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Australian businesses running the numbers on analytics-driven customer service

Australian businesses, such as the University of Adelaide, are gaining customer insights from large volumes of data through data analytics technology.

Deep in the University of Adelaide's data centre, a business-analytics system is humming away, dutifully collecting masses of data – up to 250GB on a busy day – from seven different network-security systems.

It may sound like the kind of esoteric platform only an IT-security nerd could love, but the data – fed through an analytics platform from fast-growing vendor Splunk – is winning broad support by providing new insight into how the university's network functions on a day-to-day basis.

This, in turn, is fueling a new wave of thinking about how the university services its nearly 21,000 students and thousands of staff on a daily basis. What began as a system for monitoring network security now helps business units do everything from tracking the usage and planning of 25,000 separate rooms and other floor spaces, to measuring the environmental efficiency of new solar arrays, to helping faculties optimise software budgets by measuring actual usage of student computer labs and applications.

“We have a lot of very important systems that underpin the general operation of the university,” said CIO Mathew Benwell, “and there's value in being able to diagnose issues as rapidly as you can: when the systems go down, it affects the entire university. Outside of the security team it goes into the rest of the infrastructure – and it's being used very broadly across the university now. It's all based on value-add.”

Welcome to the new analytics, in which new big-data platforms are enabling the mass collection and analysis of data that is, more often than not, revealing surprising insights that are helping businesses build new customer-focused operational cultures that boost efficiency – and revenues.

Big data getting bigger.

As Australia's once government-supported university sector builds marketing prowess to lure ever-more-important fee-paying students, this visibility is helping optimise the allocation of increasingly scarce financial resources. This can be refocused into more-appealing services that boost the institution's appeal in the highly-competitive sector.

Yet higher education isn't the only place analytics fever has caught on in Australia, where often-concentrated market power means just a few giants fight tooth and nail for customers. With large market penetration and geographical isolation making customer churn a zero-sum game, better analytics is helping innovators both steal customers from rivals, and convince them to spend more.

The country's two grocery-store giants, for example, have invested heavily in transaction-analytics systems to track customer spending and lure them in-store with personalised discounts and special offers. “The earliest and fastest-moving industries are essentially the ones with the largest data sets and volumes,” says Martin Ashby, Asia-Pacific principal with big-data platform developer Hortonworks.

“Companies are now looking to drive this into knowing the individual customer and drive the next generation of revenue lines. Sometimes they don't know what the next usage of that will be, but having it available means they can always go back and analyse it at a later point.”

If, that is, they can find the right staff. Hiring trends in the Australian analytics market reflect the increased investment in the platform, with recruitment firm Bluefin Resources noting in a recent market report that “analytics will continue to be driven from a customer-centric rather than a product-centric view.”

Businesses instigating analytics strategies are recognising this at a salary level, with digital analytics experience “in high demand and short supply with a significant lack of local level expertise within this space”, the firm found. According to rival recruitment firm Greythorn, even a junior customer analytics analyst can expect to command a A$70,000 (£32,000) salary in Sydney, with senior analysts on A$120,000 and data scientists earning A$150,000.

Recent estimates by the Australian Computer Society (ACS) cited a recent Gartner analysis that suggested Australian businesses will spend $A670.6m on business intelligence and analytics tools in 2015 – a 12.1% increase over last year that dwarfs the 9.3% growth rate in neighbouring New Zealand's $NZ94.2m (£39m) market. Gartner's 2015 survey of 2800 ANZ CIOs found that business intelligence and analytics were their top priority.

“The role of BI has shifted from being something to help monitor and manage the organisation, to information itself being a monetised product or revenue stream,” the ACS noted, citing anecdotal evidence from members suggesting that two-thirds of Australian organisations have already created competency centres focused on analytics and information management.

The New Analytics

Australian businesses aren't new to large-scale data warehousing, although storage and processing limitations, integration issues, format incompatibilities and lack of user education meant that data previously had to be carefully curated – and its use limited to a select few people. Analytics was little more than high-tech navel-gazing, generating sales dashboards and self-service reporting platforms used as often as not simply to impress executives.

Today's big-data platforms have democratised access to information, with tools like the Hadoop open-source platform rapidly emerging as drivers for the collection and rapid analysis of previously unthinkable amounts of information. This, in turn, is driving new customer insight that is helping organisations become more responsive to customer needs than ever before.

“Our staff are very driven around wanting to help people,” said former Australia Post CIO Andrew Walduck. He drove a year-long digital transformation at the erstwhile government monopolist to ensure its survival in the digital era as its traditional letters business implodes.

“They will say to customers 'I hear that you have a problem and I'm going to solve it for you', and right now our focus is changing our culture to ensure that we can drive that systemic change throughout the organisation.”

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Supported by analytics systems such as IBM SPSS, Australia Post has not only increased monitoring of back-end functions like cashflow management, but is engaging customers online and drawing on digital services and its physical branch network to drive customer behaviour analytics.

“We want to understand enough about [customers] that we can provide them with a better service or product,” Walduck said, “so we're using transactions as our touch point to be able to improve their experience, and to remove friction from the transaction so we can continue to play the part. It really involves a lot of internal change to get us there, and it completely reorients the discussion.”

Top down

While revenue growth lures the private market to big-data analytics, the greatest impetus for Australia's analytics may ultimately come from its government. It is building a citizen-focused digital culture with the creation of a Digital Transformation Office (DTO) earlier this year.

The DTO's first mandate was for all federal agencies to submit, by this month, detailed plans about how they are going to rework their services around digital technologies and deliver better services the way citizens want them – be that online, via mobiles or even directed offline interactions.

Such flexibility would have been anathema to bureaucracy-minded government organisations in the past, but the scope of its ambit reflects newfound recognition even amongst efficiency-minded government bodies that digital services not only make for happier citizens, but can streamline the cost of high-volume transactions considerably.

Michael Buckley, Australian managing director of digital consultancy Accenture Interactive, calls the new culture an era of “liquid customer expectations” – and believes it's here to stay as the new analytics allows organisations to not only personalise customer offers, but to dynamically shape interactions based on contextual cues that breed customer satisfaction and revenue growth.

The DTO initiative “is identifying where improvement is traditionally needed, and working to rebuild these services from the ground up,” Buckley says. “What's interesting about the DTO is that it's not platform led; it's design led. And that's the real effort.”

“We say that the battleground is therefore experience,” he adds, referencing recent research by the company's Fjord design and innovation unit suggesting that convergence – of connected devices, connected sensors, network connectivity, cloud platforms, data and analytics, and user interfaces – will create a world of 'living services' that will “start to change the dynamic between customers and brands to one that is more consumer-centric and relationship based. Personalization and purpose are critical to winning customer affection in this digital age.”

For Buckley, this conclusion goes without saying – and analytics will be at the cusp of the revolution. “The success metric is delight,” he says. “We differentiate ourselves through execution.”

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