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The man in charge of IBM’s effort to support chief marketing officers learned how to take a chance while “Bringing Down the House in Las Vegas.”  This past week however, Yuchun Lee, vice president of IBM’s enterprise Marketing Management Group, has been leading the marketing discussion at the IBM Smarter Commerce Global Summit in Madrid.

As part of the Summit, Yuchun presented at the Marketing Innovation Summit and focused on “Generation C” and best practices for increasing marketing effectiveness. To learn more about Yuchun’s perspective on what marketers can do in this evolving age of consumer engagement, read his latest Smarter Commerce blog here: http://ibm.co/L6q6uj

For more on the connected customer and what Yuchun calls “The Retail Revolution,” read his recent contribution to the Huffington Post.

So how did Yuchun go from college whiz kid to IBM’s marketing expert? Check out ZDnet’s recent profile.

Technorati Tags: CMO, generation C, marketing effectiveness

by Saul Berman, Strategy and Transformation Leader, IBM Global Business Services

One of the most interesting findings in our new Global CEO study being released this week is how CEOs are changing the nature of work by adding a powerful dose of openness, transparency and employee empowerment to the traditional command-and-control operating structure of the past. Outperforming CEO’s are even more likely to move in this direction.

This is a significant cultural shift. In the age of digital communications, CEOs understand the need to free up their organizations internally and externally to promote innovation and growth using technology, often with the use of social media platforms. As the world becomes smaller and flatter, society is demanding closer personal relationships in business.

CEOs are also showing a greater appreciation for new connections. By using new  technologies CEO’s can  enhance relationships among employees, customers and partners, CEOs can advance a new leadership agenda.  In so doing, they can take on a new role as the “Chief Engagement Officer” to increase engagement across all levels, both inside and outside their organizations. More than half of the CEOs we spoke with (53 percent) are planning  to facilitate collaboration with outside organizations, while 52 percent are shifting their attention to promote greater internal collaboration.

Those who can embrace this new spirit of openness can win. Our research shows that outperforming companies are 30 percent more likely to identify openness to be a key influence on their organization.  For example, Baush & Lomb now provides employees with social platforms and mobile technologies to let people communicate at work like they do at home. The rationale is simple: productivity and effectiveness will rise.

On the customer front, the pursuit of customer knowledge is as old as business itself, but where and how those insights are found and used are changing radically. What’s different now is all the data people are dishing up about themselves on social networks, and Web sites. As consumers provide data about their shopping preferences, they are providing an opportunity for companies to recognize and understand what makes each individual unique, and tailor their products and services accordingly. One Brazilian retailer we spoke to has even gone so far as to open a virtual store for each of its customers – so that consumers can visit it to see clothing and accessories tailored to their specific wants and needs.

Today’s CEOs are in a position that none of their predecessors have faced. Although there have been many eras of disruption in the past, several factors make this period dramatically different. First, the number of disruptive forces rippling through society at the same time has never been higher. And pervasive adoption has never come faster. More than anything, this backdrop provides CEOs with a unique opportunity to lead.

The connectedness brought upon by a new open approach is the hallmark of our era – and the driver of innumerable possibilities.  How will CEOs capitalize on this change? How will they lead in a more open era? How will they create sustainable business value? The possibilities are endless – and wide open.

Technorati Tags: CEO Study, CEOs, IBM, Leadership, performance

by Secretary Al Delia, North Carolina Department of Health and Human Services 

Twelve billion dollars.

That’s the price tag for providing vital Medicaid services to 1.5 million North Carolinians. That kind of money is crucial for so many of our citizens in need, but the complexity of the system combined with such large sums of money also present an unwelcome opportunity for fraud, waste and abuse. Every year, Medicaid suffers losses at the hands of people intent on defrauding the system, and it’s potentially costing us millions in taxpayer dollars.

Click here to view the embedded video.

As governor during the worst economic crisis North Carolina has seen since the Great Depression, Governor Bev Perdue made it her mission to fix state government – making it work smarter for our citizens by doing more with less. Hundreds of millions in state dollars were cut from our Medicaid budget in the last three years, and that meant making choices that were almost unbearable. Do we deny coverage of prosthetic limbs, or dentures? Do we cancel payment of vaccinations for children, or eye care for the elderly?

With Governor Perdue’s leadership and unwavering commitment to accountability in state government, we made the tough choices while protecting services for as many as possible. But even as we stretched every dollar and pinched every penny, we knew unscrupulous people were still finding ways to game our system, and it added insult to injury. Every dollar wasted or defrauded could be used to provide much-needed care to a child or a disabled person. Something had to change.

So in 2010, under the governor’s direction, the state Department of Health and Human Services partnered with IBM for a software system designed to ferret out fraud, waste and abuse in our Medicaid system. North Carolina is the first state to use IBM’s advanced analytics in this way, and now, two short years later, we are on the cusp of a dramatic crackdown on what appears to be widespread defrauding of Medicaid.

In just our first phase of data analysis, we’ve flagged hundreds of providers who have submitted bills for hundreds of millions of dollars in suspicious claims. The beauty of this system is that it recognizes patterns of billing behavior that don’t fit in with the norm – and then takes it a step further by looking for relationships among providers that can point us to a web of suspicious accounts. With some 88 million Medicaid bills coming in every year, there’s no way we could connect these dots through manpower alone. Analytics makes it possible to sift through tens of thousands of documents and hundreds of millions of pieces of data to identify strange behavior in a matter of minutes.

This summer DHHS investigators are fanning out across the state to put together criminal cases, and the state attorney general is ready to prosecute. Word is getting out to unscrupulous Medicaid providers: the state is watching your every move.

It’s about to get a whole lot harder to steal money from the state of North Carolina.

Now that’s smarter government.

As a current MBA candidate with an interest in healthcare, many people have asked me what opportunities I see that will have a transformational effect on the healthcare industry.  After attending the 2nd Annual Robert H. Smith School of Business & IBM Business Analytics Workshop, which focused on healthcare analytics, I can definitively say that advanced analytics will have a profound impact on the future of healthcare.

Some of the research and presentations touched on the use of analytics by physicians to provide increased quality of care, how IBM’s Watson is being incorporated into aspects of healthcare, and health plans utilizing analytics to provide personalized plan options and transparent cost information to their members.  What struck me about the event was the diversity of backgrounds of the attendees, from physicians to health plan administrators and from students to military personnel.  It was clear from this and the presentations that analytics will be a major need in all aspects of healthcare going forward.

The use of analytics will advance the progress healthcare leaders have already made thus far in understanding the most effective treatments given a specific set of conditions.  It will enable leaders to aggregate evidence-based best practices across large populations and aid healthcare providers in delivering more effective care.  Additionally, analytics will have a profound impact on the cost of healthcare by optimizing the delivery and workflow of existing processes.

The amount of data generated in the healthcare industry continues to double every five years, and this trend necessitates new skills and approaches to make sense of it all.  No individual is capable of interpreting so much information without assistance. Skills in analytics, natural language processing, and machine learning will all be required to be an effective business leader in the future healthcare environment.  This need presents a significant opportunity for students who can get exposure to these skills early in their careers. To fill the skills gap,  partnerships such as the one between IBM and the University of Maryland are emerging to develop the next generation of healthcare leaders.

As data volumes continue to grow, our desire to incorporate additional data points will also grow.  For example, in addition to analyzing claims and EHR data, what additional insights could be gained by incorporating a patient’s lifestyle data?  What happens when genomic information is layered in on top of that?  Clearly, using analytics to mine big data for knowledge discovery is the next frontier and will provide the next generation of novel hypotheses and solutions.

By Paulo Albuquerque, Asst. Professor of Marketing, University of Rochester, Simon Graduate School of Business

Give a college student a question and you’ll get an answer. Give them an answer, and you’ll get a lot of questions. The right questions can trigger responses that represent an entirely new way to look at solutions to today’s most pressing societal and business challenges.

This is exactly what happened at the Simon Graduate School of Business where I teach business students to take an analytical approach to marketing. Instead of the usual case competition where students are asked to develop a strategy to address a specific business challenge, this time the university collaborated with IBM and regional business leaders to look at ways IBM’s Watson technology could be applied to a variety of industries.

Entering a new era of computing, Watson represents a way to pique the interest of students in areas such as analytics and cognitive computing. The Watson system has the extraordinary ability to learn and become more accurate over time.

At the Simon Graduate School of Business, we aim to familiarize students with new technologies and provide students with the chance to take a hands-on approach looking at how technology could be used in business. This required students to think critically about combining technology tools with fundamental business practices to uncover new solutions and market opportunities.

Specifically, over the course of their studies, students at the Simon School master the FACt approach (Frame, Analyze, Communicate) to handle unstructured problems: they first frame the issue in the context of economics, analyze each dimension of the problem, and then come to a decision that must be communicated throughout the organization. With the help of IBM, the case competition brought the learning experience one step further. The students were asked to look at industries that the Watson technology could be used to manage information from a variety of sources to create long-lasting value to all business stakeholders.

Marketing has always required a combination of access to data, along with the smarts to know which data to use and when. What’s different today is the massive amount of data — called Big Data — that’s flowing at incredible speeds online and through mobile devices. Consumers are making their presence known in new ways on Facebook and Twitter, and on thousands of new channels cropping up inside mobile marketplaces. For today’s students, navigating all these social media channels is part of their DNA. It’s natural for students to poll Facebook friends for a restaurant recommendation, check in on Foursquare once they get there and then post a Yelp review when they get home that night. But how can they use these channels to solve real-world business problems and create new market opportunities?

What we witnessed during the case competition was a remarkable process among students. They started with open ended questions and began to apply the Watson technology in entirely new ways. Beyond IBM’s current work applying Watson in healthcare and financial services, students researched how Watson could be used to make more accurate weather predictions and help organizations allocate resources during times of disaster and crisis, taking the aggravation out of travel by reducing wait times in airports, or make mining for natural resources such as oil, gas and minerals safer and more effective.

We had 25 students participate in the Watson case competition, each with their own ideas. All were good, and some were excellent. You can read about the three standout ideas here (link to press release). The competition has inspired students to take a more creative approach to business and societal challenges. It’s a new way of thinking, innovating, and creating new business opportunities that our future leaders must be prepared to deliver by combining business acumen and technical savvy.

Click here to view the embedded video.

Technorati Tags: Analytics, Big Data, ibm watson, Smarter Education

By Jack Danahy, Director for Advanced Security, IBM

There’s an evolution going on in the executive suite–emerging technologies like mobile, cloud and embedded devices are making the world more instrumented, and at the same time, producing huge amounts of data. Senior executives are paying close attention to these emerging technologies, not only because of the opportunity to learn more about behavior, but also because of the potential security risks they pose. With this, security is increasingly moving beyond simply a technology issue to a business issue.

High-profile hacking and data breach incidents can quickly impact shareholder value, tarnish public perception and expose the company to law suits. This is convincing senior executives of the key role security needs to play in the modern enterprise.

IBM recently surveyed global Chief Information Security Officers (CISOs) to get a look at how their role is evolving in an increasingly interconnected world.

The study, conducted by IBM’s Center for Applied Insights reveals how the CISO role follows the historical evolution of the CIO and CFO with more strategic organizational responsibilities. IBM’s new study identifies the distinguishing traits, expectations and challenges these CISOs are facing.

Nearly two-thirds of CISOs surveyed say their senior executives are paying more attention to security today than they were two years ago– but there’s room for advancement for security as a function–only one in four security chiefs surveyed currently are playing this kind of strategic role in their firms. The study also shows that mobile security is the biggest headache facing CISOs in the coming two years.

John Meakin, global head of security solutions and architecture at Deutsche Bank – echoed many of the assessments findings and speaks to the need for security officers to take on a more strategic role via a contributed article in Forbes. John hits the nail on the head when he says “to do a better job of protecting our enterprises, we’ve got to become more open and collaborative.”

The findings of this survey of Chief Information Security Officers–and Mr. Meakin’s article in Forbes–speaks volumes to the need for technology leaders to connect and learn from each other. We’ll continue this conversation and these initiatives on our Institute for Advanced Security blog. Please check that site regularly for updates regarding the CISO initiatives.

David Jarvis, senior consultant with IBM’s Center for Applied Insights, led the CISO survey initiative and provides a succinct recap of the survey results in this short video.

Click here to view the embedded video.

Technorati Tags: cybersecurity, information security, IT security, mobile security

Click here to view the embedded video.

What’s the one thing all organizations have in common? They must identify new ways to grow revenue and expand their business to stay competitive.

Increasingly, organizations are using cloud computing and social networking to help them embrace new market opportunities.

Over the past several years cloud computing has matured to a point where it’s considered a mainstream technology service. The benefits can seem endless. It helps to reduce IT costs, it’s easy to set up, scales to your business’ storage needs seamlessly, provides customers, partners and employees with remote access from anywhere at anytime, it’s secure and security-rich. Expected to grow to more than $214 billion by 2020, cloud computing has become a catalyst for capturing new business value.

Similarly, social networking for business has exploded over the past several years. Forrester Research reports that the market opportunity for social enterprise apps is expected to grow at a rate of 61 percent through 2016, reaching $6.4 billion. Once viewed as a tool for students and teens to connect with one another, businesses are now adopting similar concepts to better connect their employees, partners and clients and to transform globally. These organizations are transforming into social business as every department, from HR to marketing to product development to customer service to sales, are using social networking the way they use any other tool and channel to do their job.

They’re integrating social networking tools into traditional business processes to fundamentally impact how work gets done and to create business value. They’re deepening customer relationships, generating new ideas faster, identifying expertise, enabling a more effective workforce and ultimately driving their bottom line.

Imagine what could happen if you were to marry cloud computing and social networking.

Many organizations, of all shapes, sizes and industry, are already doing so and creating significant business value.

For example, within the RICOH Company, Ltd., an international supplier of office and industrial equipment, the Business Development Center is collaborating in the cloud creating products faster with an expected improvement in cycle time for new product introduction of 20 percent. Chefs at Newly Weds Foods, a world leader in food ingredient technology, have reduced department travel and meeting costs by 10 percent. Strategic Decisions Group (SDG), an international strategy consulting firm, has also achieved more than 60 percent cost reduction in their Asia Pacific e-mail system costs, all thanks to using cloud services.

‘Colleagues in Care’ Global Healthcare Network (CIC) is using social networking tools in the cloud to virtually connect medical workers and volunteers from around the globe. Using this technology, the volunteers and those on the front lines taking care of patients are armed with an online medical knowledge system that includes treatment options, clinical pathways, and best practices specific to the situation in Haiti. For example, doctors on the ground in Haiti now have immediate access to information. Previously, a healthcare worker typically had no access to a specialist to consult about a specific medical condition. They can now immediately determine how to best care for a patient directly in front of them, at the same time collaborating with colleagues to determine more population-based strategies of effective care.

Colleagues In Care is using IBM cloud-based social analytics and collaboration services to provide their global network of healthcare volunteers with immediate access to critical data and information for the current healthcare needs of the Haitian citizens.

Organizations like Colleagues in Care, Neiman Marcus, University of Texas El Paso (UTEP), Strategic Decisions Group (SDG), Hindustan Motors, Bonduelle and Apave have chosen the cloud to help drive social business adoption across the enterprise. These organizaions are seamlessly collaborating, sharing information and ideas, resulting in increased efficiency, improved productivity and in the case of CIC changing the very fabric of healthcare delivery in an areas devastated by earthquake.

Social and cloud are opportunities that organizations are realizing can’t be missed, they’re becoming must-haves that businesses can’t ignore. Have you taken advantage?

Click here to view the embedded video.

Technorati Tags: cloud, social business, social networking

By Rich Hume, General Manager of IBM Europe

In an ever more globally integrated economy, Europe has headlined one of its key competitive differentiators: Research and Development.

A fact acknowledged by Horizon 2020, the European Union’s ambitious € 80 billion program for research and innovation.

Part of the drive to create new growth and jobs in Europe, Horizon 2020 will see projected EU research investment increase by as much as 46% compared to the current EU research programs, when it begins in 2014.

That’s no small bet.

As it stands, the EU’s current round of research investment funding is expected to create around 174,000 jobs in the short-term and up to 450,000 jobs and € 80 billion in GDP growth over 15 years.

This program will promote research to tackle the biggest societal challenges facing Europe and the world. Looking at the EU’s track record, appetite for a smarter planet is evident.

EU-backed research projects include a 26-partner international consortium in France, which demonstrates how the impact of CO2 absorption by oceans may affect marine resources and food security.

In Spain, a research project based on collaboration between local and German participants saw the construction of the first large-scale commercial solar thermal power plant in Europe. This uses new methods to concentrate the sun’s rays and produce heat later converted into electricity.

These projects, by their very scope, duration and complexity are intensely collaborative affairs.

Somewhat uniquely, they highlight an ability to bring researchers and businesses together in Europe to address challenges and apply science to deliver smarter solutions.

Europe may have more than 20 nations and about 200 spoken languages; but there is little doubt about its ability to work in partnership in order to innovate.

A two-millennium cultural heritage, sustained investment in skills and world-leading universities provide the platform for this collaborative research tradition.

IBM too, recognizes the power of research collaboration in Europe.

In Denmark, we are part of the EU EcoGrid project, developing a smart energy grid that will balance the supply of renewable energy sources, such as wind power, with peaks and troughs in national grid demand.

Our Zurich scientists are providing the supercomputing power for the Netherlands Institute for Radio Astronomy. Together, they will design computing systems required to process the immense volume of data generated by the Square Kilometer Array – the world’s largest and most sensitive radio telescope.
In a decade-long endeavor, this telescope will ultimately look into the Big Bang, the origins of the universe and perhaps even answer the question every sci-fi fan wants to know: “Are we alone?”

Today though, we mark the first anniversary of the opening of the Zurich-based Binnig and Rohrer Nanotechnology Center, a collaboration with ETH Zurich.

Today IBM celebrates the one year anniversary of the opening of a nanotechnology research center in Zurich, Switzerland. IBM Fellows and Nobel Laureates Drs. Gerd Binnig (left) and Heinrich Rohrer (right), whose pioneering work paved the way for the study of nanoscience, join IBM Research Senior Vice President Dr. John Kelly III to inaugurate the center, a joint collaboration with university partner ETH Zurich. (Patrick B. Kraemer/Feature Photo Service)

Nobel laureates Gerd Binnig and Heinrich Rohrer were recognized in 1986 for inventing the scanning tunneling microscope, which paved the way for nanotechnology research as we know it.

At the center opening a year ago, they discussed the highs and lows of their research work – but evidently from their lively, joint discussion, they were never, ever “alone”.

Technorati Tags: Binnig and Rohrer Nanotechnology Center, Europe, Horizon 2020, IBM Research, nanotechnology, Zurich

Ronen believes that this line of thinking could lead to important breakthroughs that will help us improve everything from transportation systems in cities to environmental protection regimes.  “I’m dreaming of an ultimate game theory engine–a miracle engine that helps us make better decisions,” he says.

He is one of six scientists who recently received the prestigious Godel Prize, which is awarded each year  by the Association for Computing Machinery for academic papers what contribute significantly to scholarship concerning algorithms and computing theory. The ACM cited Ronen and his co-author, Noam Nisan, along with the authors of two other papers, for laying the foundation for growth in algorithmic game theory.

Ronen and Nisan authored the first version of their paper  in 1999, and have developed their theory since then. They coined the term “algorithmic mechanism design” to describe a new way of taking on problems in systems that include self-interested participants.

They explored the fact that glitches arise when people attempt to apply conventional computer science thinking to complex systems like the Internet, utility grids and urban transportation systems. Typically, when people design computing algorithms, they seek to optimize the systems they’re addressing to be as efficient and effective as possible based on their design goals. So far, so good. But problems emerge when they approach systems operating in the world as if they’re going to behave like computing systems, which follow the rules that are written for them. Every social, business or economic system includes individuals and organizations that have their own self-interests in mind when they interact with the system. ” Instead of simply acting as instructed,” Ronen says, “such entities are likely to take advantage of quirks in the solution and utilize them on their own behalf. And That kind of behavior can undermine the solution.”

Consider a transportation scenario. A city with severe automobile traffic problems decides to design a congestion pricing system to change the behavior of individual drivers and reduce traffic jams. The city leaders set up a new tolling system in an effort to discourage truckers and non-commuters from driving on major highways during rush hours. But, as a result, drivers in large numbers leave the major arteries to avoid tolls–bringing traffic on city streets to a standstill.

The theory of algorithmic mechanism design aims to provide mathematical tools for coping with such situations.

Here’s how it works: Game theory aims to evaluate situations in which participants act strategically and create mathematical models that help designers produce solutions that address the diverse interests of the parties involved. When designers combine game theory with computer science, Ronen says, they are better able to write algorithms that take those variables into account. At the same time, machine learning, a branch of computer science, has the potential to make game theory models produce more accurate predictions of what will happen in real-world situations.  Machine learning makes it possible for computing systems to become smarter as they encounter additional data.

Ronen cautions that it will take a lot of time and effort to meld computer science and game theory in this way. But he’s hopeful. “You have to work in many small steps, but the potential is huge,” he says.

Technorati Tags: Amir Ronen, Associating for Computing Machinery, IBM