Case study 1: Telefonica Ireland uses business intelligence to reduce churn

Churn is an obsession in the mobile telecoms industry. Focus is shifting away from simply winning new customers, moving instead to the retention of existing ones. This raises the question: Should the business try to stop all customers leaving, or are some not worth the effort? For O2 Ireland, part of Telefonica Europe, the answer came through analytics. A proportion of customers who buy a pre-paid SIM card might only use it for a business trip and leave the country in a few days, muses Peter McKenna (pictured), head of business intelligence at O2 Ireland. Given their array of behaviours, it doesnt make sense to invest in all customers in the same way. We want to invest in the customers we can influence and the customers who are really engaging with us, he says. An analysis of the use of pre-paid SIM cards revealed where it would be best to target marketing efforts. We have been able to identify the 65% of the customer base who really have a relationship with O2, and make sure we put all our investment in those guys," says McKenna Unified data warehouse strategy draws data together O2 Ireland uses Cognos business intelligence (BI) tools and a Teradata data warehouse to analyse customer behaviour. Prior to 2007, says McKenna, O2 Ireland was faced with a situation common in analytics: disparate data, with little overall data management. We had a lot of systems across O2, capturing lots of information and analysis across the business, using all sorts of different systems. The upshot was a very high-cost IT infrastructure, decisions that did not make sense and data latency. An event might be analysed up to 10 days after it happened, by which time the opportunity to do anything was very limited, he says. With its unified data warehouse strategy, O2 Ireland was able to bring all the data from all the processes on to a single infrastructure. This meant new applications could be built without needing new databases and other infrastructure, dramatically lowering total cost of ownership, says McKenna. We paid back the cost of Teradata with some business wins in year one. We brought the applications to the data, he says. O2 Ireland delivers data from more than 130 different processes to its data warehouse every day. It replicates its entire billing and customer relationship management (CRM) system onto the data warehouse every day, and some processes within 15 minutes of events occurring. But to accrue business benefits from the centralised system, the mobile telecommunications firm had to change its company culture, he says. Building a culture of analytics through training Although there was interest in analytics at a senior level of management, some saw it in isolation, he says. What a lot of them were looking for was a project; a box to tick. What we need to do is to make sure that they realise its a way of working. That takes education.

A breakthrough for O2 Ireland came when the CEO replied to a business-wide email requesting attendance on BI courses. That was a big milestone in terms of C-level sponsorship, he says. The telecoms firm has created a set of questions to guide business users through analytics projects to help them achieve their goals through business intelligence. Analysis should not be limited to the data scientist in a dark room who is smarter than everyone else. Everybody needs to have an ability to analyse data and understand how to interpret and make knowledge-based decisions, he says. Measuring success and expanding the BI infrastructure The standard framework includes a statement of business goals and measures of success, which ideally should be limited to a single indicator, he says. It ensures business users also suggest lead indicators of success, he says. Many times, measures of success can be lagging six months. We dont have time for that; we could have lost huge opportunities if we wait six months. The framework also asks users what they will do differently as a result of BI and identifies a business owner responsible for the project. In this way, the BI team promotes its own services to the business and tries to help decision-makers benefit from them. It is part of our core role to make sure that we communicate the purpose of BI and evangelise the opportunities, not just to build systems based on what were asked, he says. O2 Ireland tries to regularly introduce new applications to its business intelligence infrastructure. Over Christmas, the telco used it to launch location-based marketing offers to customers who were passing its retail outlets, provided they had opted to have their data used in this way, he says. It was a very effective initiative in driving people in [to stores] at the right time. Despite the successes, McKenna says his team must ensure that senior management sees BI as an ongoing process, rather than a single project. The world keeps getting faster, and the competition keeps getting smarter. The most important thing is to ensure that C-level management sees business analytics as a way of working which needs continuous investment and a knowledge-driven culture throughout the company.

Q.1. What were the business Issues and formulate the business questions for the company? Q.2. What Information is required and where can the company find that information? Q.3. Suggest the possible information retrieval methods to the company management? Q.4. Can you think of some actions which can be deployed to cater to the business problem of the company? Q.5. Discuss the Business Intelligence application in terms of challenges, Benefits and Change management in the company scenario?

Case 2: Sports performance data analytics fuels Optas business expansion

Football performance data could play a role in clubs scouting efforts and possibly even in footballer market evaluation, according to OptaSports Data. Florian Diederichsen, chief operating officer at OptaSports Data, advances these thoughts as he reflects on the business, founded in 1996, and bought and developed by Aidan Cooney in 2002.

The company supplies data to some 300 clients, including football leagues, clubs, betting companies and media organisations, such as Sky. It is the official statistics supplier to the major west European leagues, including the Scottish Premier League and, most recently, the Dutch Eredivise. No one else collects performance data, says Diederichsen. There are other companies who provide results data, but Opta specialises in event information, such as tackles and passes in football, he says. Around 80% of the value comes from ball tracking, but the firm also does optical tracking on all the players in the Spanish La Liga and the German Bundesliga. Opta also provides data for other sports, like cricket and rugby. Managing large numbers It covers 50,000 fixtures a year, capturing about 2,500 elements per fixture, with three analysts covering each match. Diederichsen stresses the strong editorial team at the core of the Opta business, which is also known for its Twitter handles OptaJoe, OptaJos, OptaJean and so on. Diederichsen confirms the companys strategic goals are to extend its reach in being official by signing up more leagues; providing more bespoke services for clients, as it does for Sky; and providing direct access to the companys data. They also plan to expand into new geographical markets in eastern Europe and Asia. NetSuite assists for a quick set up In setting up new subsidiaries rapidly, the company finds its use of cloud-based NetSuite for financial planning useful, reports Natalie Young, financial controller at the company. OptaSports replaced Sage 50 and a host of spreadsheets with NetSuites CRM [customer relationship management] technology in 2005, then took the suppliers OneWorld service.

When we open a new subsidiary in a new location all the tax information is there already in multiple languages, Young says. The UK-based company opened a German office in 2005, an Italian one in 2006, and took a stake in a Spanish company, Geca Sport in 2007. It has since opened offices in France, New York, Sydney, and Montevideo, Uruguay. Diederichson adds: There is also more room for expansion on the predictive data analytics side, on the betting front, yes, but also in offering objective valuation of players". At present, there are football clubs using their data set to identify players who fit sets of criteria instead of indiscriminate scouting. Diederichson confirms Chelsea is one club that takes the entire data set and Manchester City is also a client. Opta uses a MySQL database with 10 nodes over two datacentres. It also opens up the database as a playground for users to do their own analysis. We have a lot of startups and university students creating apps around the database," says Diederichson. "This is still an emerging thing for us, more of an investment for the future. ESPN has a similar programme. If it works for them, why not for us?

Q.1. Discuss the importance of database for the business intelligence effort of the company? Q.2. Briefly describe the business challenges and information requirements for the company? Q.3. What value addition do you think the Business analytics has provided over the boundary? Q.4. Can you identify some reporting tools/methods and analysis tools/methods in the case?

Case 3: Shoppers Stop: BI for micro-segmentation, expansion

The portfolio containing a variety of retail formats and ever expanding product basket at each store had made expanding into new geographies a challenging task for Shoppers Stop. The management also felt the need to have a holistic view of the customer across the retail formats (department stores, hypermarkets, bookstores, specialty stores, and airport retailing) to analyze the customer-behavior and thereby improve wallet-share. Micro-segmentation of customers was another requirement as the retailer wanted to reach to its customers with specialized messages, thus making an integrated BI platform the key business requirement. Shoppers Stop also needed BI to carry out market basket analysis and recency, frequency, and the monetary value of each customer to review effectiveness of its merchandising and associations between products. BI was seen as critical to help the organization with demand forecast to optimize on fast/slow movers in the same store and across the chain to reduce markdowns and fill rates (a measure of shipping performance expressed as a percentage of the total order). Solution implemented:

Datawarehouse appliance: Netezza (IBM) Business Data model: RDM (Retail Data Model) from Claraview (Teradata) ETL Tool: ODI (Oracle Data Integrator) Business Intelligence and Analytics: SAS Data Visualization: Tableau

BI system at Shoppers Stop covers:

Used by:

Analytics Dashboards Decision support systems Online analytical processing Querying and reporting

Top management Finance and accounts Customer support Sales Operations Merchandising

Benefits delivered by BI:

With BI, Shoppers Stop is able to target micro-segments to ensure incremental business through promotions and messages sent to its customers. This has also helped the retailer to reduce inventory and still offer the customer what he wants by optimizing the merchandise mix. BI has turned Shoppers Stops store expansion projects productive. The company analyzes the profiles of its stores located in the cities with similar demographic spread to create new stores at new locations. This analysis ensures that stories opened in the new cities have a higher probability of success. Monitoring sales patterns across stores helps the operations teams to tactically change store layouts or of the displayed merchandise to attract customers. The same feedback helps the back office planners in adjusting flow of merchandise to the stores. BI has also helped Shoppers Stop to grow its online retail and improve the flow of referrals.

Q.1. What were the business Issues and formulate the business questions for the company? Q.2. What Information is required and where can the company find that information? Q.3. Suggest the possible information retrieval methods to the company management? Q.4. Can you critically evaluate the Business intelligence applications deployed for their relevance to the business of shoppers stop. Q.5. Discuss the Business Intelligence value to building strong customer relationship management and business partnerships.