total revenues from the
unexpected outages
Advanced Maintenance Analytics to Rise). sort of predictive analytics that Kaeser uses are
} Use an M2M interface
expected to grow sharply in coming years (see Figure
to monitor customers
mission-critical air ABI Research principal analyst Aapo Markkanen 3, A Growing Market).
compressors around the says the cost savings associated with the ability
clock, with resources on to predict equipment breakdowns before they occur Using real-time analytics, Kaeser can monitor
call to address issues is potentially huge, both for Kaeser (or any other keyparameters in real time, including power
swiftly
solutions manufacturer and service provider) consumption, operational availability andsafety or
} Establish a portal to
and its customers. From the manufacturers compressed air quality at each customer air station
accelerate problem
resolution and enable perspective, the key benefit is the ability to againstminimum and maximum allowed values.
customerservice transform a product business into a product- Service engineers can analyze thisreal-time data from
personnel to be more and-service business, he says. a portal without having to visit the customer site.
proactive and more Serving key data to the portal accelerates the
customer-oriented
Many manufacturers have been trying to do this resolution of any problem, keeping customer
for years, with their maintenance and other services operations reliableand efficient. With the
offerings, but what makes the difference here is comprehensive view that the portal provides,
that the combination of [M2M communication] and customerservice personnel have become more
analytics can make such services more cost- proactive and ever more customer-oriented.
efficient from the vendors point of view, as well as
more valuable from the customers point of view, What makes our predictive maintenance solution
Markkanen says. Maintenance is conducted only cutting-edge is its computationalcomplexity combined
1. http://goo.gl/VHzpWK when truly needed, he says, but still before a with the scale on which it operates, wrote Lameter in
2 Bloomberg
Bloomberg Businessweek
Businessweek Research
ResearchServices
Services
Benefits of a recent blog post.2 It collects thousandsof

FIGURE 3 A Growing Market
In-Memory real-time data streams from customer air stations; ABI Research forecasts worldwide maintenance
Computing analytics revenues for the next five years will top
big data scales into theterabyte range. We
$24 billion. (projected revenues from maintenance
at Kaeser collect, analyze and act upon that huge amount of analytics, CAGR: 22%)
Kompressoren dataas part of our routine operations.
} Improvedequipment $9.1 billion
uptime
2014
} Decreased time to The predictive maintenance portal handlesthese
problem resolution complexities while providing service engineers
} Reduced operational with user-friendly, Web-based and mobile access. 2019 $24.7 billion
risks As a result, the portal keeps Kaeser service
} Accelerated innovation
engineers fullyinformed of equipment status at Source: ABI Research. http://goo.gl/9oJm67
cycles
customer sites so they can provide a
} Better alignment
between Kaesers consistentlypositive customer experience. anddevelopment of our next-generation
products and services equipment, Lameter wrote.
and its customers The power and scale of the system provide a real
needs advantage. We had to harness the power of big This is an important benefit, Markkanen says.
data to remain at the vanguard of ourindustry in Manufacturers are able to study their products
the 21 Century, Lameter said recently. At the
st
behavior in the field more closely than what has
same time, the company simplified its software been possible before, so much of the analysis done
landscape by migrating its CRM application to a for maintenance purposes can be used to steer the
robust in-memory platform. The in-memory product development work, too, he says. If certain,
platform helped Kaeser accelerate its core previously hidden circumstances prove detrimental
business processes and achieveoperational to the product time and again, it may be possible to
excellence, he wrote. address them when designing the product.
Running on the in-memory platform, database In this way, product development can become more
response times are nowfive times faster than of an iterative process, with manufacturers
before. This has allowed us to bring the continuously learning about their products and
entirelifecycle of the sales process under careful improving them accordingly. All this can make a
scrutinyfrom lead management torequirements manufacturer like Kaeser more competitive in its
analysis, solution planning and solution market, Markkanen says.
implementation. And withreal-time information,
we have streamlined our supply chain to deliver The big data and in-memory platform that form the
oncustomers changing needs while generating basis of Kaesers predictive maintenance service have
healthy margins, Lameter wrote in the blog post. produced substantial benefits for the nearly 100-year-
old company. According to Lameter, We are seeing
Aligning Product Development with improveduptime of equipment, decreased time to
Customer Needs resolution, reduced operational risks andaccelerated
The predictive maintenance system has had a innovation cycles. Most importantly, we have been able
significant, unforeseen side effect. Stored in to align ourproducts and services more closely with
Kaeser datacenters, the big dataculled from our customers needs.
monitoring machine operations forms the basis for
Lauren Gibbons Paul has written extensively on
sophisticated data analysis, including insights
customer relationship management and customer
relating to new product development. This helps experience management for more than 15 years.
us further optimize ourservice processes and
2. http://goo.gl/iyjdoy furnishes highly valuable input for the research This research project was funded by a grant from SAP.

Maple Leaf Foods at a glance

A leading CP company that specializes in meat and
bakery products as well as agribusiness
Headquarters: Toronto, Canada
Founded: 1991
2012 revenues: $4.9 billion (Canadian)
Employees: 1,200
www.mapleleaf.ca
Source: Maple Leaf Foods
Page 67
Maple Leaf Foods Turns Over a New

Leaf with Up-to-the-Minute Insights
Real-time business enables Maple Leaf Foods to keep pace with fast-changing market conditions,
increase profitability and hone a competitive edge.
BY JOE MULLICH
I n a world that moves at Internet speed, consumer products (CP) companies

face a particular challenge in responding to fast-changing tastes. And taste is
literally the issue for Maple Leaf Foods, a leading CP company that specializes in
Maple Leaf Foods meat and bakery products, headquartered in Toronto. Product pricing is also a
at a Glance
Industry: Bakery, meat, make-or-break issue, with ever-fluctuating FIGURE 1 Three Core Businesses
agribusiness consumer demand and commodity prices. Maple Leaf Foods is organized into three
Headquarters: Toronto, major groups.
Because its primary products have extremely short
Canada
shelf lives (see Figure 1, Three Core Businesses), Meat Products Bakery Products Agribusiness
Founded: 1991 Products
Revenues (2012): $4.9 Maple Leaf needs to move swiftly to ensure its new
billion (Canadian) product introductions, marketing and pricing Packaged Premium fresh, Hog production
Employees: 1,200 strategies will translate into sales, profits and meats and frozen and
meals specialty bakery
www.mapleleaf.ca customer satisfaction. products
To meet these challenges, Maple Leaf needed a Fresh pork, Fresh pasta and Rendering and
poultry sauces biodiesel
real-time understanding of its complex business
and turkey operations
operations. Over the years, the company has products
grown through dozens of acquisitions, leaving it
with a multitude of systems. That is why, about five
years ago, Maple Leaf launched an initiative to Number One in Many Markets
coordinate its diverse data volumes and is now Open a cupboard or refrigerator in the typical
embracing in-memory computingtechnology that Canadian home, and you are likely to findMaple Leaf,
enables multiple sources of data to be rapidly and Schneiders, Dempsters or one of the companys other
easily analyzed. brands. Maple Leaf Foods ranks number one in market
share in many Canadian food categories, including
The companys efforts have resulted in integrated fresh bakery products, branded prepared meats,
analytics across business functions and chilled ready-made meals, branded fresh poultry, and
instantaneous insights to support real-time fresh pasta and sauce. Additionally, the company has
decision-making. This is a critical issue for many operations in the United States, the United Kingdom,
CP companies, which need to respond quickly to Asia and Mexico. To stay ahead of the competition,
rapidly changing market conditions. Ultimately, Maple Leaf introduces 100 or more new products
the big piece is profitable growth so we can every year, such as its Maple Leaf Natural Selections,
actually understand whats happening in the a line of deli meats that contain no added
marketplace quickly and secure more profitable preservatives, artificial ingredients, fillers or MSG.
1. Canadian Financial Executives

growth as a result, said Michael Correa, vice
Research Foundation. Real Time president, Information Solutions, at Maple Leaf Although an acquisition spree was key to Maple Leafs
Business: Making The Most Of Big
Data. 2012. http://goo.gl/TujxFE. Foods.1 growth, it also left the company with 65 plants and 35

Benefits of Real- enterprise resource planning (ERP) systems. Because this meant consolidating its data into a single ERP
Time Business at of the difficulty connecting information among these system, enabling integrated analytics across business
Maple Leaf Foods isolated systems, Maple Leaf relied on weekly functions and developing the ability to analyze its data in
} Standardized view summaries of business performance data, which real time. The first move in this direction began in 2008,
across the enterprise: when Maple Leaf launched Project LeapFrog, in which it
hampered its ability to respond to fluctuations in supply
System consolidation
and demand. In addition, business users were unable consolidated its many ERP systems and implemented
and process
standardization have led to easily drill down into reports to truly understand the common business processes across the organization.
to improved operations supply and demand of individual products.
through the use of A big part of the business is proteinpoultry, hog and
in-memory analytics for These issues grew particularly acute between 2009 prepared meatsand each had their own way of doing
management. work, Hutchinson said. And if you go over to the bakery
and 2011, when the Canadian dollar appreciated
} Faster analysis
by 50 percent, resulting in Maple Leaf operating at side, like Dempsters or frozen foods, each of them ran
speeds: Business users
are experiencing speeds a cost gap of 15 percent to 25 percent versus its almost every process internally their own way.3
that are 100 to 1,000 U.S. competitors. If [Maple Leaf is] going to grow,
times faster than with it cant rely on the exchange of the U.S. dollar, An important data source that Maple Leaf needed to
traditional databases. said Dr. E. Jeffrey Hutchinson, global CIO of Maple integrate with its internal systems was the fluctuating
} Self-service: Users can market prices for hogs and hams, Correa said, which
Leaf Foods. If its going to compete against the
now run their own ad
U.S. and European players, it needs the right can change throughout the day. Because the company
hoc queries and reports.
} Real-time pricing capabilities in house. 2
trades such products on the mercantile exchange, he
analysis: Maple Leaf said, Were looking at real-time, live information.
will be able to price Building the Analytics Foundation Maple Leaf needs to combine supply and demand
products based on the As the competitive landscape toughened, the information from its transactional systems with data
cost fluctuations of raw generated by the marketplace to enable real-time
company realized it needed a better handle on its
materials by combining
cross-organizational performance. For Maple Leaf, pricing analysis.
syndicated data with
supply and demand
information from
transactional systems.
FIGURE 2 Most CP Companies in Early Analytics Stages
(adoption rates of new technologies, %)
} Future use cases: The
company is evaluating Completed Implementing Piloting or budgeting No plans
the use of in-memory
100 4% 7% 4% 4%
analytics for recipe 26% 11%
development, demand 90 44% 33% 19%
45%
planning, production 67%
planning and trade 80
48% 55%
promotion to help it 70
further improve decisions
60 44%
and profitability.
50 15%
41%
40
37%
30
22%
20 22% 22%
19%
2. Schick, Shane. Maple Leaf 10
Foods ERP system project: A CIO 7%
strategy. IT World Canada, April 0 4%
18, 2011. http://goo.gl/8daaTX.
Software as a Digital media Mobile Social network Advanced Big data
3. Schick, Shane. Maple Leaf
Foods ERP system project: A CIO service (SaaS) platforms collaboration analytics
strategy. IT World Canada, April Base: 27 leading CP companies
18, 2011. http://goo.gl/8daaTX. Source: Grocery Manufacturers Association and The Boston Consulting Group, 2013. http://goo.gl/dFnylX

Maple Leaf To enable real-time insights and provide employees FIGURE 3 Better Decisions Through Data
Foods Business with a range of analytics tools, Maple Leaf Business drivers for investment in analytics
Challenges embraced in-memory computing. Its first in-memory include the following. (% responding)
} Real-time information project focused on customer data that contributes Improving the quality of decision-making
and analytics were to profitability, such as profit and loss, price 59%
required to optimize
elasticity, and sales and marketing data, all of which
product pricing and Making quicker decisions
enable other business
amounted to about one terabyte of data. Although 53%
performance insights. Maple Leaf had used analytics for more than a
} Data needed to be decade, in-memory computing enables the Improving planning and forecasting
consolidated from 35 47%
company to ask entirely new questions; for example,
ERP systems. How should products be priced tomorrow in line Developing new products, services and
} Processes needed to be
with supply and demand? revenue streams
standardized across the
47%
enterprise.
} Business users needed The In-Memory Edge Source: IDG Enterprise Big Data Study, 2014. http://goo.gl/BNImWX
the ability to drill down The ability to answer such questions through
into reports. analytics puts Maple Leaf ahead of the pack. databases.5 For example, profit-and-loss analysis previously
According to a late 2013 study by the Grocery required 15 to 18 minutes, but it now takes 15 to 18
Maple Leaf Foods Manufacturers Association and The Boston seconds with in-memory computing, according to Correa.6
Solutions
} Consolidated systems
Consulting Group, only 23 percent of CP The in-memory computing system has also enabled a
and standardized companies had implemented or completed an self-service data platform on which users can run ad hoc
processes advanced analytics initiative (see Figure 2, Most queries and reports (see Figure 3, Better Decisions
} In-memory technology CP Companies in Early Analytics Stages). Through Data).
to provide instantaneous
analysis of disparate data
And according to Lora Cecere, head of research The use of in-memory computing has simplified Maple
} Analysis and visualization
tools for hundreds of
firm Supply Chain Insights, only a small percentage Leafs business rules, processes and data, removing
users of companies are satisfied with their what-if complexity and enabling collaboration. Business users
capabilities and few can easily determine the can create more reports and queries, rather than
profitability of decisions. They need more real-time relying on the old system of canned reports. At the
monitoring, dashboards, early-warning systems and same time, the company has achieved a standardized
other imperatives that can only be accomplished view across the enterprise, enabling it to better
through smarter use of analytics, she said. manage its operations.
In Maple Leafs case, such insights could potentially As Maple Leaf begins using predictive analytics supported
4. Schick, Shane. Maple Leaf guide the company on product introductions, as by in-memory computing, it plans to price products based
Foods ERP system project: A CIO
strategy. IT World Canada, April well. Well start to see what the reality is and be on the cost fluctuations of raw materialssuch as wheat,
18, 2011. http://goo.gl/8daaTX.
5. Yuhanna, Noel, Holger Kisker,
much faster at adjusting to market conditions as pork and chickenand combine this information with
Ph.D. and David Murphy. Case they change, Hutchinson said. Well be able to syndicated data from sources like Nielsen to obtain
Study: Maple Leaf Foods Relies
On SAP HANA To Enable Faster make sure that our trade promotion monies, for real-time pricing information. The company is also
Business Analytics. Forrester
Research, Oct. 28, 2013. example, are giving us what we want to get out of evaluating many new use cases, such as recipe
http://goo.gl/QGBfXt.
6. Henschen, Doug. Oracle
them. Too often, unless you are very proactive there, development, demand planning, production planning and
In-Memory Apps: Hunting Hana. it just becomes a slush fund.4 trade promotion to help it improve decisions and
InformationWeek, April 11, 2013.
http://goo.gl/nGvZns. profitability even further.7
7. Yuhanna, Noel, Holger Kisker,
Ph.D. and David Murphy. Case In early 2012, Maple Leaf extended its real-time
Study: Maple Leaf Foods Relies Joe Mullich is a freelance business and technology writer
On SAP HANA To Enable Faster
analytics capabilities to 800 business users. In some
based in Sherman Oakes, Calif.
Business Analytics. Forrester cases, business users experienced speeds that were
Research, Oct. 28, 2013.
http://goo.gl/QGBfXt. 100 to 1,000 times faster than with traditional This research project was funded by a grant from SAP.

Mercedes-AMG at a glance
The performance unit of Mercedes-Benz, it tests the
limits of driving dynamics and performance with
hand-built engines
Industry: automotive
Parent company: Daimler AG
Headquarters: Affalterbach, Germany
Founded: 1967
Employees: approximately 900
www.mercedes-amg.com
Source: Mercedes-AMG
Page 71
CASE STUDY
Technology Small/Midsize Marketing
Business & Sales
Mercedes-AMG: A Showcase for

Real-Time Business Decisions
M
The maker
Y28 K28 C78 M52 Y28 K6 C73 M19 Y40 K1 ercedes-AMG
C65 M29 Y79 K22 C61 M20 is
Y78the
K3 performance Figure 1 Analytics Offers Relief From
unit of Mercedes-Benz, testing the
Operational Pressures
of high- Need to reduce the cost of manufacturing operations
limits of driving dynamics and performance
performance 70%
with its hand-built engines. But the division
automobiles is Need to improve delivery of new products to market
is also a testing ground for revving up 38%
building next- Management of global supply chains
C0 M60 Y100 K17 C28 M88 Y70 K19 C48 M89real-time
Y84 K49 C61business performance.
M66 Y61 K52
generation 36%
manufacturing As manufacturers integrate complex machinery

Management of demand volatility
32%
operations on with networked sensors to create next-generation
Customer mandates for improved order fulfillment
production processes, they are gathering more data
a real-time than ever before that could eliminate waste and
27%
Source: Aberdeen Group, Big Data in Manufacturing Operations,
business improve efficiency, according to the U.S. National 2012. http://goo.gl/E43v5f
Cutting costs is a top reason for seeking more

platform. Institute of Standards and Technology. In fact, 1
insight from data.
pressure to cut costs while bringing new products
BY ST E P H A N I E to market is pushing manufacturers to make better
OV E R BY
use of that data, the Aberdeen Group has found cars, such as its million-dollar S-class line and the
(see Figure 1, Analytics Offers Relief From new GLA compact SUVs, but also invested in more
Operational Pressures). efficient manufacturing processes to cut the cost of
product delivery and improve vehicle quality.
In the automotive industry, manufacturers must Daimler saw Mercedes-AMG as the perfect place to
manage a greater number of both models and test out real-time systems that might benefit the
customization options as they adjust to fragmented larger enterprise.
consumer demand, while also managing shorter
product life cycles, according to McKinsey and Employees working in the performance units
Company (see Figure 2, More Product Options, engineering-focused manufacturing environment
Shorter Product Cycles). To make the best use of have yearned for real-time access to information for
their data riches as they tackle these challenges, nearly 50 years, observes Dirk Zeller, Mercedes-AMG
companies are implementing technology capable of head of IT Consulting. In addition, Mercedes-AMG
analyzing large volumes of data from disparate operations are concentrated at the companys
1. National Institute of Standards
and Technology. Real-Time
sources in real time. Affalterbach, Germany, headquarters. We have
Data Analytics for Smart everything close to us, from design and development
Manufacturing Systems Project.
http://goo.gl/KZ9nzW. Mercedes-AMG and its parent company, Daimler to marketing and sales, making us a good company
AG, are among the businesses that are expanding to test out innovation, with regards to the products
their product portfolios. Daimler is currently one of as well as in the IT area, Zeller says.
the largest producers of premium cars and the
AUGUST 2014 biggest global manufacturer of commercial LESS WAITING, MORE WORKING
Copyright 2014. vehicles. To increase market share and profits, the In late 2012, Mercedes-AMG began to deploy an
Forbes Insights. 118 billion company has not only introduced new in-memory platform across business functions to
All rights reserved.
FORBES INSIGHTS 1
FORBES
INSIGHTS
CASE STUDY
analyze large volumes of data in real time. The Figure 2 More Product Options, Shorter
company started with back-office systems, such as Product Cycles
accounting and finance, and then moved on to its Number of models Avreage product life cycle (months)
core operationsthe development and manufacture 131
122
of its one-of-a-kind vehicles. 111 110
106
100
Ultimately, The first goals were to be more efficient by

crunching numbers faster, says Mercedes-AMG CIO
Mercedes- 44
Reinhard Breyer. Company leaders saw an 32 30
AMG is 22
15
opportunity to free financial analysts from waiting 12
considering for reports and enable them to focus on strategic
2002 2011 2002 2011 2002 2011
simplification analysis and decision-making. BMW Audi Mercedes-Benz
of the Source: McKinsey & Company, Manufacturing the Future:
The Next Era of Global Growth and Innovation, 2012. http://goo.gl/EcQ6tq
hundreds of But a faster, more efficient back office was just a start. A greater number of models and options and shorter
The key to becoming a real-time enterprise is not product life cycles challenge automakers.
systems it
delivering more data quickly, its more quickly
uses to
delivering information that can improve the processes equipment, and efficient use of the facilities was a
engineer, sell
that lead to competitive advantage. For Mercedes- priority. The ability to correlate historical test data in
and service AMG and Daimler, these are product development and real time with sensor data from the engines being
cars to run on manufacturing processes. tested enables engineers to identify possible
a single, problems more quickly.
in-memory Real-time efforts are useless if they arent aligned,
platform. says Behnam Tabrizi, consulting professor at We are able to analyze test data from engines and
Stanford Universitys department of management test vehicles faster than before, Zeller says. And that
science and engineering. If you throw new leads to more insights faster, as we compare more
technology at a bad process, you wont resolve data and use complex analytics without losing time.
anything. Its not just about real-time systems, its
about real-time organizational transformation. Now an engine test that shows unusual behavior can
be stopped at any step of the test procedure;
A NEW WAY TO TEST ENGINES engineers used to have to wait to analyze the majority
Even today, every Mercedes-AMG engine is hand of data until after the hour-long test run has ended.
built from start to finish by a master engine builder: That change, in turn, creates more engine-testing
its a hallmark of the brand. But company leaders capacity each week. It also gives engineers more time
recognized an opportunity to use big data analytics to focus on refining engine quality.
to also improve the engine production process.
When they went looking for the next high-value area A PLATFORM FOR REAL-TIME
to transform the company using real-time TRANSFORMATION
applications, they zeroed in on quality assurance Whats more, Mercedes-AMG now has a scalable
for its engines. platform that it can apply to other areas of its
business, and which Daimler can begin to apply
Earlier this year, Mercedes-AMG piloted a real-time across the enterprise. Both Mercedes-AMG and
quality assurance platform that harnesses predictive Daimler are expanding their vehicle lines, and thus
analytics to optimize engine-testing processes when the number of projects they must manage.
manufacturing its vehicles. The dynamometers the Mercedes-AMG has already introduced three new
company uses to determine the torque or power compact models in pursuit of new market segments.
characteristics of engines being tested are high-cost
2 FORBES INSIGHTS
FORBES
INSIGHTS
CASE STUDY
The company is also enabling car buyers to FIGURE 3 Delivering Real-Time Supplier Data
customize their vehicles more than ever before.
Customer information
The strategy seems to be working: in 2013 Mercedes
46%
AMG sold more than 32,000 automobiles, its most
Employee data
successful year ever.
46%
Product data
We are able to The project expansion and growth could strain
42%
analyze test existing project management processes, so
Supplier information
data from Mercedes-AMG leaders have begun exploring how
23%
engines and test the same data analysis and predictive functionality
Source: Accenture, High Performance in IT: Defined By Digital, 2013.
can be applied to engine testing for project
vehicles http://goo.gl/7cc4KM
management. The goal is to be able to visualize in Among top-performing companies, nearly half provide customer
dramatically and employee data to employees in the moment, but less than a
real time how the product creation and engineering
faster than process is progressing and to predict potential
quarter can do the same with supplier information.
before. bottlenecks, such as supplier delays, before they

Dirk Zeller, impact manufacturing ramp-up. who will be consuming the data and what they need to
head of IT know. Business leaders and managers shouldnt become
Consulting, Both Mercedes-AMG and parent company Daimler overwhelmed by the amount of data available to them,
Mercedes-AMG anticipate benefits beyond managing an individual Zeller advises. The concern is similar to that which
project more efficiently. They want to take accompanied the introduction of email, Zeller recalls.
advantage of real-time analytics to give employees People felt disturbed by too many alerts, tending to
who work across several projects, such as those with ignore them over time, he says. During our projects,
a focus on braking systems, visibility across all we need to define if our target audience is prepared for
projects, so they can see if a new part is in time, the solutions were offering.
quality and budget during the engineering process,
if it is available for testing or inventories are low. Daimlers IT group recently awarded Mercedes-AMG
several innovation awards for the testing and
Even among top-performing companies, access to implementation of its real-time systems. The parent
such supplier intelligence in real time is relatively company will be using the performance units
rare. Less than one-quarter of leading enterprises experience and lessons learned as the basis for its
can provide up-to-the-minute supplier data to their planned implementation of in-memory analytics.
employees (see Figure 3, Delivering Real-Time Theyre the trigger that started us on this path, Zeller
Supplier Data). Mercedes-AMG, however, plans to says. And we had a huge will to innovate.
be the exception.
The goal is to have new business intelligence ABOUT FORBES INSIGHTS

software running on the in-memory databases by Forbes Insights is the strategic research and thought leadership
practice of Forbes Media, publisher of Forbes magazine and Forbes.
the end of the year, and then to release new
com, whose combined media properties reach nearly 50 million
functionality every two months. We are working business decision-makers worldwide on a monthly basis.
very closely with our business partners to deliver Bruce Rogers
CHIEF INSIGHTS OFFICER
exactly what is needed in an easy-to-use user
Brian McLeod
experience, Zeller says.
DIRECTOR, NORTH AMERICA
Writer: Stephanie Overby is a freelance business and technology
One key to success when deploying real-time writer based in Boston.
capabilities is gaining a deep understanding about
FORBES INSIGHTS 3
National Football League at a Glance

A professional U.S. football league that runs a
17-week regular season
Industry: sports & entertainment
Headquarters: New York, New York
Employees: 1,100
Founded: 1920
Number of Teams: 32
Viewership: 205 million people tuned
in to NFL games in 2013
www.nfl.com
Source: National Football League
Page 75
The NFLs Advanced Analytics

Score with Football Fans
Looking to spur fan engagement, the National Football League is putting user-friendly data analytics
tools in the hands of fantasy football fanatics.
BY STEPHANIE OVERBY
P rofessional football is Americas true national pastime. Viewership of NFL

games has grown steadily over the past decade. During the 2013
football season, NFL games attracted three times more eyeballs than other
The National
Football League primetime TV offerings, and 34 of the 35 most- FIGURE 1 NFLs Gameday TV Viewership
at a Glance watched TV shows in autumn 2013 were NFL games Gameday outdraws the leading primetime
Industry: Sports and (see Figure 1, NFLs Gameday TV Viewership). broadcast television shows. (average in millions of viewers)
entertainment NFL broadcast Primetime broadcast
NFL league office 2009
But if regular viewers of NFL games on Sunday,
employees: 1,100 18.4
Monday or Thursday nights are considered fans,
Founded: 1920 8.5
Number of teams: 32 those who participate in the NFL-inspired fantasy
Viewership: 205 million football leagues might better be deemed fanatics. The 2010
people tuned in to NFL fantasy teams that individuals put together might be
20.0
games in 2013
8.2
imaginary, but the process of managing a franchise is
www.NFL.com very real for them. When Tom Brady throws that 2011
Source: National Football League
touchdown pass, its six points for the New England 19.8
8.1
Patriots, says Daniel Shlossman, the NFLs director of
product for fantasy football and mobile games. But if 2012
Im playing Tom Brady, its also six points for my 19.3
fantasy team. 7.6
2013
This year, there will be 41 million fantasy players 20.3
across all sports, nearly 70 percent of whom say that 7.0
football is their favorite, according to the Fantasy Sources: NFL and The Nielsen Company. http://goo.gl/nGSRhN
Sports Trade Association (FSTA), with their ranks
increasing at least 10 percent every year. Around So when the NFL was looking for new ways to use
three-quarters of fantasy football participants use four data to maximize the engagement of football fans, the
or more Web sites for research. They spend nearly 18 fantasy market was a logical target. In addition to the
hours a week consuming sports content and more direct revenues that fantasy league participation
than 8.5 hours a week specifically on their fantasy generates, fantasy league members view about seven
teams, FSTA says (see Figure 2, Fantasy Sports times more content, including text, video and data, on
Users Are Active Fans). NFL.com than nonmembers. The NFL has its own
fantasy sportswriters online, and NFL.com is chock
full of key breaking news, expert analysis and
weekly rankings to help fantasy managers develop
their teams.
OCTOBER 2014 | Copyright 2014. Bloomberg L.P. All rights reserved.

The NFLs Player There has been no shortage of companies looking to FIGURE 2 Fantasy Sports Users Are
Comparison Tool be the preferred destination for fantasy footballers. Active Fans
Challenges The NFL launched its own fantasy football league on
} Increase direct There are 36.6 million fantasy users across all
NFL.com in 2010 and has sprinted into a position sports.
engagement with
among the leaders. 69% of fantasy users say football is their favorite
fantasy football users
fantasy sport.
by developing a player
comparison tool for In 2011, the league introduced in-game video, The universe of fantasy users is growing at a rate
delivering big-play highlights to viewers only seconds of 10% to 12% annually.
NFL.com
} Create a simple user after they happen on the field. In 2012, it added more 74% of fantasy users go to four or more Web
sites to conduct research.
interface that enables functionality, such as social tools and basic research
users to easily make Fantasy users dedicate 17.89 hours a week to
tools, along with simpler fantasy football games to lure watching sports.
better decisions about
in the novice or casual user. The league also Fantasy users spent 8.67 hours a week
their fantasy teams
incentivizes participation in its own fantasy leagues by specifically on fantasy sports.
} Enable customization so
that the tool is equally awarding prizes for league champions, such as trips Sources: Fantasy Sports Trade Association
valuable to novices and to the Super Bowl (see Figure 3, The ROI of
experts Customer Engagement). We are leveraging a custom cloud platform to answer
} Ensure that the online
very fantasy football-centric questions, Shlossman says.
tool is scalable and
Last year, as new, more advanced tools for data Which player should I start? Whos going to perform
reliable, with 100 percent
uptime analysis and visualization became available, the NFL better in a certain environment? Fans are wanting an
saw an opportunity to further fuel its captive fantasy answer very quickly that they can understand.
Elements of the contingent. In 2013, we wanted to focus on the
NFLs Player data, Shlossman says. We wanted to make it The tool uses 10 years of historical information to make
Comparison Tool simpler to understand the data, make it easier to play predictions about player performance so that fantasy
Solution
fantasy football and grow that market. franchise owners can make data-driven decisions
} Deploy the tool on an
in-memory analytics about their teams. They can analyze and track more
platform in the cloud to Putting Big Data in Customers Hands than 100 stats on each player, from team defense
ensure real-time As is the case with any statistics-generating sports tendencies to home-and-away performance
processing, scalability organization, the NFL has for years been collecting comparisons. The tool also incorporates variables
and reliability
and analyzing what is now commonly known as big ranging from the forecast weather at kick-off time to
} Utilize self-service data
data. But that activity has taken on a sharper focus playing surface to injury reports. Historical and real-time
visualization software to
deliver player analysis in in recent years. We are able to use our own data from live games is fed into a statistical model that
a user-friendly format exclusive content, data and statistics to increase predicts player performance.
} Enable users of the tool the fantasy market, Shlossman says. The league
to customize player wants fantasy players to compete on NFL.com. There are lots of things we can do with the data to break
analysis along five
But, he adds, at the end of the day, we want fans it down at a very detailed level, Shlossman says. Its all
dimensions:
playing fantasy football because it brings them about the live data and understanding who the players
performance, matchup,
consistency, upside and closer to the game. are and who the best players are for me to play in my
intangibles fantasy team.
The question was, how do you bring a tremendous
volume of data and statistics to fans in a very A Tool for Rookies and Veterans
simplified, intuitive and highly visual way? says Vishal The behind-the-scenes number-crunching that delivers
Shah, the NFLs vice president for digital media player comparisons is very complex, but the user
business development. The NFL used the same interface had to be simple, Shah says, and the tool had
in-memory analytics platform and data visualization to work for the fantasy rookie and the fantasy pro. The
software that businesses deploy to gain a competitive NFL wanted a tool that was just as valuable for someone
edge in their industries for its Player Comparison Tool. who has been fielding fantasy teams for 15 years as it

At the end was to someone who has never done it before. A FIGURE 3 The ROI of Customer
tool that works for both markets was the goal, Engagement
of the day, Shlossman says.
we want A fully engaged customer represents an
average 23% premium in terms of share of
Throughout the week, a fantasy football user typically
fans playing wallet, profitability, revenue and relationship growth
makes three types of decisions: whom to start, whom
compared with the average customer.
fantasy to add or drop, and whom to trade. The tool can
An actively disengaged customer represents
football guide users through all three types of scenarios,
a 13% discount in terms of share of wallet,
enabling them, say, to evaluate a rival users proposed
because it profitability, revenue and relationship growth
trade or whether to start a particular quarterback. compared with the average customer.
brings them
Source: Gallup. http://goo.gl/mdjf2A
closer to the Novice users can keep it simple and do a basic
head-to-head comparison, say, between starting the
game. Houston Texans Andre Johnson or the Denver Stability and Scale on Any Given Sunday
DANIEL Broncos Wes Welker at receiver. The two are very For any fan-facing system, the NFL requires 100 percent
SHLOSSMAN, different players. Welker is consistent, catching short uptime. Thats quite a challenge for a pursuit that
DIRECTOR OF
passes over the middle of the field and delivering involves millions of users hitting the system at the same
PRODUCT FOR
FA N TA S Y F O O T B A L L steady fantasy points. Johnson is known for streaking timejust before kick-off. Were a direct-to-consumer
AND MOBILE GAMES, down the edge of the field and reeling in the long, business, Shlossman says. [The tool must] scale to
NFL rainbow passes that can end in a touchdown. The millions of users who want to access this data at any
tool kicks back a simple-to-read answer about who given moment.
is recommended in a head-to-head decision,
Shlossman says. The NFL chose to host the Player Comparison Tool in the
cloud for flexibility and stability. Everything we build has
More experienced users can drill down for a more to be best in class, Shlossman says. We get to very,
nuanced analysis of potential performance in the very high load levels on Sundays and other peak
specific gamehow each player performs in snow, periodsthousands of requests per second on the
for example, or against a certain defensive back. platform as people make last-minute changes to their
lineups. We had to build a tool that not only utilized all of
Rather than rely on one-size-fits-all rankings, users this data but was also accessible and performed well at
can easily customize the tool by tweaking how much the most crucial moment for fans, which is right before
weight to place on five different variables: game time.
performance, matchup, consistency, upside and
intangibles. If users decide they need a big week, The NFLs fantasy apps show how consumers as well as
theyll turn up the volume on the upside and turn businesses can reap the value of real-time analytics,
down the consistency dial. opening up a whole new spectrum of consumer-grade
tools beyond fantasy sports. Just remember, Shah says,
Users come in and add their own spice to it, to make the tools immersive and fun. Thats what
Shlossman says. They can adjust the sliders if they attracts the fans and hopefully keeps them on our
want big points and get one result, or tweak it and get platform for longer periods of time.
something else. The leagues fantasy site also
features mixes of variables devised by each of the Stephanie Overby is a freelance business and
NFLs own fantasy experts, which managers can use technology writer based in Boston.
at home.
This research project was funded by a grant from SAP.

Nomura Research Institute at a glance

Japans largest consulting and IT consulting firm
Industry: high tech
Business activities: Consulting, financial IT solutions,
industrial IT solutions, IT platform services
Established: April 1, 1965
Headquarters: Tokyo, Japan
Capital: 18.6 billion yen
2012 sales: 363.8 billion yen
Employees: 5,823 (NRI Group 7,738)
www.nri.co.jp/
Source: Nomura Research Institute
Page 79
Tokyo Drivers Avoid Traffic Jams with

NRIs Big Data and Analytics
With in-memory computing and big data behind it, Japans popular Zenryoku Annai! application is
helping drivers get to their destinations faster and more efficientlyboth day and night.
BY JOE MULLICH
T okyos first taxicabs appeared a century ago. Now, about a quarter million of them service the
metropolitan area and beyond. For Nomura Research Institute (NRI), Japans largest consulting
and IT consulting firm, all these vehicles crisscrossing the nation represent a huge wealth of information
and clues about how to break gridlock in one of the

Nomura Research Traffic Data Jam in Japan
worlds most densely populated countries.
Institute at a }C hallenge: 360 million data records of Japanese
Glance traffic information needed to be analyzed more
} Business activities: NRI is analyzing traffic jams in Japan using multiple quickly than the several minutes required by
Consulting, financial IT sources, including traffic data from sensors around the traditional relational database technology.
solutions, industrial IT
country and location data from 12,000 taxicabs. What } Solution: In-memory computing, which can
solutions, IT platform
services enables NRI to keep up with the massive data flow is analyze large amounts of data quickly, was able
to process the 360 million records in just over
} Established: April 1, 1965 the use of in-memory computing technology, which can
one second.
} Headquarters: Tokyo, process reams of different data types in real time for
Japan instant analysis.1
} Capital: 18.6 billion yen
Japan can plot out the shortest travel routes, avoid traffic
} Sales: 363.8 billion yen
(fiscal 2012, ending Not too long ago, NRI relied on more traditional snarls and estimate what time they will arrive at their
March 31, 2013) technologies. But the database component, in particular, destinations.4
} Employees: 5,823 (NRI became a stumbling block for this application. According
Group 7,738)
to Hiroshi Terada, NRIs general manager for ERP Zenryoku Annai! combines information from satellite
www.nri.co.jp/
solutions, An ordinary relational database took several navigation systems linked to sensors at fixed locations
Source: Nomura Research Institute
minutes to analyze the 360 million traffic records and we along roads with traffic data determined through
had problems with real-time data processing.2 statistical analysis on position and speed information
from subscribers, moving vehicles and even pedestrians.5
After NRI implemented in-memory computing technology, Meanwhile, data from thousands of taxicabs is added
it was able to analyze the millions of records in just over to the mix. Using all this information, Zenryoku Annai!
one second. The speed this enables is sudden and analyzes road conditions and helps drivers plan routes
significant, and has the potential to transform entire more accurately and over a wider range than is possible
business models, says Akihiko Nakamura, corporate with conventional GPS systems.
1. SAP. NRI: HANA. Customer senior vice president, Services and Industrial Solution
Testimonial Video. http://goo.gl/gat2AC
2. SAP. NongFu Spring: Accelerating Division, at NRI.3 As the number of users of our Zenryoku Annai! service
performance with SAP HANA. Customer
Testimonial. http://goo.gl/MAQgp1 continues to grow, so too does the amount of position
3. Ashford, Warwick. SAP highlights
customer experiences of in-memory New Business from Big Data and speed data collected. Accordingly, we must now
computing at Sapphire Now.
ComputerWeekly.com, May 19, 2011. NRI is a leading example of how to find huge benefits process this data faster than ever before, says Aritaka
http://goo.gl/gsGp5e
4. Pai, Suraj. Guest Blog: How to from big data, the term given to data that comes in Masuda, general manager of NRIs Ubiqlink Department,
run an intelligent business. CIO Asia,
September 14, 2012. http://goo.gl/btFQrt large volumes, variety and velocity. Thanks to big data, which is responsible for gathering the traffic information.6
5., 6. Intel. Not limited to ERP
applications alone, the Intel Xeon NRI has leveraged its research and traffic analysis
processor E7 family also provides new
business opportunities via in-memory expertise to develop a widely used service called Masuda says in-memory computing tests have confirmed
technology. Case study, 2011.
http://goo.gl/6nZC9m Zenryoku Annai!. Using this service, subscribers all over that 360 million data points can be processed in just over

one second. The technology has improved search speed by

a factor of more than 1,800 over the departments previous The Price of Traffic Congestion in the
relational database management system. United States in 2012
}T otal Cost: $121 billion
} Wasted Fuel: 2.9 billion gallons
Besides the big boost in speed, NRI found that in-
}C O2 Emissions: 56 billion pounds
memory computing helps simplify the programming
needed to solve a complex analytical challenge and
Source: Texas A&M Transportation Institute15
Tokyo at a Glance somewhat counterintuitivelyhas even reduced the
}P opulation: 13.2 amount of processing power needed. The NRI findings come at a time when many government
million (metropolitan agencies and companies in Japan are exploring new
area) In addition to making real-time processing possible, this ways to leverage traffic data and other sources in an
} Number of taxicabs:
approach simplifies traffic-data generation logic, says effort to improve quality of life issues. Toyota, which is the
Approximately 250,000
Kenji Honda, an NRI senior systems analyst in the Ubiqlink largest provider of taxis in Japan, recently announced it
(metropolitan area)
}N umber of cars: Business Planning Group. He says the higher speed of is using real-time traffic information from 700,000 Toyota
Approximately 3.33 data extraction processing achievable with in-memory vehicles on the countrys roads to offer what it calls a
million computing means that historical data can be processed big data service to local governments and businesses.
}T otal land area: 2,700 on a continuous basis. This, in turn, reduces the amount of The service is aimed at helping drivers during disasters
square miles
computer resources required to perform calculations. 7
and emergencies. Drivers will be encouraged to share
their own observations on road conditions, including
A Better Quality of Life blocked paths and strong winds, with other drivers
The ability to analyze traffic jams more quicklyand thus around the country.12
to potentially alleviate issues fasteris crucial in nations
like Japan, which can be crippled by traffic congestion. A recent report in The Japan Times notes the Japanese
During the countrys largest spring break, traffic jams can Government also wants to use car navigation data to
stretch 37 miles or more.8 better monitor traffic after disasters.13 The Transport
7. Intel. Not limited to ERP Ministry found it was able to check conditions on only 79
applications alone, the Intel Xeon
processor E7 family also provides new Traffic congestion also can and does have a significant percent of the nations roadways on the night after the
business opportunities via in-memory
technology. Case study, 2011. impact on quality of life and the economy in many major earthquake and tsunami ravaged the Tohoku region in
http://goo.gl/6nZC9m
8. Yamanaka, Megumi and Yuji Okada. cities around the world. For example, a 2013 report from the 2011. Following the disaster, the ministry discovered that
Japan Braces for Record Traffic Jams
as Aso Cuts Highway Tolls. Bloomberg, Texas A&M Transportation Institute found that the financial traffic data collected from car navigation systems clearly
April 27, 2009. http://goo.gl/9i93AX
9. Texas A&M Traffic Institute. As Traffic cost of congestion in the United States in 2011 was $121 showed roads on which no vehicles were running. Being
Jams Worsen, Commuters Allowing
Extra Time for Urgent Trips. February 5, billion, translating to $818 per U.S. commuter.9
able to understand traffic conditions immediately, both
2013. http://goo.gl/fyNEJL
10. Hotz, Robert Lee. The Hidden day and night, is a crucial aid in responding to a disaster.
Toll of Traffic Jams. The Wall Street
Journal, November 6, 2011. The likely negative impact that traffic jams have on public
http://goo.gl/mOjIMK
11. Enterprise Innovation Editors. Traffic health is an even greater concern. As roadways choke on All this demonstrates the growing need forand benefits
congestion top cause of employee
stress, declining productivity. Enterprise traffic, researchers suspect that the tailpipe exhaust from ofusing big data in the public sector. In the past, it
Innovation, March 14, 2011.
http://goo.gl/mIDZYz cars and trucksalready implicated in heart disease and could easily have taken several hours to process large
12. The Associated Press. Toyota to try
out real-time traffic data service in Japan cancermay also injure brains cells and synapses key to volumes of data, and for this reason, I suspect many of
next month. CTV News, May 29, 2013.
http://goo.gl/TNbFe5 memory.10 According to one analysis, drivers traveling the our clients ultimately abandoned the process of data
13. JIJI. Government wants car
navigation data to monitor post-disaster 10-worst U.S. traffic corridors annually spend an average analysis in the public sector, says NRIs Masashi. But in-
traffic. The Japan Times, August 3,
2013. http://goo.gl/yRnbtU of 140 hours, or about the time spent in the office in a memory computing may well provide a way to offer faster,
14. Intel. Not limited to ERP
applications alone, the Intel Xeon month. Meanwhile, a 2013 survey by workplace solutions tailored solutions to them.14
processor E7 family also provides new
business opportunities via in-memory provider Regus suggests that traffic congestion and
technology. Case study, 2011. Joe Mullich is a freelance business and technology
http://goo.gl/6nZC9m crowded public transportation systems are the top
15. Texas A&M Traffic Institute. As writer based in Sherman Oaks, Calif.
Traffic Jams Worsen, Commuters causes of stress and declining productivity among Hong
Allowing Extra Time for Urgent Trips.
February 5, 2013. http://goo.gl/fyNEJL Kong employees.11 This research project was funded by a grant from SAP.

Norwegian Cruise Line at a glance

Cruise ship operator that gives guests the freedom and
flexibility to create their own dining and entertainment
activities
Industry: travel & transportation
Headquarters: Miami, Florida
Founded: 1966
2013 revenues: $2.6 billion
Year-on-year growth: 12.9%
Initial public offering: January 2013
Number of cruise ships: 13, with four on order
Passengers carried in 2013: more than 1.6 million
Destinations visited in 2013: 114

www.ncl.com
Source: Norwegian Cruise Line
Page 82
Norwegian Cruise Line Sets Its

Course for Real-Time Insights
Innovative cruise company adopts predictive analytics and real-time business capabilities,
with the aim of improving the guest experience and ensuring operational efficiency.
B Y L A U R E N G I B B O N S PA U L
N orwegian Cruise Line has a reputation to uphold. Founded in 1966, the

$2.6 billion, 13-ship cruise line has a track record of innovation and
differentiation. The company was the first in the business to offer round-trip
cruises out of Floridas Port of Miami. It also insights that have led to major operational cost
revolutionized the industry with its signature Freestyle reductions. Over time, Norwegians real-time capabilities
Norwegian Cruise Cruising, which gives guests the freedom and flexibility will aid in its ability to quickly ascertain and even predict
Line at a Glance to create their own dining and entertainment activities. guests needs and desires.
Industry: Hospitality/travel
Headquarters: Miami No wonder, then, that an engaging and increasingly The real power of the tool comes in predicting the
Founded: 1966 personalized customer experience is paramount to future and giving visibility we never had before, says
2013 revenues: $2.6 billion Norwegians quest to keep up with industry trends and Ben Lightfoot, director of business intelligence delivery
Year-on-year growth: 12.9%
continue attracting the growing number of people systems at Norwegian.
Initial public offering:
around the world who want to book a cruise in
January 2013
Number of cruise ships: anticipation of enjoying a one-of-a-kind vacation (see Many companies in the hospitality/travel industry are
13, with four on order Figure 1, Top 4 Cruise Industry Trends). According to leveraging analytics to gain a better understanding of
Passengers carried in 2013: Cruise Lines International Association, the industry will their customers needs and preferences. This is what
More than 1.6 million serve 21.7 million passengers worldwide, up from 21.3 the innovators are doing, says Joshua Greenbaum,
Destinations visited in 2013:
million in 2013 and 13.5 million in 2009. principal at EA Consulting. Its a very competitive
114
environment. They are taking every piece of data they
www.ncl.com
Source: Norwegian Cruise Line But to maintain its track record for innovation, and have and using it to change the customer experience.
develop offers that will resonate with different segments
of customers, Norwegian knew it needed to better
understand who its customers are, what they value and
FIGURE 1 Top 4 Cruise Industry Trends
what they most want to do when onboard the ship.
Improved technology to lower the cost of onboard

With an eye toward increasing guest satisfaction, communications and provide more efficient passenger
among other goals, Norwegian embarked in 2012 on servicing.
a fast-moving journey to implement a business
First-time passenger growth coming from younger
intelligence (BI) system aimed at delivering insights to
generation travelers, especially Millennials.
business users. Because it wanted to analyze large
volumes of data from multiple sourcesand needed Rebound in luxury cruising, stimulated by an improving
rapid resultsNorwegian chose an in-memory economy and increased consumer confidence.
platform, which aggregates and analyzes vast
More all-inclusive options and packaging in
amounts of data from multiple data sources in real
accommodations, services and amenities.
time. From its earliest days, the system has generated
Source: Cruise Lines International Association. www.cruising.org

Voyage to Customer Insight FIGURE 2 Swimming Through the Data

Norwegian leverages its BI solution, powered
According to Lightfoot, the homegrown BI system
by in-memory computing, for a host of data
had long turnaround times and performance issues, types in real time.
lacked flexibility and was too complex for anyone but
Norwegian Cruise power users and IT staff to use effectively. There was Financial data. Norwegians BI system elucidates
Line Business and authenticates the financial data in its ERP system,
no true enterprisewide BI strategy in place and no
Challenges something it was not able to do previously, according
real processes around master data management. to vice president of operations finance Chad Berkshire.
} Legacy BI platform
was slow, inflexible and
Now, business users can swim in the detailed transac-
We knew we needed a state-of-the-art BI platform tion data behind the financials.
complex
} Individual departments and strategy to stay ahead of the competition,
Inventory data. Norwegian uses analytics to keep
could not easily share Lightfoot says. The business couldnt wait until the
a closer eye on food/drink inventory aboard its cruise
data, leading to multiple next day for an answer. Further, departments ships, spotting trends and heading off waste. In the
versions of the truth future, it will use the system for inventory planning and
maintained siloed data marts, with no way to tie the
} The company needed forecasting.
data together, adds Chad Berkshire, vice president of
a quicker and more
effective way to validate operations finance at Norwegian. There was no one
Guest data. Currently, Norwegian uses analytics to
and scrutinize financial version of the truth. segment and better understand its guests. In the near
data in real time future, it will use the system to predict which guests
} Norwegian wanted In late 2012, Norwegian began its quest for a platform and prospects are most likely to go on a cruise in the
to better understand near future.
that offered performance, self-service for business users
customer needs and
and streamlined decision-making. We knew this couldnt Source: Norwegian Cruise Line
preferences to improve
and personalize the be a project that dragged itself out for the next three to
customer experience five years, Lightfoot says. The BI platform needed to without any concerns around the data they were
produce results within a year. This platform would be a consuming, Lightfoot says.
Norwegian Cruise game-changer as to how users consumed and
Line Solutions performed data analytics. Changing our organizational Financial Reality Check
} Adopting an analytics culture around data needed to begin right away. The first use of the system was to provide a reality check
system based on an for financial data. We needed to deliver the transactions
in-memory platform, The team selected the system in June 2013, and that made up the numbers in the ERP system, Berkshire
enabling real-time says. The increased scrutiny was a natural part of
implementation progressed quickly. The ERP system
analysis of a large variety
was the first data source to move onto the platform, with Norwegians becoming a public entity in January 2013.
of data types
the property management and reservations systems We needed to talk to potential shareholders about
} Porting ERP data
to the in-memory slated for future phases. Along with data cleansing, data specific financial goals and performance, he says.
platform, followed by governance and master data management, another
property management, major change was the creation of a new corporate With the system in place, Norwegian could begin to
reservations and obtain the coveted 360-degree view of its guests.
department for BI delivery, headed by Lightfoot.
customer data
Under the legacy data warehouse, guest data was
} Implementing data
One of the other huge contributing factors to the maintained in multiple data marts, and understanding
cleansing, data
governance and master success of the implementation was the decision to the correlation between pre- and post-spend was
data management create the BI department under the business becoming increasingly difficult. Guest information was
processes umbrella, he says. This shift from the norm allowed sourced from the reservations system, property
} Establishing a business management system, casino system and guest
the BI department to align itself with the business,
department dedicated to
immerse itself in the business culture and drive home satisfaction. However, there was no way to bring all of
BI and analytics
the necessary business requirements. It also this together without complexity. The new system is
ensured system usability at all levels of the enterprise. changing that, giving everyone the same view of guests,
I wanted users to have a true self-service platform enabling them to provide a better customer experience
that would allow them to swim through their data (see Figure 2, Swimming Through the Data).

Early Wins FIGURE 3 Better Decisions Through Data

Business drivers for investment in analytics
Soon after the system went live Berkshire was able to
include the following. (% responding)
Benefits of see how much money was spent annually on individual
Improving the quality of decision-making
In-Memory vendors across purchasing systems. It turned out 59%
Computing at there were five different departments all using one
Norwegian Cruise vendor, he says. We had been negotiating in siloes,
Line 53%
says Berkshire, whose team worked with the vendors
} Operational cost representative to reduce the bill by 6 percent. Improving planning and forecasting
reductions as high as 6 47%
percent
Purchasing was a fertile area for more hard returns as the Developing new products, services and
in purchasing
purchasing department obtained visibility across multiple revenue streams
} Expected revenue
47%
improvements driven systems. We discovered that a significant number of
by improved ship services we were buying were not running through a Source: IDG Enterprise Big Data Study, 2014. http://goo.gl/BNImWX
configuration and new purchasing system. They were being negotiated without
food and entertainment
purchasing being involved, Berkshire says. Purchasing For example, guests who meet a certain threshold of
packages
has reestablished oversight of services purchases, driving spending on the gaming systems will likely be passengers
} Improved scrutiny and
validation of financial additional cost reductions and greater efficiency. who Norwegian would encourage to book another trip.
data Lightfoot expects the system will help his team pinpoint
} Improved inventory The system would also potentially highlight problematic profitable customers and develop personalized offers (see
planning and forecasting areas on the ships related to revenue. We might Figure 3, Better Decisions Through Data).
} Holistic customer views,
change the way the casino floor is laid out, or place
leading to improved
assets in different places as a result of looking at the They will be able to close the gap between someone
segmentation and
prediction of needs asset spend across the casino floor, Lightfoot says. who is interested in taking a cruise vs. someone who is
onboard enjoying themselves, Greenbaum says. This is
The biggest impact for guests so far has been the a major advantage in an industry where there are
creation of onboard food and entertainment packages complex products, many customers and a lot of
based on common spending patterns. We make it competition. There are 100 different cruises. Being able
convenient for them to buy it in one package while also to take all these potential products and correlate them to
gaining savings, Berkshire says. customers based on datathat is the perfect scenario,
he says. You can move the needle very quickly.
Another example of data-fueled innovation: Norwegian
recently introduced all-inclusive cruising, the first of the Norwegians use of the system will increase over time, as will
major cruise lines to do so, according to USA Today.1 its associated benefits. When we can begin to predict for
With this option, available for 2015 cruises, the guest the future, the payoff will be huge, Lightfoot says. We are
pays one price for unlimited extras, including access to now looking in the rearview mirror. The goal is to be able to
specialty restaurants and alcoholic beverages, predict months in advance, so we can put together the right
shoreline excursions and bingo games. offers, the right experiences for the right customers.
Predicting the Future So far, Norwegians journey has been smooth sailing, with
Currently, the crucial activity of customer segmentation great things on the horizon. A lot of hard work has gone
is handled by an external service provider. With the into this, Berkshire says, but it has really paid off.
new solution in place, Norwegian will take that function
back in-house. In this business, you have a fixed Lauren Gibbons Paul has written extensively on customer
relationship management and customer experience
1. Sloan, Gene. Norwegian Cruise
number of customers based on the ships and number
management for more than 15 years.
Line tests all-inclusive packages. of rooms, Lightfoot says. We really have to get the
USA Today, July 31, 2014.
http://goo.gl/opYCzx. best guests, so segmentation is really key for us. This research project was funded by a grant from SAP.

Southern California Edison at a glance

Southern California Edison is a subsidiary of Edison
International, which was founded in 1886. A regulated
utility, SCE delivers electricity to 4.9 million customer
accounts in 430+ cities and communities
Industry: utilities
Headquarters: Rosemead, California
Service territory: 50,000 square miles
Transmission and sub-transmission line miles:
12,782
Electricity wood poles: 1.3 million
2012 annual operating revenues: $11.9 billion
(Edison International)
Employees as of 2012: 16,593
www.sce.com
Source: Southern California Edison
Page 86
How Southern California Edison

Harnesses Big Datas Power
Real-time capabilities are transforming how the electric utility manages supply and demand to
lower costs and improve efficiency.
BY STEPHANIE OVERBY
T o keep up with electricity demand from its 14 million customers, Southern

California Edison (SCE) plans to invest more than $20.4 billion during the next
four years to expand and strengthen its electric grid. But pouring money into physical
Southern infrastructure such as power plants and substations is not enough. Leaders at the
California Edison
At a Glance regulated utility need to manage energy supply and FIGURE 1 Real-Time Data Bolsters
Industry: Electric utility demand more intelligently, using more data, better Performance
Company description: By integrating processes, information and technology,
analytics and faster reporting.
Southern California companies deliver real-time benefits to a very large extent.
Edison is a subsidiary
Many organizations, across all industries, have High performers Other organizations
of Edison International,
which was founded in similar ambitions. But for utilities, the transformation Improve the ability to analyze costs and benefits
1886. A regulated utility, to a real-time businessone that uses dynamic and 62%
SCE delivers electricity granular data to make decisions in the momentis 7%
to 4.9 million customer
in many ways an industry imperative. Theodore F.
accounts in 430+ cities Embed real-time decision-making tools
Craver, Jr., chairman and CEO of SCEs parent
and communities. 46%
Headquarters: company, Edison International, has stated that
2%
Rosemead, Calif. preparing for transformative change in the industry
Develop and capitalize on insights about customer behavior
Service territory: is critical to creating long-term value.
50,000 square miles
46%
Transmission and sub- 3%
Not only is demand for electricity increasing, but
transmission line miles:
utilities are also under pressure from regulators and Provide access to information across devices
12,782
consumers to reduce consumption and lower 38%
Electricity wood poles:
6%
1.3 million costs. The only way they can meet customer
2012 annual operating expectations and shareholder demands is if they Source: Accenture, 2013
revenues: $11.9 billion replace concrete with information, says Narendra
Mulani, senior managing director at Accenture Understanding Business Demands
Employees as of 2012:
Analytics (see Figure 1, Real-Time Bolsters SCEs business data, like that of most large
16,593 (Edison
International) Business Performance). companies, is scattered among various systems and
www.sce.com databases. Integrating it was time-consuming, which

SCE has responded to these demands by initiating made analysis difficult. As a result, the utility was using
Source: Southern California Edison
a business transformation. New technologies and only a small portion of its data effectively. If it takes a
analytics tools deliver instant information about lot of time and effort to get information out of your
electricity generation and consumption to the systems, it hampers your ability to make business
utilitys customers, regulators and employees. decisions in a timely manner, says Ron Grabyan,
Real-time data is helping SCE manage its manager of business intelligence services at SCE.
multibillion dollar assets more effectively, while it Oftentimes, by the time you get the data together, the
partners with customers to meet their needs. opportunity is lost.

Although it was obvious that SCE needed to pull FIGURE 2 Big Data Success Factors
these disparate data sources together more quickly, The top five point to a critical alignment of
business strategy, people and tools. (% responding)
the business intelligence services group studied what
type of information, and how much of it, people Identifying where big data can have the greatest impact
needed, as well as how they would use it, before
81%
choosing a technology platform. Having staff who can extract value from big data initiatives
Benefits of Real- 72%
Time Business at Business users wanted to do deeper analysis of
Finding the best tools or resources to meet goals
Southern California customer data, as well as predictive modeling. SCE 70%
Edison has access to an increasing volume and variety of
} Integrated data: Ensuring needed storage, compute and networking resources
internal and external datafrom customer and smart
Business users can are in place
aggregate internal and meter data to weather and traffic feeds and electricity 68%
external data sources to market informationthat can streamline operations
Getting IT and business agreement on where big data can
unearth fresh insights. and improve decision-making. By aggregating and
have the greatest impact
} New services: A new analyzing such information in real time, the utility can 64%
tool built on the
begin to transform processes across its business. So
in-memory platform Source: IDG Enterprise Big Data Study, 2014. http://goo.gl/BNImWX
SCE invested in an in-memory platform for its
helps customers
manage their electricity business intelligence systems.
usage and their costs. The smart meter data became the foundation of an
} Faster processes: You have all of these different databases, and you online tool that uses the in-memory platform to show
Real-time data means need information from all of them, Grabyan notes. customers what their bills might look like under various
finance professionals
Youre limited by the speed of the slowest one. An usage scenarios.
can, in effect, partially
in-memory platform enables users to load extremely
close the books daily.
} Future use cases: large volumes of data from multiple sources into one SCE had to deliver the results, which are based on the
In-memory analytics database and answer questions almost instantly. previous years consumption, almost instantly, or
holds the potential to customers would abandon the exercise. The customer
improve response times Choosing High-Value Targets expectation is not set by the interaction they have with
when power outages
The platform for real-time analytics is designed to any other utility, its set by the interaction they have with
occur and to help
benefit many business functions. But successful retailers or with online companies, Mulani says. They
analysts create new
statistical models with companies choose targeted projects to demonstrate expect that same transparency and ability to interact in
richer results. its value, Mulani says. According to a recent survey real time.
by IDG Enterprise Research, 81 percent of
respondents say that identifying the business areas Using legacy systems, the data analysis took 40
and processes where the real-time collection and seconds. Employing the new in-memory platform and
analysis of big data can have the greatest impact is analytics technologies, customers get the analysis in five
critical or very important to the success of such seconds. With increased insight, more options and
initiatives1 (see Figure 2, Top 5 Success Factors for greater control over their energy usage, consumers will
Big Data Initiatives). help us engineer a better energy future, stated Doug
Kim, SCEs director of advanced technology, in a recent
With the launch of its smart meter program in 2008, press release. If customers use energy more efficiently,
SCE enabled consumers and businesses to reduce SCE does not have to build as many power plants.
their use of electricity during peak periods in Everyones bills go down.
exchange for preferred pricing. The utilitys business
1. IDG Enterprise. Big Data:

leaders decided that if they could get detailed Transforming Work
Growing Trends and Emerging information about electricity usage to consumers Real-time transformation, however, involves more
Opportunities. 2014.
http://goo.gl/BKeOYy. faster, they could better moderate their energy use. than deploying new technology or delivering a cool

new tool. The business process has to be FIGURE 3 People Before Technology
changed, Grabyan observes. And you have to Culture change is among the top barriers to
building the analytical capabilities needed to become a real-
have the appetite to make that business process
time enterprise. (% citing it as a barrier)
change. Although SCEs executive team was
Resources
hungry for the transformation, others were less
55%
eager to see their work change. Indeed, culture
Culture
Southern change is among the top barriers to building the
49%
California Edisons analytical capabilities needed to become a
Challenges real-time enterprise2 (see Figure 3, People Talent/skills
} Centralize data for better Before Technology). 30%
and faster customer
Leadership
service and predictive
The key is to make it clear to people how they will 27%
analytics.
} Deliver instant analysis of personally benefit from new systems and Data
smart-meter data to help processes. The business intelligence services team 26%
customers manage their showed how real-time analytics and process
Technology
consumption. changes could enable employees to more easily 21%
} Better manage capital
access information while on the phone with a
investments. Source: American Management Association, 2013
customer, cut the development time for new
Southern California projects in half or close the books faster. Finance
Edisons Solutions professionals do not have to wait until the last traffic patterns are and what it is going to take to get
} Deploy business week of the month to perform all financial closing- everyone where they need to go.
intelligence systems with related activities. They can spread that work
an in-memory database
throughout the monthin effect, partially closing There are, as well, opportunities to advance the
to speed information
the books on a daily basis. Not every piece of predictive analytics the utility has been doing for years,
delivery to customers,
business users and business information needs to be delivered not only to forecast outages, analyze usage patterns
regulators. instantly. But as hundreds of reports run faster, a and costs, or model customer segmentation, but also
} Develop flexible more efficient workforce emerges. to create new statistical models. In the past, much of
customer data and the analysis, using legacy systems, was based on
predictive analytics
Big Returns Take Time samples from SCEs millions of meters and customers.
models.
Employee buy-in will be critical as SCE rolls out That takes time, and it has not always delivered the
} Enable online access to
analytics to empower real-time capabilities to additional areas. With each insight decision-makers wanted. With in-memory
consumers and business potential use, there will inevitably be process change. analytics, they will be able to use the full data sets and
users. That is where the real value is derivedand it takes receive richer results.
time. Anyone who approaches real-time
transformation with a short-term outlook is destined Ultimately, the real-time transformation will deliver new
to be disappointed, Grabyan advises. You put the ways of doing business that no one can imagine today.
systems in the first year, the process changes occur When you make changes like this, you speed up
over the following years. analytics, which speeds up processes, which speeds
up decision-making, which creates exponential
Take outage management. Like any utility provider, change, Grabyan says. It will change the way we think
SCE has to deal with natural disasters, such as the about operating the company.
2011 windstorm that left hundreds of thousands of
Stephanie Overby is a freelance business and technology
customers without power. The company is looking
2. American Management writer based in Boston.
Association. Organization Culture,
at putting its storm tracker program onto the
Lack of Resources Impede Big in-memory database to enable managers to see This research project was funded by a grant from SAP.
Data. Oct. 3, 2013.
http://goo.gl/3NUXN8. where crews are, where equipment is, what the

T-Mobile at a glance
Provides wireless PDAs, cellular telephones, tablets as
well as mobile communications, DSL
Industry: telecommunications
Headquarters: Bonn, Germany
Founded: 1990
Area served: Europe, United States, Puerto Rico, U.S.
Virgin Islands
Employees: 36,000 worldwide
www.telekom.com/home
Source: T-Mobile
Page 90
CASE STUDY
Technology Small/Midsize Marketing
Business & Sales
Using Social Media to Improve

Customer Loyalty at T-Mobile
How a small
Y28 K28 C78 M52 Y28 K6
team within A C73 M19 Y40 K1

ccording to
C65 M29 Y79 K22
a 2013 study1 by the
C61 M20 Y78 K3
University of Massachusetts Dartmouth
FIGURE 1 T-Mobile: Social Media Success
January 2013
2.8 million
T-Mobile uses Center for Marketing Research, a stunning 77
June 2013
percent of the most successful U.S.
the simple act 3.7 million
companies use Twitter to communicate with
of listening to December 2013
C0 M60 Y100 K17 C28 M88 Y70 K19 C48 M89customers, while 70 percent use Facebook. 5.1 million
turn unhappy Y84 K49 C61 M66 Y61 K52
Source: T-Mobile
They use other social media tools in varying
customers The companys social media efforts have resonated with a
degrees. However, frequent usage doesnt growing number of its customers.
into happy necessarily lead to expected business results.
customers Thats because, according to experts, social
T-Mobile today focuses on social media as a
and happy media success requires a new way of

competitive advantage, using it to listen and respond
to customers desires and concerns. It has to. With
customers thinking about customers. mobile phone penetration at 78 percent of the U.S.
into recom- population in 2014 and leveling off,3 T-Mobile must
mendation Companies are tuned toward delivering messages, show how it is better to grow. Social media is one of
but that doesnt work in social media channels, the key prongs in its strategy.
engines. says social media consultant Paul Gillin. Customers
dont go to social media sites to get advertising A ROCKY START
BY H OWA R D
B A L DW I N messages. The more a company tries to sell via When we first started doing social media in 2012, we
social media, the more likely the very people its tripped all over ourselves, recalls Michelle Mattson,
targeting will stop listening, he warns. Get over the senior manager, social customer support. We didnt
idea that youre there to talk. Youre there to help. have a business case for how to handle social properly.
The more people you help, the more you get known
as someone who is a pleasure to do business with. The original team of 24 peopledubbed T-Force
didnt have a clear goal either, other than to try and
1. Barnes, Nora Ganim, Ava M. That is, in essence, what wireless mobile carrier reduce some negative comments on T-Mobiles
Lescault and Stephanie Wright.
2013 Fortune 500 Are Bullish T-Mobile is doing, with significant results. The Facebook page and to explore the possible use of
on Social Media. University
of Massachusetts Dartmouth number of its social media fans almost doubled analytics. We took big risks and learned our lessons
Center for Marketing Research.
between the beginning of 2013 and the end (see from them, Mattson remembers. That education
http://goo.gl/tzXPgg.
2. T-Mobile. Awards and Figure 1, T-Mobile: Social Media Success). got us to where we are today, but those first six
Recognition.
http://goo.gl/CWPfWp. Socialbakers, the social media analytics site, months were painful.
3. Statista. Mobile phone
penetration in the U.S. from consistently ranks T-Mobile as a top 10 socially
2010 to 2016.
devoted company.2 The results are even more Among those risks: When they first started tracking
http://goo.gl/ZurWud.
impressive given that the program has been in complaints, the system for customer sentiment
existence for only two years. tracking was manual and time consuming.
SEPTEMBER 2014 Eventually T-Mobile started tracking customer
Copyright 2014. sentiment in a more automated way, using a
Forbes Insights. cloud-based system that integrated with its
All rights reserved.
FORBES INSIGHTS 1
FORBES
INSIGHTS
CASE STUDY
customer relationship management FIGURE 2 Upon Further Review

system. But even that process was Step 1 Step 2 Step 3 Step 4
difficult. As a result, Mattsons team Initial T-Mobile Social media T-Mobile Social media
action response reaction response
tried several other products and
approaches before settling on the T-Mobile 7% positive T-Force quickly 33% positive
announces 37% negative communicates 5% negative
cloud-based services it is using today
elimination of negative feedback
T-Mobile today to track everything from general Advantage to management;
customer sentiment to reactions to discount program CEO promises to
focuses on social rethink decision
new promotions and campaigns.
media as a T-Mobile 5% positive After T-Force 20% positive
competitive Mattson soon determined that her
announces 20% negative notifies T-Mobile 8% negative
campaign to executives, CEO
advantage, using group needed to articulate a clear promote switching tweets that the
it to listen and strategy. Out of those discussions from Blackberry campaign will be
tweaked
respond to came a simple mantra: Were
Source: T-Mobile
customers listening, were engaging customers
Most announcements will trigger a negative reaction of 1 to 3 percent. These two
where they want to engage, and were
desires and went far beyond that, but were saved by quick responses from T-Mobile.
resolving issues. Tactically, Mattson
concerns.
broke the goals down to four steps: customer used the comment capability to say
Identify trending issues and monitor customer Cant make or receive calls! Within 32 minutes,
sentiment. one of Mattsons team had posted a URL for the
A
llow the tough conversations to take place. customer to send T-Force a message directly. The
Offer quick responses in real time. formerly disgruntled customer was one of 38,000
M
ake positive connections that deliver on the users who liked the response.
brand promise.
GOING BEYOND THE BASICS
The sheer action of monitoring customer sentiment Most telecommunications companies take
is an eye opener. Typical negative reaction on every advantage of social media to some degree. They
campaign is 1 to 3 percent, she says. But in two use applications like Facebook and Twitter to
cases where T-Mobile launched a campaign or communicate with consumers at a rudimentary
announced a service change to a popular offering, level, says Bas den Braber, principal consultant at
the negative response was off the chart (see Figure Capgemini Consulting, who focuses on digital
2, Upon Further Review). In the first instance, it customer experience in the telecom segment. But
planned to discontinue what turned out to be a very telcos that take social media seriously are the ones
popular discount program called Advantage. In the who are making progress. Theyre using social
second, T-Mobile tried promoting a program to get media for marketing, to derive insights and as a
customers to switch from Blackberry phones. In both real-time interaction channel to enhance brand
cases, the T-Force team was able to engage engagement. Theyre deploying predictive analytics
executive support to respond to social sentiment, platforms to help make data-driven decisions
sometimes in as little as 24 hours. across the organization. Theyre integrating social
media with the customer service function.
Dealing with negative sentiment is part of the job,
Mattson insists, noting that some of T-Mobiles T-Mobiles efforts put the carrier into the category of
competitors simply delete negative postings. We leading practitioners of social media in its industry.
engage with those people, and in most cases, we We have sophisticated reporting that tells us what
can turn it around, she says. In one instance, our customers are saying about us and whether
T-Force posted a message on Facebook, and a theyre happy or not, Mattson says.
2 FORBES INSIGHTS
FORBES
INSIGHTS
CASE STUDY
For social media monitoring, the T-Force team is FIGURE 3 Chat Strategy Goes Social
using a listening tool that identifies when T-Mobile is
Number of issues solved via chat Up 12%
mentioned and highlights potentially negative
Wait times Down 3 minutes
hashtags and keywords (for example, hate and
never). Sometimes the teams efforts are made Overall handling time Down 1 minute
Source: T-Mobile
more difficult when someone with a lot of followers
It gives us a complains, and the complaints are retweeted. That
When the T-Force social media team applied its methodologies
to customer service chat, management was impressed with
sense of pride to happened once with a DJ who was upset about the results.
work with being dunned for a bill he said hed paid; it turned
out later that he had not actually paid it. we wanted to be when we grew up, and without a clear
someone who is
vision or aspiration, youll just flail.
super-negative,
No matter what level of status the person has,
and then have Her T-Mobile colleague Jennifer Palmer, director of
however, the T-Force team dives in. It gives us a
that person sense of pride to work with someone who is knowledge management and social media services
come back and super-negative, and then have that person come support, recommends looking at what other companies
say how great back and say how great we are. Thats a key element are doing to get a sense of how you can best engage
we are. Thats a of customer service, Mattson says. with your customers. Look at brands you admire and
analyze why you like that, Palmer says. For instance,
key element of
Mattson has been so successful with T-Forces efforts the social content of [toilet tissue manufacturer]
customer
that shes been assigned responsibility for improving Charmin is funny. Is that the way you want to engage
service. with customers? Theres nothing worse than boring
T-Mobiles chat process. Her strategy involves giving
MICHELLE the chat team the same tools the social media team content. And you have to commit to delivering it at
MATTSON, SENIOR usessetting up anticipated responses to questions regular intervals.
MANAGER, SOCIAL
CUSTOMER SUPPORT, and building dashboards to track results.
T-MOBILE Perhaps the most important lesson is to understand the
But it also involved making some structural changes. complexity of making social media work. Just because the
Sometimes we had content to be used within chat T-Force team responds quickly doesnt mean it is
that wasnt appropriate for offshore agents who may spontaneous. The team has spent a lot of time developing
not understand the nuances of social media, Mattson relationships with marketing, customer service, public
says. The solution: creating a two-tiered chat model relations, legal and senior executives. Before, marketing
that shifted complicated support issues to an onshore would just launch campaigns, and the social team would
team. The results were almost immediately positive respond to them. Now, we come up with questions and
(see Figure 3, Chat Strategy Goes Social). issues relating to how customers might respond,
Mattson says. We have to be methodical. The last thing
The number one metric for Mattson, however, is we want is to become our own news story.
resolution. Thats the most important thing to
measure in the long term. We want to earn customer ABOUT FORBES INSIGHTS
Forbes Insights is the strategic research and thought leadership prac-
loyalty in the way we resolve issues across all tice of Forbes Media, publisher of Forbes magazine and Forbes.com,
platforms. whose combined media properties reach nearly 50 million business
decision-makers worldwide on a monthly basis.
Bruce Rogers
LESSONS LEARNED CHIEF INSIGHTS OFFICER
What has T-Mobile learned about social media that
Brian McLeod
other companies could emulate? The most important DIRECTOR, NORTH AMERICA
lesson is setting a goal for your social media efforts. Writer: Silicon Valley-based freelancer Howard Baldwin has written
Set your goal, Mattson says. We didnt know what about business and technology since 1987.
FORBES INSIGHTS 3
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ARI Florida Crystals NFL

CareFusion Globus Nomura Research Institute

City of Cape Town, South Africa HSE24 Southern California Edison

Commonwealth Bank of Australia Johnsonville Sausage T-Mobile

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CareFusion: Real-Time Business Leads to Healthy Performance at

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City of Cape Town, South Africa: Real-Time Data Speeds Services in

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Florida Crystals: Real-Time Business Sweetens Performance at Florida

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Hewlett-Packard: HP Paves the Future with Real-Time Insights

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National Football League: The NFLs Advanced Analytics Score with

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COPYRIGHT AND DISCLAIMER NOTES

Adobe Systems at a glance

Industry: high tech

Headquarters: San Jose, Calif.

2013 revenue: $4.06 billion

Employees: More than 11,000 worldwide

Products: Software for creative and

Source: Adobe Systems

Adobe Gets Personal

T hroughout high-tech, long-time business models are falling by the wayside as

These shifts have transformed the types of Source: Adobe Systems

customer, product and sales data to which Adobe

FEBRUARY 2014 | Copyright 2014. Bloomberg L.P. All rights reserved.

A Fractured Data Environment FIGURE 2 Channel Quagmire

2 Bloomberg Businessweek Research Services

FIGURE 3 Preference for promotions. In the past, it was necessary to wait

3 Bloomberg Businessweek Research Services

Alliander Energizes Its Business

energy infrastructures for Asset management

MARCH 2014 | Copyright 2014. Bloomberg L.P. All rights reserved.

Alliander itself has been on a data quest. The utility Utilities

Allianders IT benefits, including more accurate forecasting of

2 Bloomberg Businessweek Research Services

demographic growth, seasonality, consumption

Would recommend having a smart meter installed

In the IDC Energy Insights report, Feblowitz

3 Bloomberg Businessweek Research Services

In-Memory Computing Drives

Running a report or query with in-memory technology Three seconds

Number of vehicles in ARIs fleet Roughly 950,000 in North America

ROI 5% efficiency improvement in the call center

JULY 2013 | Copyright 2013. Bloomberg L.P. All rights reserved.

FIGURE 2 ARIs In-Memory Technology: What the Future Holds

2 Bloomberg Businessweek Research Services

ARIs salespeople can also work more effectively with FIGURE 3

3 Bloomberg Businessweek Research Services

Real-Time Business Leads to Healthy

MAY 2014 | Copyright 2014. Bloomberg L.P. All rights reserved.