Oz Analytics

Silicon Beach

Since my last post I have spent a couple of breakfasts and evenings attending networking events around Sydney where Six Degrees Of Data (6DD) is based.

I never realized how vibrant this city is - it's full of interesting people doing an amazing range of entrepreneurial things. I'm beginning to wonder if I have been asleep for the last couple of years.

Here are a few of the events and organisations I'm talking about:

• HUB Sydney - the newly opened local offshoot of the global network of shared offices/innovation communities.
• Fishburners - the co-working space and innovation community. They hold weekly get togethers each Thursday morning and these attract quite a crowd.
• Your Desk - around the corner from my day job in Surry Hills.

Then there are the likes of BlueChilli, Startmate, Bizspark, Pollenizer, the Sydney Seed Fund and others who may prove that the Australian venture capital industry is not avoiding tech start-ups as they have done in the past.

Of course our Silicon Beach is still just a handful of sand when you compare it to the networks and dynamism of Silicon Valley. At least we seem to be in the game and it's nice to know that 6DD is not alone.

A lifetime ago (or so it seems) I founded a company with an office in Los Altos, just down the road from Stanford. That's another story for another time, but the funny thing was that at that time I opted to put our HQ in Amsterdam, The Netherlands. To my delight the idea worked and I was able to attract a lot of talented people. Part of the attraction for them was living in an amazing city like Amsterdam. One thing you can say about the Valley is that it is not the most environmentally attractive place to live - some would say most places in the Valley are pretty ugly. Amsterdam is beautiful, dynamic and fascinating.

So I'm hoping that the same will apply in Sydney and when we reach the next stage of expansion, Sydney will be the cherry on the top when we are competing for talent against dozen's of other start-ups.

The Surf is up at the Silicon Beach!

Forget The Politics

I read with interest this morning about the kerfuffle New York Times blogger Nate Silver is causing. A Financial Times article (subscription required) explained that Silver has been using statistical analysis to consistently predict an Obama win in the coming US elections. His FiveThirtyEight blog is now being roundly criticised by the right-wing - and the criticism is getting pretty personal.

The unfortunate reality is that this "effeminate man with a soft-sounding voice” (Dean Chambers) has a pretty amazing track record of success. He started plying his trade forecasting the performance of Major League Baseball players and since 2008 has turned his attention to politics. In 2008 he correctly predicted the presidential winner of 49 out of 50 states. As a side note, the same blog (but different blogger) also correctly predicted the narrow win for the ruling Australian Labor party in 2010.

As far as I can see, Silver is only guilty of using open data to make systematic and scientifically based predictions using probability theory. You can check-out his methods for yourself.

I recommend his blog to anyone interested in stats and polling. TL;DR? If that's too old-school for you gen-Y twits (?), then he tweets as well.

His book 'The Signal and the Noise: Why So Many Predictions Fail-but Some Don't' has just been published and I'm ordering it today.

It's good to see that mathematically-based poll analysis continues to be politicised in the States. Way to go America - who needs facts?

The State of Analytics Across Asia

Further to my last blog, I have collected my facts and thoughts into a year-end overview of Asia in 2009. Here's a round-up of developments that I noted over the last 12 months. There were many more that you can access by using the CORTEX, but several key events are listed below.

What are common trends across the region?

• A V-shaped market recovery is predicted in the 2010 BI market.
• The leading tech companies have created analytic centres of excellence across Asia. If you engage a major vendor or consultancy then it is likely that you will be leveraging Indian or Chinese IP.
• Low-cost and innovative reporting and analytic solutions are winning worldwide accolades. Strong sales across the region will continue and price sensitive buyers in Western markets will begin to take notice.

Notable Events in 2009

January

Accenture India said it planned to hire 8,000 people by the end of 2009, which will take its total workforce in India to 50,000. “We believe that analytics is going to be an important trend that our customers are going to demand from us. We think India is going to be a great place for us. We have some core centres of excellence in the analytics space in the country,” said William D Green, chairman and CEO of the firm that employs 177,000 people globally.

April

SAP Opens Co-Innovation Lab in Bangalore. Joins existing labs in Palo Alto, California, and Tokyo, Japan. Work has concentrated on delivering workflow and mobility solutions.

May

Analytics tools are becoming more vital to outsourcers -especially quality monitoring and performance management products. Agent Performance Optimisation (APO) products have become vital as outsourcers strive to differentiate themselves competitively and cut costs for their clients.

June

Tata Consultancy Services (TCS) launched a new business intelligence solution for hospitals and health care sector. The company today said in a press release that it has developed an out of the box dashboard that will simplify projects, cut cost and dramatically shorten time to value related services to both hospital administration and patients care.

Ramco Systems in India introduced a corebanking analytics solution aimed at addressing Business Intelligence (BI) needs of banks. The analytics solution packaged and delivered with HP s Neoview Appliance box will be based on Ramco s Decisionworks software framework. 

Chinese telecom operators reportedly spent US$1.18 bln on their business and operation support systems in 2008, up 26.8 percent year-on-year and a significant portion of this was reportedly on business intelligence.

China Mobile is working on a back end system based on cloud computing technology, which it has dubbed "Big Cloud". This includes data mining systems for China Mobile's mobile search service and a business intelligence system to track user behavior.

August

IBM Analytics Centre in Beijing. IBM announced last August that it would open an advanced business analytics centre in Beijing that will serve clients including the Chinese government. This centre joins a worldwide network of others in cities such as Berlin, Tokyo, London, New York and Washington, D.C. China was the first to be based in a developing country.

The company has stated that the China centre will at first focus on products aimed at traffic, water and electrical grid management.

"A major stimulus opportunity in China, transportation infrastructure such as new high speed trains, a hugely expanded rail network and faster links between the country's major cities are in development. This center will bring together research experts, major universities, partners and clients to develop best practices for rail systems that are smarter, more efficient, greener and attractive for travelers all around the globe."

They also said that other centres are planned in China.

Activities by the centre have included:

• Building a cloud computing platform in the city of Dongying (in the Yellow River Delta) as a model for how local government and businesses can modernize in China. Chinese economic stimulus funds are fueling the project, which is expected to be duplicated in other cities. The Yellow River Delta Cloud Computing Center will serve as a central platform for developing software that automates the petroleum production supply chain. It will be used to expand e-government services in Dongying and will serve as a technology center through which Chinese software engineers will supply outsourcing services. Clients for the first of three planned phases include Sanyo and Dupont. In the second phase the Dongying City Government will use cloud software to supply government services and administer "a smart airport, smart parks, and smart railroads.". A third phase would extend into the cities health care services.
• In September it was announced that IBM, the City of Shenyang, and China's Northeastern University were embarking on a major "smart city" collaboration effort focused on enabling Shenyang to improve the lives of its citizens by meeting its environmental responsibility goals.

"The Collaboratory will focus on advancing technology solutions that: significantly reduce carbon emissions, conserve energy, manage water efficiently, effectively track food from farm to fork, enhance the intelligence of transportation and traffic systems, create environmental emergency response plans, and allow a proactive approach to environmental responsibility vs. reactive."

• It is known that local telco China Mobile Communications Corporation has been working closely with IBM's China Telecommunications Solutions Center to deploy a  business intelligence platform that supports service creation, deployment, execution, integration and management. IBM claims that China Mobile is now able to reduce time-to-market for new products, increase revenue and improve customer service with end-to-end monitoring and analysis. It is not known if the business analytics centre in Beijing is involved.

The Beijing center will employ up to 300 consultants, mathematicians and software specialists at first and recruit or retrain up to 300 more as demand grows. It is unclear if any of these are new jobs but a portion are 'reassigned' existing IBM consultants and scientists.

September

IBM Business Analytics Centre of Competency in Bangalore, India. It's focus will be on Web 2.0 Analytics, Risk and Fraud Analytics, Financial Analytics, Customer Analytics and Enterprise Business Analytics Strategy. It also appears to have more of a regional focus whereas the Beijing centre looks to be focussed exclusively on the domestic Chinese market.

IBM acquires RedPill Solutions. A privately-held company headquartered in Singapore. RedPill provides advanced customer analytics services to businesses in industries such as financial services, telecommunications, technology and hospitality. RedPill is a specialist customer management services firm with significant expertise in areas such as churn management, segment propositions, segmentation, risk management and market/opportunity assessment. RedPill has delivered engagements across in 17 different countries in Asia Pacific and the Middle East and has offices in Thailand, Singapore, Malaysia, Indonesia, India and the United Arab Emirates.

November

QlikTech named Asian Rising Star. The Business Intelligence software vendor, has been named by MIS Asia Magazine as a Rising Star in its annual Strategic 100 IT vendors. QlikTech now has 650 customers and over 50 partners in Asia Pacific.

December

Neteeza Opens in China. The company opened a Sales (they call it a Proof of Concept) Center in Beijing. Their existing presence includes Japan, Korea, Singapore and Australia.

Alterian opens a full-service operation in Singapore, expanding from their initial APAC presence in Sydney.

MAIA Intelligence wins Red Herring Top 100 Award. MAIA is an Indian startup that produces a low cost but powerful BI software suite. The company was founded in 2006, has grown rapidly with over 10,000 users of 1KEY BI products. It has also been featured in Gartner’s Hype Cycle for ICT in India 2008 & BI Trend Report 2008-09 APAC.

Tata Consultancy Services is a Gartner leader. TCS is placed in the leaders quadrant for the 'Magic Quadrant for Oracle Outsourcing, North America'.

Is 2010 The Year Asia Cuts the Apron Strings?

It has been many years since I last worked in China and a couple of recent announcements led me to wonder what has been going on there recently. When I started to review what I knew about analytics in China I started thinking about Asia in general. Would 2010 be the year we would see an upswell of analytics with a distinctly Asian (as opposed to US) flavour?

What makes Asia Different?

Analytically, it's both the size of the potential market as well as its fundamental differences from the West that intrigue me. Take a look at the mobile market for example:

 

So not only is the absolute size greater but 75 per cent of mobile users own web-enabled phones - compared with only 41 per cent in the US. This data is care of Netpop Research. China is not alone in the region, IDC estimates that there are over 600 mn fixed line subscribers in Asia Pacific excluding Japan (APEJ) and over 1.6 bn mobile subscribers.

Telco's in India expect 2010 to see Enterprise Mobility as a hot trend. According to local trade publication Voice&Data:

"Enterprises will be relooking at their entire IT architecture and strategize ways to ensure that the entire workforce – be it blue collar manufacturing employees, gray collar service employees or white collar management employees – is able to leverage and add-on to the intelligence available at the back office."

In the wired world, 5 of the top 10 most connected countries or territories are in Asia. South Korea led, where 95 percent of homes have broadband. Singapore and Taiwan are among the top five countries in terms of access to high-speed Internet, according to a survey released in 2009 by Boston-based Strategy Analytics.

The United States, where just 60 percent of households had broadband as of last year, ranked 20th in the survey of 58 countries. The firm predicted the broadband subscriber base in the Asia-Pacific region will grow on average by a further 15 percent a year between 2009 and 2013.

Strategy Analytics said South Korea's highly urbanized population and its government-backed broadband policy accounted for its high rate of broadband penetration.

Singapore ranked second on the list with household broadband penetration of 88 percent, followed by the Netherlands (85 percent), Denmark (82 percent), Taiwan (81 percent), Hong Kong (81 percent), Israel (77 percent), Switzerland (76 percent), Canada (76 percent) and Norway (75 percent).

Among other Asia-Pacific nations, Australia ranked 11th with 72 percent, Japan ranked 16th with 64 percent, New Zealand ranked 25th with 57 percent, China ranked 43rd with 21 percent and Malaysia ranked 44th, also with 21 percent.

Thailand ranked 51st with seven percent, Vietnam ranked 52nd, also with seven percent, the Philippines ranked 53rd with five percent, India ranked 57th with two percent and Indonesia ranked 58th with one percent.

Why Is Asia Important?

Technology spend across Asia excluding Japan (APeJ) is expected to grow strongly in 2010. Singapore-based Springboard Research's recent Asia-Pacific Predictions 2010 report is predicting 8.8 per cent growth. They put analytics as the #1 trend in 2010:

"Among the hot technologies for this year are analytics solutions that will make use of data and predictive modelling technology to help support business decision-making."

This prediction is similar, but more optimistic than that from the better-known IDC. They recently predicted that ICT spending in APEJ will reach $184 bn in 2010 with a 7.7% growth over this year. Analytics was their #2 trend for 2010:

"2010, IDC expects business analytics to emerge as a key technology area to help CIOs manage cost, comply with regulations, and most importantly, grow the business as information is treated as a strategic asset within the organization. More advanced and sophisticated forms of analytics solutions, are actively being implemented by organizations in the region."

IDC goes on to add a second analytic prediction with trend #9:

#9: Intelligent X: Building a smarter and more measurable world

IDC believes that 2010 will be a year of multiple 'intelligent' initiatives in Asia, as major governments and cities try to beat each other to reach the goal of securing foreign investment and foreign technology participation in this region. In these 'intelligent' initiatives, a new business model is emerging as a 'Holy Trinity' consisting of government, ICT vendors, and citizens; all three working in sync is required to make inroads in emerging countries.

From an ANZ perspective, the signing of the Free Trade Agreement between ASEAN, Australia and New Zealand (AANZFTA) in late 2008 should also expand activity as it includes provisions covering trade in services, together with investment, intellectual property, competition policy and economic cooperation.

More personal reasons for why Asia matters include:

• Large numbers of analytics graduates I meet from Bangalore, Chennai and Shanghai
• ETL and SQL outsourcing deals between ANZ and Asia
• Rise of leading BI Vendor centres of excellence in Asia (more on this in my next blog)
• Expansion of local BI players into South East Asia (and beyond).

In my next blog I will try to summarise what has been happening in analytics in Asia recently. I believe that we will see evidence of Asia coming out of the Global Financial Crisis in a stronger position than when they went in. Analytics in Asia is looking a lot more dynamic these days and many local organisations are not going to pay for the BI suites from the SOMIS (SAP, Oracle, Microsoft, IBM, SAS) vendors when viable local options are around at a fraction of the price.

It's still too early for Silicon Valley to start worrying - but it may be time to start taking notice of what's happening to the East of La La Land.

Mining The Gartner Symposium

Gartner's biggest annual get-together (Gartner Symposium/ITxpo 2009) is on in Orlando and although I generally don't think too much about it, it does (claim to) bring together over 1,600 CIO's and I was wondering what knowledge I could mine by looking at what people are tweeting, blogging and in other ways posting online.

Here's what I have found. I include some interesting snippets and also a sprinkling of 'stating the obvious'. Gartner remains a fascinating mix of deep insight and banality. I can't resist it, but you can judge the value yourself:

@lgreski: #gartnersym keynote: 75% of leaders surveyed say bad data constrains business. Too much info managed in spreadsheets.

@andreagoulet: Avg team size for big brand twitter team? 4. @jetblue :12 @wholefoods :11 @ford :6 @starbucks :2 Most common 1-2 people "on duty" #ims09

“Just as your business counterparts use fact-based business intelligence data to make decisions regarding investments and resource prioritization to achieve their goals, IT needs to gather and analyze relevant data to run the business of IT,” said the Gartner analysts. By Mike Hill, Gartner

The most blogged news of the conference comes from Gartner Analysts Carl Claunch and David Cearley’s Top 10 Strategic Technologies for 2010:

1. Cloud Computing
2. Advanced Analytics
3. Client Computing
4. IT for Green
5. Reshaping the Data Center
6. Social Computing
7. Security – Activity Monitoring
8. Flash Memory
9. Virtualization for Availability
10. Mobile Applications

Most made me yawn, but these stand-out (from a Gartner post):

#1: Cloud Computing. Cloud computing is a style of computing that characterizes a model in which providers deliver a variety of IT-enabled capabilities to consumers. Cloud-based services can be exploited in a variety of ways to develop an application or a solution. Using cloud resources does not eliminate the costs of IT solutions, but does re-arrange some and reduce others. In addition, consuming cloud services enterprises will increasingly act as cloud providers and deliver application, information or business process services to customers and business partners.

#2 Advanced Analytics. Optimization and simulation is using analytical tools and models to maximize business process and decision effectiveness by examining alternative outcomes and scenarios, before, during and after process implementation and execution. This can be viewed as a third step in supporting operational business decisions. Fixed rules and prepared policies gave way to more informed decisions powered by the right information delivered at the right time, whether through customer relationship management (CRM) or enterprise resource planning (ERP) or other applications. The new step is to provide simulation, prediction, optimization and other analytics, not simply information, to empower even more decision flexibility at the time and place of every business process action. The new step looks into the future, predicting what can or will happen.

#6 Social Computing. Workers do not want two distinct environments to support their work – one for their own work products (whether personal or group) and another for accessing “external” information. Enterprises must focus both on use of social software and social media in the enterprise and participation and integration with externally facing enterprise-sponsored and public communities. Do not ignore the role of the social profile to bring communities together.

#7 Security – Activity Monitoring. Traditionally, security has focused on putting up a perimeter fence to keep others out, but it has evolved to monitoring activities and identifying patterns that would have been missed before. Information security professionals face the challenge of detecting malicious activity in a constant stream of discrete events that are usually associated with an authorized user and are generated from multiple network, system and application sources. At the same time, security departments are facing increasing demands for ever-greater log analysis and reporting to support audit requirements. A variety of complimentary (and sometimes overlapping) monitoring and analysis tools help enterprises better detect and investigate suspicious activity – often with real-time alerting or transaction intervention. By understanding the strengths and weaknesses of these tools, enterprises can better understand how to use them to defend the enterprise and meet audit requirements.

From a presentation by Gartner Senior Analyst Eric Knipp on “Citizen Developers: When End Users Surpass the IT Department in Delivering Business Applications”:

"as much as 25 percent of business applications will be built by “citizen developers” – users outside of the scope of formal enterprise IT – by 2014."

“Future citizen-developed applications will leverage the IT investments beneath the surface,” he said. “Mashups will enable IT to focus on deeper architectural concerns, while end users will focus on wiring together services into business processes and workflows. Furthermore, citizen development introduces the opportunity for end users to address projects that IT has never had time to get to — the vast expanse of departmental and situational projects found beneath the surface.”

A recent report published by Gartner entitled Introducing Pattern-Based Strategy states: “We live in a world of patterns — competitive advantage and survival are about recognizing and acting on patterns before others. Previous strategic planning models were strained to seek changes, predict outcomes, adequately guide decisions and assist leaders in defining governance models that embrace change. Through a focus on pattern-based strategy organizations will move from being ‘reactive’ to being ‘proactive.’” The research note goes on to say, “The environment emerging from the recession demands an increased focus on detecting leading indicators of change, and on identifying and quantifying risk emerging from new patterns, rather than obsessing over lagging indicators of performance. In this way, we move from a world of ’sense and respond’ to one focused on ’seek and act.’”

"Introducing Pattern-Based Strategy," Gartner, 7 August 2009.

A cut-down version of the Gartner roadshow comes to Sydney 17-19 November 2009.

Out Of Balance?

A small thought to ponder for the local community:

Trade between Australia and Brazil has increased by 58 per cent last year, making two-way commerce between the countries bigger than with France, Germany or Italy.

In our own Analytics field, why are we so fixated on news and views from the US? Shouldn't we be focussing more on what is happening in our strongest growing major partners like India, China and Brazil?

Here are a couple of pieces of interesting news coming out of these countries in the last few days:

India

• Tata Consultancy Services (TCS) launched a new business intelligence solution for hospitals and health care sector. The company today said in a press release that it has developed an out of the box dashboard that will simplify projects, cut cost and dramatically shorten time to value related services to both hospital administration and patients care.
• Ramco Systems will soon introduce a corebanking analytics solution aimed at addressing Business Intelligence (BI) needs of banks. The analytics solution packaged and delivered with HP s Neoview Appliance box will be based on Ramco s Decisionworks software framework. 

China

• Chinese telecom operators spent US$1.18 bln on their business and operation support systems in 2008, up 26.8 percent year-on-year and a significant portion of this was on business intelligence.
• China Mobile is working on a back end system based on cloud computing technology, which it has dubbed "Big Cloud". This includes data mining systems for China Mobile's mobile search service and a business intelligence system to track user behavior.

Perhaps we need to to redress the balance and start looking at innovative and cost-effective analytics solutions coming out of these countries? Are they potentially going to deliver greater functionality at significantly lower cost from the big 4 (IBM, Microsoft, Oracle and SAP) vendors?

I would love to know if any of our local organisations are using analytic technology from these countries. Anyone know?

July 3, 2009:

Here's a footnote to my original blog entry. I just read a white paper from HP called the 'Top 10 trends in Business Intelligence for 2009' and I was pleased to read:

Trend #2: Post-Western tech economy
Western countries will not continue to be the sole
source of technology innovation. World-leading
businesses of the future are the ones who will make the
shift from western-centric business models to become
true globally adaptive organizations. They’ll seek the
best ideas from anywhere in the world and distribute
research and development (R&D) activity to include
emerging markets. Emerging regions will transition
from being simply suppliers of low-cost talent to 1)
developers of best practices and technology,
challenging multi-nationals to localize their value
chain, and 2) consumers who set global standards.
Western companies will be driven to using social
network-based collaboration tools to integrate the
creativity and work of a globally distributed workforce
and partner ecosystem.
Much innovation in BI, i.e. event processing, advanced
analytics, integration of unstructured data, automated
data classification, decision automation, etc., can
benefit and accelerate from technology research and
the modern and collaborative development techniques
used in countries like India. Need has outstripped
availability and the organizations who can leverage
this R&D efficiency will be well positioned in the
new economy.

A least one other person agrees with me!

Here's a copy of the full paper from the folks at HP Neoview:

Download Top 10 trends in Business Intelligence for 2009

Take a look online at  www.hp.com/go/bi