Session - II BA basics

Impact of Tech on Agriculture

Agriculture needs to become like manufacturing.

by 2050, world population will be 9.7bn ( 7.3 in 2016).
Agri production must increase by 70% to meet the demand.

Technology will transform farmers lives in both the rich and the poor
world. Number of people engaged in farming has been reducing.
 Farmers will have to juggle weather, Soil properties (moisture
level, nutrient content.), weeds, pests, diseases, cost of
taking action to mitigate these threats.
Precision Agriculture or Smart Farming.
Sowing, watering, Fertilising, Harvesting would all be
computer controlled using sensors, cloud, analytics & IoT.
Farms will become more like factories.

Technological changes, in hardware, software and liveware,

are reaching beyond field, orchard and byre.
Better understanding of DNA & precise genetic manipulation,
known as genome editing, makes it possible to change
required characteristics of a crop (GM) or stock animals. This
technology imitates the process of mutation on which crop
breeding has always depended, but in a far more controllable
way.
Patterns Emerge before
Reasons for them
become Apparent.
 Why Data & Analytics ???
Today more than ever, professionals are being
asked to argue their cases and make their
decisions based on data,

A new, data-oriented mind-set is permeating

the business world.

It means that non-technical professionals also

must now produce and comprehend insights
from Data.
 Business Analytics

BA is the practice of iterative, methodical

exploration of an organisations data with
emphasis on statistical analysis.

It is used by Companies committed to data

driven decision making who treat their data
as a corporate asset and leverage it for
competitive advantage.
BA includes :-

Formation of Predictive models.

Application of Optimisation Techniques.

Communication of these results to

Decision makers, business partners and
customers.

It is the intersection of Business &

Technology
 Business Intelligence (BI)
BI is an umbrella term that includes the applications, infrastructure
and tools, and best practices that enable access to and analysis of
information to improve and optimise decisions and performance.

It is a data analysis process aimed at boosting business performance

by helping corporate executives and other end users make informed
decisions.

Enable organisations to collect data from internal systems and

external sources.

Prepare it for analysis, develop and run queries, create

reports, dashboards and data visualisations to make actionable
intelligence available to decision makers.
 Potential Benefits
Accelerating & improving decision making.

Optimising internal business processes.

Increasing operational efficiency.

Gaining competitive advantage over business rivals.

Driving new revenues.

Identifying market trends.

Spotting business problems that need to be addressed.

 Bloomberg Business week research study(2014)
of 930 various diversified Cos around the World:
BA still in emerging state.
Orgs are cautious in adoption of BA.
Intuition based on biz experience still driving
factor in decision making.
Cos looking to BA for reducing costs, risk
management, improving bottom line.
Data is No 1 Challenge - accuracy, consistency
& even Access.
Most companies lack analytical talent.
Cos with Analytical Culture reap benefits.
 BA/BI Data Can Include

Historical information/data.

New data as it is generated.

From all possible sources.

From different systems.

 KNOWLEDGE MANAGEMENT

KM : Process of capturing, developing,

sharing & effectively using Org Knowledge.
Leveraging expertise of Experts in Org.
Avoid reinventing the wheel.
Facilitating & managing innovation & Org
learning.
 BA / BI in Every Field
Finance
HR
Marketing/Sales
Operations
Medicine
 FINANCE / Fintech
Stock market- tech analysis to forecast
prices using past data - price & volume.
Chart patterns - heads & shoulders or
double top/bottom
moving averages, lines of support,
resistance.
obscure formations - flags, pennants, cup
& handle patterns.
Information Arbitrage. Algo Trading
Fraud Risk Management.
 HR
People Analytics.
Knowledge Management.
Appropriate Recruitment profile selection.
Employee Profiling & Segmentation.
Attrition & Loyalty Analysis.
Forecasting HR Capacity & Recruitment Needs.
Employee Fraud Risk Management.
Appraisals and Promotions.
 People Analytics
The application of massive data collection and analysis to human
resources, known as "people analytics," is catching on among
innovative companies. Harnessing Big Data helps Cos to reap
enormous business and cultural benefits.
Cos put in lots of effort to predict client behaviour with a high
degree of accuracy.
Paradoxically, companies are not nearly as advanced when it
comes down to knowing their own employees:
What makes them happier or more efficient?
How to best attract and retain top talent?
When to promote and how to determine competitive
compensation?
Optimal recruitment- not just academic results but other talent
like leadership roles (Credit Suisse).
use of games to spot desired qualities.
What is the value of promoting from within vs. hiring externally ?
Determine, with accuracy, an employee's probability of quitting.
 MARKETING/SALES
Customer profiling, Demographic segmentation,
Competition analysis.
Identify under served niche & become value
provider.
Limited scale -easy to pick up nuances, take
decisions but A large business????
Walmart
9000 stores.
10,000 - 100,000 SKUs/store.
> 1 million transactions/hour.
just to find the average transaction ?
 1 million transactions/day, 4 billion/year.
Capacity of Microsoft Excel 1 million rows.
Airtel
261 million subscribers.
8 Billion calls per day.
Hundreds of different call plans.
Average duration of a call ?
year worth of data - trillions of calls.
Amazon. over 10 million transactions/day.
VISA. over 100 million transactions.
 OPERATIONS
Analysis of Processes and Workflow.
Management of traffic on networks.
IoT All gadgets talking to each other,
billion of devicesinterconnected and
changing lives.
Gaming and Augmented Reality.
 Telemedicine.
Consult doctor online(phone/email/webcam).
Online monitoring of vitals through apps/
wearables.
Remote areas: availability of trained med
professionals & cost.
Convenience Vs Quality.
Regulation and accreditation
Interventionist: Virtual ICUs.
Amazon of Healthcare :offering a marketplace of
branded tele-med programs from top hospitals
or a clinic in cloud allowing patients anywhere
access to top physicians. Joined with local
pharmacy clinics, imaging centres & labs.
 SMART PHONES SWAT OUT DENGUE

2011 Dengue 359 Dead, > 21000, 17000 - LAHORE.

Android App + Online Dashboard.
Smartphones to field staff to upload geo tagged before /
after pics + Hospital patient data.
Prevention activities-Verifiable, check absenteeism.
Entomological data on larvae clusters.
Case detection data on neighbourhoods with outbreak.
Algorithms work out high risk locations.
SMS sent to officials i/c control.
Results: 2013, Lahore 18 cases, 9 deaths.
Being used for Polio surveillance.(246/291 across 9
countries in Asia/Africa)
 Campaign by Delhi Government for
SWACHH DELHI. 7666 400 400
Use Android App to take pictures of
Garbage dumps not being attended to and
upload.
The pics are geo tagged and location gets
uploaded automatically.
Govt + MCD will ensure cleaning up within a
few days. (22-29 Nov 2015).
 Analytics in BA/BI
Simulation Modeling
Prescriptive
Optimal Outcome Questions :- (what actions
should be
taken)
High Behavioral Questions :- Predictive
(what is likely
to happen) Cluster Analysis
Forecasting
Complexity

Quantity Questions :- (what might

happen) Regression Analysis
Monitoring
(whats
happening
now) Descriptive Statistics
Analysis (why
did it happen)

Reporting
(what
happened)

Low
Business Value High
No single type of analytic is better than another, and in
fact, they co-exist with, and complement each other.
For a business to have a holistic view of the market and
how a company competes efficiently within that market
requires a robust analytic environment which includes:

Descriptive Analytics, which use data aggregation and

data mining techniques to provide insight into the past
and answer: What has happened?
Predictive Analytics, which use statistical models and
forecasts techniques to understand the future and
answer: What could happen?
Prescriptive Analytics, which use optimisation and
simulation algorithms to advice on possible outcomes and
answer: What should we do?
 Descriptive Analytics: Insight into the Past

Descriptive analysis or statistics does exactly what the

name implies they Describe, or summarise raw data and
make it something that is interpretable by humans.

They are analytics that describe the past. The past refers to
any point of time that an event has occurred, whether it is
one minute ago, or one year ago.

Descriptive analytics are useful because they allow us to

learn from past behaviours, and understand how they might
influence future outcomes.
 Descriptive Analytics: Insight into the Past

The vast majority of the statistics we use fall into this category.
(Think basic arithmetic like sums, averages, percent changes).

Usually, the underlying data is a count, or aggregate of a filtered

column of data to which basic math is applied.

There are an infinite number of these statistics.

Descriptive statistics are useful to show things like, total stock in

inventory, average Rs spent per customer and Year over year
change in sales.

Common examples of descriptive analytics are reports that

provide historical insights regarding the companys production,
financials, operations, sales, finance, inventory and customers.
Use Descriptive statistics when you need
to understand at an aggregate level what
is going on in your company, and when
you want to summarise
and describe different aspects of your
business.
 Predictive Analytics: Understanding the Future

Predictive analytics has its roots in the ability to Predict what might
happen. They are about understanding the future & provide:

- companies with actionable insights based on data.

- estimates about the likelihood of a future outcome.

Important to remember that no statistical algorithm can predict the

future with 100% certainty. Companies use these statistics to
forecast what might happen in the future. This is because the
foundation of predictive analytics is based on probabilities.

These statistics try to take the data that you have, and fill in the
missing data with best guesses.

They combine historical data found in ERP, CRM, HR and POS

systems to identify patterns in the data and apply statistical models
and algorithms to capture relationships between various data sets.
 Predictive Analytics: Understanding the Future

Companies use Predictive statistics and analytics anytime they want to look
into the future.

Predictive analytics can be used throughout the organisation, from

forecasting customer behaviour and purchasing patterns to identifying
trends in sales activities.

PA also help forecast demand for inputs from the supply chain, operations
and inventory.

One common application most people are familiar with is the use of
predictive analytics to assign a credit score. These scores are used by
financial services to determine the probability of customers making future
credit payments on time.

Typical business uses include, understanding how sales might close at the
end of the year, predicting what items customers will purchase together, or
forecasting inventory levels based upon a myriad of variables.
Use Predictive analysis any time you need to know
something about the future,
or fill in the information that you do not have.
 Prescriptive Analytics: Advise on possible Outcomes

The field of prescriptive analytics allows users to prescribe a number

of different possible actions to and guide them towards a solution. In a
nut-shell, these analytics are all about providing advice.

Prescriptive analytics attempt to quantify the effect of future decisions

in order to advise on possible outcomes before the decisions are
actually made.

Prescriptive analytics predict not only what will happen, but also why it
will happen providing recommendations regarding actions that will
take advantage of the predictions.

These analytics go beyond descriptive and predictive analytics by

recommending one or more possible courses of action.
Essentially they predict multiple futures and allow companies to
assess a number of possible outcomes based upon their actions.
 Prescriptive Analytics: Advise on possible Outcomes

Prescriptive analytics use a combination of techniques and tools such as

business rules, algorithms, machine learning and computational modelling
procedures.

These techniques are applied against input from many different data sets
including historical and transactional data, real-time data feeds, and big
data.

Prescriptive analytics are relatively complex to administer, and most

companies are not yet using them in their daily course of business.

When implemented correctly, they can have a large impact on how

businesses make decisions, and on the companys bottom line.

Larger companies are successfully using prescriptive analytics to optimise

production, scheduling and inventory in the supply chain to make sure
that are delivering the right products at the right time and optimising the
customer experience.
Use prescriptive statistics anytime you need to
provide users with
advice on what action to take.
 Data - Business Analytics/Intelligence

Increasing Potential
To Support
Business Decisions End User
Making
Decisions

Data Presentation Business

Analyst
Visualisation Techniques

Data Mining Data

Information Discovery Analyst

Data Exploration
Statistical Analysis, Querying And Reporting

Data Warehouses / Data Marts

OLAP, MDA
Dba
Data Sources
Paper, Files, Information Providers, Database Systems, Oltp
BUSINESS ANALYTICS : A CASE STUDY
 Data Sources
Transaction Table

Transaction ID
Customer ID : Identifying the customer to whom you have rented out the CD
Movie ID : Identifying the movie
Issue date : When was the movie rented out
Received date : When was the movie received. Blank if CD is still due
Rent due : How much does the customer need to pay as rent
 Product Table

Movie ID : Unique ID of movie

Origin yearmonth : When was the CD bought?
Genre of movie
Language of movie
Star Cast of movie
Movie name

Customer Table

Customer ID : Unique ID of customer

Name
Age
Gender
Area : Area where the customer lives
Package : Package customer has enrolled to
Enrol_date : When did the customer make his first transaction
 Engagement Tracker

Engagement id : Unique engagement identification

Inbound flag : 1 if inbound, 0 if outbound
Type of engagement : Code for the type of engagement
Product ID : ID of product in question

Derived tables : Because the data sizes become huge with time, it is always
recommended to keep some monthly snapshots handy. One of such table can be
transactions data rolled up at customer level in a Warehouse. Following is a list
of such possible variables :

Customer ID
# lifetime transactions : Number of transactions made by customer till date
Enrol date
# English Movies : Number of English movies taken by customer till date
Last engement date
Last transaction date
GRAPH SCHEMA
PROCESS : TARGET LIST
Current Health of Business

Possible Changes or Strategies to Improve the Health

Customise the theme based on what customers may like.

Customise the banners based on the localities you are going to place them in.
Identify the most popular genre and stock more CDs pertaining to the same.
Map and profile localities which get you more business & profits. Identify more such localities
for more customer acquisitions.
 Make theme more customer-centric:
Make each advertising banner focused to local taste :
Genre wise Inventory/Stock optimisation :
Target most profitable societies for acquisition :
Here is a summary of strategies recommended for the month 3 :

Change the banner and front desk of movie genre to English Action and Hindi Romantic.
Put customised banners in different kinds of societies, according to the societys taste.
Stock more titles in the English Action and Hindi Romantic genre.
Market the business, more in Medium standard societies similar to HEWO society.
 Identify most valuable customers, send movie reviews & other value added services to these
customers
Innovate, and come up with new services like home delivery, weekly packages, promotional
packages etc. to targeted customers
Create targeted marketing campaigns for each type of new product.
Create a website to promote your shop and collect information of trailers viewed by the
customers.
Create an optimised inventory management system to make sure you are never stocked out
Create proper retention/win-back processes
Form groups using RFM approach

:THE R : R stands for measuring Recency. Take into account the number of days since
the customer took the last CD and score each customer based on the band he qualifies.

THE F : F stands for frequency. The total number of CDs a customer has rented in his
entire lifetime. Again band the frequency and score accordingly

The M : M stands for Monetary. Because, in this case each product costs the same,
monetary parameter will behave very similar to frequency, there is no use of this metric.

Consider a case, customer X has bought 8 CDs in total and bought his last CD 6 days
before. His total score becomes 8/10. Similarly, score each of the customers. First thing to
check is the distribution and the stability of the score. Following is the distribution of
scores as on month 4 and month 5:
Step 3 : Find the right strategy for each of the groups

Loyal Customers : These are the customer who were highly valuable and are still highly
valuable. This is the loyal base and it is important to delight these customers because of the
constant stream of revenue. All customer delight / engagement strategies need to focus on
these customers. A few possible engagement Strategies for Up-selling :

Based on the preferred genre, send updates of new releases or newly acquired CDs.
Send weekly updates of star rating on new movies of preferred genre.
Send festive promotional offers to up-sell.
Give free delivery services.

Grow Customers : Show a growing pattern and are becoming more and more engaged. The
right strategy with these customer is to delight them and grow their engagement further. Add
these customers to the up-sell group. A similar strategy as of Loyal customer might be helpful
in making them more engaged.

Win Back customers : These customers are showing a declining pattern in terms of
engagement/revenue. Some different strategies to arrest their likely attrition and bring them
back. 2 possible reasons for their attrition:

They are now shopping from other shops.

They have declined their overall requirement.
Some strategies to increase their wallet share or transfer their demand from other
vendors :

Win back Offers : Give promotional offers to get them back on books. Offers like Buy 2
CDs a month and get third 50% off will differentiate us from other vendors.

Customer specific Engagements : All customers want to be treated deferentially. A

simple promo offer like Get 25% off on next CD might not work as good as We know
you like watching Romantic movies. Here is If Only one of the best in genre 15% off
only for you.
Other strategies :
There can be many other data driven strategies, which can be implemented at this
point in time. Some of these strategies can be :

Inventory optimisation model based on past demand trends.

X-sell of other rental services to loyal customers like renting home theatre.
Mutually share data with Home theatre store and bring off-us customers with profile
similar to loyal customers on board.
 Learning from Data is virtually universally useful.
Master it & youll be welcomed nearly everywhere !
John Elder.

Black-box trading - driving financial trading decisions

automatically with a machine is the holy grail of data-
driven decision making.

Floodgates of PA driven decision making have opened :-

wildly increasing amount of data.

Cultural shifts as orgs learn to appreciate, embrace &

integrate predictive technology.

improved software solutions to deliver PA to orgs.

 PA can be applied anywhere, but the quintessential
application in Business : Targeting Direct Marketing.

Whats Predicted :Which customers will respond to

marketing contact.

Whats done about it : Contact customers more likely to

respond.

The Prediction Effect : A little prediction goes a long

way.
We cannot deal with so much Information
Analytics can Help

Use of Sophisticated Statistical Algorithms to

Explore, Analyse & Understand DATA.

Generate Insights from it.

Discover hidden patterns.

Make better Decisions.

Data Science and Data Scientists are the Key.

Analysing The Analysers
 Analysing The Analysers By Harlan Harris,
Sean Murphy & March Vaisman.
Surveys 250 Data Workers On How They See
Themselves & Their Work.
Focuses On Skills, Experience, Education,
Self-Identification & Web Presence.
5 Skill Areas.
Business.
Machine Learning/Big Data.
Math/ OR.
Programming.
Statistics.
 DATA BUSINESS PERSON Most Likely to have a
MBA, managed employees OR started a business.

DATA CREATIVE Broadest range of skills, artists,

psychologists, economists.

DATA DEVELOPER Build data Infrastructure,

Code on a daily basis. Computer Science OR
Computer Engineering Degree.

DATA RESEARCHER Closest to Scientist /

Academic, PHDs, with published works. Least likely
to have started a business OR manage an
employee.
Analysing The Analysers
With the flood of data available to businesses regarding
all their activities, companies are turning to analytics
solutions to extract meaning from the huge volumes of
data to help improve decision making

Companies that are attempting to optimise their S & OP

efforts need capabilities
to analyse historical data,
forecast what might happen in the future.

The promise of doing it right and becoming a data driven

organisation is great. Huge ROIs can be enjoyed as
evidenced by companies that have optimised their supply
chain, lowered operating costs, increased revenues, or
improved their customer service and product mix.
Thanks