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Month: November 2017

Are You Really Ready for Intelligent Automation?

If you haven’t considered how intelligent automation will impact your industry and company, start now. Automation is going to impact every industry and every business in some way, first as a competitive differentiator and later as a matter of economic necessity.

The average consumer has been interacting with bots online and on the phone for years. However, bots are now reviewing contracts faster than lawyers can and solving scientific problems that have taken scientists decades to solve.

Some vendors already claim that their software can replace salespeople or data scientists, although management and technology consultants tend view automation as “assistive” because humans and machines excel at different things. The manufacturing industry has proven that machines are better at rote, repetitive tasks than humans because they can do the same thing a bazillion times without getting tired or bored, or needing a break. However, machines are also better at pattern recognition than humans, which describes one of the core things researchers, consultants and even journalists do.

Perhaps intelligent automation would be easier to understand if its growth path were linear, meaning that it would replace tasks that don’t require a lot of intelligence or skill first, and then move up over time to tasks that require increasing levels of skill and knowledge.

That isn’t the way things are shaping up, however.

“Outsourcing and offshore manufacturing affected certain categories of jobs and there was job creation in other areas and that played out over a decade,” said Todd Lohr, a principal within  KPMG’s Technology Enabled Transformation practice. “The problem here is this is going to happen faster than other transformation. It’s non-linear, and it’s going to affect all job categories.”

The business view

Lohr thinks automation will become the new corporate responsibility trend, like “green” which has been fashionable for the last three decades.

“The C-suite is enamored with technology. They have Alexa, they’re using Siri, they’re seeing it in their own lives. They’re buying Teslas and seeing self-driving cars are happening,” said Lohr. “This will impact them as leaders. What is their responsibility to their workforce and society?  It’s not just a cost/benefit analysis, so I think there’s going to be another paradigm for them to make those decisions.”

Business leaders need to consider how intelligent automation will impact their business model, goods and services, or they may find themselves disrupted. Similarly, a disruptor who understands the technology but fails to consider cost may find itself disrupted by a company that can deliver the same result at a lower cost.

“We’ve been talking about AI forever and nothing has happened, but people don’t recognize that the last 20 years was the very slow part of [the] exponential growth curve,” said Lohr. “Organizations need to think about how they handle this today because it’s going to happen faster than they think. They have to think about what it means to their organizations and the societies in which they work.”

Technology implementation matters

Intelligent automation, like any other technology, needs to be considered in the context of the existing infrastructure and how well it will scale. As always, what works well for a proof of concept may not scale well enough for a large enterprise implementation.

“You need to think about design in terms of what is going to be done digitally. You also have to think about governance,” said Sanjay Srivastava, chief digital officer at global professional services firm, Genpact. “If 50 employees failed to come to work in a 250-person firm, you’d have policies around that and visual clues. If 50 robots stopped working because of a password change, it might not be immediately obvious.”

Srivastava raises a good point: The policies that apply to people today need to be revisited in light of digital transformation and intelligent automation. Srivastava recommends business leaders and IT consider how the existing architecture and IT infrastructure need to evolve so any automation can align with what a company is trying to achieve and can change as needed.

The operating model also needs to be considered, and that includes the functions being automated, the role of that function in the enterprise and end-to end-processes. Finally, governance will be necessary to avoid or reduce the risks of errant bots and biased AI.

“You have to look at end-to-end processes in terms of integration and visibility,” said Srivastava. “If it’s designed right, it works well.”

Stop and think

Business leaders need to consider how automation will affect their operations, workforce, technology stack and offerings. Importantly, they should ponder what they want to (or would want to) achieve with automation, such as efficiency gains or cost reduction.

Ignoring the situation is unwise given the rapid pace innovation. Some will disrupt. Others will be disrupted.

How to Modernize Business Intelligence for Self-Service

One thing that drives analytics consultants absolutely batty is clients who believe their data is inherently clean, regardless. That’s on the business side, of course. IT, data science, and data engineers are all too familiar with what it takes to get data in order, but one thing even they may overlook is the usefulness of that data over the long term. Some are throwing everything into a data lake hoping for the best later, which is fine, as long as there’s some structure and governance in place.

GPU manufacturer NVIDIA is addressing that very problem as it attempts to enable self-service analytics. If the analytics are going to be reliable, then data quality and documentation need to be considered. As I write this, there’s a pilot project unfolding, and a big part of the effort is focused on the data itself.

“There’s not enough emphasis on data assets. It’s more like a byproduct of your systems,” said Ivan Chen, director of Enterprise Business Analytics at NVIDIA. “The first we’re doing is taking inventory of all our data assets, documenting them, and then trying to figure out how we can use that data effectively to make decisions and understand what it means.”

As part of the project, Chen and his team are documenting all the steps needed to meet a performance metric, so everyone can agree not only to the KPI but how that it is achieved.

“I want enable analysis, not give you a debatable report because neither of us really understands the nuances of the data,” said Chen. “If we define and document everything, then we can agree about what a data field is and how it’s used. That way, we can have a conversation about what to do with the data instead of debating about what wasn’t considered.”

The scope of the documentation includes memorializing the data transformation so people can understand how it was done now and later.

Modernizing the BI Platform

NVIDIA is in the process of modernizing its BI platform to enable self-service capabilities. Like other companies, NVIDIA has struggled to leverage pockets of data owned by different people, even though the data came from the same source, such as an ERP system.

“What we’re doing now is we’re bringing it all together in a central repository and documenting all that, so analysts can use it in a self-service way,” said Chen. “I’d like to scale our documentation that so more people understand what’s available and how they can use it, because we’ll be able to create more insights.”

The effort is an attempt to overcome what so many organizations have experienced which is business requirements that move and change at an Agile pace, and the Waterfall nature of IT creating reports, which is gathering requirements, building something, and then finding out whether it really meets the needs of the business or not.

“NVIDIA has a very progressive IT shop where they want to partner with and help business,” said Chen. “As part of the three-month trial, we’re testing the Agile method. There’s a dedicated team from IT that’s solely working on this so there is some sustainability.”

Part of working with IT is resolving the Agile-Waterfall disconnects because the point of self-service analytics is to enable faster and more timely insights.

“Analytics really needs to be treated differently than an implementation project,” said Chen. “I think IT has accommodated this because they recognize that Waterfall reporting is not going to work in today’s fast-changing environment. That’s why we’re able to try this new [Agile] method.”

If everything goes well, the project will scale up to the enterprise level eventually, which will enable more and different types of insights than are achievable today.

Achieving a holistic view is very important if you want to answer important cross-functional questions,” said Chen. “There are a lot of connection points that need to be understood and reconciled if you want to get to an accurate, holistic view. Most companies don’t have that yet.”

Insurance Struggles with Lead Gen & Data Analytics

The International Institute for Analytics (IIA) recently published a report stating that the insurance industry was the least mature of 12 vertical markets it studied. Insurance companies have lots of data, but they’re having trouble making sense of it.

“We have this data, but we can’t make heads or tails of it because we have data integration problems and there’s no data governance,” said Samantha Chow, senior analyst at market research firm Aite Group. “[Insurance carriers] are hiring data analysts and data scientists, but it’s very fragmented. They don’t have the support they need [to improve] their targeting, products, pricing — all of these things they’re trying to do.”

Lead generation is a huge problem. Older agents are retiring and more business is transacted online, which means the approach to lead generation must evolve with the industry. At the present time, lead generation involves a complicated web of data, external partners, and internal systems, all of which need to be orchestrated into compelling offers that are relevant to individual consumers “in the moment.”

Insurance companies also want to improve their ability to act on “triggers” that suggest a prospect’s interest in a particular product. For example, multiple mortgage loan pulls on a credit report indicate that the prospective home buyer will probably need homeowners insurance. To get information they lack, insurance companies use third-party sources such as credit information provider Transunion, data company Lexis/Nexis, and partners who specialize in social media analytics.

Addressing lead generation

Aite Group recently published a report based on interviews with 80 lead generation vendors and more than 30 insurance company and agency lead-generation and marketing executives. Chow said orchestrating information is the biggest problem the insurance industry faces today, which is why some carriers turn to vendors such as data integration platform provider LeadCloud.

Meanwhile, data acquisition costs are rising because insurance companies don’t know how to target prospects younger than the Baby Boomer generation.

“Getting a 30-year-old to understand the value of life insurance is difficult,” said Chow. “Learning how to target them and speak to them adds to the acquisition costs.”

It doesn’t help that the information insurance companies provide to consumers can be more confusing than clarifying. Because consumers have trouble differentiating products, insurance companies such as Geico, Progressive, MetLife, and Allstate spend lots of money on radio, TV, and pay-per-click advertising promoting their brands.

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To reduce lead-generation costs, insurance companies need to improve their ability to use data and analytics.

“We’re seeing acquisition costs go down [among auto insurance carriers] but [for the rest] it’s going to be learning who your target market is, having the supporting data, and being able to hone in on that particular consumer. It’s not going to be easy,” said Chow.

Making sense of data still difficult

The insurance industry also has challenges with data access. Data quality is a problem because different systems say different things about the same person or issue.

Further complicating the matter is the number of systems insurance companies have. They have dedicated systems for claims, underwriting, new business, customer service, and policies. Worse, there are often duplicates of systems because one may cover claims from 1990 to 2000, while another covers claims from 2001 and later, for example.

“On average, some of the top tier carriers have over 26 or 27 legacy policy administration systems they’re running on at one time,” said Chow. “If you have a life insurance policy and an auto policy or a dental policy with [a particular carrier], they can’t get data from one policy to the next policy. They can’t merge that together so they can learn more about you.”

Even if insurance companies could unearth “the golden leads,” loyalty may be an issue for some types of insurance. Chow said most people won’t move their life insurance policy from one carrier to another. Yet, most consumers shop for auto insurance based on price. When it comes to health insurance, customer loyalty depends on the carrier’s willingness to make good on its promises and streamlining the claims process.

Perhaps the insurance industry lags behind in its intelligent use of data because its technology stack and business processes are complex and fragmented. Still, if insurance companies want to remain competitive, they must be able to use data more adeptly to quickly identify quality leads and compete more effectively.

How Customer Intelligence Impacts Customer Loyalty, Wallet Share

Many of today’s companies talk about getting a 360-degree view of their customers and how that will enable them to increase share of wallet and improve customer loyalty. As a consumer and an industry observer, I would argue that these “360-degree views” are aspirational at best. Striving for a holistic view of customers is a noble goal and a necessary one; however, achieving customer intelligence nirvana is easier said than done.

“The vast majority of the people we talk to aspire to get a 360-degree view of the customer, but the reality is they may not have closed the circle,” said Julio Hernandez, partner, global customer Centre of Excellence Lead and US Customer Advisory Practice Lead at KPMG . “A 360-degree view of the customer is really knowing who the customer is, what they’re doing and why they’re doing it. It’s also bringing in the right information sources, and the information sources are continuously evolving.”

Companies should also understand how valuable their customers are and where they are on their journeys. However, truly understanding customers and marketing to them appropriately is still difficult despite all the technology and data that’s available now.

Part of the problem is what Hernandez calls “The New Year’s Day” problem, which is saying one thing and doing another.

“It goes back to the 360-degree view and having multiple sources of data, combining them, and combining [different] types of analysis to get a better picture of what the customer wants and is doing,” said Hernandez. “You have to start with what you’re trying to achieve with customer insights. That drives how you harness the analytics and how you look at the data. If you expect to just look at all your data and [get] all the insights in the world, you’re going to come up short.”

Increasing Share of Wallet

Businesses purchase a lot of third-party data to better understand their customers’ economic means, what they’re buying and where they’re buying it to understand their share of wallet. If they have a loyalty program, they have insight into what their share of wallet looks like.

“You have to make some inferences about what’s your share in the marketplace is in different categories,” said Hernandez. “You can also triangulate and come up to a number about what I’m actually selling to that person versus the inferred wallet [because] you won’t know for sure exactly what their wallet is.”

Businesses should also consider the attributes of their best customers and then identify customers who share the same attributes but spend less. That way, the company can intervene with some sort of marketing campaign that encourages the latter group to spend more.

Improving Customer Loyalty

Businesses with loyalty programs get varied results depending on the benefits their programs provide and the degree to which companies leverage that information.

“Loyalty cards are interesting because they’re trying to [get] you to clearly state who you are when you’re using the card and then they can track your basket and your purchases,” said Hernandez. “But you have to step back and ask how do you as an organization define loyalty? Is it someone who stays with you on an ongoing basis? If so, that’s great, but if you’re a utility and I continue to business with [you], that doesn’t necessarily means that I’m loyal. It means I’m lazy or I don’t have substitutes.”

Money isn’t everything. If two customers spend the same amount of money, but one is a brand advocate on social media, the latter is considered more valuable now.

“When you think about loyalty, it’s also about what are they’re doing with their loyalty,” said Hernandez. “Are they engaging with your services? Are they proponents of it? Those are things that help you determine what kind of loyalty you have.”

5 Things to Know About IT Candidates

Hiring and retaining IT talent is difficult. Part of the problem is that some companies don’t understand what IT professionals want and why they want it.

Manpower Solutions Group recently published a survey-based report that sheds some light on the matter. More than 14,000 currently-employed individuals between the ages of 18 and 65 participated, across industries. Some of the results are specific to IT professionals and they may surprise you.

#1: Expect turnover

IT professionals who change jobs frequently do it for two reasons: to increase their compensation (43%) and to advance their careers (60%). Employers should appeal to those desires.

“Candidates within the IT space shouldn’t be measured solely on their time spent within a specific role,” said Stephen Rees, Director of Program Delivery at Manpower Group Solutions, in an interview. “A review of a project’s purpose, the candidate’s role and [her] accomplishments within the timeframe of the project should be the key areas of focus. Seasoned recruiters and hiring managers will need to account for the time needed to ramp up performance in order to understand the value of work delivered.”

Technology is constantly changing which impacts what IT does and what IT professionals must know. Those who learn the newest must-have skills, whether it’s DevOps or virtualized IT infrastructures, tend to be in high demand. When skills are in high demand and there’s a “skills shortage,” companies will pay handsomely for the right talent.

IT professionals have to acquire those new skills somewhere, however. If they can’t learn those skills at their present companies or their present company doesn’t invest education or training, they may seek opportunities at a company that provides such benefits.

#2:  Monetary compensation isn’t everything

IT professionals weigh several factors before making a decision. The top three of seven options are compensation (23%) opportunity for advancement (22%) and benefits (21%). Schedule flexibility, type of work, geography and the company’s brand reputation rank lower. Of those, schedule flexibility ranks the highest.

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Interestingly, opportunity for advancement is almost twice as important to IT professionals than individuals who work in financial services, healthcare/pharmaceuticals and retail. Benefits are more important to IT individuals than others too and not just traditional benefits, such as a 401K program or health and dental insurance. They tend to value non-traditional benefits such as game areas, rest areas and perhaps a healthy drink on tap. Although benefits hold some value in themselves, more importantly, they tend reflect a company’s culture.

“Today’s benefits are becoming more lifestyle/non-work specific,” said Rees. “The emphasis is shifting from the immediate short-term benefits that tie employees to the office and are instead focusing on the broader impact on an individual’s life such as PTO, sabbaticals, learning and development, diversity and inclusion, etc. While the specific role, project or product is still important, the company the work is being done for is increasing in importance as candidates increasingly want to align themselves with an organization that shares their values.”

#3: Your digital presence and industry associations matter

Most survey respondents, including IT professionals, use company websites and search engines to research career opportunities. However, IT professionals are more likely to rely on social media (55%) and industry associations (33%) than the U.S. average of 38% and 18%, respectively.

In the IT world, associations are where standards are defined. Defining standards involves a lot of intellectual banter and collaboration among individuals who work at competing companies. The comradery can result in very compelling career opportunities that don’t appear on a job site or a company’s website.

Manpower notes that some of these IT associations have emerged around certification, training programs and hacking events. Within those groups knowledge exchange and mentoring happen.

“Networking has always been a core component of the IT space. For IT professionals, their work is typically their passion,” said Rees. “This participation is also seen as a way of giving back and helping others develop – there is a true desire to share experiences and knowledge, helping others to learn instead of keeping information to themselves.”

Companies can create their own hubs for interaction, whether that’s offering training or certification at an event or hosting informational sessions that enable IT professionals to meet with some of the company’s engineers.

#4:  They want you to reach out to them

More than half (55%) of IT professionals said they prefer weekly emails from potential employers of interest, which is considerably more than retail (37%), financial services (37%) and healthcare/pharmaceuticals (33%). Manpower equates this finding with the fact that 65% of IT professionals are always looking for the next job opportunity.

If you’re going to reach out to IT professionals and you’re truly interested in maintaining a dialog, don’t send out a general email blast. Instead, engage in a meaningful conversation.

#5: They’re more willing to relocate than others

IT professionals are more likely to relocate to a new city (38%) or a new state (40%) than the U.S. average of 30% and 29%, respectively, but less willing to move to a different country (8%) than the U.S. average (10%). Manpower attributes the greater degree of mobility to the lure of California locations.

While Skype interviews are common, be ready and willing to reimburse top candidates for their travel to and from an on-site interview. It demonstrates a willingness to invest in your employees.

Conclusion

Companies should avoid cookie-cutter approaches to IT recruitment because they tend to overlook some of the important things andidates value. What they value changes with time.

Manpower’s report can provide more insight into what IT professionals really want. It also includes some great advice. Happy reading.