The Power of One
When we last spoke, I talked about how Talend is working with data-driven companies to define and implement their One-Click data strategies. 1-Click, introduced by Amazon.com in 1999, allows customers to make on-line purchases with a single click – and is a showcase of how well they can turn massive volumes of shopper, supplier and product data into a customer convenience and competitive advantage.
Recently I’ve noticed some customers, particularly in the area of Internet of Things (IoT), are using a similar but different metric – “1 percent.” In this instance, “1” is used to describe the significant impact a fractional improvement in efficiency can have on major industries.
The Positive Power of 1%
For example, take GE Water & Power, a $28 billion unit of the parent company. For nearly a decade, GE has been monitoring its industrial turbines in order to predict maintenance and part replacement. Recently, the company has dramatically increased its ability to capture massive amounts of data from these sources and blend it with additional large data sets.
GE Water & Power CIO Jim Fowler, in a speech last year in Las Vegas, said that GE now has 100 million hours of operating-data and maintenance and part-swap data across the 1,700 turbines its customers have in operation. Each sensor-equipped turbine is producing a terabyte of data per day. That information has been combined and processed with external data such as weather forecasts. And the results clearly illustrate the power of one.
According to Fowler, GE is using the data to help its customers realize a tiny 1% improvement in output that adds up to huge savings – about $2 to $5 million per turbine per year. While that’s impressive enough, when one considers the total savings across all 1,700 turbines over the next 15 years, 1% efficiency savings could equate to a staggering figure in the range of $66 billion.
Another excellent example of the Power of One comes from the OTTO Group in Europe, also a Talend customer. This is the world’s second largest online retailer in the end-consumer (B2C) business that reported 6B euro in online sales in 2013. OTTO is using the Talend platform to “…make quicker and smarter decisions around product lines, improve forecasts, reduce leftover merchandise and importantly, improve our customer experience,” says Rupert Steffner, Chief BI Platform Architect of the company’s IT organization.
For OTTO, like any other online retailer, shopping cart abandonment is a major challenge. Industry reports note that $4 trillion worth of merchandise will be abandoned in online shopping carts this year. By applying solutions made possible by access to extensive customer data, OTTO estimates it can predict with 90% accuracy customers who are likely to abandon a cart. It’s not hard to see how this information could be used to send incentives and promotions to these customers before they leave the site and their carts. Even if such activities were to net only a 1% change of fortune, when you consider it’s a $4 trillion issue, such a shift would be extremely meaningful.
Another European customer exemplifying the Power of One is a financial services company. A 1% improvement in cross selling its insurance policies to their existing customer base (a tiny fraction of their overall business) has resulted in a return of 600,000 euros over the past year.
GE – A Data-Driven Enterprise
GE, by the way, is totally committed to making the most of Big Data. It has coined the term “The Industrial Internet” – a combination of Big Data analytics with the Internet of Things (IoT). The challenge, says CIO Fowler, is to build an open platform for ingesting and sharing Big Data to build new, highly secure applications. Talend is lending a hand.
Talend 5.6, our latest release, sets new benchmarks for Big Data productivity and profiling, provides new Master Data Management capabilities with advanced efficiency controls, and broadens IoT device connectivity.
Working with machine-generated content or IoT devices is enhanced by the platforms support for two related protocols – MQTT and AMQP – that allow sensor data to be ingested into a company’s real-time data integration workflows. It supports the latest Hadoop extensions, Apache Spark and Apache Storm, providing significant performance advantages and supporting real time and operational data projects.
Talend 5.6 is ready to help any data-driven enterprise realize the Power of One – and that’s just for openers. For smaller companies, the Talend solution may generate even greater returns – efficiencies on the order of 10% to 20%. Now that’s Power!