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IBM Trains its Analytical Eye towards Big Data

By   /  May 10, 2012  /  No Comments

by Paul Williams

An enterprise’s big decision makers are potentially getting a sharper analytic eye on Big Data, courtesy of Big Blue. Last month, IBM announced a new predictive analytics service offering aimed at improving company’s fraud prevention, financial operations, and customer management.

This new service, titled IBM Smarter Analytics Signature Solution, is derived from IBM’s extensive experience in analytics projects combined with intellectual work in the predictive space from both IBM Research and various acquired companies. The company hopes that this new offering continues to solidify IBM as an industry leader in business analytics:

“These new capabilities target the agendas of global business leaders operating in a world of accelerating complexity, unpredictability and massively available information,” said Bridget van Kralingen, senior vice president, IBM Global Business Services. “By integrating analytics into business processes and converting new insights into action, IBM is helping organizations transform big data from a threat into an opportunity, one that will be their most valuable natural resource.”

Preventing Electronic Fraud with Big Blue

The estimated cost of electronic fraud is running into the hundreds of billions of dollars, so organizations of all sizes need to pay attention to newer options in the world of fraud prevention and detection. One of the major offerings of the Smarter Analytics Signature Solution is in the areas of anti-fraud, waste, and abuse.

IBM’s system is adaptive, with algorithms that work within existing business processes to provide real-time fraud detection and prevention. These algorithms are continually learning about new and emerging fraud, theoretically protecting organizations against heretofore unknown techniques for e-theft. Once fraud is detected, the system offers a recommendation on the best remedy to fix the issue.

According to IBM, an automobile insurance company using Big Blue’s analytics process to analyze historical crash and accident data reduced the amount of time for fraud detection from two weeks to one day, proving the potential of great cost savings for firms implementing this solution.

Facilitating the Customer Relationship

Deriving meaningful information from the masses of CRM-based data is another core offering of IBM Smarter Analytics Signature Solution. One unique aspect of the Big Blue solution is the inclusion of data from social media networks in addition to the typical CRM data. Web usage data is also an essential ingredient in the soup.

Ultimately, performing real-time analytics against the entirety of the data allows the system to predict customer preferences. Companies have used this analysis in the development of promotional offers for both existing customer retention and new customer acquisition.

Finding Insight within Financial Data

Financial information is not immune to the massive growth seen across most data disciplines. In fact, IBM’s own research estimates that financial data will continue to grow by at least 70 percent each year. Due to this growing need, tools providing insight for CFOs are an important component of Smarter Analytics Signature Solution.

In addition to the predictive analysis feature similar to the one in the fraud detection module, IBM’s analytics tool includes a unique “what if” tool useful for testing out various financial scenarios. These tools combine with traditional Business Intelligence functionality, all contained on in executive dashboard interface.

According to IBM:

“[T]his kind of improved financial visibility is used by Alfred Angelo, one of the   largest U.S. wedding gown manufacturers and retailers. The company is using IBM analytics to move beyond spreadsheets to a more comprehensive view of its operations across product lines. By analyzing which wedding dress styles or accessories have been profitable over time, Alfred Angelo can take the SKU level ‘investigation’ down to a particular color, size, or design and then optimize its inventory to meet client demands and increase revenues.”

A Big Data Technology Stack at Home in the Cloud

IBM’s new analytics services are founded on the latest in Cloud-based technology, scaled to the demands of Big Data. Clients remotely access IBM’s eight globally networked Analytics Solutions Centers, powered by a platform featuring a mix of Hadoop, stream computing, data warehouse systems, and information integration and governance capabilities.

Nearly 100 business partners have adopted IBM’s Blue Big Data platform, helping to grow the market for the Smarter Analytics Signature Solution to new types of clients across many industries. IBM’s Global Financing arm assists credit worthy organizations in the procurement of the new Big Blue analytics offering.

With a projected 16 billion dollars in analytics-based revenue by 2016, IBM is working hard to meet that projection. Nearly 9,000 analytics consultants are now employed at Big Blue; these frontline staffers are augmented by nearly 400 researchers as well as solution centers spanning the United States, Europe, and Asia.

Over 27,000 business partners combine with 25 companies acquired since 2005 as well as hundreds of patents to position IBM as one of the leaders in the growing analytics space.  The new Smarter Analytics Signature Solution is primarily the result of this focus on analytics.

Making a Commitment to the Future of Analytics

IBM’s commitment to analytics goes beyond their focused research and intellectual property acquisitions, and now includes their new platform and solution initiatives. Late last year, Northwestern University and IBM announced the creation of two Masters of Science programs both with a focus on business analytics.

Big Blue cites government data showing a 24 percent increase over the next eight years in the need for professionals skilled in management analysis. These analytics’ needs echo many of the functionalities provided by the Smarter Analytics Signature Solution, including predictive analysis and the effects of social media on the explosion of Big Data.

The new Masters of Science programs are available at the McCormick School of Engineering and Applied Science, and the School of Continuing Studies.  The former school makes sense considering the traditional technical knowledge needed in data analytics.  On the other hand, offering the Masters program at the latter school reflects the emerging need for developing analytical stars in business degree programs.

Julio M. Ottino, Ph.D., Dean of the McCormick School of Engineering at Northwestern University describes Northwestern’s new commitment on analytics:

“Business leaders are faced with an enormous, and ever-increasing, amount of complexity.  It is critical that we prepare the next generation of leaders with the skills to find trends and patterns in this vast amount of data. The field of analytics provides powerful tools to find meaning and opportunity amid complexity. We are committed to preparing students to excel in this emerging field, and we value the support of IBM in our efforts.”

Northwestern faculty also are currently working side-by-side with IBM staff at the TJ Watson Research Center, providing exposure to the latest in computing innovations.

IBM’s focus on improving university access to state of the art technology and business expertise goes beyond Northwestern.  Big Blue developed Academic Initiative, a program providing business-honed case studies, curriculum materials, and access to IBM professionals to colleges and universities.

The growing importance of analytics is one artifact of the explosion in Big Data, partially driven by social media and an increasingly wired society. IBM’s efforts in leveraging its technical expertise in this area are reflected by both its new Smarter Analytics Signature Solution and Academic Initiative. Big Blue is poised to remain a giant in analytics in both the business and education communities.


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