Most businesses today are Reactive – They react only after the customer has placed an order, after the stock price has fallen, after the customer discovered a bug , After Customer has complained, After customer has dropped out , stopped a payment
Most often, either it’s too late or one has too little options and space to manoeuvre or salvage the situation. This type of “Kick me now” syndrome and is witnessed commonly in most organizations.
How is analytics related to this?
Well to start with most of the failures are decision making failures resulting from lack of Information or insights when it matters the most. Let’s look at a few things that make the difference.
Event Vs. Real time Analytics: Most MIS and Analytics reports are generated after the event has happened. This means that one becomes aware of the forest fire after the fire has broken out. Similar would be the case with business opportunities that are lost because of insights arriving out too late. In essence the decision maker does not know what’s happening right now.
Business activities are in real time: Let’s face it, Most of the events impacting the organization happen in real time for e.g.:
- The commodity prices that impact the supply chain changes in real time
- The Market demand & supply of markets changes in real time
- The products & services consumed by consumers are in real time
- The stock prices change in real time
- Customer support handle irate customers in real time
- The prospects visit your website in real time
- The advertising is viewed by audience in real time
- The social media buzz is created in real time
So why have an analytics system that is not based on real time?
People & process: The main thing to realise is real-time analytics is not for the back-office analytics team whose job is to create reports, and who work in silos and follow the traditional organizational hierarchy of forwarding information. Real Time Analytics is about front end decision makers, who can provide real-time responsiveness when data is put directly into their hands.
Real-time analytics is today relevant to front line decision makers in publishing, that’s editors, producers and content creators. On the brand side, it’s for the marketers. In e-commerce, it’s people like the merchandisers who are seeing demand on the page and adapting based on inventory and marketing spend. In the supply chain side, its for professionals who are seeing the demand & supply changes in real time and adapting better pricing, batch processing strategies.
Even in advertising, many people on the front line are using it to make swift tactical differences to an ever-changing audience behavior. Everyone saw this working really well in Super Bowl this year, When a faulty device caused a blackout in the stadium, and everyone saw brands immediately adapting to that and pushing out amazing ads around the blackout.
How is real time analytics different?
Real time analytics is not very different than the traditional analytics, except that it is about Right Now data. This obviously means lot of data and computing and big data, that increases exponentially overtime. The data could be in structured or unstructured form, but it is worth its weight in gold. Because this data can be used for improved customer satisfaction, better supply chain management, better Implementation of marketing & business plans.
Real time analytics in totally useless
It is very true that Real time analytics is of no use to anybody if it is used, just like regular analytics. One needs to understand that all analytics are the foundation for making processes and decisions better. Real time data and analysis needs to be consumed immediately not only to be fast & effective but for data discovery that will account insights from the past and go a step further of knowing whether one is in the same situation today or not; if yes then one can Invoke & exercise interventions to avoid damage or seize opportunity, essentially Real time analytics is not effective when:
- If it is not used immediately
- If it is used in silos
- If it is not used by front line decision makers
- If it is not used for data discovery
- If it is not used for understanding customers better
- If it is not used as a foundation to better decision making
- If it is not used for Real time interventions
Some of the interventions could be in the form of:
- Real time suggestions or content customization to a visitor on e commerce site
- Invoking Personalized offers to a returning visitor on a site
- Up sell or cross sell a product/ service by a call centre agent
- Avoiding Bull whip effect in supply chain with rationalized pricing and orders batching
- Real Time testing & de bugging of software deployed at the customer site
- A/B test of advertising creative and messaging to yield maximum click thru
- Real time engagement with prospects on website
Relevance of Real Time Analytics
Many people (including Mr. Avinash Kaushik) might have a different view on the relevance of real time analytics – Many might say that it is just fast data, with enormous complexities and not much relevance to their business at the moment.
But, its importance cannot be negated because the spirit of entrepreneurship and innovation is about being there before somebody else. Its also not about just fast or avoiding complexities, in fact it is a lot about:
- Faster decision making
- Better Integration of systems & processes
- Staying ahead of your competitors with better understanding of demand & supply
- Faster interventions and not making the same mistakes again
- Fastest resolution to a customer’s problem
- Fastest identification of opportunity before someone else makes the move
- Being there first for your customer when it matters
If used correctly, It would mean automated micro-adjustments to your supply chain to the ability to understand just what and when to up-sell a customer who’s calling into the call centre, visiting a webpage, or using a location-aware mobile application. Instead of executing inflexibly against a marketing and sales plan that you hope will work, you can execute flexibly against a marketing and sales plan that is being reviewed and refined in real time
Real time analytics till now was in the realm and domain of Stock Markets, Defence & Weather forecasting, but its time for organizations to adapt to real time if they are on a growth path and want to provide strategic advantage to people who can affect change.
Needless to say Real time is neither about being proactive or reactive, its about being real. One cannot change the past, but learn from it, Real Time Analytics only provides the window of opportunity to discover the true nature of Customers, Markets, Products & Environment and try to build a better future.