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3 posts from March 2015

09 March 2015

Seeing the wood for the trees: creating insight from your data

by Matthew Linehan Manager

Data is ubiquitous in modern business and frequently plays an important role in decision making. So how do we ensure we get the most from it?

The growth of agile analytical technologies is disrupting the traditional IT-driven model of business intelligence. These technologies, marketed at the end user, streamline and simplify the process of preparing and presenting insightful analysis. Business users are empowered to quickly find answers in their data without the need for deep technical knowledge or experience. Business intelligence can become a rapid process.

Using modern analytical technology can expedite the process from receiving a large series of values to producing a set of key metrics. Getting hands on with your data is a quick way to understand its scope and limitations. Exploring different means of presenting information can highlight new patterns and trends.

But this isn’t without risk. Naturally the ability to manipulate large amounts of data on the fly can bring challenges of its own. With the power to rapidly generate analysis comes the temptation to cut to the chase and dive in head first. It can be all too easy to jump the gun and lose focus. As a result your analysis is defined by the art of the possible, rather than the questions you need to answer.

Creating insight is an individual process, unique to each business in a given situation. To get the right answers you need to ask the right questions. To derive valuable insight, you need to understand what drives the business. These drivers vary from one business to another and are shaped by a variety of factors, both internal and external: industry, size of organisation and seasonality, to name a few.

Bringing focus to your analysis is at the heart of getting value from your data. A purely exploratory approach rarely offers the best answers. A rich dataset can tell a number of stories and the key to making the most of your data is to understand the story that you want to tell. Exploring your data through the lens of your business drivers will help you to see the wood for the trees, define your approach to business intelligence and realise the value in your data.

If you would like to discuss these issues, or the impact of emerging technology or data and analytics on your industry, then contact our Data & Analytics team.

by Matthew Linehan Manager

Understanding customer behaviours

As the spectre of short term deflation looms in the UK, manufacturers, wholesalers, retailers and consumers are entering somewhat unfamiliar territory. The supermarkets have already faced the phenomenon of falling real prices for food for some time, but what does the prospect of negative inflation now mean for demand and customer expectations and consequent behaviours, especially as real wages are forecast to rise strongly as the UK economy picks up?

In areas where customers have already deviated from their historical patterns of behaviours, this may bring additional challenges. For example:

  • Ever since retailers started sales events during the Christmas trading period, rather than waiting until the traditional Boxing Day and New Year Sales, consumers have increasingly held off shopping for Christmas presents until in-store and on-line promotional discounts are offered. Or they purchased presents and goods early during the “Black Friday” promotional events. How can the retailers return to the days of headier Christmas trading figures against this backdrop?
  • In the tourism and leisure industry, canny customers increasingly wait for the big seasonal sales events from airlines and travel agencies. In the case of cruise operators, they increasingly wait to the last minute, in the hopes of getting a great bargain. How can such revenue leakage be stemmed, or even reversed?
  • Price matching campaigns by supermarkets, following aggressive expansion by the discounters and new entrants, have sought to stem the flood of customers to the new challengers. But can customers who have switched allegiances be swayed to return when expectations of low prices seem to now be deeply engrained?
  • Sustained low interest rates have impacted savers, most significantly pensioners who have seen their purchasing power diminish in real terms, causing them to fundamentally modify their manner of consumption and priorities. Will short term deflation make any difference to their consumption behaviours?
  • How will the next generation of pensioners consume goods and services, in light of the recent Pensions Reform? Will retirees increase the extent of lump sum draw down to take advantage of short term lower prices and the end of the era of austerity? Will deferred annuity income still be desirable, especially when annuities are expensive in the current low interest environment and longevity continues to improve?

At the same time, customers increasingly demand, and expect, financial services providers, retailers, entertainment and media companies etc to provide a full multi-channel experience, to allow customers to transact how they want, when they want. Falling revenues in real terms and a higher cost base (at least in the short term while the necessary infrastructure and software investments are made) to support multi-channel capabilities will squeeze margins, if nothing is done to drive revenue enhancement. So how can revenues be increased, and which customer segments might yield the highest returns?

Data analytics – which covers a very broad landscape from relatively simple data visualisation tools and techniques to help draw deeper insights, all the way to the deployment of very complex predictive mathematical algorithms based on multivariate modelling of very large internal and external data sets, and the use of neural networks – play an important role in tackling such challenges.

After all, if you can understand customers’ historical behaviours to the extent that you can accurately predict their likely actions under different scenarios (such as innovation, new products and new product bundling propositions, improved convenience, price promotions, cash backs, interest free or other forms of credit, new tariffs, new distribution channels etc), you will be able to launch very successful sales and marketing campaigns and promotions.

This is easier said than done, however, and two key challenges many organisations face revolve around collecting the necessary data, often from disparate sources and systems, and then deploying the right types of analytical techniques and tools to provide those critical insights.

Although initially daunting, the effort required to pull this off is ultimately more than worth it, as those companies which have subsequently eked out a competitive advantage will testify. 

If you would like to discuss these issues, or the impact of emerging technology or data and analytics on your industry, then contact our Data & Analytics team.

05 March 2015

Cyber security in the news

by Triin Sober Manager

Malware (adware, ransomware, trojans, spyware), phishing scams - there are lots of different ways cyber criminals will attempt to access your device and the personal information held on it. The majority of people hold personal and financial information on their devices, leaving themselves vulnerable to being hacked.

Malware (short for malicious software) in its various forms is specifically designed to gain access or damage a computer without the knowledge of the owner and phishing scams have moved from the real world to the online one in the attempt to get you to divulge private information to the scammers. These threats are well known and most of us will think twice before opening an unknown email or link.

Even so, the last weeks in February were particularly interesting in the world of Cyber Security with no less than four security issues striking within the space of a few days. In addition, only a few short weeks ago, our own PwC UK firewall came under attack from emails from fictional service providers, inviting people to click on the attachment. So what are these new threats that we should all be aware of? (Lenovo users beware!).

1. Equation Group

Equation Group is an advanced team of hackers, which according to Kaspersky Lab has been operating for almost two decades in countries all over the world. The terrifying part here (in addition to its rumored state-sponsored nature) is its sophisticated malware. Equation Group uses malware that actually infects the firmware of your hard drive, making it impossible to remove either by installing a new operating system or fully formatting your drive. The only option is to destroy the physical drive itself.

http://www.kaspersky.com/about/news/virus/2015/equation-group-the-crown-creator-of-cyber-espionage

2. FreeBSD’s random number generator

It also emerged last week that CURRENT, the Random Number Generator (RNG) of the operating system FreeBSD (derived from BSD, the version of UNIX developed at Berkeley) has been spitting out some not so random numbers as far back as the last four months.

Should we care? Well, odds are that this will not impact you personally; however RNG is used in the creation of encryption keys, meaning any keys created in FreeBSD over that period will be potentially unsafe and have to be regenerated.

http://www.phoronix.com/scan.php?page=news_item&px=FreeBSD-RNG-Broken

3. Superfish

In February 2015, it came to light that for more than six months, Lenovo PCs were shipped with a piece of adware called Superfish installed on them. Superfish is a tool for visual searches and plugs product recommendations into search results and web pages. By itself it’s more of a nuisance than a threat but it has emerged that the way the programme operates (a certificate installed in Windows) creates a serious vulnerability in the system, leaving it open to malicious attacks. The first proposed class action law suit against Lenovo has already been filed. 

http://www.pcworld.com/article/2887392/lenovo-hit-with-lawsuit-over-superfish-snafu.html

http://www.home.superfish.com/

4. Big Brother

A new revelation by whistleblower Edward Snowden claims that a joint UK and US government team hacked into the computer network of the world’s biggest maker of smartphone SIM cards to steal the encryption keys, making any mobile devices with a Gemalto SIM vulnerable to monitoring (a claim denied by Gemalto). This information dates from 2010, meaning government agents could have been listening in on mobile communications without warrants for years.

http://www.theverge.com/2015/2/23/8089443/gemalto-says-sim-secure

None of the usual methods and tips for avoiding malware would have helped with these incredibly sophisticated attacks but there’s no need to swear off technology altogether! Luckily for us, the majority of threats encountered in the digital world are much more basic and avoidable. We can carry on surfing the net, happy in the knowledge of our (relative) safety.

If you would like to discuss these issues, or the impact of emerging technology or data and analytics on your industry, then contact our Data & Analytics team.

by Triin Sober Manager