Organisations generate millions of transactions and data, stored across several systems. However, extracting meaningful insights from this information resource is often challenging due to lack of an integrated methodology and technology. PwC Global has been advising clients on how to take advantage of data to grow their businesses and the service is being rolled out in full in Ghana and across West Africa. Our correspondent, Samuel Doe Ablordeppey of Graphic Business (GB), caught up with Mr Femi Osinubi (F.O.), the Leader of Data Analytics for West Africa, PwC, for a chat on how businesses and SMEs can leverage Data Analytics.
GB: Why is Data Analytics important to businesses, especially in Ghana and West Africa?
F.O: It’s a big bet for a lot of organisations globally. When Microsoft acquired Nokia, the Nokia CEO said they didn’t do anything wrong but they still lost out. So what I tell my clients is that you don’t have to waste time now; this is the time to actually get business and the only way you get insight is through the power of data where you can actually perform real time analytics.
Analytics cover three areas. One is more descriptive; what’s happening in your business at the moment.
Another one is actually prescriptive and you can actually manage your data to respond to certain programmed changes. So, for instance, if you reduce your cost on a real time basis, what will your profit be?
Then there is the one about predictive where you can actually predict the future to say ‘what can happen to my business in the next two years’ all with the power of data.
That’s why we are telling organisations that you have got to take this seriously. With the way data is being gathered in businesses these days, analytics is the future.
We actually do things around social media analytics where you can gauge what your customers are saying. It is not about relying on your Customer Relationship Management (CRM) systems now; it is about the power people now have to go and put comments about your company on social media. How do you get that data to analyse and respond quickly? And that is what this is all about.
GB: So is it the way data has been captured that is the difference, because forecasting has been a thing with us for a long time, so what is the change here?
FO: There are a couple of things involved; the volume of data and there’s something called ‘Big Data’ which not just about the volume, but the velocity of data as well. The speed with which data comes and is used to run your business is very phenomenal. Assuming that you look at scenarios where data that you need in your business is actually captured through several devices such as mobile devices, laptops and iPads. All these data, whether desired or not, require that you need to start thinking about them how to get them, but internal and external data.
So it’s not just your own data. Businesses need to start bringing in data from external sources to combine with internal data to be able to determine how to run the business, going forward.
We look at the veracity of data which is actually the accuracy of data. How accurate is this data? All these need to be analysed in real time basis. Traditionally, people wait for the month end to do analysis and it delays their business decisions. This can actually collapse the business.
So it is a lot of things combined together. Again, you cannot rely on structured data which is the traditional data we know.
GB: Are we talking about the numbers only, is that what you describe as data?
F.O: It's both structured and unstructured data. Some of the demonstrations will show how we manage unstructured and structured data and combining both. We have a solution called ‘Fleet Analytical Solution’ where we are able to combine data from GPS Tracker of a large conglomerate having a fleet of thousands of trucks. Data produced from the tracker is almost every second when the car moves. Data is pumped in a form that is not analysed easily, so we have combined the GPS data with financial data and even the Enterprise Resource Planning (ERP) transportation model where three sources of data are combined to help manage the way the organisation manages fleet to reduce the cost of diesel and reduce the cost of the tyres, which is very necessary. So managing these to reduce cost is what we’re talking about analytics in general.
GB: How relevant is this to businesses, especially in this part of the world, West Africa, where we have a large number of them being SMEs? Can they also tap into this resource?
F.O: I always tell people that even if it is a small company, no matter how small, you still need to start analysing your data because now data is the power, data is the king. You can almost do nothing without data.
So the small and medium enterprises (SMEs) are in the game. We’ve worked with a lot of SMEs and we keep working with them. To me, if you want to grow your SME, you have to actually start doing the right things now.
I see a situation where as part of corporate governance all the regulatory bodies will start talking about data, how accurate and complete data are the data they receive. So it’s going to be regulatory driven. In the UK, in a lot of organisations, especially in the financial sector, data is key to the Bank of England and I see that happening in Africa, especially in West Africa. Look at, say, the Bank of Ghana, where returns are sent, what do they do with this data?
So analytics is very key and regulatory bodies are also pushing for financial institutions for data analysis no matter how small they are, to actually start doing analytics, as they want to understand the data they are sending.
GB: Ghana is notorious for having one of the stubbornly high interest rates in the whole world. How can they rely on analytics to do risk management in relation to bringing down the cost of borrowing?
F.O: One of the dashboards we have is risk analytics which actually talks to the financial institutions. So if you look at the Basel II and Basel III, talking about operational risk and credit risk, we are currently working with some banks so that they can monitor their risk on a real time basis, depending on the frequency you want. This can be done on daily basis, analysed and scored.
GB: Do they only do this to make more money for themselves and not to transfer it to the customer?
F.O: This means then that the regulator has to come in. It needs to do this from their own part as well to empower themselves. They actually do analytics themselves and they can work with the banks.
I agree because the banks have the funding to put into projects like this. They actually develop a solution and people work with them. The regulator needs to do the same. The regulator has to be a step ahead of the banks that they are regulating. If they can do that, life will be more easier for the end consumer.
GB: So in all these, how affordable it is for the SME particularly to deploy this? Do you have systems where they can partner third parties to help them to do this?
F.O: The good thing about analytics these days is what we call self-served business intelligence. The traditional business intelligence was very expensive. For instance, telecom companies used to spend a lot on business intelligence. But what the vendors – the original equipment manufacturers (OEMs) have done is to move several steps ahead. So there are tools like Clickview and tablo. Even the likes of SAP and Oracle have actually moved to self-served business intelligence (SSBI). The technology they have developed with their architecture is very cheap.
We’ve got solutions directly from the vendor, which is the platform to use such as ClickView or ClickSensewhich is between US$10,000 and US$30,000, to have the base solution. Then the buyer can engage firms such as PricewaterhouseCoopers (pwc) to actually build what you want to have. So you can have analytics built around ‘the procure to pay’ cycle to monitor the several KPIs, or the build for the revenue management process.
Again, to put cost to that, you need to scope, depending on the requirement, but it is very flexible and could come as low as US$10,000 for a model. But once there is the base then we come in and advice you. There is really no off the shelf, so we work with the company and engage them.
Business analytics is about helping to solve a business problem to reduce cost.
GB: PWC, what is the strategy and what do you want to achieve with Data Analytics in Ghana and within West Africa?
F.O: I lead Data Analytics for West Africa and I am in tune with what’s going on globally. Data and analytics is actually a big bet for us and it is part of our the digital programme.
We believe that the business models globally, whether for PwC or for most companies, will change in the next five years. It’s going to be this generation; we are beginning to see those changes.
At PwC, we are changing our business. Even from Audit, we brought tools such as Halo, which we developed and have patented. Most of our audit work globally, before the end of next year would be automated through analytics.
For most of our reporting that we do internally and globally, we actually do analytics. A lot of our reports are generated by the click of a button, on an iPad, etc. Gradually, we are bringing the changes in model to West Africa. In the next few months, we will go full hog on analytics.
GB: If I am going to quote Femi on Data Analytics in the West Africa environment, what should I quote?
F.O: I will say that with analytics, your business is going to move to the next level and we have got to do it now. Don’t wait till something happens. It’s a bold statement to say,“I do not see you in the next two years running a business without understanding your data.”