Discover the value in IBM Business Analytics

© 2009 IBM Corporation

IBM Business Analytics and OptimizationDiscovering the Value of Business Analytics

Lennart Frantzell [email protected] Giuseppe Accardo [email protected], Chris Heckhart [email protected] San Mateo Innovation Center, San Mateo, California

2011/05/6

mailto:[email protected]



IEEE Accessing the Future Conference, Boston, July 2009.

TIME TOPIC

10:00 a.m. Registration10:15 a.m. Introduction, an overview of Business Analytics

Lennart Frantzell, San Mateo IBM Innovation Center

11:30 a.m. IBM Business Analytics product portfolio introductionGiuseppe Accardo, San Mateo IBM Innovation Center

12:00 Lunch, networking

1:00 p.m. IBM Business Analytics product portfolio introduction, contGiuseppe Accardo, San Mateo IBM Innovation Center

1:30 p.m. Prescriptive analytics in the real world with ILOGJeremy Bloom, IBM

2:00 p.m. Build Online RevenueGene Hoffman, Vindicia

2:30 p.m. Where do we go from here?Lennart Frantzell, San Mateo IBM Innovation Center

Event Agenda Event Agenda Discover the Value of IBM Business AnalyticsDiscover the Value of IBM Business AnalyticsWednesday, May 25, 2011Wednesday, May 25, 2011


IEEE Accessing the Future Conference, Boston, July 2009.The sea change, from analog to digital data

• Historical change, from analog to digital data

• Today, mankind generates staggering amounts of digital data

• How do we search vast amounts of digital data?

• How do we make sense of all this data?

• Mobile computing, social networks and Cloud Computing make business analytics accessible everywhere

• Mankind entering era of informed decision making



©ILOG

1 billion transistors for each person on earth.

THINK

1 trillion things connected to the net.

By 2010, 30 billion RFID tags, embedded intoour world.

4



Artificial Intelligence and Analytics

• AI– Inference engines, Expert Systems, Rete

Algorithm, Prolog, Neural Networks, Rules-based systems

– Complex algorithms and very little data– Answers intertwined with algorithms – Snakebites in Australia– Airline scheduling

• Analytics– Staggering amounts of data– Separation of algorithms and data– Successful HIV treatment in Ethiopia,

match patients against data.

Patient HIV treatment

• Match incoming patient against patients who have been successfully treated for HIV,

• Select that treatment

Analytics



Searching large amounts of dataThe canonical example application of MapReduce is a process to count the appearances of each different word in a set of documents:

void map(String name, String document):// name: document name// document: document contentsfor each word w in document:

EmitIntermediate(w, "1");

void reduce(String word, Iterator partialCounts):// word: a word// partialCounts: a list of aggregated partial countsint result = 0;for each pc in partialCounts:

result += ParseInt(pc);Emit(AsString(result));


IEEE Accessing the Future Conference, Boston, July 2009.IBM’s Grand Challenges: Deep Blue

1997IBM’s chess-playing computer. Each chip was equipped with a million transistors, which evaluated 2 million positions Each second.

In Deep Blue, some 256 chips were teamed together under the overall control of a general-purpose IBM SP2®, a parallel computer consisting of, in this case, 32 processor nodes.

The parallelism derived from these 32 processors and 256 chess accelerator chips is what mades Deep Blue the most powerful chess computer in the world.

It was capable of looking at an average of 100 million positions per second.


IEEE Accessing the Future Conference, Boston, July 2009.IBM’s Grand Challenges: Deep Blue, Blue Gene

1997

2005

Blue Gene

Blue Gene is an IBM Research project dedicated to exploring the frontiers in supercomputing: in computer architecture,in the software required to program and control massively parallel systems, and in the use of computation to advanceour understanding of important biological processes such as protein folding.


IEEE Accessing the Future Conference, Boston, July 2009.IBM’s Historical Grand Challenges: Deep Blue, Blue Gene and Watson

1997

2011

2005



Watson and structured versus unstructured data

The canonical example application of MapReduce is a process to count the appearances of each different word in a set of documents:

void map(String name, String document):// name: document name// document: document contentsfor each word w in document:

EmitIntermediate(w, "1");

void reduce(String word, Iterator partialCounts):// word: a word// partialCounts: a list of aggregated partial countsint result = 0;for each pc in partialCounts:

result += ParseInt(pc);Emit(AsString(result));



July 20, 2009

IBM Watson and IBM’s DeepQA Technology• Watson runs IBM’s DeepQA technology, developed using Apache UIMA, a framework implementation • of the Unstructured Information Management Architecture.

• UIMA was designed to support interoperability and scale-out of text and multimodal analysis applications.

• The Watson database includes Wikipedia and other sources

• Powered by IBM POWER7 processor technology, Watson is an example of the complex analytics workloads that are becoming increasingly common in business

• Watson also uses Apache Lucene, Indri, SPARQL and the Jena Toolkit

• Watson’s DeepQA UIMA annotators were deployed as mappersin the Hadoop map-reduce framework, which distributed them across processors in the cluster.

The Regular Expression Annotator (RegexAnnotator) is an Apache UIMA analysis engine that detects entities like email addresses, URLs, phone numbers, zip codes or any other entity based on regular expressions and concepts.

IBM Power 7 Hardware

Database/Wikipedia

Apache UIMA

IBM DeepQA



Top right: World of Warcraft Bottom Right: Wicked Left: Frank Baum



IBM ConfidentialJuly 20, 2009

•




Watson in Healthcare

Natural Language Processing in Healthcare• As Electronic Healthcare Records systems are adopted by

Government mandate, physician notes are digitized in a computer readable format…, the Mayo Clinic and IBM have already announced a partnership to open source much of the UIMA annotators Mayo developed to mine its own medical records.

• Mining patient reported data is another interesting area. Patient communities such as PatientsLikeMeand Association of Cancer Online Resources.

• In 1999 by BMJ (British Medical Journal) a team of researchers observed 103 physicians over one work day. Those physicians asked 1,101 clinical questions during the day. The majority of those questions (64 percent) were never answered.

http://www.ibm.com/developerworks/industry/library/ind-watson/index.html



IBM Smarter Planet

•



Business Analytics in Action

HIV treatment in EthiopiaSequoia Hospital in Silicon Valley



EuResist, HIV Treatment in Ethiopia

Doctors in Ethiopia can instantly compare this blood sample to over 41,000 HIV treatment histories.

EuResist is helping doctors predict patient response with over 78% accuracy – outperforming 9 out of 10 human experts.

The tool is built on an IBM analytics solution that integrates a variety of disparate databases onto a flexible IBM DB2® platform to process complex metadata more effectively than anything else on the market.

Link: http://www.euresist.org/

http://www.euresist.org/



EUResist Demo



How do we use Business Analytics? Reference Implementation



Degree of Complexity

Com

petit

ive

Adv

anta

ge

What exactly is the problem?

What will happen next ?

What if these trends continue?

What could happen…. ?

What actions are needed?

How many, how often, where?

What happened?

Descriptive

Prescriptive

Predictive

What’s the best that can happen ?

What’s the best that can happen including the effects of variability?

Std Reports

Query/Drill Down

StatisticalAnalysis

Alerts

Forecasting

Predictive Modeling

Optimization

StochasticOptimization

Based on: Competing on Analytics, Davenport and Harris, 2007

Ad Hoc Reports

Optimization and Analytics, an Overview


IEEE Accessing the Future Conference, Boston, July 2009.Architecture pattern: Service Orientation architecture and analytics

Analysis

Data Warehouse

Analytics

Das

hboa

rdin

g

Pred

ictiv

eA

naly

sis

Analysis

Stat

istic

alA

naly

sis

Dat

amin

ing

Opt

imiz

atio

nData sources:Patient data, e-meters, data streams, unstructured data

ETL

ETL (Extract Transform Load)

Cycle initiationBuild reference dataExtract (from sources)ValidateTransform (clean, apply business rules, check for data integrity… )Stage (load into staging tables, if used)Audit reports (for example, on compliance with business rules. )Publish (to target tables)ArchiveClean up


IEEE Accessing the Future Conference, Boston, July 2009.Cross River, HIF Reference Implementation at Global Solutions Center• Premier test harness, product showcase, and center of excellence at the IBM Global Solutions

Center (Dallas)

• Proof point for integrating all essential components for an enterprise class health analytics platform (integration, analytics, presentation layer)

Data Source Layer (Clinical, Financial, (Operational, Administrative)) …



Center (Dallas)


InfoShpereInformation Analyzer, DataStage, QualityStage, Service Director

Adapters (e.g. Cache)

WSTX (HL7)

Rational Data Architect

Integration Layer




Center (Dallas)




WSTX (HL7)


Integration Layer

Data Layer InfoShpere WH Cubing Services

Data Models

InfoSphere Meta Data Management

InfoShpereWarehouse

InfoSphereBusiness GlossaryBCU

Data Source Layer (Clinical, Financial, (Operational, Administrative)) …BCU: Balanced Configuration Unit



Center (Dallas)




WSTX (HL7)


Integration Layer


Data Models

InforSphere Meta Data Management

InfoShpereWarehouse


Cognos Performance Management Cognos BI InfoShpere Structured and

Unstructured Data Mining


Analytic Layer



Center (Dallas)




WSTX (HL7)


Integration Layer


Data Models

InforSphere Meta Data Management

InfoShpereWarehouse


Cognos Performance Management Cognos BI InfoShpere Structured and

Unstructured Data Mining


Analytic Layer

WebSphere Portal Server

Presentation Layer

Cognos Chronic Disease Management

Track, analyze, report events

Ad Hoc Analysis

Planning and Forecasting Cohort Analysis

Clinicians Researchers Patients Administrators



Discovering the Value of Business AnalyticsIBM Product Portfolio

IBM Business Analytics and Optimization



Sub-market Segments:

BI Tools

Data Integration tools

DB Management Systems

Hardware Platform

Reporting languages(Focus and Ramis)

Technology Evolution of BI & Analytics (Blog: Wayne Eckerson - BeyeNetwork)



32

The integrated platform




33





Actionable Optimization & Analytics

34

Degree of Complexity

Com

petit

ive

Adv

anta

ge

Standard Reporting

Ad hoc reporting

Query/drill down

Alerts

Monte Carlo simulation

Forecasting

Predictive modeling

Mathematical Optimization

What exactly is the problem?

What will happen next if ?

What if these trends continue?

What could happen …?

What actions are needed?

How many, how often, where?

What happened or is happening?

What-if Analysis

Based on: Competing on Analytics, Davenport and Harris, 2007

How can we achieve the best outcome?

What should we do, given the alternatives and real-time changes?

ForesightInsight Descriptive

Predictive

Prescriptive

http://www.spss.com/






35

IBM Business Analytics and Optimization Portfolio – Key Products

… What happened ?




36





Business Intelligence & Performance ManagementAnswer three important questions that drive better performance

Finance

Operations

HumanResources

IT/Systems

CustomerService

Marketing

Sales

How are we doing?Scorecards and Dashboards

What should we be doing?Planning, Forecasting and Budgeting

Why?Reporting & Analytics

37



10 Capabilities

Querying and ReportingQuerying and Reporting

Analysis & PlanningAnalysis & Planning

DashboardingDashboarding

ScorecardingScorecarding



10 Capabilities

Real time monitoringReal time monitoring

StatisticsStatistics

Extending BIExtending BI

Collaborative BICollaborative BI



•Design and build – Create report templates to include standard report objects, queries, and layouts.

•Analyze and share – View, interact with and analyze the result set, and share the results generate a unique perspective around information.

•Assemble and format widgets from BI, TM1, Real-Time Monitoring, Metric Studio, PowerPlay, RSS and HTML elements etc and put them in a single report

10 Querying and Reporting



10 Querying and Reporting

•Relational databases from IBM, Oracle, Microsoft, Teradata, and Sybase, various sources accessible via ODBC and dimensionally aware sources like SAP BW.

•Widely deployed ERP systems, including mySAP (R/3), PeopleSoft Enterprise, JD Edwards EnterpriseOne, Oracle eBusiness Suite and Siebel CRM.

•Enterprise data warehouses and marts, with both 3NF and star schemas.

•All widely used OLAP sources, including IBM DB2 OLAP Server, IBM Cognos PowerCube, Microsoft Analysis Services, Oracle 10G and Oracle EssbaseOLAP.

•Satellite data sources, including Microsoft Excel files, Microsoft PowerPoint® files, Microsoft Access® files, flat files and more.

•Mainframe sources, including VSAM, IMS, IDMS, COBOL®copybooks and others

•Content management data, including IBM FileNet®, EMC Documentum, OpenSoftand others

Supported data

sources

•Modern data sources, such as XML, LDAP and WSDL



10 Dashboarding

Louis Barton, a Frost Bank IT executive, dashboards add value by “reducing the cycle time it takes to analyze information [key performance metrics], You can make a decision sooner. That means people are more productive.”



PLANS & FORECASTS

TM1 Planning SoftwareWith Cognos Planning you can access current actual data to assess fiscal performance, and proceed from what-is to evaluate the what-if scenarios critical to forecasting future performance.

• Rapid development. • Sophisticated modeling.• Flexibility. • Finance friendliness. • Less time on process

Power of “sandboxing”:

Link: http://forms.cognos.com/?elqPURLPage=2293&offid=od_tm1

DEMO Video

DEMO Video

http://forms.cognos.com/?elqPURLPage=2293&offid=od_tm1



Strategy Map with associated metrics

10 Scorecarding -

Cause and effect diagramMetrics grouped by owner Advance initiative tracking

It allows executives and business managers to instantly visualize how the business is performing against key performance indicators.

At the operational level, departments and employees can use scorecards to monitor their performance against targets set for specific projects and activities.

Communicate strategy - Understand key relationships - Build metrics and scorecards based on reliable information



10 Extending Business Intelligence

Provide actionable intelligence to users, no matter their location or their connectivity.

Business users, from executives to mobile field workers, can know and understand the health of the business at all times, and have the tools to take action on what they see.

Reduce the burden on IT to redevelop reports for various devices.

Take full advantage of the mobile network infrastructure —an excellent opportunity for low-cost BI deployment.



With integrated Lotus Connections, users can:

• Link directly from Lotus Connections to a Cognos Business Insight dashboard

• Use single sign-on for both Business Insight dashboards and Lotus Connections

• Add other individuals to an Activity at any point in the decision-making process

• Search for Activities directly from the Business Insight window

• Send email notifications directly from the Activity

10 Collaborative Business Intelligence


IEEE Accessing the Future Conference, Boston, July 2009.IBM Cognos Express – Solution for the Mid Market

47

Features of IBM Cognos Express Reporter

•Complex reporting tool designed for business•Reports against a single common data source will harmonize your business•Self-service flexible reports to meet the needs of different users, including financial, production, operational, transactional, managed or ad hoc reports•No matter if relational or multidimensional OLAP data are used for reports•Ergonomic Web interface•Drag&Drop style of work•Publish reports to web portal, HTML, PDF or Excel files•Interactive dashboard for quick orientation and decision making across the whole company•Integration with other modules, a single platform for BI and planning

Features of IBM Cognos Express Reporter

•Complex reporting tool designed for business•Reports against a single common data source will harmonize your business•Self-service flexible reports to meet the needs of different users, including financial, production, operational, transactional, managed or ad hoc reports•No matter if relational or multidimensional OLAP data are used for reports•Ergonomic Web interface•Drag&Drop style of work•Publish reports to web portal, HTML, PDF or Excel files•Interactive dashboard for quick orientation and decision making across the whole company•Integration with other modules, a single platform for BI and planning

Features of IBM Cognos Express Advisor

•Create multidimensional view of your business based from your relational data with a few clicks while employing the powerful and fast in-memory multidimensional database •Get maximum information from your data using drill-down and drill-up capability in combinations with lucid graphical outputs •Conformable self-service ad-hoc analysis according to your needs without waiting for IT department implementation •Step into the world of what-if analysis and planning with the write-back and data spread features •Ergonomic Web interface •Employ the power of dashboards and interactive reports •Integration with other modules, a single platform for BI and planning

Features of IBM Cognos Express Advisor

•Create multidimensional view of your business based from your relational data with a few clicks while employing the powerful and fast in-memory multidimensional database •Get maximum information from your data using drill-down and drill-up capability in combinations with lucid graphical outputs •Conformable self-service ad-hoc analysis according to your needs without waiting for IT department implementation •Step into the world of what-if analysis and planning with the write-back and data spread features •Ergonomic Web interface •Employ the power of dashboards and interactive reports •Integration with other modules, a single platform for BI and planning

Features of IBM Cognos Express Xcelerator

•Delivers the powerful and fast in-memory multidimensional database •Create scenarios, versions, variance and what-if analysis against live data directly in Excel •Build and edit your plans real-time with write-back capability •Use worksheets - employ your strong knowledge of Excel and extend it with powerful Cognos Express functionality like multidimensional data functions•Web interface available for easy data contribution and work with excel worksheets without having Excel installed on your machine •A single common base for metadata and data, business rules and calculations, which harmonizes the view of your business

Features of IBM Cognos Express Xcelerator

•Delivers the powerful and fast in-memory multidimensional database •Create scenarios, versions, variance and what-if analysis against live data directly in Excel •Build and edit your plans real-time with write-back capability •Use worksheets - employ your strong knowledge of Excel and extend it with powerful Cognos Express functionality like multidimensional data functions•Web interface available for easy data contribution and work with excel worksheets without having Excel installed on your machine •A single common base for metadata and data, business rules and calculations, which harmonizes the view of your business


IEEE Accessing the Future Conference, Boston, July 2009.Case Study #1 - BMR tones up its sales performance with advanced analytics

Business need:BMR was in the process of replacing its core ERP solution, and saw this as an opportunity to enhance its business analytics capabilities to deliver improved sales performance management. As a mid-sized business, BMR wanted to find an affordable solution that would offer enterprise-class functionality.

Solution:ProStrategy Colman, an IBM Business Partner, helped BMR become the first company in Europe to implement IBM Cognos Express – an all-in-one business intelligence and planning solution designed for mid-sized companies. The solution is integrated with the company’s new Microsoft Dynamics NAV ERP system, and also draws data from sales channels such as eBay, BMR’s Slendertone website and retail customer databases.

Benefits:Provides real-time analysis of sales performance, helping sales teams and managers work more productively. Reduces time spent on collecting and checking data by more than 30 percent, allowing users to focus on actual analysis. Eliminates data silos and provides a ‘single version of the truth’ with accurate, up-to-date information.http://www-01.ibm.com/software/success/cssdb.nsf/CS/STRD-8CEE4P?OpenDocument&Site=default&cty=en_us

http://www-01.ibm.com/software/success/cssdb.nsf/CS/STRD-8CEE4P?OpenDocument&Site=default&cty=en_us


IEEE Accessing the Future Conference, Boston, July 2009.Case Study #2 - Mercury Medical a healthcare manufacturer improves reporting and analysis with IBM Cognos Express

Business need:IBM Software Valuenet Reselling Partner, BlueNET Technologies introduced Mercury Medical to Cognos Express through the 30-day product trial that allowed BlueNET to create a custom report and analysis demo tailed to Mercury’s specific data and user needs.

Solution:Cognos Express met Mercury Medical’s recovery time objectives, giving the company confidence in its decision.

Benefits:Mercury’s users can now create the most critical reports that they were previously relying on a Legacy Reporting Platform to produce. These include sales commissions, weekly sales, a rolling 12-month sales report, and an inventory summary report.

http://www-01.ibm.com/software/success/cssdb.nsf/CS/SANS-8DBM29?OpenDocument&Site=default&cty=en_us

http://www-01.ibm.com/software/success/cssdb.nsf/CS/SANS-8DBM29?OpenDocument&Site=default&cty=en_us



50


… What could happen ?



51

Statistical Package for the Social Sciences (SPSS) V.19The integrated platform




PharmaSales

Manager

Telco Call Center Rep

Loan Officer Retail Sales Associate

…predict regions where

doctors prescribe high

volume of medication?

…apply social relationships of

customers to prevent churn?

…adjust credit lines as

transactions are occurring to

account for risk fluctuations?

…determine discount levels for

select people at time of sale instead of

offering to all?

Imagine you could gain new insights to….

52



SPSS Enables New Solution Value for IBM Cognos Customers

Why are we on/off track?

How are we doing?

What should we be doing?

New customer insight through Data Collection

New customer insight through Data Collection

Time series forecasting

Time series forecasting

Predictive analytics for deeper understanding of the data

Predictive analytics for deeper understanding of the data

Addition of KPPs(Key Performance Predictors)

Addition of KPPs(Key Performance Predictors)

Broad distribution of statistical results

Broad distribution of statistical results

53



DEMO Video

DEMO Video

Traditional Approach Breakaway

Sense and Respond Predict and act

Back Office Point of impact

Skilled analytics experts Everyone

Instinct and Intuition Realtime fact driven

Automated Optimized

Traditional decision processes evolved



IBM SPSS Statistics is a comprehensive, easy-to-use set of data and predictive analytics tools for business users, analysts and statistical programmers.

SPSS Statistics Family

IBM SPSS Statistics Standard

IBM SPSS Statistics Professional

IBM SPSS Statistics Premium

IBM SPSS for Education

Linear models – make your analysis more accurate and reach more dependable conclusions

Nonlinear models – have the ability to apply more sophisticated models to your data

Customized tables – quickly slice and dice your data using pivot tables

Data preparation – Prevent outliers from skewing analyses and results

Decision trees – Better identify groups, discover relationships between groups and predict future events

Forecasting – Deliver information in ways that your organization’s decision makers can understand and use

Structural equation modeling - you can quickly create models to test hypotheses

Bootstrapping - Estimate the standard errors and confidence intervals of parameters

Direct marketing and product decision making procedures - Develop a marketing strategyHigh-end charts and graphs - Extend the capabilities of templates or create your own

Provide more flexible pricing and licensing optionsEasily extend usage throughout the universityFoster a permanent link between academic and corporate institutionsRecognize IBM SPSS software users for their contributions to their respective industriesSupport more effective teaching with IBM SPSS softwareEnsure that students will be sought by employers



ModellerIBM® SPSS® Modeler is a powerful, versatile data mining workbench that helps you build accurate predictive models quickly and intuitively, without programming

Data Collection Deployment

Product Family

Survey and market researchers worldwide use this rich suite of products to achieve deeper understanding of people’s attitudes, preferences and behavior.

-Authoring-Interviewing-Reporting-Management

Drive results-oriented decisions by building analytics into your operations. Integrate the analytics that predict outcomes. Automate processes to deliver insight at the point of impact.



Author Desktop

Author Professional

Author Server

Base Professional

Data Entry Station

Data Model

Dialer

Interviewer

Interviewer Server Administrator

Paper/Scan

Phone Interviews

Remote Administration

Survey Reporter Desktop

Survey Reporter Developer Kit

Survey Reporter Professional

Survey Reporter Server

Survey Tabulation

Translation Utility

Web Interviews

Data Collection tools



IBM SPSS Modeler includes advanced, interactive visualization for models that use single technique, or ensemble models that combine techniques making modeling results easy to understand and communicate.

Modeller



Integration with Cognos 10



Deployment



Case study: Predictive Analytics on Human Capital Management

Reference Link:http://forms.cognos.com/?elqPURLPage=4206&offid=sb_spssrc_human_capital_mgmnt_imw14291&mc=-web_ibm_spss_stat_products

Problem:Optimize recruitment effort for a given position (Corporate job, Military school, etc ..).The volume of potential recruits or the intricacies of a specific job requirement can overwhelm the efforts of even the best individual recruiter.

Solution:Build a predictive performance model.Apply the experience and intuition of expert recruiters in creating a model that helps an organization to prioritize and target the individuals most qualified for a specific position.

Example: One of the branches of the U.S. military is responsible for getting more than 100,000 new recruits every year under contract. Approximately 600,000 leads that must then be prioritized and sent to individual recruiters.

Baseline:Predicting the success of a potential employee or recruit in a given work environment is difficult, there are numerous variables that affect a successful outcome for that person’s career. (Examples: changes in management, co-workers, and mission goals …. )

http://forms.cognos.com/?elqPURLPage=4206&offid=sb_spssrc_human_capital_mgmnt_imw14291&mc=-web_ibm_spss_stat_products



Case study: Predictive Analytics on Human Capital Management (cont.)

Performance Prediction with SPSS Modeling:- Collect Data (predictors)- Data cleansing

- Eliminate Variables with low variance- Eliminate var. with too many missing values

- Screen, rank and select predictor variables- Rank the importance of each variable

Employee opinions and outlooks can be an important predictor of performance.

IBM® SPSS® Modeler can consolidate data visually from multiple sources, such as demographics data and attitudinal data.

Text Analytics and Text Mining with SPSS: Example: Analysis of open ended questions to model employee satisfaction

Provides a technical foundation for extracting usable knowledge from unstructured text data through identification of core concepts and sentiments. Text analytics allows users to understand the relationships between concepts and the sentiment around concepts, and ultimately create a structure for unstructured text data that can be integrated with analytics. A view into text analytics within IBM® SPSS® Modeler Premium. On the left is

a list of extracted categories and on the right is a visual representation of the linkages between concepts and sentiments (sentiment analysis).



63


… What’s the best that can happen ?



IBM Business Analytics and Optimization

Discovering the Value of Business Analytics

Where Do We Go From Here?

Lennart Frantzell [email protected] Giuseppe Accardo [email protected], Chris Heckart [email protected]

IBM San Mateo Innovation Center, San Mateo, California 2011/04/27





Step 1) Read up on the IBM Products

http://www.redbooks.ibm.com/redbooks/pdfs/sg247912.pdf

http://www.redbooks.ibm.com/redpapers/pdfs/redp4710.pdf

http://www.redbooks.ibm.com/redbooks/pdfs/sg247881.pdf



Step 2) Install IBM Cognos Express

http://www.ibm.com/developerworks/downloads/im/cognosexpress/



Step 3) Join IBM PartnerWorld or IBM Academic Initiative

http://www.ibm.com/partnerworld

/https://www.ibm.com/developerworks/university/academicinitiative



Step 4) Follow-on Business Analytics education at the San Mateo Innovation Center

/

•Netezza Bootcamp (6/21-6/24)

•Cognos seminar

•SPSS seminar

•ILOG seminar



Step 5) Join IBM Social Networks, read Business Analytics Blogs and the San Mateo IBM Innovation Center blog

/

https://www.ibm.com/developerworks/mydeveloperworks/groups/service/forum/topicThread?topicUuid=45358eb2-315a-43e3-8e5f-5e94fd60009a#fullpageWidgetId=Members

https://www.ibm.com/developerworks/mydeveloperworks/blogs/business-analytics/?lang=en

http://www-935.ibm.com/services/us/gbs/bao/

https://www.ibm.com/developerworks/mydeveloperworks/blogs/iic-san-mateo/?lang=en

https://www.ibm.com/developerworks/mydeveloperworks/groups/service/forum/topicThread



March 24, 2011

Reference Links:

Cognos:http://www.reporters.cz/en/index.php?option=com_content&task=view&id=123&Itemid=168

SPSS:http://www-01.ibm.com/software/analytics/spss/downloads/http://www-01.ibm.com/software/analytics/spss/products/modeler/http://www-01.ibm.com/software/analytics/spss/products/modeler/professional.htmlhttp://support.spss.com/ProductsExt/Data%20Collection/ProductMatrix.html

iLOG:http://www-01.ibm.com/software/websphere/ilog/http://www-01.ibm.com/software/solutions/soa/newsletter/nov10/brms.html

Bloghttp://www.b-eye-network.com/blogs/eckerson/archives/business_analyt/

http://www.reporters.cz/en/index.php?option=com_content&task=view&id=123&Itemid=168

http://www-01.ibm.com/software/analytics/spss/downloads/

http://www-01.ibm.com/software/analytics/spss/products/modeler/

http://www-01.ibm.com/software/analytics/spss/products/modeler/professional.html

http://support.spss.com/ProductsExt/Data Collection/ProductMatrix.html

http://www-01.ibm.com/software/websphere/ilog/

http://www-01.ibm.com/software/solutions/soa/newsletter/nov10/brms.html

http://www.b-eye-network.com/blogs/eckerson/archives/business_analyt/



BACKUP SLIDES




Watson, the hardware

• Each of Watson’s 90 clustered IBM Power 750 servers features 32 POWER7 cores running at 3.55 GHz.

• Running the Linux®operating system, the servers are housed in 10 racks along with associated I/O nodes and communications hubs.

• The system has a combined total of 16 Terabytes of memory and can operate at over 80 Teraflops (trillions of operations per second).

• POWER7 also features 500 gigabytes of on-chip communications bandwidth, contributing to exceptional efficiency of both memory and processor utilization. And since each server packs 32 high performance POWER7 cores with up to 512 GB of memory, the Power 750 makes an ideal platform for Watson’s processor and memory-hungry Java processes.

• Designing Watson on commercially available Power 750 servers was a deliberate choice to ensure more rapid adoption of optimized systems in industries such as healthcare and financial services.

• That goal was a fundamental difference between Watson and Deep Blue, which was a highly customized supercomputer. Deep Blue was based on an earlier generation of Power processor technology, featuring a.But in addition to the regular POWER2 processors, Deep Blue’sperformance was enhanced with 480 special purpose chess processor chips.




Inside Watson

• Watson uses UIMA-AS to scaleout across 2,880 POWER7 cores in a cluster of 90 IBM Power®750 servers.

• UIMA_AS manages all of the inter-process communication using the open JMS standard. • The UIMA-AS deployment on POWER7 enabled Watson to deliver answers in one to six

seconds. • Watson has roughly 200 million pages of natural language content (equivalent to reading 1

million books). • Watson uses the Apache Hadoop framework to facilitate preprocessing the large volume

of data in order to create in-memory datasets used at runtime. • Watson’s DeepQA UIMA annotators were deployed as mappers in the Hadoop map-

reduce framework, which distributed them across processors in the cluster.

The Regular Expression Annotator (RegexAnnotator) is an Apache UIMA analysis engine that detects entities like email addresses, URLs, phone numbers, zip codes or any other entity based on regular expressions and concepts.



Madrid First Responders Demo



You're invited to take a ride with Madrid’s emergency first responders as they rush to the scenesof three separate incidents. In the wake of the 2004 Madrid bombings, the city implemented a business process management solution from IBM to integrate the disparate applications, data and processes of its various emergency departments. IBM helped the city reduce emergency response times by 25%. the ride.

http://www-03.ibm.com/innovation/us/leadership/response/index.html

Madrid’s emergency first responders



http://www.ibm.com/developerworks/industry/library/ind-watson/index.html

IBM Watson and Healthcare. How natural language and semantic search could revolutionize clinical decision support

To see the kinds of questions Watson can answer, check out the two example questions Dr. David Ferrucci showed to German Chancellor Merkel and Turkish PM Erdogan at the CeBIT2011 Opening Ceremony..

Question: Streptococci cause this childhood "fever" characterized by a bright red rash and high temperature.Answer: 98% Scarlet fever, 15% Rheumatic fever, 8% Strep throat

Question: This disease can cause uveitis in a patient with family history of arthritis presenting circular rash, fever, and headache. Answer: 76% Lyme Disease, 1% Behcet's Disease, 1% Sarcoidosis

According to an observational study published in 1999 by BMJ (British Medical Journal) a team of researchers observed 103 physicians over one work day. Those physicians asked 1,101 clinical questions during the day. The majority of those questions (64 percent) were never answered. And, among questions that did get answered, the physicians spent less than two minutes looking for answers. Only two questions out of the 1,101 triggered a literature search by the physicians attempting to answer them. Hence, providing quickanswers to clinical questions could have major impact in improving the quality of healthcare. Enter Watson.





IBM SPSS Statistics Standard

Linear models – make your analysis more accurate and reach more dependable conclusions

Nonlinear models – have the ability to apply more sophisticated models to your data

Customized tables – quickly slice and dice your data using pivot tables

Linear models• General linear models (GLM)• Generalized linear mixed models (GLMM)• Hierarchical linear models (HLM)• Generalized linear models (GENLIN)• Generalized estimating equations (GEE)

Linear models• General linear models (GLM)• Generalized linear mixed models (GLMM)• Hierarchical linear models (HLM)• Generalized linear models (GENLIN)• Generalized estimating equations (GEE)

Nonlinear models• Multinomial logistic regression (MLR) • Binary logistic regression• Nonlinear regression (NLR) and constrained nonlinear regression (CNLR)• Probit analysis

Nonlinear models• Multinomial logistic regression (MLR) • Binary logistic regression• Nonlinear regression (NLR) and constrained nonlinear regression (CNLR)• Probit analysis

Customized tablesIBM SPSS Statistics Standard enables you to quickly “slice and dice” your data. Then you can create customized tables to help you better understand your data and easily report your results.

Customized tablesIBM SPSS Statistics Standard enables you to quickly “slice and dice” your data. Then you can create customized tables to help you better understand your data and easily report your results.





IBM SPSS Statistics Professional

Data preparation – Prevent outliers from skewing analyses and results

Decision trees – Better identify groups, discover relationships between groups and predict future events

Forecasting – Deliver information in ways that your organization’s decision makers can understand and use

Data preparationIBM SPSS Statistics Professional helps you streamline the data preparation stage of the analytical process – saving time and ensuring greater accuracy. Perform data checks based on each variable’s measure level, quickly find multivariate outliers by searching for unusual cases based upon deviations from similar cases and preprocess data prior to model building with an optimal binning procedure.

Data preparationIBM SPSS Statistics Professional helps you streamline the data preparation stage of the analytical process – saving time and ensuring greater accuracy. Perform data checks based on each variable’s measure level, quickly find multivariate outliers by searching for unusual cases based upon deviations from similar cases and preprocess data prior to model building with an optimal binning procedure.

Decision treesCreate classification and decision trees to help you better identify groups, discover relationships between groups and predict future events. Decision trees present categorical results in an intuitive manner, allowing you to explore results and visually determine how your model flows, and then clearly explain categorical results to non-technical audiences. You can also find specific subgroups and relationships that you might not uncover using more traditional statistics.

Decision treesCreate classification and decision trees to help you better identify groups, discover relationships between groups and predict future events. Decision trees present categorical results in an intuitive manner, allowing you to explore results and visually determine how your model flows, and then clearly explain categorical results to non-technical audiences. You can also find specific subgroups and relationships that you might not uncover using more traditional statistics.

ForecastingPredict trends and develop forecasts quickly and easily with advanced statistical techniques to work with time-series data. Regardless of your level of experience, you can analyze historical data, predict trends faster and deliver information in ways that your organization’s decision makers can understand and use.

ForecastingPredict trends and develop forecasts quickly and easily with advanced statistical techniques to work with time-series data. Regardless of your level of experience, you can analyze historical data, predict trends faster and deliver information in ways that your organization’s decision makers can understand and use.





IBM SPSS Statistics Premium

Structural equation modeling - you can quickly create models to test hypotheses

Bootstrapping - Estimate the standard errors and confidence intervals of parameters

Direct marketing and product decision making procedures - Develop a marketing strategyHigh-end charts and graphs - Extend the capabilities of templates or create your own

Structural equation modelingStructural equation modeling (SEM) can help you gain additional insight into causal models and explore the interaction effects and pathways between variables. SEM lets you more rigorously test whether your data supports your hypothesis. You create more precise models than if you used standard multivariate statistics or multiple regression models alone.

Structural equation modelingStructural equation modeling (SEM) can help you gain additional insight into causal models and explore the interaction effects and pathways between variables. SEM lets you more rigorously test whether your data supports your hypothesis. You create more precise models than if you used standard multivariate statistics or multiple regression models alone.

Bootstrappingprovides an efficient way to ensure that your models are stable and reliable. It estimates the sampling distribution of an estimator by re-sampling with replacement from the original sample. With bootstrapping, you can reliably estimate the standard errors and confidence intervals of a population parameter, including the mean, median, proportion, odds ratio, correlation coefficient, regression coefficient and numerous others.

Bootstrappingprovides an efficient way to ensure that your models are stable and reliable. It estimates the sampling distribution of an estimator by re-sampling with replacement from the original sample. With bootstrapping, you can reliably estimate the standard errors and confidence intervals of a population parameter, including the mean, median, proportion, odds ratio, correlation coefficient, regression coefficient and numerous others.

Direct marketing and product decision-making proceduresQuickly perform various kinds of analyses, including recency, frequency and monetary value (RFM) analysis, cluster analysis and prospect profiling. Increase your understanding of consumer preferences to more effectively design, price and market successful products – maximizing campaign effectiveness and return on investment.

Direct marketing and product decision-making proceduresQuickly perform various kinds of analyses, including recency, frequency and monetary value (RFM) analysis, cluster analysis and prospect profiling. Increase your understanding of consumer preferences to more effectively design, price and market successful products – maximizing campaign effectiveness and return on investment.



81

IBM Business Analytics and Optimization PortfolioIBM acquisition landscape



82



Unica is an enterprise and cloud-based marketing software solutions that help businesses streamline and automate marketing processes, and understand and predict customer preferences. Through Unica, IBM will enable its clients to develop more relevant and targeted communications while minimizing marketing expenditures.

Coremetrics, is a leader in Web analytics software. Coremetrics, based in San Mateo, CA, will expand IBM's business analytics capabilities by enabling organizations to use cloud computing services to develop faster, more targeted marketing campaigns.

OpenPages, a leading provider of software that helps companies more easily identify and manage risk and compliance activities across the enterprise through a single management system.

Clarity Systems delivers financial governance software that enables organizations to automate the process of collecting, preparing, certifying and controlling financial statements for electronic filing, in support of mandates by the SEC and other financial regulatory agencies.

Netezza data warehouse appliances bring analytics directly into the hands of business users within every department of an organization such as sales, marketing, product development and human resources. Netezza appliances makes the technology ideal for the needs of high-performance analytics, requiring minimal administration and IT skills, and enables clients to run complex data queries within days of deploying the solution.

Initiate's software helps healthcare clients work more intelligently and efficiently with timely access to patient and clinical data. By adding Initiate's software to its software portfolio, IBM will be better equipped to help clients draw on data from hospitals, doctors' offices and payers to create a single, trusted shareable view of millions individual patient records.

Guardium, a market leader in real-time enterprise database monitoring and protection. Guardium's technology helps clients safeguard data, monitor database activity and reduce operational costs by automating regulatory compliance tasks.

Business Analytics - acquisition landscape



84


… What’s the best that can happen ?



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Where it fits



ability for non-technical business users to be directly involved in business rules management, enabling flexible decision automation.

create the best possible plans, explore alternatives, understand trade-offs, and respond to changes in business environment

a recognized industry leader in Business Rule Management Systems (BRMS), visualization components, optimization and supply chain solutions enrich IBM software portfolio and fortify IBM's Smarter Planet initiative.

WebSphere ILOG BRMS

WebSphere ILOG BRMS Family

WebSphere ILOG JRULES

WebSphere ILOG Visualization

Elixir Enterprise

JView Enterprise

Optimization and Analytical Decision Support Solutions

CPLEX Optimization Studio

LogicNet Plus XE

industry’s most comprehensive set of graphics products for creating highly graphical, interactive displays.



A business rule management system (BRMS) enables organizational policies to be defined, deployed, monitored and maintained separately from core application code. By externalizing business rules and providing tools to manage them, a BRMS allows business experts to define and maintain the decisions that guide systems behavior, reducing the amount of time and effort required to update production systems, and increasing the organization’s ability to respond to changes in the business environment.

What is a Business Rules Management System BRMS?



Business Event Processing describes a wide range of ways that enterprises approach events, simple or complex. But in all cases, information about the event needs to be quickly disseminated to others affected by the event for both awareness and to take appropriate action.

Why Business Event Processing (BEP) matters?

DEMO Video

DEMO Video



Platforms:

Java

.Net

Adobe Flex

C++

Visualization

Diagrams

Gantt Charts

Maps

Business DashBoard

Charts

User Interfaces



A software based solution that enables enterprises to create the best possible plans, explore alternatives, understand tradeoffs and respond to changes in the business environment

IBM ILOG optimization maximizes resource efficiency• By helping companies make Decisions

• To reach a Goal

• While observing Requirements

• Determined by Analyzing Data

Using powerful, robust, scalable and diversified optimization software and services

Requirements

Bus. Rules

Data

Requirements

Bus. Rules

Data

Decisions

Goals

Decisions

GoalsPlans – alternatives - tradeoffsPlans – alternatives - tradeoffs

What is ILOG Optimization ?



Optimization helps businesses make complex decisions and trade-offs about limited resources• Discover previously unknown options or approaches

• Automatically evaluate millions of choices• Automate and streamline decisions

• Compliance with business policies and regulations• Free up planners and operations managers so that they can leverage their

expertise across a wider set of challenge• Explore more scenarios and alternatives

• Understand trade-offs and sensitivities to various changes• Gain insights into input data• View results in new ways

What optimization can do?



Optimization based problemsThey exist in all industries…



Optimization based problems… and are critical for the companies !



Success Story – Unit Commitment at REEBusiness Problem – Use exact mathematical methods to replace the approximate, heuristic methods Red Eléctrica de España, in charge of managing the Spanish national power grid, had been using for the last 20 years

The methodology applied until now was an interactive methodology, which did not guarantee an optimum solution. There were many difficulties in the smaller systems and it was hard to find the most viable solution. Thanks to the new methodology, we have resolved this type of problem.- Mr. Mustafa Pezic, REE Project Director



Benefits• The implementation of the ILOG based solution has provided great operational

advantages to company’s managers and engineers– “The new tool allows us to simplify all maintenance tasks and any changes made to the model, which

in our particular case, are very frequent.”

– “From a user viewpoint, it has brought greater trust in the solution and a significant reduction in planning time required by users. In parallel with this, from a development and maintenance viewpoint, there has been a significant reduction in associated costs, as well as in the duration of the processes.”

• The bottom line: – REE reduced production costs by between €50,000 and €100,000 per day.

– REE has reduced its carbon emissions by approximately 100,000 tons of CO2 annually.

Saving $140,000 Per Day: How Companies are Achieving Breakthrough Improvements in Bottom-Line Performance Using Optimization

Dr. Jeremy BloomProduct Marketing Manager, ILOG OptimizationMay, 2010

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The Story In Brief

• IBM ILOG Optimization Products are Helping Many Businesses Run More Efficiently

• IBM ILOG Optimization Uses Sophisticated Technology to Solve Hard Business Problems

• IBM ILOG Optimization Products and Services Can Help Your Business Run More Efficiently

• IBM ILOG Optimization Can Generate Hard Benefits to Your Bottom Line

Better decisions faster

3

What Can Optimization Do?

Automobile Manufacturer increased productivity at Europe’s most efficient car production facility by 30%

• South American country’s two largest forest-products companies

reduced their truck fleets by 30% and saved $20 million annually

• Major Electronics Manufacturer cut wafer-processing cycle time in half, to just 30 days

International airline responded to unexpected delays with efficient crew rescheduling,saving $40 million in one year

Package delivery company cut package delivery costs by $87 million over 2 years and reduced its aircraft fleet by 10%

Television network increased annual advertising revenue by $50 million

Investment firm cut transaction costs by $100 million

Consumer packaged goods manufacturer

dramatically increased the direct loading of trucks off its packaging lines

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What Can Optimization Do?

• Whether the problem is large or small, straightforward or complex, optimization supports effective decision-making across a wide range of issues.

• Firms in many industries use optimization software to solve business problems ranging from long-term planning to real-time scheduling and rescheduling.

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Where is optimization used?

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Benefits of Optimization

• Calculable ROIs, with paybacks within months, sometimes even weeks– Capital expense avoidance or deferral– Operating expense reductions– Total revenue, revenue mix, and margin improvements

• Improved customer satisfaction– Provide better and more customized customer service

• Improved employee satisfaction– Satisfy schedule preferences while improving productivity– Better planning and scheduling processes

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Sophisticated Optimization Technology Solves Hard Business Problems

• IBM ILOG Optimization helps businesses maximize resource efficiency– by helping companies make Choices– to reach Targets– while observing Limits– driven by analyzing Data

• Using powerful, robust, scalable, and diversified optimization technology and services– Optimization has most value when there are many choices with

complex relationships that force trade-offs

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How Optimization Supports Decision Making

What-If Analysis

Collaboration

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Case Study

Cash Management: Restocking Automatic Teller

Machines

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Restocking Automatic Teller Machines

The Customer

• Provides financial electronic commerce services and products to financial institutions worldwide

• Provides systems processing more than two-thirds of 14 billion annual automated clearing house transactions in the US

• Provides reconciliation, financial messaging, workflow and compliance products and services to more than 600 banks and businesses

• Its clients manage more than 2.6 million portfolios totaling about US $1.8 trillion in assets

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The Business Problem

Schedule restocking taking into account customer withdrawal habits and government cash management regulations

• Too much cash some times – carrying costs• Too little cash at other times – angry customers• Forecast errors – volatility• Data errors – static, dirty, missing, wrong!

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Vaults as Distribution Centers

• Services: counting, verifying, sorting, packaging, shipping• Federal Reserve Regulations

– Cross-shipping penalties– Custodial Inventory: De Minimis Exemptions, Fitness Issues, etc.

• Banks Organize Vaults Geographically by FRB zone– 33 Zones in US– From 2 to 12 Vaults per Zone

• High Service Levels– Due to nature of product (cash) and customer (ATM’s and bank

branches)– Substantial business case for optimization solution


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Day 1 Day 2 Day 3 Day 4

FEDDEPOSITS

+10 -10

+20

-10+10+10 0

-50+10 0

010+40

1010

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10

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possible solution

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Note: Uses 4 trucks

1010

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Business Case Synopsis: Top-10 Bank Client

• Daily Retail Cash Dispensed– $ 200 million (+20,000 retail outlets - Branches & ATM’s)

• Total Cash in System (before optimization) – $ 7 billion

• Optimization Development Goals– No change of current replenishment schedules– Reduce cash inventory levels (i.e. carrying costs) – Reduce replenishment costs (i.e. deliveries)– Reduce cross-shipping costs (penalties at Fed)– Improve reporting capability (information)– “Piggybacking” fixed-charge denomination shipments– Must solve overnight for implementation next day

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The Bottom Line: Results After 6 Months

• 58 Vault Pilot • Reduced cash inventories by 35%*• Reduced replenishment costs by 55%• Cross-shipping fees decreased about 63%• CPLEX runtimes within overnight window • Project rated “Highly Successful” by client’s internal Six Sigma

Unit• Rolled-out to entire enterprise in 2008

* Attributable to the optimization model and other factors including better forecasting, better operations, better people, and better measurement.


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What the Customer Says:

• “Our OPL model solved by CPLEX has proven to be a powerful platform from which advanced uses of MILP can be studied, showcased, and advanced. Several successful efforts have been accomplished thus far with respect to speed improvements, always the challenge for us.”

• “We like IBM ILOG’s people, and the reason we like them is we could call people up and talk to intelligent, well-versed, experienced people who either could answer our questions directly or could point us to a resource that could answer our questions.”

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Case Study

TransportationScheduling:

Train Timetabling

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Train TimetablingThe Customer

• Netherlands Railways• Operates the busiest national railway network in Europe• Manages more than 4,800 trains per day• Has 2,100 km of track and 279 stations• Between 1970 and 2006, traffic has nearly doubled

from 8 billion passenger km in to 15.8 billion• During the same period, freight transport increased by

285 percent

In 2006, • 9 million different passengers traveled 15.8 billion

passenger km• Operating revenues of €1.5 billion and operating

income of €200 million

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Train Timetabling


To keep costs down and service on time, more accurately match trains to expected user traffic by developing a new, automated timetabling system

• Stimulate growth of passenger railway transport, without investing additional billions of euros in new infrastructure

• Improve on-time performance – percentage of trains that arrive at the 35 main stations with delay

of less than three minutes• Reduce greenhouse gas emissions by reducing automobile

travel

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Train TimetablingFeatures of the Timetabling Problem

• Trade-off between number of trains and on-time performance• Frequency of arrivals• Connections with Germany and Belgium• Cyclic scheduling

– departures at same minute in every hour• Line system

– Origin, final destination, frequency, stopping pattern• Timetable

– Planned departure and arrival event for each train at each station served

• Station routing– Inbound track, platform, outbound track

• Crew rostering– Assign duties (consecutive trips from base to return) to crew

members

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The Bottom Line

• Operating efficiency has improved 5 - 10% percent• Additional profit of €10 million annually• In 2007, on-time performance reached a record high 87% up

from 84.8% in 2005 and 2006

Train Timetabling

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Train Timetabling

What the Customer Says

• “Netherlands Railways used IBM ILOG CPLEX to enhance its rolling stock allocation planning for better resource utilisation, resulting in a cost savings of over 20 million Euros annually. CPLEX is also used for time table scheduling and has helped improve on-time performance for more than a million daily rail passengers”

• “IBM ILOG's optimisation technology helped us to achieve our primary goal of improving service but has also had a significantimpact on our bottom line in terms of operational cost savings. This resulted in winning the INFORMS 2008 Franz Edelman Award for outstanding practice in Operations Research and Management Science”

– Mr. Wim Fabries, Head of Logistics

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Case Study

Operations Planning: Dispatching Power

Generators

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Dispatching Power Generators

The Customer

• Red Eléctrica de España• Operates the Spanish national power grid

In 2008• Managed production and delivery of 280 billion kWh• Served a peak demand of 43 thousand MW• Handled 95 thousand MW of generating capacity,

including 17 GW of hydroelectric and 16 of wind• Operated 35 thousand km of high-voltage transmission

lines• €1.1 billion in revenue (net turnover), €286 million in

after-tax profit

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Schedule the dispatch of power generators (when to start and how much to produce each hour) in order to minimize the cost of electricity to consumers

• Power supply and demand must match at all times• Wind production is highly variable• Significant cost to starting up a combustion generator• Seasonal limits on hydroelectric generation• Changing market structure made old methods of dispatch

obsolete

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The Bottom Line

• REE reduced production costs by between €50,000 and €100,000 per day ($70-$140 thousand)

• REE has reduced its carbon emissions by approximately 100,000 tons of CO2 annually

• The ILOG project required an investment of €300,000 but no new acquisition of hardware or any changes to the existing platform


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• “The methodology applied until now … was an interactive methodology, which did not guarantee an optimum solution. There were many difficulties in the smaller systems and it was hard to find the most viable solution. Thanks to the new methodology, we have resolved this type of problem.”

• “From a user viewpoint, it has brought greater trust in the solution and a significant reduction in planning time required by users. In parallel with this, from a development and maintenance viewpoint, there has been a significant reduction in associated costs, as well as in the duration of the processes.”

– Mr. Mustafa Pezic, REE Project Director

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Case Study

Donor Pairing:Organ Transplants

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Organ Transplants

The Customer

• Non-profit organization• Focuses on live donations of a particular organ• Arranges organ swaps among incompatible donors and

recipients• Has 70 transplant program members in 25 states of the

US• Began enrolling transplant centers in October 2006

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Organ TransplantsThe Business Problem

More than 83,000 people in America are waiting for a transplant of this organ; about 12 die every day due to lack of donors. Many patients have someone who is willing to donate, but because of immune system or blood type incompatibilities, they are not able to give the organ to their significant other.

Paired donation matches one incompatible donor/recipient pair to another in the same situation. The donor of the first pair gives to the recipient of the second, and vice versa. Longer chains of donations are also possible.

The transplants do not have to be performed simultaneously.

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Organ Transplants

Donor A

Donor B

Recipient A

Recipient B

X

X

Paired Donation

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Organ Transplants

Solution Features

• Organ compatibility measured on a point scale– HLA Match, Blood Group, Pediatric Case, Distance, Recipient

vs. Donor Age Disparity, Wait time, …• Optimization considers all potential matches and chains of

matches• Find the chains with the largest total quality points• Can consider altruistic donation (donor has no significant

other as recipient)

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Organ Transplants

The Bottom Line

• In first 18 months, performed 28 paired donations• In a recent month, found potential matches for 21 patients in

10 transplant centers• July 2007 – March 2008 10 donation chain with altruistic

initial donor• This application featured on NBC’s TechNow program• In 2009, IBM added this organization to its list for the

Employee Charitable Contributions Campaign

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Organ Transplants


• “The number of possible solutions are like the grains of sand on the seashore, and what IBM ILOG’s CPLEX does is that helps us to identify the best possible solution amongst all those solutions.”– Founder

• “It once took 3 weeks to match a kidney donor with a patient, with this software, it takes seconds to save lives and money by bringing people together.”– NBC Technology Reporter

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IBM ILOG Optimization Can Help Your Business Run More Efficiently

• Build an optimization application yourself– If you have the OR experts, IBM ILOG technology will make their

development faster and more reliable

• Use a packaged solution for your business– IBM and its ISV partners have configurable applications for many kinds of

business issues– Supply chain, logistics, transportation, energy, financial services,…

• Let IBM help you build it– IBM Professional Services can provide the expertise to build custom

applications that meet your business requirements

3 Ways to Use IBM ILOG Products and Services

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• Better decisionsGet better performance for lower costOptimization produces quantifiable benefits on your bottom line

• Faster decisionsIncreases your speed of responseAllow your managers and planners to focus on critical complexities

• Faster, lower cost development and maintenanceCode and validate your application with less time and effort Maintain and upgrade your system easier and more reliably

• Turn information into action Leverage your investment in enterprise information technology

The Value IBM ILOG Optimization Technology

38

For More Information

Dr. Jeremy BloomProduct Marketing Manager, ILOG [email protected]

http://www-01.ibm.com/software/websphere/products/optimization/

http://www-01.ibm.com/software/websphere/products/sca/




http://www-01.ibm.com/software/websphere/products/sca/

Confidential - Prepared by Vindicia January 2011

Build Online Revenue

IBM Innovation CenterMay 25, 2011

Gene Hoffman, CEO - Founder


Vindicia ClientsVindicia Clients


The Vindicia AdvantageThe Vindicia Advantage

Customer Acquisition Customer Retention Operational Excellence

Customer Data OwnershipInternational

Payments, Language,& Process

Fraud Screen & Chargeback Management Tax Calculation Business Analytics

Complete Solution


Architecture OverviewArchitecture OverviewCustomers

Reporting & Analytics

Product Access / Balances

Products & Promotions

Global Taxation

Fraud Mgmt.

Customer Account Mgmt.

Transaction Processing Gateway

Customer Communication

Secure Card Tokenization

Provider Website

Product / Service

Customer Service

Email Server

Entitlement / Balance

Mgmt.Reporting

& Analytics

SOAP API with multiple client libraries

Merchant processors, PayPal, alternative payment providers, etc.


B2C Merchants with recurring customer relationshipsWhat monetary metrics matter?

Why payments fail?

How to ensure the highest level of renewals / churn?

How to optimize product / pricing mix?

• ACLV – Average Customer Life Time Value

• Chargeback percentage

• Auth to deposit ratio

• Method of Payment

• Presentment & Settlement Currency

• Credit / Debit Mix

• Decline code analysis (Hard / Soft)

• Rating (usage based metering)

• Geo location billing (AVS)

• Churn by any attribute

• CMRR - Committed Client Monthly Minimum (SaaS)

• Duration of Subscription (Term, Block or Indefinite)

• Number of / types of Subscriptions (Products)


Sample ClientsSample Clients

Data from April 2011


Vindicia Client Revenue LiftVindicia Client Revenue Lift

In 2010 CashBox increased client subscription revenue $50M+* understates the compound annual effect** Blended average of multiple price points

(April 2011)


Over 24 out of the box reports

Reporting is customizable

New Report development

All reporting data available via CSV download or direct API integration

Reporting & Dashboards


Cohort Analysis For ACLVCohort Analysis For ACLV

Average ~ 8moAverage ~ 8mo

Vindicia Client With Monthly Subscriptions


IBM Solutions that complement Clients who want to build online revenue

IBM SPSS Predictive Analysis

Cognos 10 Business Intelligence and Financial Performance Management

Unica & Coremetrics: Marketing software solutions, offers web analytics, campaign management, website personalization, email, marketing resource

IBM WebSphere Commerce 7: customer interaction platform for cross-channel and online commerce


Questions & Answer – visit www.vindicia.com

Discover the value in IBM Business Analytics

Technology

Transcript of Discover the value in IBM Business Analytics