Analytics In A Global Recession: Fixed Price Operational Dashboard

As the world economy moves towards a potential global recession companies are asking about how could they could optimized their investments in business intelligence, BPM, data mining, and analytics. The answer is simple: go to a fixed price operational dashboard model that requires vendors and service providers to:

1. Deliver within 90 days a proof of concept (POC) operational decision support system;

2. Operational means that information workers within the company can use the decision support system to meet a company's financial goals;

3. The POC should be measured in one of three simple key performance indicators: increase revenues, decrease costs, or increase the percentage of profits; and

4. Total price for POC should not be more than $25,000

In a recession companies must manage with a laser focus their revenues, expenditures, and investments. Strategic dashboards are nice, but operational dashboards reach down into the income producing worker. The goal of achieving a cost efficient and revenue enhancing operational dashboard is within all companies regardless of the technology that they use (i.e., Oracle/Hyperion, IBM/Cognos, Microsoft SQL 2005 and 2008, SAS, or Business Objects/SAP). Even small companies can use Software-as-a-Service analytics like Zementis to build operational dashboards that are cost efficient.

Let an analytics operational dashboard be the compass that guides your company in this stormy economic times. Contact me at atomanalytics@gmail.com If you would like to work with a technology provider who you can trust to work together in providing a fix cost operational dashboard in the marketing, retail, banking, insurance, manufacturing, CRM, or healthcare industries.

Alberto Roldan

See, Business Analytics at: http://www.linkedin.com/redirect?url=http%3A%2F%2Fatomai%2Eblogspot%2Ecom%2F&urlhash=AwT7&_t=disc_detail_link

IT and Enterprise Architecture Metrics: Managing in Tough Economic Times

How can IT demonstrate its value to the CFO in this times of economic downturn? How can IT make the case for funding for new projects? Lately I have seen this type of questions asked more often. The answer is that IT must have metrics that are directly connected to corporate revenues, expenditures, and profitability. In order to develop this metrics IT must partner with the business units. For example, if a business department wants a more efficeint application so that workers spend less time manually completing reports IT must ask to that department: how is the improvement in the application going to affect revenues, expenditures, or profitability. IT and business departments should be sitting down and making project-specific economic forecasts that are measurable in terms of the economic health of a company. If you need assistance in making these forecasts and its accompanying metrics let me know and I will assist you in this area.

The Democratization of Analytics - Microsoft Project Gemini

Last week I attended the Microsoft BI Conference. I learned about project Gemini. This project will allow analytics power users in companies to use Excel to do powerful analytics, while simultaneously allowing collaboration among all stakeholders using PerformancePoint. It allows Excel to load over 100 million rows (and about 6 columns) in just a few seconds and then create interactive pivot tables. They are still working on calculations but the demonstration was powerful. If you see Ted Kummert, Bruno Aziza, Kamal Hathi, Donald Farmer, or Amir Netz in a meeting make sure that you let them know that they are doing a great job.

Microsoft is doing a fantastic job at integrating Analysis Services, Integration Services, Reporting Services (the visualizations are robust in SQL 2008 RS), Excel Services, and PerformancePoint. This family of products are very different than SQL Server 2000. If you have followed this products for over 5 years you realize that the 2005 and 2008 products are totally different than the 2000.

A brief note about PerformancePoint and Reporting Services. For the first time I saw powerful visualizations that allow reports to be actionable. This is impressive and tells a lot about the folks working to develop these products.

Sometime ago I wrote: "If anticipation is part of journey, I can hardly wait for the sounds and tastes that will come in the next 12 months when business, technology, and science merge to produce masterpieces to help solve complex business problems." See, http://atomai.blogspot.com/2008/06/genetic-algorithm-grid-computing-and.html. Microsoft is providing the right tools for those who do analytics, to do their job in the most efficient manner.

In the Disney-PIXAR movie Ratatouille a Chef says that "anyone can cook". Microsoft is saying anyone can do analytics, and I agree. See, http://atomai.blogspot.com/2008/05/business-analytics-unleashing-power.html

Financial Markets & Credit Crisis: A Potential Solution

The failing of financial institutions are having a global impact on the financial and credit markets. The issues with Fannie Mae, Frddie Mac, Merryl Lynch, Lehman, AIG, and Countrywide were fairly obvious. Since March I have been predicting these type of failures by using the ratio of mortage based securities in a companies portfolio to total capital under management (mortage based securties/total capital under management). Also, I suggested that you use the Carlysle Fund ratio as your upper benchmark (or alarm). See, http://atomai.blogspot.com/2008/03/business-analytics-and-financial.html. If investors are being caught in these financial institutions failures and downgrades is because they are failling to do basic due diligence.

Also, I have suggested potential solutions that may have sounded fairly radical 6 months ago, but they are sounding more reasonable in today's financial markets. Let's allow more direct foreign investment in our capital markets. Second, target housing relief, for homeowners and financial institutions, to primary homes with a market value of up to $250,000. Lastly, let the market forces dictate what happens to properties valued at over $250,000. See, http://atomai.blogspot.com/2008/03/financial-markets-crisis-potential.html.

I have also suggested new metrics, using advanced analytics, as well as financial models that can be used to gauge risk and create a robust decision support system. See, http://atomai.blogspot.com/2008/05/bernanke-banks-must-get-better-at.html

These problems are not easy, but that is part of life...what we need is the will to implement these changes.

Microsoft BI Conference

Business Analytics Group Members,
I will be present at the Microsoft BI Conference in Oct 6-8 in Seattle, Washington, representing HP at our booth answering questions about BI design using SSAS in the the financial, marketing, internet, healthcare, CPG, life sciences, and retail industries. Also, I will be covering how to use advanced analytics for: improving view of the data by 40%; fraud detection; and improving server performance in large databases. If you are attending the conference let me know so we can meet.

I have met some of you, but most of the members of the group I have never meet in person. This is a great opportunity to meet, exchange opinions, and probably get some souvenir from HP. In the best case scenario you can claim that you saved thousand of dollars by consulting with me for free. In the worst case scenario you can claim that you "stumped the chump" (i.e., me) with your questions and knowledge.
Thanks,
Alberto
alberto.roldan@hp.com

Data mining detects signs of Lou Gehrig's disease in gene carriers long before symptoms appear

This data mining methodology of "pattern arrays" in life sciences could be adapted for business analytics. I would recommend this methodology for large retailers to examine consumer behavior in brick and mortar onsite shopping. Also, it could be used in online advertisement.

Evaluating Online Advertising: Media Measurement Framework

There is an article by Stephen Pretorius published in Adotas that correctly identifies the Media Measurement Framework for evaluating online advertisement. He correctly identifies five areas of concern:

1. Track everything – The higher the number of variables that greater the probability that you can build a robust decision support system.


2. Integrate the data – You need a data warehouse for your variables, metrics, and decision support system that is separate from your operational data warehouse.


3. Compare apples with apples – Meaning comparison requires comparing the same type of metrics.


4. De-duplicate conversions – “You need a conditional filtering system (like DoubleClick’s Floodlight tag tool) to ensure that you only ping performance media tracking tags when they were the ones sending you the customer.”


5. Make your metrics relevant to your business – Invest in creating meaningful metrics for your business.
   

Additionally, Pretorius discusses the engagement measurement within the context of some potential improvements to Microsoft’s Engagement Mapping (EMAP) methodology: assumptions by advertisers without factual prove, and more data is better at prediction than better data mining algorithms. See, http://atomai.blogspot.com/2008/04/more-data-usually-beats-better.html

Stephen Pretorius article is called Why CFOs Don’t Believe in Online Advertising and it can be found at: http://www.adotas.com/2008/07/why-cfos-don’t-believe-in-online-advertising/

Google Analytics Switch Data Processing Times or Reporting Errors

Over the course of a month or two, many Google Analytics users began distrusting the reports provided in Google Analytics. We now have more reports, this time via Search Engine Roundtable Forums of Google Analytics not reporting accurate numbers.
I noticed yesterday's reports for this site was down about 20%. I immediately thought, give it a day and see if the numbers are higher tomorrow. They were. The numbers reported for Tuesday on Wednesday, was at normal levels when I looked today, Thursday. So I thought, maybe Google Analytics changed the time they are processing these reports (i.e. pulling in less data because they are running the reports earlier).
For example, let's say, Google Analytics typically runs the reports at 3am every morning. If Google Analytics pushed the report runs to 10pm every night, then you will be missing out on 2 hours of traffic, from the previous day. That means, you would have to wait a two-day period to see your full traffic data for the previous day. Hope I explained that well.
In any event, I am also hearing these reports outside of the forums - so this seems fairly widespread. Is this an bug or a feature - now that is the question.
Forum discussion at Search Engine Roundtable Forums.

Mending Fences Between Microsoft and Yahoo

It seems that Microsoft and Yahoo may enter into some type of an agreement if Carl Icahn wins the majority of Yahoo’s shareholders votes on August 1. If that happens Microsoft and Yahoo management will need to mend fences in order to move efficiently forward. There are two ways to mend a broken fence: discard or repair. In this situation, Icahn has stated that he will discard Yahoo’s current board of directors for a different slate of directors willing to seriously consider a business agreement with Microsoft. This is an important, but small piece of fence that is broken between these two companies.

The next layer will be the executive management of Yahoo. Microsoft’s goal would be to identify the members of the executive team that could be repaired vis-à-vis—those that are beyond salvage. A definition of beyond salvage is going to be crucial at this early stage. I assume that those members of executive management beyond salvage are those that are not willing

1. to cooperate with Microsoft’s executive management;
2. to have the flexibility to change Yahoo’s current business strategy; or
3. to take the time to understand Microsoft’s culture and business strategy.

The key ingredient is willingness. Willingness can be explained as a voluntary eagerness or disposition to act without reluctance to accomplish the goal of integrating both cultures while advancing Microsoft’s business objectives. Willingness comes from within an individual, hence it can only the measured through the actions or inaction of a particular individual.

Microsoft management also has the task of mending fences, since most fences can be repaired. This will require small but consistent acts from Microsoft that show business maturity and personal understanding to difficult changes. It reminds me of the story of the young boys that used to play baseball in an alley and the old lady that would never give them the balls that came into her yard. One of those boys started to water her lawn and clean the leaves on her patio for an entire year. He did this voluntarily and without expecting anything in return. He saw a need and he acted according to his conscience. After an entire year of doing this, the old lady called him to her house and gave him all the stray baseballs that she had collected over the years. He realized that more important than the baseballs was that he had her trust. It takes business maturity and transparency to earn trust in this type of situation.

Microsoft and Yahoo management can expect a difficult road ahead. It will not be perfect, but the combination of these two companies should be rewarding and worthwhile.

8 Lessons of Leadership

Read this article in Time magazine. For those in business analytics it brings eight principles that we should be applying to provide leadership to our organizations:

1. Courage is not the absence of fear - it's inspiring others to move beyond it. I am sure that getting involved in changing the status quo brings fear of rejection. The issue is not whether changing the status quo brings fear or not, it is the leadership that we provide to inspire other to move beyond that fear.
2. Lead from the front - but don't leave your base behind. Your base is your co-workers and your clients (internal and external). Incremental changes make changes easier than drastic changes.
3. Lead from the back - and let others believe they are in front. Give your co-workers permission to try their own ideas, and permission to fail. When people in good faith unite for a common purpose the impossible become possible.
4. Know your enemy - and learn about his favorite sport. It is part of the natural order to have adversaries, but it is important to have something in common with everybody within an organization. Besides sports I recommend talking about family, since this is a common denominator to all of us.
5. Keep your friends close - and your rivals even closer. Your friends will help you reach your goals, but your rivals can block your progress. The person that opposes the initial objective the most is a great candidate to lead the second version of the product.
6. Appearances matter - and remember to smile. Always make sure that your appearance is professional. This is not the university, this is the business world and appearances do matter.
7. Nothing is black or white. Please learn the difference between what is illegal and unethical. Illegal is against the law. Nobody is perfect, including you.
8. Quitting is leading too. We can exercise leadership by changing course. Reach consensus on metrics and timetable up front in the process and they will be the best indicator when is time to change course or make adjustments during the process.
   

Data Mining Combined With Predictive Modeling Equal 3D Data Visualization

The interaction and cooperation between computers and the human brain is at a crossroad. There are some who believe that decision support systems should be completely automated. There are others who believe that there are many areas of business, technology, and science that have not been discovered yet, and, hence, only part of a decision support system can be automated. I subscribe to the latter proposition.

Computer science is, at its core, an attempt to replicate the processing, reasoning, and learning processes of the human brain. Therefore, an understanding of the human brain is fundamental to determine the next steps into advances in the area of business analytics (i.e. the fusion of technology, science, and business). See http://atomai.blogspot.com/2008/06/intersection-of-business-science-and.html; and http://atomai.blogspot.com/2008/05/attention-system-of-human-brain.html.

Visualization is an important method that the human brain uses to perceive and make decisions. See http://atomai.blogspot.com/2008/06/on-visualization-of-mathematics.html. Classification into groups with similar characteristics, or data mining, is another method to make decisions. Depth and movement perception based on prior experience for the human brain is the equivalent of what we call in science predictive modeling or forecasting. The amalgamation of these elements in a decision support system is equivalent to the way the human brain makes decisions.

History teaches us that some discoveries provide a quantum leap of understanding. The earth revolving around the sun, gravity, and the theory of relativity are examples of these types of discoveries. On the other hand, most decision making is incremental in nature. See http://atomai.blogspot.com/2008/05/kaizen-analytics-continuous-improvement.html. For example, buying securities collateralized with real estate might not be the best investment in the United States right now; buying short-term oil contracts in the commodities market might be a more profitable investment.

We have reached a point in our technological development that we can put together genetic algorithms, data mining techniques, grid or cloud computing, and visualization techniques using gaming technologies to automate some areas of decision support systems to reduce operational costs. For an interesting perspective on how gaming techniques use predictive modeling to forecast movement, see http://web.cs.wpi.edu/~claypool/courses/4513-B03/papers/games/bernier.pdf. Also, the joining of these techniques will facilitate a decision support system to make both incremental as well as quantum leap discoveries in many business areas.

Microsoft Announces Name, Pricing for Subscription Office

This is one important piece of the Microsoft strategy to integrate Software-as-a-Service as part of it Internet strategy. See, http://atomai.blogspot.com/2008/06/internet-business-models-and-analytics.html; and http://atomai.blogspot.com/2008/06/delivering-software-as-service.html. The price will need to be adjusted to an Internet model of less than $50, it should be on a month-to-month basis without limited restrictions, and it should incorporate Microsoft Analysis Services in order to be competitive. See, http://atomai.blogspot.com/2008/06/business-analytics-and-software-as.html.

On the other hand, it shows that Microsoft is aware of the basic components to have a sucessfull Internet strategy and the steps that it can take to make those changes. The failed adquisition of Yahoo would have made it easier for Micrsosoft in terms of the change management that need to occurr for them to make these changes. Yahoo already has an Internet business and culture that could more easily adapt to these type of changes than the Microsoft propietary software business culture.

Also, Microsoft adquistion of semantic search engine Powerset shows the understanding by Microsoft of the importance of Internet "search speed" as part of its strategy.

Genetic Algorithms, Grid Computing, and Visualization Techniques

In the beginning of the technological era, we used computers to more efficiently process information. Now we use computers to help us solve problems. The next phase is to have computers generate their own solutions to problems. The last frontier is to have man and computers cooperatively competing to find solutions to complex business problems.

John Koza at Genetic Programming provides an example of computers generating their own solutions (and coding) to complex problems. Koza, a professor at Stanford University, is a thought leader in this area. “Genetic programming (GP) is an automated method for creating a working computer program from a high-level problem statement of a problem. Genetic programming starts from a high-level statement of ‘what needs to be done’ and automatically creates a computer program to solve the problem.” See, http://www.genetic-programming.com/

In the past I have written about genetic algorithms and their practical applications in business analytics. See, http://atomai.blogspot.com/2006/08/artificial-intelligence-applied-to.html; http://atomai.blogspot.com/2006/08/segregative-genetic-algorithms-sega.html; and http://atomai.blogspot.com/2006/07/genetic-algorithm-based-optimization.html.

If we combine the power of genetic programming, grid computing, predictive modeling, and data mining with powerful dynamic three dimensional visualization techniques used by game developers, we can have a world where complex business problems can be solved by cooperatively competing between man and machine. See, http://atomai.blogspot.com/2008/06/on-visualization-of-mathematics.html. The Internet and Software-as-a-Service are going to be an integral part of that mix of ingredients as a way to lower IT costs.

The next step is akin to a chef putting together a gourmet meal by using the finest ingredients and tools of the trade. A conductor brings out the most expressive details of a classical piece while blending all the sounds of an orchestra as one exquisite experience.

If anticipation is part of journey, I can hardly wait for the sounds and tastes that will come in the next 12 months when business, technology, and science merge to produce masterpieces to help solve complex business problems. See, http://atomai.blogspot.com/2008/06/intersection-of-business-science-and.html

Unleashing the Power of the Mind™

VISUALISATION USING GAME ENGINES

This is a good introductory article that explains how to adapt game engines visualization to business analytics in mobile devices. The issue to create a visualization that captures the entire data set in 3D.

At the present time businesses are used to visualize the entire data set using Excel charts. One way to augment the Excel charts and create depth perception into the data set is to add a predict probability vector. SQL Analysis Services already provide this capability. If you combine the add-in Analysis Services capability to Excel, you can see your entire data set in 3D. In other words, you combine data mining and predictive analytics capabilities in the same chart. This allows the user to see the entire data set in 3D.

In the next twelve months we will see more efficient ways to see large data set in 3D using GIS graphs.

The Internet, Business Models and Analytics

The Internet is ready for another dramatic change within the next twelve months. Technology, science and business are converging on the Internet. See Intersection of Business, Science, and Technology: Business Analytics. The speed and capacity of computers has brought us to a place “where no one has gone before”. See High Performance Computing (HPC) is Changing the World; HP Delivers Real-Time Business Information with Enhanced Neoview Capabilities; and Math Grid Toolkit brings grid computing to business. Science has provided us with powerful data mining and predictive algorithms that are used in healthcare, financial services, energy, and government industries. See Business Objects Aims to Predict the Future; The New ADAPA iGoogle Predictive Analytics; and BI Conceptual Architecture using Microsoft Products.

Companies like IBM, SAS, Google, and Microsoft are investing not only in the latest science and technology, but on different business models that will make the most of the capabilities of the Internet. The next elements to this exciting pursuit of the next Internet generation are visualization, mobile devices, and Software-as-a-Service. See On the Visualization of Mathematics (Analytics); Mobile Devices and Business Analytics; and Delivering Software as a Service.

Companies that are successful in harnessing the reach of the Internet will need a powerful infrastructure that would support virtual machines using grid computing. Companies like Microsoft, IBM, Oracle, and SAS would need to add a different Internet business model to their current business model in order to overcome the advantage that Google has in providing Software-as-a-Service and analytics through the Internet. Google’s partnership with Zementis has all fundamentals to reach individuals, as well as small, medium, and large businesses. See Business Analytics and Software-as-a-Service: Controlling IT costs. Companies like Microsoft have the potential to challenge Google if they implement an Internet business model that incorporates business analytics and Software-as-a-Service elements.

The human brain has been waiting thousand of years for business, science and technology to come up to par to its capabilities. See The Attention System of the Human Brain. We can harness this power by using the reach of the Internet to bring together the minds of millions of people. See Kaizen and Analytics.


Unleashing the Power of the Mind™

Business Analytics and Software-as-a-Service: Controlling IT costs

During an economic downturn IT executives are looking for ways to control the cost of hardware and software while simultaneously providing their companies ways to improve its business analytics capabilities. I had a demo of the ADAPA Predictive Analytics Edition on Amazon EC2 and was impressed with its capacity to provide powerful analytics at a fraction of the investment for hardware and software for predictive modeling. This is a product for the current power users of analytics within an enterprise. You can get a subscription for $49 per month plus CPU usage to start with. If you are not satisfied with the product your investment will not have any impact in your budget.

Try this product and let me know your comments. http://www.zementis.com/howtobuy.htm

I think that this predictive analytics product and business model is the future. I recommend that this product add a cluster analytics functionality that will incorporate data mining into the suite of algorithms. Also, I recommend a dynamic 3D visualization to “see” the entire data set. Otherwise, this is a powerful business model to provide cost-efficient analytics to an enterprise.

Attensity - Text Analytics

We should be hearing more and more about Attensity text analytics products and solutions. The issue is how to do analytics with unstructured data, and they have developed a powerful product.

KXEN Analytic Framework Version 5.0 Accelerates Data Mining Automation Throughout the Analytic Enterprise

KXen product is powerful and its business model "to move beyond traditional cottage-industry analysis to large-scale factory analysis" is the correct approach.

Analyze This: Four Fundamentals of Business Analytics

Very general article but captures four basic ingredients needed to implement business analytics.

1. Leaders who "get it".
2. Staff who love numbers
3. Processess that revolve around facts
4. Technology to capture, clean, sort, and make sense of data
   

Double Feature Selection and Cluster Analyses in Mining of Microarray Data from Cotton

This technique can be applied to data mining in the financial services, banking, investment banking, and healthcare industries.