IBM's View on Business Analytics and Sustainability

Yesterday, I mentioned P&G’s Sustainability Vision and wondered what some other global organisations might also be saying on sustainability.

 

Thanks to Kathy Tyler from External Relations in Business Analytics & Information Management within IBM’s Software Group, I have some thoughts from  Colin Shearer, IBM’s Worldwide Industry Solutions Leader on analysing sustainability.

 

Colin suggests that business analytics is crucial in helping companies plan and manage their sustainability – because it is only possible to do so with a clear understanding of the business environment and sustainability drivers that affect an organisation.

 

Through intelligent energy monitoring tools like Smart Metering, businesses now have access to vast amounts of data, which further underscores the importance of analytics. More data simply requires more interrogation, which can be a drain on time and resources. By utilising business analytics to interpret this information, companies can capitalise on their wealth of data to make efficient and accurate decisions.

 

These tools can be applied to many different industries and to both businesses and consumers alike.

 

For example, Andy Stanford-Clark is a smart consumer who has used business analytics and software to transform his 16th Century cottage into a modern-day smart home. The software precisely monitors his energy usage, and has enabled his family to reduce their personal carbon footprint and slash bills by one-third.

 

Energy consultant Hildebrand installed a monitoring system that uses real-time analysis of electricity usage for households across the UK – even down to individual appliances. This is helping Britons to make better decisions about energy efficiency in the home and minimise their environmental impact.

 

Yorkshire Water has effectively used predictive analytics to identify areas at risk of flooding in the UK, and improved the detection of blockages that could lead to flooding by 25-30%. The increased knowledge and insight allowed them to meet regulatory targets and also predict and avoid damage to the environment.

 

These examples demonstrate how business analytics can have such a valuable impact in protecting the environment. However, in order to improve sustainability the problem must be examined in greater detail. By grouping customers into segments, and even micro-segments, a company can identify the reasons behind the problem and the specific issues that need to be addressed. Companies are then able to produce solutions and schemes to change behaviour accordingly.

 

An energy company that is faced with the challenge of reducing excessive customer usage would need to predict which circumstances were causing it. Advanced analytics would enable them to understand the patterns in customer behaviour and to identify specific fine-grain customer profiles that are associated with abnormally high usage. Reduction schemes could then be implemented that are tailored to the customer profiles they need to target, which would increase their resonance and subsequent impact on customer behaviour.

 

A case study in Paris has even shown business analytics being used to understand and implement policy changes. The government needed to predict what mode of transport residents would take under certain circumstances. They examined the different times of day that people might choose to walk, take public transport or cycle rather than drive and were then able to shift and improve their traffic policy so that it suitably reflected usage. By implementing an intelligent transportation solution they were able to improve citizen services, increase transparency, enhance public safety and achieve a sustainable environment.

 

Colin concludes that business analytics effectively provides companies with a powerful combination of greater knowledge and foresight that enables them to make smart decisions, and predict and recommend solutions.

 

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