BIG DATA ANALYTICS

NOVEMBER 23, 2016

PLACEMENT PREPARATION COMMITTEE
IIM INDORE
 BIG DATA ANALYTICS | Placement Preparation Committee

In today’s world, Data really powers everything that we do. Data is becoming the new raw material of
business. However, today, we have more information than ever. This quantitative shift leads to a
qualitative shift. Having more data allows us to do new things that weren’t possible before. In other
words: More is not just more. More is new. More is better. More is different. And here the Big Data and
its Analytics come into picture.

WHAT IS BIG DATA?

To understand Big Data Analytics, first let’s see what Big Data means. Big Data is high-volume, high-
velocity, and high-variety information assets that demand cost effective, innovative forms of
information processing for enhanced insight and decision making.
High Volume refers to the total amount of data and is contributed due to sensor and machine-
generated data, networks, social media, and much more.
High Variety refers to the number of types of data. Big data extends beyond structured data such as
numbers, dates, and strings to include unstructured data such as text, video, audio, click streams, 3D
data, and log files.
High Velocity refers to the speed of data generation. The pace at which data streams in from sources
such as mobile devices, clickstreams, high-frequency stock trading, and machine-to-machine processes
is massive and in real-time.

WHAT IS BIG DATA ANALYTICS?

Big Data Analytics is the use of advanced analytic techniques, tools and solutions to examine large
amounts of data to uncover hidden patterns, unknown correlations, market trends, customer
preferences and other insights. It helps analysts, researchers and organizations to harness their data and
use it to identify new opportunities. That, in turn, leads to smarter business moves, more efficient
operations, higher profits and happier customers.

Using advanced analytics techniques such as text analytics, machine learning, predictive analytics, data
mining, statistics, in-memory analytics and natural language processing, businesses can analyse
previously untapped data sources independent or together with their existing enterprise data to gain
new insights resulting in significantly better and faster decisions.

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WHAT ARE ITS ADVANTAGES?

Big Data Analytics mainly offer the following advantages:

1. Cost Reduction: Big data technologies such as Hadoop and cloud-based analytics bring
significant cost advantages when it comes to storing large amounts of data – plus they can
identify more efficient ways of doing business.
2. Faster, Better decision making: With the speed of Hadoop and in-memory analytics, combined
with the ability to analyse new sources of data, businesses are able to analyse information
immediately – and make decisions based on what they’ve learned.
3. New Products, Services and Business Opportunities: With the ability to gauge customer needs
and satisfaction through analytics comes the power to give customers what they want. With big
data analytics, companies are creating new products to meet customers’ needs.

WHO USES IT?

Big data analytics lends itself well to a large variety of use cases spread across multiple industries.
Financial institutions can quickly find that big data analysis is adept at identifying fraud before it
becomes widespread, preventing further damage. Governments have turned to big data analytics to
increase their security, crime rates and combat outside cyber threats. The healthcare industry uses big
data to improve patient care and discover better ways to manage resources and personnel.
Telecommunications companies and others utilize big data analytics to prevent customer churn while
also planning the best ways to optimize new and existing wireless networks. Marketers have quite a few
ways they can use big data. One involves sentiment analysis, where marketers can collect data on how
customers feel about certain products and services by analysing what consumers post on social media
sites like Facebook, Twitter and other social media.

DATA LAKES:

Gathering data from various sources is, of course, only one part of the big data analytics process. All that
data needs to be stored somewhere, and that repository is often referred to as a data lake. Data lakes
are where data is kept in its raw form, before any organizational structure is used and before any
analytics are performed.

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BIG DATA STACK:

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BIG DATA ANALYTIC TOOLS:

The Top Big Data Analytics Tools are Apache Hadoop, MapReduce, Hadoop Hive, Spark, Presto, Yarn, Pig,
NoSQL databases, etc.

Big Data on Cloud is one solution to the complexity of maintaining the Big Data. Taking big data to the
cloud offers up a number of advantages. Improvements come in the form of better performance,
targeted cloud optimizations, more reliability, and greater value. Big data in the cloud also allows
organizations to scale quickly, easily and flexibly. Data in the cloud also takes advantage of the benefits
of cloud infrastructure, whether they be from Amazon Web Services, Microsoft Azure, Google Cloud
Platform, or others.

The big-data world is still very new, but it will change the business. It is aptly said that, without big data
analytics, companies are blind and deaf, wandering out onto the web like deer on a freeway.

Data is the new science. Big Data holds the answers.

-Pat Gelsinger

Big Data Analytics Implementation Examples:

1. Fraud detection

For businesses whose operations involve any type of claims or transaction processing, fraud detection is
one of the most compelling Big Data application examples. Historically, fraud detection on the fly has
proven an elusive goal. In most cases, fraud is discovered long after the fact, at which point the damage
has been done and all that's left is to minimize the harm and adjust policies to prevent it from
happening again. Big Data platforms that can analyze claims and transactions in real time, identifying
large-scale patterns across many transactions or detecting anomalous behavior from an individual user,
can change the fraud detection game.

2. IT log analytics

IT solutions and IT departments generate an enormous quantity of logs and trace data. In the absence of
a Big Data solution, much of this data must go unexamined: organizations simply don't have the
manpower or resource to churn through all that information by hand, let alone in real time. With a Big
Data solution in place, however, those logs and trace data can be put to good use. Within this list of Big
Data application examples, IT log analytics is the most broadly applicable. Any organization with a large
IT department will benefit from the ability to quickly identify large-scale patterns to help in diagnosing
and preventing problems. Similarly, any organization with a large IT department will appreciate the
ability to identify incremental performance optimization opportunities.

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3. Call center analytics

Now we turn to the customer-facing Big Data application examples, of which call center analytics are
particularly powerful. What's going on in a customer's call center is often a great barometer and
influencer of market sentiment, but without a Big Data solution, much of the insight that a call center
can provide will be overlooked or discovered too late. Big Data solutions can help identify recurring
problems or customer and staff behavior patterns on the fly not only by making sense of time/quality
resolution metrics, but also by capturing and processing call content itself.

4. Social media analysis

Of the customer-facing Big Data application examples we could discuss, analysis of social media activity
is one of the most important. Everyone is on social media these days, whether they're "liking" company
pages on Facebook or tweeting complaints about products on Twitter. A Big Data solution built to
harvest and analyze social media activity, like IBM's Cognos Consumer Insights, a point solution running
on IBM's BigInsights Big Data platform, can make sense of the chatter. Social media can provide real-
time insights into how the market is responding to products and campaigns. With those insights,
companies can adjust their pricing, promotion, and campaign placement on the fly for optimal results.

How Companies use Big Data Analytics:

1. Capital One has been harnessing behavioral data to shape customer offerings for years. For
instance, their deal optimization engine analyzes customer demographics and spending patterns to
determine how, where and when to put offers in front of people – leading to more revenue for Capital
One and a more positive experience with the brand for customers. They also created Capital One Labs, a
sort of tech-driven think tank where employees use big data to sort through potential opportunities like
new modes of mobile banking.

2. T-Mobile, like all telecomm companies, collects massive amounts of data from its smartphone and
tablet subscribers and it's using this data to prevent customer turnover. In fact, the brand has managed
to reduce "churn" by 50% just by staying on top of things like usage patterns, geographical usage trends,
customer purchases by location and most importantly, Customer Lifetime Value. T-Mobile has banked
on the fact that customers with strong social networks can influence others' telecomm decisions,
making a point of identifying its most influential customers and giving them perks.

3. Free People, the more bohemian segment of Urban Outfitters, uses millions of customer records
(reviewed by an in house analytics team) to shape the next season's offerings. Information like what
sold, what didn't, what was returned and more fuels the brand's product recommendations, the look of
its website and what kinds of promotions customers see to improve Free People's bottom line. And it's
working – Free People has done well even when retail has been dicey.

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4. Starbucks' ubiquity – as in its ability to maintain a surprising number of locations in close proximity
to one another – is a function of big data. The fact that two Starbucks can exist a block away from one
another isn't luck; they were placed in their adjacent locations thanks to location-based data, street
traffic analysis, demographic info and data culled from other locations. In fact, Starbucks actually built
its own planning and development application to make the most of big data in its growth strategy.

The reason these companies in particular have done well harnessing the power of big data likely boils
down to goals. Capital One was focused on customer retention, even as technology changed. T-Mobile
wanted to reduce the customer turnover so common in telecommunications. Free People was
interested in giving their customer base example what it wanted, in stores and online. And Starbucks
needed to know more about what really constituted a winning location.

Big Data at United Healthcare:

United Healthcare, like many large organizations pursuing big data, has been focused on structured data
analysis for many years, and even advertises its analytical capabilities to consumers (“Health in
Numbers”). Now, however, it is focusing its analytical attention on unstructured data—in particular, the
data on customer attitudes that is sitting in recorded voice files from customer calls to call centers. The
level of customer satisfaction is increasingly important to health insurers, because consumers
increasingly have choice about what health plans they belong to. Service levels are also being monitored
by state and federal government groups, and published by organizations such as Consumer Reports. In
the past, that valuable data from calls couldn’t be analyzed. Now, however, United is turning the voice
data into text, and then analyzing it with “natural language processing” software. The analysis process
can identify—though it’s not easy, given the vagaries of the English language— customers who use
terms suggesting strong dissatisfaction. A United representative can then make some sort of
intervention—perhaps a call exploring the nature of the problem. The decision being made is the same
as in the past—how to identify a dissatisfied customer—but the tools are different. To analyze the text
data, United Healthcare uses a variety of tools. The data initially goes into a “data lake” using Hadoop
and NoSQL storage, so the data doesn’t have to be normalized. The natural language processing—
primarily a “singular value decomposition”, or modified word count—takes place on a database
appliance. A variety of other technologies are being surveyed and tested to assess their fit within the
“future state architecture. United also makes use of interfaces between its statistical analysis tools and
Hadoop. The work is to put the customer satisfaction data, along with many other sources of customer
data, into a customer data warehouse and analyze it. However, several other functions and units of
United, including its Optum business specializing in selling data and related services to healthcare
organizations, are participating. Big Data Analytics team includes both conventional quantitative
analysts and data scientists with strong IT and data management skills.

More on Big Data in Companies: http://www.sas.com/resources/asset/Big-Data-in-Big-Companies.pdf

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