How IT Innovators Turn Digital Disruption into a Business Productivity Force Multiplier

Transcript of a discussion on digital business transformation and how that’s been accomplished by several prominent enterprises.

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Dana Gardner: Hi, this is Dana Gardner, Principal Analyst at Interarbor Solutions, and you're listening to BriefingsDirect.

Gardner

Our next innovation thought leadership panel discussion examines how digital business transformation has been accomplished by several prominent enterprises. We'll explore how the convergence of cloud, mobility, and big-data analytics has prompted companies to innovate and produce new levels of productivity.

We're now joined by some finalists from the Citrix Synergy 2016 Innovation Awards Program. So, please join me in welcoming our panel. We're here with Olaf Romer, Head of Corporate IT and group CIO at Bâloise in Basel, Switzerland. Welcome.

Olaf Romer: Hi, Dana. Thank you very much for your invitation.

Gardner: We're also here with Alan Crawford, CIO of Action for Children in London. Hello, Alan.

Alan Crawford: Hello, Dana. Great to join you.

Gardner: And we're here with Craig Patterson, CEO of Patterson and Associates in San Antonio, Texas. Welcome, Craig.

Craig Patterson: Thank you very much for letting me be here.

Gardner: Olaf, what are the major trends that drove you to reexamine the workplace conceptually, and how did you arrive at your technology direction for innovating in that regard?

Becoming more modern

Romer: First of all, we're Swiss traditional insurance. So, our driver was to become a little bit more modern to get the new generation of people in our company. In Switzerland, this is s a little bit of problem. We also have big companies in Zurich, for example. So, it’s very important for us.

Romer

We did this in two directions. One direction is on the IT side, and the other direction is on the real-estate side. We changed from the traditional office boxes to a flex office with open space, like Google has. Nobody has their own desk, not even me. We can go anywhere in our office and sit with whom we think it’s necessary. This is also on the IT side. We go in this direction to go for more mobility, an easier way to work in our company.

Gardner: And because you’re an insurance organization, you have a borderless type of enterprise, where you need to interact with field offices, other payers, suppliers, and customers, of course.

Was that ability to deal with many different types of end-point environments also a concern, and how did you solve that?

Romer: The first step was inside our company, and now, we want to go outside to our brokers and to our customers. The security aspect is very, very important. We're still working on being absolutely secure, because we're handling sensitive customer data. We're still in the process of opening our ecosystem outward to the brokers and customers, but also to other companies we work with. [See related post, Expert panel explores the new reality for cloud security and trusted mobile apps delivery.]

Gardner: Alan, tell us about Action for Children and what you’ve been doing in terms of increasing the mobile style of interactions in business.

Crawford: Action for Children is a UK charity. It helps 300,000 children, families, and young people every year. About 5,000 staff, operate from between 300 and 500 branches. So, 300 are our own and a couple of hundred locations are with our partner agencies.

Crawford

When I started there, the big driver was around security and mobility. A lot of the XP computers were running out of support, and the staff outside the office was working on paper.

There was a great opportunity in giving modern tablets to staff to improve the productivity. Productivity in our case means that if you spend less time doing unnecessary visits or do something in one visit instead of three, you can spend more quality time with the family to improve the outcomes for the children.

Gardner: And, of course, as a non-profit organization, costs are always a concern. We’ve heard an awful lot here at Citrix Synergy about lower cost client and endpoint devices. Has that been a good news to your ears? [Learn more about Citrix Synergy 2016.]

Productivity improvements

Crawford: It has. We started with security and productivity as being the main drivers, but actually, as we’ve rolled out, we’ve seen those productivity improvements arise. Now, we're looking at the cost, about the savings we can make on travel, print, and stationery. Our starting budget this year is £1.3 million ($1.7 million) less than it was the year before we introduced tablets for those things. We're trying to work out exactly how much of that we can attribute to the mobile technology and how much of that is due to other factors.

Gardner: Craig, you're working with a number of public sector organizations. Tell us about what they are facing and what mobility as a style of work means to them.

Patterson: Absolutely. I'm working with a lot of public housing authorities. One is Lucas Metropolitan, and other is Hampton Redevelopment Agency. What they're facing is declining budgets and a need to do more with less.

Patterson

When we look at traditional housing-authority and government-service agencies that are paper-based, paper just continues to multiply. You put one piece in the copier and 20 pieces come out. So, being able to take the documents that contain secure private information of our clients and connect those with the clients out in the field is why we need mobility and efficiency and workflows.

And the cloud is what came to mind with that. With content management, we can capture data out in the field. We can move our staff out in the field. We don’t have to bring all of the clients into the office, which can sometimes pose a hardship, especially for elderly, disabled, and many of those in the greatest need. Mobility and efficiency with the cloud and the security have become paramount in how we perform our business.

Gardner: I suppose another aspect of mobility is the ability to bring data in analytics to the very edge. Have you yet to take advantage of that or do you see that it’s something that you’re going to be working toward?

Patterson: We know that it’s something we're working toward. We know from the analytics that we’ve been able to see so far that mobility is the key. For some time, people have thought that we can’t put online things like applications for affordable housing, because people don’t have access to the Internet.

Our analytics prove that entirely wrong. Age groups of 75 and 80 were accessing it on mobile devices faster than the younger group was. What it means is that they find a relative, a grandchild or whoever they need that allows them to access the Internet. It’s been our mindset that has kept us from making the internet and those mobility avenues into our systems available on a broader scale. So, we're moving in that direction so that self service to that community can be displayed more in a broader context.

Measuring outcomes

Crawford: On the analytics and how that’s helped by the mobile working, we had a very similar result in Action for Children in the same year we brought out tablets. We started to do outcome measures with the children we were with. To reach a child, we do a baseline measure when we first meet the family, and then maybe three months later, whatever the period of the intervention, we do a further measure.

Doing that directly on a tablet with the family present has really enhanced the outcome measures. We now have measures on 50,000 children and we can aggregate that, see what the trends are, see what the patterns are geographically by types of service and types of intervention.

Gardner: So it’s that two-way street; the more data and analytics you can bring down to the edge, the more you can actually capture and reapply, and that creates a virtuous cycle of improvement in productivity.

Crawford: Absolutely. In this case, we're looking at the data and learning lessons about what works better to improve the outcomes for disadvantaged children, which is really what we're about.

Gardner: Olaf, user experience is a big topic these days, and insurance, going right to the very edge of where there might be a settlement event of some sort, back to the broker, back to the enterprise. User experience improvements at every step of that means ultimately a better productive outcome for your end-customers. [See related post, How the Citrix Technology Professionals Program produces user experience benefits from greater ecosystem collaboration.]

How does user experience factor into this mobility and data in an analytics equation?

We're looking at the data and learning lessons about what works better to improve the outcomes for disadvantaged children, which is really what we're about.

Romer: First of all, the insurance business is a little bit different business than the others here. The problem is that our customers normally don’t want to touch us during the year. They get a one-time invoice from us and they have to pay the premium. Then, they hope, and we also hope, that they will not have a claim.

We have only one touch a year, and this is little bit of problem. We try to do everything to be more attractive for the customer to get them to us, so that for them it’s clear if they have a problem or need a new insurance, they go to Bâloise Insurance.

We're working on it to bring a little bit of consumerization. In former years the insurance business was very difficult and it wasn’t transparent. The customers have to answer 67 questions before they can take out insurance with us, and this is the point. To make it as simple as possible and to work with a new technology, we have to be attractive for the customers, like taking out insurance through an iPhone. That’s not so easy.

If you talk with a core insurance guy to calculate the premiums, they won’t already have the 67 answers from the customers.  So, it's not only the technology, but working a little bit in a differently in the insurance business. The technology will also help us there. For me, the buzzword is big data, and now we have to bring out the value of the data we have in our business, so that we can go directly with the right user interface to the right customer area.

Gardner: Another concept that we have heard quite a bit at Synergy is the need to allow IT to say yes more often. Starting with you Craig, what are you seeing in the trends and in the technology that is perhaps most impactful for you to be able to say yes to the requests and the need for agility in these businesses, in these public sector organizations?

Device agnosticism

Patterson: It’s the device agnosticism, where you bring your own device (BYOD). It’s a device that the individuals are already familiar with. I'm going to take it from two angles. It could be the employee that’s delivering a service out to a customer in the field that can bring their own device, or a partner or contractor, so that we can integrate and shrink-wrap certain data. We will still have data security while they're deploying or doing something out in the field for us. It could be inspections, customer service, medical, etc.

But then, on the client end, they have their own device. By our being able to deliver products through portals that don’t care what device they have, it’s based on mobile protocols and security. Those are the types of trends that are going to allow us to collect the big analytics, know what we think we know, and find out whether we really know it or not and find it, get the facts for it.

The other piece of it though is to make it easy to access the services that we provide to the community, because now it’s a digital community; it’s not just the hardcore community. To see people in a waiting line now for applications hurts my feelings. We want to see them online, accessing it 24×7, when it makes sense for them. Those are the types of services that I see becoming the greater trends in our industry.

Those are the types of trends that are going to allow us to collect the big analytics, know what we think we know, and find out whether we really know it or not and find it, get the facts for it.

Gardner: Alan, what allows you to say “yes” more often?

Crawford: When I started with the XP laptops, we were saying no. So doing lot of comparisons in program within our center now, they're using the tablets and the technology. You have closed Facebook groups with those families. There's now peer support outside hours, when children are going to bed, which is often when they have issues in a family.

They use Eventbrite, the booking app. There are some standard off-the-shelf apps, but the real enterprise in our service in a rural community currently tells everybody in that community what services they're running through posters and flyers that were printed off. That moved to developing our own app. The prototypes are already out there, and the full app will be out there in a few weeks time. We're saying yes to all of those things. We want to support them. It is not just yes, but yes and how can we help you do that.

Gardner: Olaf, of course, productivity is only as good as the metrics that we need to convince the higher-ups in the board room that we need more investment or that we're doing good work with our technology. Do you have any measurements, metrics, even anecdotes about how you measure productivity and what you've done to modernize your workspaces?

Romer: Yes, for us it’s the feedback from the people. It’s very difficult to measure it on a clear technology level, but feedback from the people is very good and very important for us. You can see  with the BYOD we introduced one and a half years ago, a stronger cultural change in collaboration. We work together much more efficiently in the company and in the different departments.

In former times, we had closed file shares, and I couldn't see the files of the department next to me. Now, we're working completely in a modern collaboration way. Still, on traditional insurances, let’s say with the government, it’s very hard for them to work in the new style..

In the beginning, there were very strong concerns about that, and now we're in a cultural shift on this. We get a lot of good feedback that in project teams, or in the case of some problems or issues, we can work much better and faster together.

Metrics of success

Gardner: Craig, of course it’s great to say yes to your constituents, but it’s also good to say that we're doing more with less to your higher-ups and those that control the budget. Any metrics of success that you can recall in some of the public-sector organizations you're working with?

Patterson: Absolutely. I'll talk about files in workflow. When a document comes into the organization before, we mapped how much time and money it took to get it in a file folder, having been viewed by everyone that it needs to get viewed by. To give quick context, before, a document took a file folder, a label maker, copy machine, and every time a person needed to put a document in that folder, someone had to get it there. Now, the term "file clerk" is actually becoming obsolete.

When a document come in, it gets scanned, it’s instantaneously put in the correct order in the right electronic folder, and an electronic notification is sent to the person who needs to know. That happens in seconds. When you look at each month, it amounts to savings; before, we were managing files, rather than assisting people.

We can now see how many file folders you looked at, how many documents you actually touched, read, and reviewed in comparison with somebody else.

The metrics are in the neighborhood of just about 75 percent paper reduction, because people aren’t making copies. This means they're not going to the copy machine and along the way, the water-cooler and conversation pits. That also abates some of the efficiencies. We can now see how many file folders you looked at, how many documents you actually touched, read, and reviewed in comparison with somebody else.

We had as many as five documents, in comparison with 1,700 in a month. That starts to tell you some things about where your workload is shifting. Not everyone likes that. They might consider it a little bit "big brother," but we need those analytics to know how best to change our workflows to serve our customer, and that’s the community.

Gardner: I don’t know if this is a metric that’s easy to measure, but less bureaucracy would be something that I think just about everyone would be in favor of. Can you point to something that says we're able to reduce bureaucracy through technology?

Patterson: When you look at bureaucracy and unnecessary paper flows, there are certain yes-and-no questions that are part of bureaucracy. Somebody has it go their desk and their job is to stamp yes or no on it. What decision do you have to make? Well they really don’t; they just have to stamp yes. To me, that’s classic bureaucracy.

Well, if the document hits that person’s desk and it meets a certain criteria or threshold, the computer automatically and instantaneously approves it and it has a documented audit trail. That saves some of our clients in the housing-authority industry, when the auditors come and review things. But if you had to make a decision, it forced you to know how long it took you to make it. So, we can look at why is it taking so long or there are questions that you don’t need to be answering.

Gardner: So let the systems do what they do best and let the people do the exception management and the value-added activities. Alan, you had some thoughts about metrics of success of bureaucracy or both?

Proxy measure

Crawford: Yes, it’s the metrics. The Citrix CEO [Kirill Tatarinov] talked at Citrix Synergy about productivity actually going down in the last few years. We’ve put all these tablets out there and we have individual case studies where we know a particular family-support worker has driven 1,700 miles in the year with the tablet, and it was 3,400 miles in the year without. That’s a proxy measure of how much time they're spending on the road, and we have all the associated cost of fuel and wasted time and effort.

We've just installed an app -- actually I have rolled it out in the last month or so -- that measures how many tablets have been switched on in the month, how much they're been used in the day, and what they've been used for. We can break that down by the geographical areas and give that information back to the line managers, because they're the people to whom it will actually make sense.

I'm right at a stage where it’s great information. It’s really powerful, but it’s actually to understand how many hours a day they should be using that tablet. We're not quite sure, and it probably varies from one type of service to another.

We look at those trends over a period of months. We can tell managers that, yes, total staff used them 90 percent, but it’s 85 percent in yours. All managers, I find, are fairly competitive.

There are inhibitors around mobile network coverage and even broadband coverage in some rural areas. We just follow up on all of those user experience information we get back and try and proactively improve them.

Gardner: Well, that may be a hallmark of business agility, when you can try things out, A/B testing. We’ll try this, we’ll try that, we don’t pay a penalty for doing that. We can simply learn from it and immediately apply our lesson back to the process.

Crawford: It’s all about how we support those areas where we identify that they're not making the most of the technology they’ve been given. And it might be human factors. The staff or even the managers are very fearful. Or it might be technical factors. There are inhibitors around mobile network coverage and even broadband coverage in some rural areas. We just follow up on all of those user experience information we get back and try and proactively improve them.

Gardner: Olaf, when we ask enterprises where they are in their digital transformation, many are saying they're just at the beginning. For you, who are obviously well into a digital transformation process, what lessons learned could you share; any words of advice for others as they embark on this journey?

Romer: The first digital transformation in the insurance business was in the middle of 1990s, when we started to go paperless and work with a digital system. Today, more than 90 percent of our new insurance contracts are completely paperless. In Germany, for example, you can give a digital signature. It’s not allowed for the moment in Switzerland, but from a technical perspective, we can do this.

My advice would be that digitalization gives you a good situation to think about to make it simple. We built up great complexity over the years, and now we're able to bring this down and make it as simple as possible. We created the slogan, “Simply Safe,” for us to rethink everything that we're doing to make it simple and safe. Again, for insurance, it's very important that the digitalization brings us not more complexity, but reduces it.

Gardner: Craig, digital transformation, lessons learned, what advice can you offer others as they embark?

Document and workflow

Patterson: In digital transformation, I’ll just use document and workflow. Start with the higher-end items; there's low-hanging fruit there. I don’t know if we'll ever be totally paperless, which would really allow us to go mobile, but at the same time, know what not to scan. Know what to archive and just get rid off. And don't hang on to old technologies for too long. That’s something else that’s starting to happen. The technological revolution in lifecycle of technology is shorter and we need to plan our strategies along those lines.

Gardner: Alan, words of advice on those also interested in digital transformation?

Crawford: For us, it started about connecting with our cause. We’ve got social care staff and since we’re going to do digital transformation, it's not going to really enthuse them. However, if you explain that this is about actually improving the lives of children with technology, then they start to get interested. So, there is a bit about using your cause and relating the change to your cause.

You’ve got to follow through on all this change to get the real benefits out of it. You’ve got to be a bit tenacious with it to really see the benefits in the end.

A lot of our people factors are on how to engage and train. It's no longer IT saying, "Here’s the solution, and we expect you to do ABC." I was working with those social-care workers, and here are the options, what will work for you and how should we approach that, but then it’s never letting up.

Actually, you’ve got to follow through on all this change to get the real benefits out of it. You’ve got to be a bit tenacious with it to really see the benefits in the end.

Gardner: Tie your digital transformation and the organization’s mission that there is no daylight between them.

Crawford: We’ve got the project digitally enabling Action for Children and that was to try and link the two together inextricably.

Gardner: Very good. I'm afraid we’ll have to leave it there. You’ve been listening to a BriefingsDirect discussion, focused on digital business transformation and how that’s been accomplished by several prominent enterprises.

We’ve heard how the convergence of cloud, mobility and big-data analytics has prompted these companies to innovate and produce new levels of productivity. And some of them are finalists from this year’s Citrix Synergy 2016 Innovation Awards program.

So please join me now in thanking our guests, Olaf Romer, Head of Corporate IT and group CIO at Bâloise in Basel, Switzerland; Alan Crawford, CIO of Action for Children in London, and Craig Patterson, CEO of Patterson and Associates in San Antonio, Texas.

And a big think you to our audience as well for joining this Citrix-sponsored business, innovation, thought leadership discussion. I'm Dana Gardner, Principal Analyst at Interarbor Solutions, your host and moderator. Thanks again for listening, and do come back next time.

Listen to the podcast. Find it on iTunes. Get the mobile app. Download the transcript. Sponsor: Citrix.

Transcript of a discussion on digital business transformation and how that’s been accomplished by several prominent enterprises. Copyright Interarbor Solutions, LLC, 2005-2016. All rights reserved.

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Cloud, Competition and the Rise of Business Networks

Transcript of a discussion on the emergence of business networks and how that requires new models of competition and cooperation.

Listen to the podcast. Find it on iTunes. Get the mobile app. Download the transcript. Sponsor: SAP Ariba.

Dana Gardner: Hi, this is Dana Gardner, Principal Analyst at Interarbor Solutions, and you’re listening to BriefingsDirect.

Gardner

Our next innovation thought leadership discussion focuses on the rise of business networks and how that requires new models of doing business and new ways of relating to customers and partners.

Quite rapidly, we've entered a business world where unprecedented connectedness leads to instant analysis. These insights across entire industries provide powerful new ways for businesses to innovate and to adapt to markets, supply chains, and customer demands.

All things being equal, the companies that best leverage this data-driven innovation and these business network effects will surely win in their markets. We’re here today with two experts to discuss the future of enterprise software and the role that business networks will play in creating new models for sustained success.

To learn more about doing business best in our digital and connected world, please join me in welcoming Alex Atzberger, President of SAP Ariba. Welcome, Alex.

Alex Atzberger: Thank you, Dana. Thank you for having me.

Gardner: And we are also here with Christian Lanng, CEO and Co-Founder of Tradeshift. Welcome, Christian.

Christian Lanng: Welcome, Dana, it’s great to be here, and also with Alex.

Gardner: We've had this ongoing confluence of cloud, mobile, big data and we’re seeing streamlined business processes happen as a result of these -- and it seems to be accelerating and empowering business-network effects. So, my first question to you, Christian, is how is this disrupting businesses and how do they turn that disruption into a benefit and business agility?

Lanng: As you mentioned initially, the confluence of cloud, mobile -- all of these things -- is happening and it’s a massive disruption for the Fortune 500. We’ve never really seen anything on this scale, but I want to point out two key areas. If you go back 10 or 15 years, what you were doing with your supply chain was very batch-driven. It was very large-scale business, and was all about reducing the cost of transactions. We saw the rise of business BPOs where you did a lot of outsourcing of your processes, a lot of outsourcing of transactions.

And it was all about a cost-steady supply chain. If you look at today, the main paradigm has switched completely. What you will see is that it’s all about agility. It’s all about the speed of data. We find that a lot of the solutions we implemented in the '90s and the early 2000s tended to focus on reducing cost, and that very often came with the flip side of increasing the cost of change, because we put everything into very rigid process and very rigid structures.

Full supply chain

One of the things that business networks are transforming right now -- both on Alex’s side of the table and our side of the table -- is that we're now wiring the full supply chain. We're connecting all of the processes and bringing in all of the data in real time. That’s an extremely fundamental switch from a world where everything used to be faxed via paper, up until, actually, quite recently.

It’s a tremendous disruption, probably the biggest we’ve see in business software in the last 30 years, and it’s very exciting to be here, because we're just at the very tip of the iceberg for this whole revolution.

Gardner: Alex, disruption can be a negative, but disruption could also be something that creates opportunity. How are you seeing the current market as an opportunity rather than destruction?

Atzberger: All customers are realizing that digitization, the confluence of the different trends that were spoken about, present absolute opportunities to change the business model of companies. And that if they don’t do it, they will die.

Atzberger

If you look at the Fortune 500, versus what it was 20 years ago, you see such an enormous change. It doesn’t matter which of the industries you're in -- retail, financial services, consumer products. You need to adopt a strategy of thinking about how can you use digital technologies for your benefit, because if you don’t, you will fall behind.

But the other fundamental thing that has changed, and it’s actually an opportunity for companies, is that the user has moved to the center of the conversation. So the aspects of the consumer technology that we are bringing into the business context have fundamentally changed people’s requirements on technology.

But it's also people’s adoption rates of technology. The reason why companies like SAP Ariba or Tradeshift are growing and seeing a lot of demand for our solutions is because we see that companies are embracing the change. They know embracing is the only way forward.

Gardner: And of course, we've seen the disruption on the business-to-consumer (B2C) side of things with eBay years ago, Uber now, and Airbnb changing industries rapidly. How does this affect the business-to-business (B2B) interactions of commerce? Is it the same, or do we just extend what we've seen in B2C, to B2B? Why would B2B commerce be different or more challenging?

Lanng: It’s absolutely impacting. I'll start with a point that Alex made that the consumer, the user, has moved to the center of the conversation. It’s about usability, ease of use. If you take something like Tradeshift, we focused very early on making everything mobile first because we realized that the future of B2B processes were all mobile.

If you take a country like China, there’s 97 percent smartphone penetration and 60 percent PC penetration. If you want to run your supply chain there, you want to be mobile-enabled, you want to be mobile-centric, and you want to create whole new user experiences. The other area where the consumerization of B2B is happening and increasing is what I call apps.

Easy to add apps

In the past, big enterprise systems used the concept of modules. You could load new functionality, but it was very hard to do. It required your IT department. It was very complex and challenging. Today (and Salesforce was really the pioneer), we have platforms like Tradeshift that make it very easy to add a new app to get a new set of functionality going really, really quickly. And it’s easy for the customers to change very quickly and adapt to the business environment.

Lanng

The last area of active consumerization hitting the enterprise is on insights. When I use Twitter or Airbnb, I get real-time feedback. If I send a tweet, I will immediately know the reach, how many users saw the tweet. I can go in and see that limits of the tweet, and I can make a decision, as a consumer, based on that feedback loop.

In the enterprise, in the past, a lot of the business intelligence and analytics we built, were more like centralized reports going to the top and not benefiting the people who were sitting in the front line doing the work of the business.

Where we're going today is rebuilding using network data, using the real-time data, and going to a real-time level with these people. That’s the last huge disruption you'll see in the enterprise: real-time insights, the use of the apps as a driver and a method for delivering new folks. Now, you'll see another whole new paradigm for user experience and user friendliness.

Gardner: And, Alex, for companies that have a hard time adapting rapidly -- that are still using legacy software, that prefer on-premises deployments, that are just now moving past paper-based processes -- how do we encourage them to recognize the change and adapt?

Atzberger: One expression I tend to use with companies is to say that solutions need to be consumer-simple, as well as strong. What I mean by that is that when you're in the B2B space, you need to obviously recognize that the requirements for security, the requirements for integration, the requirements between data and other pieces have a different level of complexity than when you use eBay or Twitter.

The role of technology companies today is to remove friction as much as possible for companies so that they can enjoy the same benefits as a user in the consumer would. At the same time, providers have to obviously ensure that there is a business strength to the solutions that gives companies the comfort to move to a cloud environment.

The role of technology companies today is to remove friction as much as possible for companies so that they can enjoy the same benefits as a user in the consumer would.

So if you're a financial services institution and you've worked on on-premise software all the time, you obviously had full control of making changes to the software. You knew the way it was running, etc. As you're moving this to the cloud, you're gaining the benefits of fast innovation, but you can’t give up on the necessity for security, for instance, and for sound information.

That’s often where we see customers choosing companies like SAP to go with because of the experience we have managing data, ensuring the integrity of the information, and ensuring that security. But a lot of conversations that we have with companies are about how you, on one hand, deliver that wonderful consumer simplicity, but at the same time deliver on the business strength.

This is especially relevant in procurement, because you can make it so easy, through an app, to order products. But if you're in procurement, you don’t want your employees to just buy things randomly -- just because it’s now easy to do it. You want to have the controls and compliance in place to manage your spend, have visibility on the spend, and manage your company.

That’s where the crux of the matter is, and if we solve this, I think customers are ready to move to the cloud.

The right balance

Gardner: Christian, it sounds as if Alex is calling for a balance between the governance and benefits of traditional software and business applications, while also exploiting the newer agility from mobile, from feedback loops, from the consumer-centricity. It’s almost as if we have two companies within one now. How are you seeing that balance and how do you help companies achieve the right balance?

Lanng: It’s quite natural, and Alex and I also can probably recognize that we come from both sides of the equation here. Alex is trying to transform what traditionally has been an on-premise company and going toward the cloud. I come from a cloud-first company, and I'm trying to break into some of these complex use cases. Alex is spot on; security is still a massive issue especially with the data we deal with here.

So, it's about finding that balance. It’s also why we can’t use the consumer apps, since consumer apps need to have security models, and we need to have a lot of things. But this stuff is also getting very robust. You saw some recent breaches last year. There was the Sony story with all of the emails that were leaked. That was an on-premise system that was penetrated. I'm quite sure if that has been a cloud-based provider like Google or Microsoft, that penetration would have never happened.

We have to question ourselves that, in a trade environment like today, can each individual enterprise actually uphold the security that’s required? Are we seeing that cloud companies like mine or Alex’s, in a way, become specialists in securing all domains and securing the data within that domain?

Alex is trying to transform what traditionally has been an on-premise company and going towards the cloud. I come from a cloud-first company and I'm trying to break into some of these complex use cases.

Also, when we talk about this balance, when we talk about compliance for instance, there are two paradigms. You can have control and compliance upfront, but obviously you limit adoption and thereby limit impact on the business-case side.

Another thing, as Alex says, is that we can’t just have people going in and randomly buying everything. Can we guide them better? Can we give them real-time data to show them the consequences of what they could do instead, rather than put up a wall as the first step? That’s where there’s a lot of innovation happening right now, and a lot of thinking.

Gardner: Let’s revisit this notion of business networks. It seems to me also that, as we move toward cloud models, as we look to systems of record as services, the data becomes more transferable, shareable, and manageable, not siloed or isolated.

It seems to me that the more data and access to process information you have, the more of an advantage we have by being able to actually analyze these things in context and in total, rather than isolated as in the past.

So, how do we as suppliers to enterprises help them recognize the benefit of combined network efficiencies -- of looking to a provider to actually help them integrate and understand all of the data that’s at their disposal? Let’s start with Alex. How do we help make business networks palatable to organizations and trust the vendor to do more when it comes to bringing these sources of information together?

Exciting topics

Atzberger: This is an exciting topic, because if you look at it, obviously networks have a network effect. This means that, as more people are connected to a network, the more valuable the network overall becomes to its participants That’s something that we see very much in the Ariba business model.

Today, we have 2 million companies connected to the Ariba Network. When I go into certain markets, and we talk to certain customers about their supplier base, it makes a difference when 50 percent, 70 percent, 80 percent of those suppliers are already connected to the platform.

If you step back and think about point-to-point connections like EDI that existed in the past to create connections between companies, now you suddenly have a network where you have the baseline to add additional services to a network to actually enrich the experience for everyone who actually participates in the network.

At the same time, the data needs to be secure and companies need to feel they actually do business with other trusted entities.

It’s very, very important to understand that from our perspective. When we talk about procurement, I also look at the supplier as a customer. So there’s value on both sides. When we talk, for instance, about mobile apps, the mobile apps don’t just exist on the buyer side; they also exist on the supplier side -- and that’s a very, very important part of this.

As you bring in new services, payments, supply chain information, and forecast information into the network, these are some of the most rapidly adopted solutions that we see, because people already have the network in place and can now do more with it. It’s very similar to social networks that started pretty much with the status update, and today, you can share more and more of your lives and do more and more things on a network. That’s the power of it.

At the same time, the data needs to be secure and companies need to feel they actually do business with other trusted entities. This brings in the whole topic of supplier risk, of having transparency, into who the suppliers actually are that you do business with, but also identifying new sources of supply. That becomes very powerful, and then underneath, everything is the actual data that sits there. Opening up that information in the platform for companies to analyze and benchmark themselves is extremely powerful.

I often talk about the application, the network, and then the data-play as the three dimensions that company should be thinking about as they embrace business networks strategy.

Gardner: A whole greater than the sum of the parts. How do you see organizations take advantage of it?

Multi-Enterprise Grid

Lanng: First off, this is one of the areas where Alex and I wholeheartedly agree. When Gartner came out with the new hot topic for Procure-to-Payment, one area that they pointed out was a whole new category called Multi-Enterprise Grid, and that’s of course, a mouthful to swallow, but what they really said was that the future for enterprise connectivity is something brand new.

It’s not the business networks in the sense that we know them today, it’s not the EDI networks, but it’s something where information can flow in all directions. It’s a full stack of information, not just transactional data, but also, as Alex talked about, real-time insights, analytics data, logistics data, collaboration, and so on.

There were only two providers mentioned in that category, which is rated by Gartner to be one of the most impactful over the next five to 10 years. And the two providers were Tradeshift and SAP Ariba. As a company a third of the age of Ariba, we were proud to be in that category. But I think it shows the focus that both of these companies have in this area.

The long tail of the supply chain will become increasingly important for networks as we move forward.

One thing we did well, and I also think it points to the future of this, is that we started out as a supplier network. Before we built any buyer functionality, we actually designed a completely functional supplier network, and we helped suppliers join for free, get access, and run all of these services. Then, we slowly built out our enterprise portfolio. And that meant that from the beginning, Tradeshift has always been network-first.

Every single feature we built on the enterprise, every single aspect of our platform, we designed with this idea of how we would utilize the network, how we would bring collaboration into it, how our partners and app partners would use these things. To the point of the openness, Tradeshift was born with a completely open set of APIs so that anybody can develop on the platform and put out applications.

The long tail of the supply chain will become increasingly important for networks as we move forward, because as we're moving into much more complex transactions and move into much more complex data, we will need to connect every single supplier. If you take something like risk – as one of the examples that Alex mentioned – you are as exposed to the tiny, tiny supplier as you are to the big North American supplier you’ve been doing business with for 10 years, maybe even more.

If you ask me what the future of networks, I think it will be three things. It will be connect everyone, rather than to connect the top 10 percent. It will be a Multi-Enterprise Grid, which means it’s moving in all directions and data are connected in all directions both from the supplier side and from the buyer side. Finally, it will be open, but to echo Alex, open but secure. People will be able to build and innovate on top of these platforms, but within a secured framework and secured context.

Gardner: Alex, SAP has been around for quite some time, and conventional wisdom nowadays is that if you're a legacy provider you're somehow at a disadvantage in the cloud environment. Yet SAP recently reported very strong growth, and I think this validates a somewhat different approach or a different perception of a legacy vendor. Tell us why you think SAP is growing while other vendors are struggling?

Technology cycles

Atzberger: Dana, if you look at it as a company that has been in business for 42 years, we know one or two things about going through different technology cycles. Each technology cycle requires you to transform your company. What SAP did right in this transformation is that it acquired businesses to move the business forward, and a significant investment in outside R and D basically by bringing in capabilities into SAP.

But then, when the companies got acquired, each company is actually managed as an entrepreneurial entity inside the business. For me, that’s a very important. I belong to a family where my father had his own business. I believe that it’s really important that companies focus on innovation and actually have a capability to have an entrepreneurial mindset, and a commerce mindset inside a business.

I respect companies like Tradeshift and other companies that are emerging very much because of that commerce mindset of those businesses. The power is the scale at which you can impact change at a company like SAP, and that’s where actually so much of the transformational capabilities are coming from.

With 250,000 customers on the SAP side touching 70 percent of the world’s transactions, imagine what type of base this gives to Ariba, which today now facilities $1 trillion worth of commerce, to expand and build on it, and all the technical capabilities that come with it.

As a company that has been in business for 42 years, we know one or two things about going through different technology cycles. Each technology cycle requires you to transform your company.

I always like to say that I want SAP Ariba to be the fastest growing startup inside a large company. And how do we do this? It’s by both focusing on that innovative mindset of a startup company and combining it with all the assets that come from a larger company. That’s a very valuable proposition both for the customer as well as for having passionate employees to actually deliver the best results.

Gardner: Christian, there’s also conventional wisdom that says if you're an agile newcomer that you can run circles around the incumbent companies. How does that work for you, and how do you see that playing out?

Lanng: I want to start by saying that we're the challenger to SAP Ariba in this market. It obviously has its advantages. But I also want to say that Ariba is obviously one of the competitors that we respect the most. Alex has been doing an excellent job also of really integrating a company like Ariba, which is 20 years old.

You have to remember, moving from a whole new stack and a whole new sort of solution also has its advantages. Sure, we're a challenger, but we're not that new anymore. We actually have 500,000 companies on our network. We have total global coverage. We have some of the largest companies in the world also on our customer list, but obviously not as big as SAP.

But it’s true that we can probably move a little faster and innovate a little faster, and maybe also sometimes tease Alex and friends on social media a little faster. But I think we’ve done it with a lot of respect, and I definitely see that’s the place for us as a competitor and challenger in this market. It’s a very healthy competition, because we're both striving to really do better for our customers.

Attracting innovators

One thing as a challenger is that we've also been attracting a lot of innovators within this industry. Other players have focused much more on companies where Ariba was today and not really innovating. I think that’s the wrong way to think about what you want to do.

We always came with being-first principles. We wanted to build something different. We've done that within procurement. We've done that within our risk offering, within our network. It’s very, very different. Also, there is a choice in the market and that’s actually really healthy. We're also tracking customers that like that innovation, and are thinking of new ways for supply chains.

At the end of the day, my biggest integration partner is still SAP. I don’t know if you want to talk about friendly competition here, but it’s certainly a market that has multiple angles.

Atzberger: If I can make one more comment on that, it’s also important to understand that often times for customers, it’s important to see that a trend, a movement gets validated by multiple companies. When the cloud came about some of the innovators, Salesforce for instance, had become absolutely mainstream. All companies have different sorts of cloud offerings, and that's good to hear.

It’s also important to understand that often times for customers, it’s important to see that a trend, a movement gets validated by multiple companies.

That’s actually important because companies know that when they invest in something, it’s actually a concept. That’s why you're talking to two innovators in this space and that gives more companies confidence to invest in something new and to say, "We want to go on this journey. I think this is good that you're taking this topic on this call today, because I do think it’s a massive trend of going forward."

Gardner: I am a big fan of showing and not just telling and doing that through a use-case or a customer example. So, Christian, I wonder if you could relate to us, maybe by name or maybe just by generic description, a customer scenario that demonstrates Tradeshift’s approach and value?

Lanng: I absolutely can, and I'll take a very recent example. We just announced, about a month ago, a big international customer, Zurich Insurance Group. It's a huge global company, very conservative industry. It's been around for 150 years and, of course, has very sensitive customer data. They were having a lot of struggles with this whole process, and they got the people inside the company engaged around actually driving impact and value in these processes.

We showed them at the time our brand new procurement platform called Tradeshift Buy combined with the Tradeshift network. There were three things that stood out for them. The first thing we addressed were rogue buyers; people who are going outside procurement rules, and we said, “Hey, these are actually people who are passionate about their company, who are trying to drive value and even willing to take enough risk that they are not always following the rules. Let’s try to give them some tools so they at least participate, and we can get the spend under control.”

The second thing we did was we showed collaboration aspects with the supply chain and showed how, in real time, you can collaborate with your suppliers around categories and also the procurement department, because in a lot of companies procurement departments get a little alienated; they become the enemy. If I'm trying to do something, they're the bottleneck. One person said, "We are the Department of Cheap."

Strategic part

I don’t think that’s the case. They are actually a strategic part of driving value in your business. So we really try to build a procurement platform where suppliers become equal citizens and became helpers, so that if you are trying to buy something to try to solve the problem, you can engage with them in the solution phase, not just when it’s the last step and you got us in the purchase order (PO).

The last step was the ability to roll out locally for their supply chain. They are a huge global company and needed confidence they could get the onboarding rates. They looked at a lot of solutions and what it comes to down to today is that there is only reach through two network solutions in the world. Those are Ariba and Tradeshift. The rest don't have all of these platform capabilities and this broad scope.

Gardner: Alex, the same question to you. Do you have a use case example, by name or generically, that illustrates the power of the composition of SAP Ariba? 

Atzberger: Absolutely. I'll give you couple of different examples. If you take a company like AIG, the insurance company, I urge you to look at the YouTube video talking about how they saved about $300 million through the Ariba platform. That was driven through -- taking all categories of spend actually on to the Ariba platform including, by the way, legal services, which is something where a lot of companies say, you can’t actually bring this into an e-sourcing environment. So that’s an exciting case.

In the last quarter alone, we enabled another 80,000-plus suppliers on the network. That’s where a lot of the power of the community and the network comes from.

Another one, for instance is, Auchan the French Company that actually went to suppliers and said, if there's no Ariba, there's no business. Basically, you need to be on Ariba in order to do business with them. It's a strong business-driven case of what actually it means if you have a strong procurement department to lead the change and do this not just in France, but across Russia, China, and markets where they operate.

Take companies like BHP Billiton in Australia and Singapore. They drive more than 90 percent of their spend over the SAP Ariba platform and connect their suppliers to it. It's one of the best-in-class examples of a sourcing and procurement organization. Also, they're going into China to identify new sources of supply and that’s something where we're working with them and really extending their reach, which is becoming so important to global sourcing strategies.

Then, I'd point out new customers that we're excited to have as part of the SAP Ariba community, like First Data. First Data has the largest IPO last year in the US. It’s a payment company, but really a technology company as well. If I look at what they want to do with the platform and also what we are doing in partnership with them around B2B payments, it's a very exciting uses case as well.

When you look at the some of the names I just gave you, at the size of those companies and the suppliers, we're talking about tens of thousands of suppliers that those companies have. In the last quarter alone, we enabled another 80,000-plus suppliers on the network. That’s where a lot of the power of the community and the network comes from.

Lanng: I just wanted to add one thing to what Alex said, because I think what he's also showing with his cases is the breadth of industries and global reach of this customer base and who can use networks. We see exactly the same within airlines, such as Air France, and companies in retail, fashion, manufacturing. I don’t think there is a single industry we don’t have on the platform, also new companies like LinkedIn within services and so on.

I just want to echo what Alex said. It's a really broad set of industries and customers who are trying to use live business networks. I don’t think there's anyone who won’t use this or, in the future, won’t have this. It will be a default, as having an ERP system as today.

Data feedback

Gardner: I think we've only begun to explore the depths of the data feedback and analysis capabilities within digital commerce, and within retail, for example, of the user experience and real-time interactions and customization impacts.

So before we close out, let's think about companies that might be resisting this notion of taking advantage of the network, and of starting to do the groundwork in order to be able to realize those feedback loops and analysis benefits.

Starting with you, Christian, what would you say to a company that is still somehow not interested in taking advantage of business networks, and what potentially could they miss out on if they don't start doing the groundwork now in order to be able to be a digital business with deep data-driven analysis capabilities becoming pervasive?

Lanng: We have to go all the way back to the beginning of this discussion, which is what also Alex pointed out, that companies that don’t change and innovate will be gone. We've seen more companies disappear out of the Fortune 500 in the last 20 years than we have in the history of business, and it’s accelerating.

If your supply chain is in such a way that you cannot react to that kind of disruption quickly, and if you can't acquire new suppliers that can help you find all of these threats, you are done.

There are three key things you miss out on if you don’t invest in networks. First is the ability to know and know fast. Today, knowing is way more important than just the cost of things or the cost of transactions. We see huge Fortune 500 companies shocking us with reporting their most basic numbers to their shareholders. You see the shareholders being more and more aggressive on having insights on how these companies are run.

The second thing is agility. Agility is probably the single most important strategic capability in 2016 and onward. And I think if you look at companies we are taking about they have new competitors coming up. You can take a company like P&G who recently got disrupted by the Dollar Shave Club, a company that spent less than a million dollars on marketing to take a shot at $13 billion market.

If your supply chain is in such a way that you cannot react to that kind of disruption quickly, and if you can't acquire new suppliers that can help you find all of these threats, you are done. Lastly is, if you don’t have a connected supply chain, you miss out on the advantage of getting new processes rolled out.

Social networks typically have a status feed. In our case, once you're connected on Tradeshift, once you have a supplier up and running, if you want to roll out any new business process, any kind of new connectivity, it is as easy as pushing a new app. Whereas somebody who doesn't have this technology and is rolling out a new business process, we're talking about a three- to five-year lifespan to get to the old supply chain. So agility, speed, and just not being disrupted are the three key reasons I will point to.

Gardner: Alex, Christian paints the picture of business networks as existential. You really don’t have a choice, but a lot of companies are still struggling with how to go about this. Is there an order to it? How should I begin rationally without getting caught up in complexity and losing control of my company? What advice, Alex, would you give companies on how to start the process of becoming a digital business, and to retain governance, but still get the agility benefits?

Back to basics

Atzberger: If your company is conservative or wondering about how best to take advantage of this, you know, you would have to go back to some of the basics. Of course there has to be a business case. Start with a business case around the benefits and the cost. What does the infrastructure currently cost you, the paper based processes cost you, to do business with your suppliers? What are the benefits that you would have, as Christian pointed out, if you could actually extend more and more capabilities over the network, and that itself is very good.

Then the second piece is to engage some things like Design Thinking, about envisioning what the future could be like. Bring together different people out of your companies cross-functionally to think about how you could envision doing more with the assets you have in actually creating new capabilities.

And that’s where things get really exciting, when you think about maybe we shouldn’t be thinking about the network just as something where we have a buying from, but maybe it is something that we become a supplier into. We have many customers, by the way, who do both, who are both buyers and suppliers on the network, and they are valuing that as well.

Anything that you digitize doesn’t mean that your business becomes somehow less involved, somehow detached from your suppliers. It’s actually the opposite.

Finally, it’s about understanding. Anything that you digitize doesn’t mean that your business becomes somehow less involved, somehow detached from your suppliers. It’s actually the opposite. You become more relevant. You, as a buyer, become a customer of choice to your supplier.

That’s very powerful, because at the end of the day, you can argue that, as a consumer, you start to prefer those companies that have a digital relationship with you. That’s what networks have built and allow you to do -- build a digital relationship between your suppliers and the buyers.

As far as conservative companies, I'm happy to talk to them, Dana. If you have any names, send them my way. We love to engage and we love to have that conversation, but it comes back to the fact that there is a real value in this, and it gives all the things that Christian talks about with the agility and other benefits as well. It both makes sense strategically, as well as from the business case, and if those things come together, companies have a great future.

Gardner: I’m afraid we will have to leave it there. You have been listening to a BriefingsDirect discussion focused on the emergence of business networks and how that now requires new buy and sell models. We have heard how companies that best leverage this data-driven innovation and these business network effects will gain significant advantages in their markets.

And lastly we have learned that the use of business networks creates new models to sustain success. So please join me now in thanking Alex Atzberger, President of SAP Ariba. Thank you, Alex.

Atzberger: Thank you so much, Dana, I enjoyed this thoroughly and thank you, Christian.

Gardner: Yes, and thank you Christian Lanng, CEO and Co-Founder of Tradeshift.

Lanng: Thank you so much, Dana, and thank you, Alex.

Atzberger: Absolutely.

Gardner: And also a big thank you to our audience for joining us for this SAP Ariba-sponsored business innovation thought leadership discussion. I’m Dana Gardner, Principal Analyst at Interarbor Solutions, your host and moderator. Thanks again for listening, and do come back next time.

Listen to the podcast. Find it on iTunes. Get the mobile app. Download the transcript. Sponsor: SAP Ariba.

Transcript of a discussion on the emergence of business networks and how that requires new models of competition and cooperation. Copyright Interarbor Solutions, LLC, 2005-2016. All rights reserved.

You may also be interested in:

• SAP Ariba Chief Strategy Officer on the Digitization of Business and the Future of Technology
• Procurement in 2016 -- The Supply Chain Goes Global
• Is 2016 the Year that Accounts Payable Becomes Strategic?
• Winning the B2B Commerce Game: What Sales Organizations Should Do Differently
• Can Great Design Really Impact Global Commerce?
• Ariba’s digital handshake helps Caesars up the ante on supply chain diversity
• Detecting and Eradicating Slavery and Other Labor Risks Across Global Supply Chains through Business Networks
• Ariba elevates business user experience with improved mobile apps and interfaces
• Ariba's product roadmap for 2015 leads to improved business cloud services
• Networks: The new model for B2B business, a panel discussion
• Big Data Meets the Supply Chain -- SAP's Supplier InfoNet and Ariba Network Enable Companies to Predict and Manage Supplier Risk

How INOVVO Delivers Analysis that Leads to Greater User Retention and Loyalty for Mobile Operators

Transcript of a discussion on how advanced analytics drawing on multiple data sources provides wireless operators improved interactions with their subscribers and enhances customer experience through personalized insights.

Listen to the podcast. Find it on iTunes. Get the mobile app. Download the transcript. Sponsor: Hewlett Packard Enterprise.

Dana Gardner: Hello, and welcome to the next edition of the HPE Discover Podcast Series. I'm Dana Gardner, Principal Analyst at Interarbor Solutions, your host and moderator for this ongoing discussion on IT innovation and how it’s making an impact on people’s lives.

Gardner

Our next big-data case study discussion examines how INOVVO delivers impactful analytical services to mobile operators to help them engender improved end-user loyalty.

We'll see how advanced analytics, drawing on multiple data sources, enables INOVVO’s mobile carrier customers to provide mobile users with faster, more reliable, and relevant services.

To learn more about how INOVVO uses big data to make major impacts on mobile services, please join me in welcoming Joseph Khalil, President and CEO of INOVVO in Reston, Virginia. Welcome, Joseph.

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Joseph Khalil: Thank you, Dana. I'm glad to be here.

Gardner: User experience and quality of service are so essential nowadays. What has been the challenge for you to gain an integrated and comprehensive view of subscribers and networks that they're on in order to uphold that expectation for user experience and quality?

Khalil: As you mentioned in your intro, we cater to the mobile telco industry. Our customers are mobile operators who have customers in North America, Europe, and the Asia-Pacific region. There are a lot of privacy concerns when you start talking about customer data, and we're very sensitive to that.

Khalil

The challenge is to handle the tremendous volume of data generated by the wireless networks and still adhere to all privacy guidelines. This means we have to deploy our solutions within the firewalls of network operators. This is a big-data solution, and as you know, big data requires a lot of hardware and a big infrastructure.

So our challenge is how we can deploy big data with a small hardware footprint and high storage capacity and performance. That’s what we’ve been working on over the last few years. We have a very compelling offer that we've been delivering to our customers for the past five years. We're leveraging HPE Vertica for our storage technology, and it has allowed us to meet very stringent deployment requirements. HPE has been and still is a great technology partner for us.

Gardner: Tell us a little bit more about how you do that in terms of gathering that data, making sure that you adhere to privacy concerns, and at the same time, because velocity, as we know, is so important, quickly deliver analytics back. How does that work?

User experience

Khalil: We deal with a large number of records that are generated daily within the network. This is data coming from deep packet inspection probes. Almost every operator we talk to has them deployed, because they want to understand the user experience on their networks.

These probes capture large volume of clickstream data. Then, they relay it to us almost in a near real-time fashion. This is the velocity component. We leverage open-source technologies that we adapted to our needs that allow us to deal with the influx of streaming data.

We're now in discussion with HPE about their Kafka offering, which deals with streaming data and scalability issues and seems to complement our current solution and enhances our ability to deal with the velocity and volume issues. Then, our challenge is not just dealing with the data velocity, but also how to access the data and render reports in few seconds.

One of our offering is a care product that’s used by care organizations. They want to know what their customers did the last hour on the network. So there's a near real-time urgency to have this data streamed, loaded, processed, and available for reporting. That’s what our platforms offers.

Gardner: Joseph, given that you're global in nature and that there are so many distribution points for the gathering of data, do you bring this all into a single data center? Do you use cloud or other on-demand elements? How do you manage the centralization of that data?

Our customers can go and see the performance of everything that’s happened on the network for the last 13 months.

Khalil: We don’t have cloud deployments to date, even though our technology allows for it. We could deploy our software in the cloud, but again, due to privacy concerns with customers' data, we end up deploying our solutions in-network within the operators’ firewalls.

One of the big advantages of our solution is that we can choose to host it locally on customers’ premises. We typically store data for up to 13 months. So our customers can go and see the performance of everything that’s happened on the network for the last 13 months.

We store the data at different levels -- hourly, daily, weekly, monthly -- but to answer your question, we deploy on-site, and that’s where all the data is centralized.

Gardner: Let’s look at why this is so important to your customer, the mobile carrier, the mobile operator. What is it that helps their business and benefits their business by having this data and having that speed of analysis?

Customer care

Khalil: Our customer care module, the Subscriber Analytix Care, is used by care agents. These are the individuals that respond to 611 calls from customers complaining about issues with their devices, coverage, or whatever the case may be.

When they're on the phone with a customer and they put in a phone number to investigate, they want to be able to get the report to render in under five seconds. They don’t want to have the customer waiting while the tool is churning trying to retrieve the care dashboard. They want to hit "go," and have the information come on their screen. They want to be able to quickly determine if there's an issue or not. Is there a network issue, is it a device issue, whatever the case may be?

So we give them that speed and simplicity, because the data we are collecting is very complex, and we take all the complexity away. We have our own proprietary data analysis and modeling techniques, and it happens on-the-fly as the data is going through the system. So when the care agent loads that screen, it’s right there at a glance. They can quickly determine what the case may be that’s impacting the customer.

Our care module has been demonstrated to reduce the average call handle time, the time care personnel spend with the customer on the phone.

Our care module has been demonstrated to reduce the average call handle time, the time care personnel spend with the customer on the phone. For big operators, you could imagine how many calls they get every day. Shaving a few minutes off each call can amount to a lot of savings in terms of dollars for them.

Gardner: So in a sense, there’s a force-multiplier by having this analysis. Not only do you head off the problems and fix them before they become evident, which includes better user experience, they're happier as a customer. They stay on the network. But then, when there are problems, you can empower those people who are solving the problem, who are dealing with that customer directly to have the right information in hand.

Khalil: Exactly. They have everything. We give them all the tools that are available to them to quickly determine on the fly how to resolve the issue that the customer is having. That’s why speed is very important for a module like care.

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For our marketing module, speed is important, but not as critical as care, because now you don’t have a customer waiting on the line for you to run your report to see how subscribers are using the network or how they're using their devices. We still produce reports fairly quickly in few seconds, which is also what the platform can offer for marketing.

Gardner: So those are some of the immediate and tactical benefits, but I should think that, over time, as you aggregate this data, there is a strategic benefit, where you can predict what demands are going to be on your networks and/or what services will be more in demand than others, perhaps market by market, region by region. How does that work? How do you provide that strategic level of analysis as well?

Khalil: This is on the marketing side of our platform, Subscriber Analytix Marketing. It's used by the CMO organizations, by marketing analysts, to understand how subscribers are using the services. For example, an operator will have different rate plans or tariff plans. They have different devices, tablets, different offerings, different applications that they're promoting.

How are customers using all these services? Before the advent of deep packet inspection probes and before the advent of big data, operators were blind to how customers are using the services offered by the network. Traditional tools couldn’t get anywhere near handling the amount of data that’s generated by the services.

Specific needs

Today, we can look at this data and synthesize it for them, so they can easily look at it, slice and dice it along many dimensions such as, age, gender, device type, location, time, you name it. Marketing analysts can then use these dimensions to ask very detailed questions about usage on the network. Based on that, they can target specific customers with specific offers that match their specific needs.

Gardner: Of course, in a highly competitive environment, where there are multiple carriers vying for that mobile account, the one that’s first to market with those programs can have a significant advantage.

Khalil: Exactly. Operators are competing now based on the services they offer and their related costs. Back 10-15 years ago, radio coverage footprint and voice plans were the driving factors. Today, it's the data services offered and their associated rate plans.

Gardner: Joseph, let’s learn a little bit more about INOVVO. You recently completed purchase of comScore’s wireless solutions division. Tell us a bit about how you’ve grown as a company, both organically and through acquisition, and maybe the breadth of your services beyond what we've already described?

Our tool allows them to anticipate when existing network elements exhaust their current capacity.

Khalil: INOVVO is a new company. We started in May 2015, but the business is very mature. My senior managers and I have been in this business since 2005. We started the Subscriber Analytix product line back in 2005. Then, comScore acquired us in 2010, and we stayed with them for about 5 years, until this past May.

At that time, comScore decided that they wanted to focus more on their core business and they decided to divest the Subscriber Analytix group. My senior management and I executed a management buyout, and that’s how we started INOVVO.

However, comScore is still a key partner for us. A key component of our product is a dictionary for categorizing and classifying websites, devices, and mobile apps. That’s produced by comScore, and comScore is known in this industry as the gold standard for these types of categorizations .

We have exclusive licensing rights to use the dictionary in our platform. So we have a very close partnership with comScore. Today, as far as the services that INOVVO offers, we have a Subscriber Analytix product line, which is for care, marketing, and network.

We talked about care and marketing, we also have a network module. This is for engineers and network planners. We help engineers understand the utilization of their network elements and help them plan and forecast what the utilization is going to be in the near future, given current trends, and help them stay ahead of the curve. Our tool allows them to anticipate when existing network elements exhaust their current capacity.

Gardner: And given that platform and technology providers like HPE are enabling you to handle streaming real-time highly voluminous amounts of data, where do you see your services going next?

It appears to me that more than just mobile devices will be on these networks. Perhaps we're moving towards the Internet of Things (IoT). We're looking more towards people replacing other networks with their mobile network for entertainment and other aspects of their personal and business lives. At that packet level, where you examine this traffic, it seems to me that you can offer more services to more people in the fairly near future.

Two paths

Khalil: IoT is big and it’s showing up on everybody’s radar. We have two paths that we're pursuing on our roadmap. There is the technology component, and that’s why HPE is a key partner for us. We believe in all their big data components that they offer. And the other component for us is the data-science component and data analysis.

The innovation is going to be in the type of modeling techniques that are going to be used to help, in our case, our customers, the mobile operators. Moving down the road, there could be other beneficiaries of that data, for example companies that are deploying the sensors that are generating the data.

I'm sure they want some feedback on all that data that their sensors are generating. We have all the building blocks now to keep expanding what we have and start getting into those advanced analytics, advanced methodologies, and predictive modeling. These are the areas, and this is where we see really our core expertise, because we understand this data.

Today you see a lot of platforms showing up that say, “Give me your data and I'll show you nice looking reports.” But there is a key component that is missing and that is the domain expertise in understanding the data. This is our core expertise.

My advice is that it’s a new field and you need to consider not just the Hadoop storage layer but the other analytical layers that complements it.

Gardner: Before we finish up, I'd like to ask you about lessons learned that you might share with others. For those organizations that are grappling with the need for near real-time analytics with massive amounts of data, having tremendous amount of data available to them, maybe it’s on a network, maybe it’s in a different environment, do you have any 20/20 hindsight that you might offer on how to make the best use of big data and monetize it?

Khalil: There is a lot of confusion in the industry today about big data. What is big data and what do I need for big data? You hear the terms Hadoop. "I have deployed a Hadoop cluster. So I have solved my big data needs." You ask people what’s their big-data strategy, and they say they have deployed Hadoop. Well, then. what are you doing with Hadoop? How are you accessing the data? How are you reporting on the data?

My advice is that it’s a new field and you need to consider not just the Hadoop storage layer but the other analytical layers that complements it. Everybody is excited about big data. Everybody wants to really have strategy to use big data, and there are multiple components to it. We offer a key component. We don't pitch ourselves to our customers and say, “We are your big data solution for everything you have.”

There is an underlying framework that they have to deploy, and Hadoop is one of them. then comes our piece. It sits on top of the data hosting infrastructure and feeds from all the different data types, because in our industry, typical operators have hundreds if not thousands of data silos that exist in their organization.

So you need framework to really host the various data sources, and Hadoop could be one of them. Then, you need a higher-level reporting layer, an analytical layer, that really can start combining these data silos and making sense of it and bringing value to the organization. So it's a complete strategy of how to handle big data.

Gardner: And that analytics layer that's what HPE Vertica is doing for you.

Key component

Khalil: Exactly. HPE is a key component of what do we do in our analytical layer. There are misconceptions. When we go talk to our customers, They say, “Oh, you're using your Vertica platform to replicate our big data store,” and we say that we're not. The big data store is a lower level, and we're an analytical layer. We're not going to keep everything. We're going to look at all your data, throw away a lot of it, just keep what you really need, and then synthesize it to be modeled and reported on.

Gardner: I'm afraid we'll have to leave it there. We've been exploring how INOVVO delivers impactful analytical services to mobile operators so they can foster improved end-user loyalty, and we've identified how advanced analytics, drawing on multiple data sources, provides a better network quality assurance and, of course, an all-important better user experience.

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So join me in thanking Joseph Khalil, President and CEO of INOVVO in Reston, Virginia. And a big thank you as well to our audience for joining us for this big data innovation case study discussion.

I'm Dana Gardner; Principal Analyst at Interarbor Solutions, your host for this ongoing series of HPE-sponsored discussions. Thanks again for listening, and do come back next time.

Listen to the podcast. Find it on iTunes. Get the mobile app. Download the transcript. Sponsor: Hewlett Packard Enterprise.

Transcript of a discussion on how advanced analytics drawing on multiple data sources provides wireless operators improved interactions with their subscribers and enhances customer experience through personalized insights. Copyright Interarbor Solutions, LLC, 2005-2015. All rights reserved.

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