Big Data in Action - the Analytics Cure-all?

Most would agree that by now, "Big Data" is a household concept in the strategic enterprise technology circuit. In this post I take an actual example of Big Data use and explore the implications of adopting and integrating it into a traditional business process. While there is a formal Gartner model defining the essential three dimensions of Big Data, for my purpose, a simple working definition might be that it is massive amounts of data, often unstructured (for example free flowing human readable text as in this blog post, as opposed to structured data in relational databases) generated either by humans or devices, that can be analyzed using advanced tools and may lead to unprecedented business insights.

Below is a demo video from IBM which delves into a specific business application of Big Data. I specially like it since it gives "just right" amount of detail (okay I'm speaking for myself here) to understand the usage. The commentary is neither at a thirty thousand foot marketing level nor so technical so as to lose the big picture.

The departmental unit in focus here is the Office of Technology Transfer, which is present at most research universities, corporate research and government research organisations (such as the National Institutes of Health OTT). The unit hangs in delicate balance at a point where incoming resources are thin while the expected output business value (from licensing and selling of IP assets) is enormous, potentially worth millions of dollars in licensing deals. Sounds like a familiar predicament? In fact, especially in universities, where the OTT is critical for creating a steady alernate revenue stream out of IP assets, the unit is frequently understaffed. The staff comprising of a mix of students and full time staff analysts are left to their own devices to perform the arduous task of sifting through massive amounts of heavy duty scholarly content strewn across the Internet hoping to make the crucial match between demand and supply that will result in a signed deal. The video illustrates what it means to apply Big Data to such a business model and how a company may use new capabilities gained from this to its advantage.



So does this mean Big Data is a panacea for all enterprise business analytics ailments?
Here are some of my takeaways from the video:

Strategic IT Case Study: Nurturing Marketing Leads into Taller Toplines

The role of IT in the Sales and Marketing process has long surpassed the days of email volleys and Excel marathons. The sales automation successor products like Siebel CRM that smooth out the marketing and sales workflows have gradually given way to the SaaS avataars like Salesforce.com (SFDC). SFDC does a great job of improving workflow collaboration through an almost fun social-media like interface (Chatter) such that no lead information falls between the cracks as the handoffs take place. However, for both the seasoned marketer or the small business entrepreneur on a shoestring budget, the ability to improve performance today rests on strategic insights into the sales and marketing effort. Salesforce's native marketing metrics and lead analytics such as ROI, channel effectiveness, conversion rate and sales cycle time merely scratch the surface of what is possible in this age of integrated offline and digital marketing.

A new crop of companies such as Eloqua and Marketo in the Sales Performance Management club are offering SaaS solutions with out-of-the-box analytics that have native compatibility with SFDC. These products give the Chief Marketing Officer critical and unprecedented X-ray vision into every segment of the pipeline providing policy based lead scoring, graduated qualification, real-time assignment and auto-escalation. They also provide a mechanism to archive leads that are not yet ripe based on customer engagement behavior and then recycle them back into the pipeline when the customer is farther along in the buying cycle. Moreover they also divulge unknown loops and dead-ends in the lead qualification pipeline that must be avoided. When addressed duly, these techniques can increase the company topline and eek out more juice out of the sales and marketing spend as measured by the cost of customer acquisition (CAC). The marketing team can finally come out of the age black-box metrics and have a compelling conversation with the CEO backed by fine grained facts and improved capabilities.

Recorded at Dreamforce seminar - this presentation by the CMO of one such provider - Marketo - takes a behind the scene tour of how its done. If you are a seasoned sales and marketing manager but new to modern-day marketing management, you will be amazed how deep this rabbit hole runs.

Can Google SaaS replace Enterprise IT?

Not in the foreseeable future, right? Specially when you consider 97% percent of Google's '09 revenues came out of advertising. The remaining 3% non-ad revenues ("Other" business including Enterprise) were predicted to stay below a paltry 6% through 2012 (Gartner Research). Add to that, the fact that this Gartner Symposium interview with Google's then CEO Eric Schmidt is about two years old. Now, do you think what follows might change your mind? Guess what - you may be in for a surprise. 


I took some time to break down the interview and look for supporting evidence in 2012:

Surviving Amazon cloudbursts - Netflix's Little Secret

Amazon was in the news of late for the wrong reasons again. In April this year, the Amazon web services (AWS) hosted off their Northern Virgina data center started experiencing major connectivity and latency issues. This escalated into a full blown outage lasting  24 hours and took down hundreds of AWS clients' services including those of Foursquare, Reddit and Wildfire. The event received mainstream media coverage in CNN, The New York Times and Washington Post. Not only was it an embarrassment for Amazon, but it also raised nagging doubts in the minds of the fence-sitters on the cloud question. Wasn't - reliability through redundancy a key promise of the Cloud? What happened to all that?

What got merely a passing mention in that story, was the fact that Amazon's key customer Netflix  was not affected by the outage at all. Now - the customer with the biggest exposure does not feel a thing? How does that happen? Did they get special treatment or somehow got lucky ? 

Turns out it was neither. In fact, there is a whole sub-story in there that got discussed in primarily technical circuits - and that tell us a thing or two about the best practices of a cloud sourcing strategy.

Cloud Economics - when demand takes a "random walk"

My previous post was a special case comparison of Amazon's reserved IaaS versus a privately owned data center where server utilization is fixed at 100%. This is a simple comparison super easy to comprehend but also unrealistic because no business has a steady demand all the time. While researching a more generic model I came across a working paper on the economics of cloud under pretty much all conceivable type of demand situations ranging from a linear growth/decline, sawtooth, exponential and even a stochastic "Random Walk".

 The paper at first glance appeared so mathematically rigorous and intense with its use of integral calculus and Monte Carlo simulations (what Joe gracefully calls "simple maths and calculus" in the video below), that I felt compelled to go back and research the author. The author is Joe Weinman who currently leads the communications, media, and entertainment segment for Hewlett-Packard's Worldwide Industry Solutions having moved recently from being the "cloud face" of AT&T's business development initiatives. He is also a prolific inventor (14 patents), frequent global keynote speaker and also author of the pithy "10 laws of cloud computing" on his blog cloudonomics .


Here is a short interview from his AT&T days where he explains why the cloud is not a panacea but a niche solution and his view that Hybrid clouds are likely to be the end state as the market matures.


Quite interesting from a sourcing standpoint are the insights derived from his working paper, some of which co-incide with my special case scenario from my previous post. Hit the jump for these insights:

Infrastructure as a Service : Costlier than you think?

As the name suggests, Infrastructure as a service (IaaS) is raw computing resources (CPU, stoage etc.) delivered online in the form of virtual server instances that can be turned on and off within minutes at the beck and call of the enterprise customer. No provisioning, no datacenter overheads, no playing catch-up with h/w technology and most importantly - no paying for what you don’t need. In days where CapEx is a forbidden word, this feels like the CIOs dream come true. The three largest cloud service providers today are Amazon, Microsoft and Google closely followed by the IBM, Cisco, Rackspace hosting, GoGrid etc. in the IaaS space.

Here is a CIO Magazine interview with the David Smith, CIO and CTO at Fujitsu with his views on IaaS:




So IaaS seems to be the silver bullet for hardware sourcing. But is he telling you everything?

IT Sourcing from the Cloud


What can I say about sourcing from the cloud that has not been said already? Cloud Computing appears to need no introduction. But appearances, as they say, can be deceptive. This over-the-top video of Oracle CEO Larry Ellison lamenting about the amount of “vapor ware” surrounding “cloud”, pretty much sums up the designer confusion that looms large over the enterprise IT horizon. (Caveat: unless you are overly charmed by Larry’s style, you’ll get the idea about halfway through)

I do not know why Mr. Ellison goes cloud-bashing but NO, cloud computing is not old wine in a new bottle just because centralized mainframe computing and then computers hooked to the internet have been around for ever (well almost). Yes, it borrows from all of those core technologies but the business model has not been in existience in this shape and form before as Mr. Ellison seems to suggest. In fact, it is amazing that supposedly the next big thing in commercial computing  is at once the most talked about and least understood.

So what is it really and what does have to do with an IT sourcing person looking to gain cost and strategic advantage?