Planning Businesses making decisions based on data mining and not on feelings

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LuAnn LaSalle
THE CANADIAN PRESS

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MONTREAL - How do you make crackers that are manufactured in countries around the world all taste exactly the same? Which tugs at an animal lover's heartstrings more, a polar bear or a pygmy elephant?

Global companies and organizations are aswim in data - seemingly trivial to outsiders - about their customers, suppliers, competitors and markets.

To make sense of such disparate and occasionally bizarre-seeming tidbits, they employ business analytics software - powerful technology that crunches even the scariest numbers, going where intuition and marketing research fear to tread.

While it might sound dry and technical, business analytics is the not-so-secret weapon of companies such as Kraft, which employs it to make sure Ritz crackers have a consistent taste and texture wherever they're made. Employing software developed by U.S.-based SAS, Kraft tests foods as they're made, assigning numerical measurements that quantify the flavour, colour, aroma and other attributes of each product.

"As a consumer it lets me have confidence, and I know that when I buy that box it's the same - I am going to have the same experience no matter where it's manufactured," said Tammi Kay George, business intelligence product marketing manager at SAS Worldwide Marketing.

Kraft uses sensory analysis software that analyzes input from product taste tests, and another application that sifts through production data to eliminate variations in the baking and mixing process.

U.S.-based SAS is among companies providing business analytics software, the use of which has been growing in the last decade, with large corporations needing to make sense of huge amounts of data. As the name implies, the software analyzes information using mathematical formulas and statistics. And it's not just multinational conglomerates taking advantage of what it can do.

The World Wildlife Fund has been using SAS software for the last three years in its direct marketing campaigns, taking the guesswork out of whether donors are more interested in blue whales, polar bears or pygmy elephants, said Terry Macko, marketing director of the World Wildlife Fund in Washington, D.C.

"We can all guess with our gut, but it's much better to have data in front of us and make informed decisions based on facts and information," said Macko.

"It really allows us to be efficient with our fundraising dollars."

The technology can even analyze human feelings, eliminating reliance on intuition.

"By using combinations of certain words together, you can determine the sentiment," George said from Cary, N.C., where SAS is headquartered.

"Was this customer angry, was this customer pleased? Is there a flag about certain terms being used together that say a certain offer should be made to a customer?"

IDC Canada analyst Vinay Nair said large organizations have been using business analystics for the last decade; in the next few years, he said, businesses with between 250 and 999 employees will need it to stay competitive.

"You've got the early adopters right now. But eventually you are going to have to do it just to compete," said Nair, who manages IDC Canada's enterprise applications practice in Toronto.

It's going to be like getting a telephone line. You've got to know where you are standing with you're competitors at any given point in time. Analytics is going to be a key component of that."

Other companies like Cognos, Oracle and SAP also offer business analytics' solutions. But Nair said SAS does a lot of predicting based on data and that's a "very niche market."

Business analytics software can also be used to make appeals to specific customers. Some would get offers, for example, about yogurt, while others would get offers for bread or diapers, based on their past shopping history, George said.