INTELLIGENT SYSTEMS: BUSINESS INTELLIGENCE COMES OF AGE
MANILA, SEPTEMBER 12, 2006 (STAR) By Eden Estopace - It used to be "security" – the all-consuming passion of chief information officers and MIS heads – that was on top of the corporate IT agenda.
Now, enterprises are still zealous about protecting corporate data but a bigger chunk of IT budgets is allocated to integrating, standardizing and maximizing the use of valuable company data for competitive advantages.
"There has been a significant degree of interest in the area," affirmed Sonny Halili, managing director of SAS Philippines. "Customers are beginning to realize the value of business intelligence and intelligent systems."
This phenomenon, he said, was driven in part by the explosion of data over the last decade. "As companies implemented ERPs (Enterprise Resource Planning), a lot of data were generated. However, the most that these systems could do was create day-to-day efficiencies," he said.
What is needed beyond generating reports, automating processes and accumulating data, he said, is to be able mine the value of these tons of information for corporate decision-making, or what is called in tech parlance as "business intelligence."
Indicative of the growing interest of companies in adopting BI platforms is SAS Philippines’ almost 50 percent year-on-year growth in the last few years. Halili said that in the last three years alone, the company grew five-fold.
SAS, a business intelligence software and services provider headquartered in North Carolina, has been providing enterprise intelligence platforms – including data integration, intelligence storage and advance analytics – since 1976. In the Philippines, it has been around since 1991.
"Basically, what we do for companies are three things. The first is what we call hindsight, or analysis of data to get an overview of what happened in the past. The second is called insight, or analysis of data to determine current market trends. And the third is called foresight, or analysis of data to predict what will happen in the future," Halili said.
An example of hindsight, he said, is the system they designed for the Bureau of Internal Revenue (BIR) to find out who did not pay taxes in the past based on data accumulated over the years.
This system, he said, has allowed the tax collection agency of the government to run after tax cheats and boost revenue collection efforts.
In the second category, Halili said most of their clients are banks, and SAS applications are beneficial to them in the area of customer segmentation.
"Based on demographics, our applications can accurately tell the banks, for example, where their customers are, how they transact with the banks, what type of services they prefer, or how they would respond to a marketing campaign," he said.
So, rather than the old "spray and pray" approach in marketing campaigns, this kind of business intelligence enables the bank to customize a more targeted approach to promotional activities.
This is also valuable in the area of cash optimization. By knowing, for example, the maximum cash requirement of each of their ATM machines, banks would know how much cash to load for a given period in each location and do away with the problem of loading up too little or too much cash.
"Through integration of the customer base, we provide a single view of the customer to our clients," he added. This process, which is also called "data mining," is also valuable in predicting future market trends.
Through SAS applications, Halili said a telecoms company, for example, can predict with a very high accuracy who among their customers will move to competition.
"This is called advance analytics," he explained. "Using statistical models, it is possible to predict future customer behavior."
In the case of Globe Telecom, Halili said this type of predictive analysis allows the company to effectively bring down its so-called churn rate both for its prepaid and postpaid subscribers.
Recently, SAS Philippines added two more big clients to its growing portfolio – the Government Service Insurance System (GSIS) and the Philippine Veterans Bank.
"GSIS sought our services because they want to get a good profile of their two million members and understand their needs so they can provide a better service," Halili said.
In the case of the Philippine Veterans Bank, the need is for compliance with Circular No. 538 of the Bangko Sentral ng Pilipinas (BSP) or the risk-based capital adequacy framework for the Philippine banking system as recommended by the Basel II accord.
"The Basell II accord," Halili explained, "defines how banks govern risks or exposure to risks. To understand risks, one has to start with gathering data or more specifically, aggregation of customer data."
"Business intelligence is really about value," he said.
For SAS, the key differentiator to its BI software and services is the complete platform it can deliver to its clients – from data integration to storage to analysis to deployment.
"All of these are linked by one metadata. Our intelligence applications and business solutions are also industry-specific," he said.
Only recently, global consulting firm Frost & Sullivan named SAS its 2006 Business Intelligence Vendor of the Year during the Asia-Pacific ICT Awards. SAS has clinched the title for the third consecutive year.
"Many enterprises are facing an uphill task in devising effective competitive strategies due to information symmetry in the digital age. Most are digging deeper into their data piles to draw some actionable insights," Nitin Acharekar, head of enterprise research at Frost & Sullivan Asia-Pacific, said in a statement. "While the business intelligence industry continues to grow on the back of this scramble to outwit competitors, the value is tilting toward applications away from tools due to the increasing commoditization of data integration, reporting and query, and analytical tools."
Chief News Editor: Sol Jose Vanzi
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