The number of businesses outsourcing traditional marketing functions is expected to jump over the next 12 to 24 months from 9% currently to 21%, according to IBM’s ‘Australian Business Process Outsourcing (BPO) Research 2012’.

The report, built from a survey of 216 businesses, rates traditional marketing as the fourth most outsourced business process, ahead of digital marketing, which is currently outsourced by a surprisingly low 6% of businesses. Intention to outsource online marketing over the next year or two is also lower than for traditional, with only 17% anticipating that they will seek external providers.

The greatest share of business for traditional marketing service providers came from the telecommunications and transport industries, with 33% and 31% of businesses in these sectors outsourcing at least one marketing process. In the future, suppliers should look to government and education sectors as their primary sources of outsource business in the future.

Adoption and future adoption of traditional marketing outsourcing across sectors

When it comes to online marketing, telecommunications and transport businesses are the highest current adopters of outsourcing, while, looking forward, telecommunications and banking, financial services and insurance (BFSI) will increase their outsourcing the most.

Adoption and future adoption of online marketing outsourcing across sectors

The BPO report goes on to break down a number of sub-processes for both traditional and online marketing. Market research is the most commonly outsourced traditional sub-process, with 74% outsourcing this function, and also ranks as the sub-process most likely to be outsourced in the future.

Currently 32% outsource content development and 16% outsource campaign management; both of which are expected to be outsourced by more than one in ten who are yet to do so. Customer service is outsourced by 11% of business currently, but a further 21% intend to in the next 12 to 24 months.

Adoption and future adoption of traditional marketing outsourcing by sub-process

Digital marketing is an area where businesses are looking for support due the volume, velocity and variety of data that comes with the territory according to BPO CRM Leader for Growth Markets at IBM Australia, Peter Monk. “The data complexities around it are not something that organisations can or want to get their head into,” Monk says. “They’re saying it’s simply not why they’re in business.”

Social media has been a great influence in driving usage outsourcing of online marketing according to the report. However, the online marketing sub-processes most commonly outsourced currently include multi-channel management at 50%, analytics at 29% and content management at 29%. In the future additional businesses are most likely to outsource content management (21%) and reporting (21%).

Adoption and future adoption of online marketing outsourcing by sub-process

The research also examined online marketing strategies, discovering that most organisations (59%) outsourcing the function have some sort of online marketing strategy. However, these still appear to be in their infancy, with only 7% of organisations that currently outsource online marketing having a constant engagement strategy, and 14% having an active use strategy. One in five do not have a strategy in place and a further 21% have a passive online presence.

Get your copy of the Australian BPO research study now.

Go to – http://thesauce.net.au/sauce-research

By Martin Conboy of The Sauce

Most Australian companies don’t want to send business functions offshore, but many intend to outsource a lot more roles in the next two years and the primary aim isn’t to reduce costs, according to our recent survey.
The survey found 83 per cent of companies would prefer not to send work offshore.

However, increases in outsourcing were expected across a range of areas including finance and accounting, HR, marketing, reporting and analytics and print and document management.

In Australia, there are many businesses both large & small that have outsourced or are about to outsource a number of business processes. There is no doubt that the outsourcing market has burst out of the shadows in the last two years.

Outsourcing has become a valuable tool for businesses to deploy in a hyper competitive market. The drivers of change, from a lift & shift approach to a more considered business expansion opportunity means that organisations are beginning to see that by outsourcing their non-core business processes, they have a lot more time to spend on a core competencies; the work they know best.

Up to now outsourcing has received a bad rap. As a result, most Australian businesses, possibly out of fear of the unknown, have not properly explored the opportunities that it presents. Often mistaken for ‘offshoring’ it is only now that outsourcing and offshoring are having their day in the Sun.

As Ken Henry (Australian Secretary of the Department of the Treasury) noted as far back 2006: “Australia has much to gain from off-shoring – most obviously through a lowing of costs to business and ultimately consumers. Opposition to ‘offshoring’ is based on the same protectionist nostrums that were once used to support the high tariff wall that a generation of Australian policy makers has been busy dismantling. It may be dressed in a different garb, but it is no more respectable.”

Being apposed to importing services through offshoring is like being opposed to imports. It would mean if we followed it to its logical conclusion that Australians would be unable to have iPhones (Heaven forbid) travel overseas (Say its isn’t so) or drive well made Japanese or sexy European cars. (Wouldn’t happen!)

Australians don’t bat an eyelid by taking advantage of our high foreign exchange rate and grabbing a bargain on line, so how is that any different from buying a service online (via the internet).

Asia’s surging growth – including high demand for our commodities – has placed us close to the engines of global wealth creation. Prices for the commodities Australia sells to the world have never been higher, providing an unprecedented opportunity. So apart from reaping the benefits of outsourcing be it locally (In Country) or off shoring we should be spreading the love around to our Pacific neighbours.

Having said that there are some challenges as well, a recent report conducted for Deloitte Consulting by the Economist magazine indicated that across the Asia-Pacific region one of the major risks facing corporations was staff attrition and lack of human capital .in fact on average 25% of companies across the Asia Pacific region indicate this is a major area of risk.

Its no secret that we have a skills shortage in Australia and many BPO service providers have perpetual ‘Want’ adverts on all of the job boards. It follows that many companies are being pushed down the path of outsourcing and off shoring just to access available staff with the right skill sets.

Our own recent BPO Research report (The Australian BPO Report 2012) http://thesauce.net.au/sauce-research supported by IBM and Fuji Xerox Australia has revealed some interesting insights from the buy side of major Australian organisations. “ The report reflects the rapid pace of change and maturity that the Australian BPO industry has undergone over the last decade. It has evolved from pure cost cutting, to improved efficiency, to strategic transformation and an important part of business strategy,” said Russell Ives, Director, Global Process Services, IBM Growth Markets.

“The report highlights that Australia’s senior business community are aware of the benefits of outsourcing and decision makers are looking towards higher order benefits such as improving financial flexibility, driving free cash flow, strengthening customer satisfaction, increasing market penetration, expanding into emerging markets and taking advantage of the opportunities with a global economy,” said Ives.

Most outsourced business processes
The report highlights that while outsourcing decisions in the contact centre and customer service functions were by far the most widely reported, usually in a negative way, customer service functions are actually not among the top three of most outsourced activities. Human Resources, and Printing/Document Management were found to be the most outsourced functions (15 and 18 percent), followed by Finance and Accounting (13 percent). In the next 12 to 24 months, HR outsourcing is expected to grow to 23 percent.

Marketing and customer relationship management
Outsourcing of marketing processes including CRM (Customer Relationship Management) is predicted to grow by 21 percent within organisations that already outsource elements of this function. Of particular note is that online marketing is expected to nearly triple, growing from 6 percent to 17 percent, signaling major opportunities for organisations offering these kinds of services.

Cloud computing and outsourcing
Another trend emerging in the outsourcing sector is the increased use of cloud services. A large number of organisations are now considering cloud computing (35 percent) when making the decision to outsource; yet a marginal proportion (15 percent) of organisations have adopted cloud computing at an enterprise level as part of their outsourcing strategy.

The report highlights that increased mobility and Cloud will create a ‘free agent’ revolution in service outsourcing as the ability to work from almost anywhere in Australia becomes possible using remote mechanisms. This is particularly relevant for the mining industry, which operates over vast distances. In these scenarios, the value of Cloud services is even greater when it can be tailored to accommodate the unique elements of a particular industry.

So in conclusion we believe that Australia has moved past BPO 1.0 (Lift & Shift) and is sitting somewhere between BPO 2.0 & BPO 3.0 with its foot on the accelerator.

Get your copy of the Australian BPO research study now.
Go to – http://thesauce.net.au/sauce-research

Catherine Armitage and Nicky Phillips

There’s another mining boom you may have missed. It too involves paying young people six-figure salaries in their first jobs, and exploring deeper for resources that may have been previously overlooked. But it’s not about driving trucks or digging holes. It’s about building algorithms and crunching facts and numbers. It’s mining for data.

Big data is the new business black. It’s a catch-all phrase for the billions of transactions and other bits of information about their customers, suppliers and operations logged by businesses and governments the world over every day. Yesterday’s storage problem has become today’s strategic asset. Turns out there’s gold in them thar files.

“This is the biggest industry that people are only now starting to talk about,” says Anthony Goldbloom, a 28-year-old former Reserve Bank of Australia statistician who has moved his start-up data analytics business, Kaggle, to Silicon Valley where NASA is among its clients. “The whole place is big data mad. Industries like banking, insurance, and increasingly pharmaceuticals are competing on the back of predictive models that get built [by mining data].”

Enterprises are using data analysis not just to improve their everyday business processes, but also to build predictive models of consumer behaviour. Retailers, telcos, airlines, hotels, healthcare and credit card companies are among those with information-rich customer data. In Australia “only really leading companies have realised this as an opportunity”, Goldbloom says. To his knowledge, Telstra, Myer, the University of Melbourne and the New South Wales Roads and Traffic Authority are among those known to have applied large-scale data analysis to their operations.

A 2011 report by McKinsey and Company said using big data to drive efficiency and quality in the US healthcare industry could create value worth $US300 billion ($A297 billion) a year including cost savings. Using personal location data to sell services to individuals could “capture $US600 billion in consumer surplus”, the report said.

Global market intelligence company IDC has estimated enterprises will invest more than $US120 billion by 2015 in data capture and analysis across hardware, software and services. IBM is investing heavily, with almost 9000 “business analytics and optimisation consultants”, 400 researchers and a global network of ”analytics solutions centres”, aiming for $US16 billion in business analytics revenue by 2015.

“There is no end in sight. I think it is an endless opportunity,” says the company’s chief data analytics guru, Jeff Jonas. Among other things, he is working on what might best be described as a digital concierge service. Customers who opt to give the service access to their personal information – such as one or more of their social media accounts and their digital personal organiser – would receive timely and, according to Jonas, helpful prompts to guide their actions and purchases.

“It says, ‘I can see from your Facebook that you like Metallica, and I can see you will be in New York next week, and Metallica is there on the same night. Would you like to get a ticket?’”

“You could subscribe to a service that would be so precise in its prescriptions that you could feel like it saves you time and money,” says Jonas, chief scientist at the IBM Entity Analytics group. He acknowledges people’s possible discomfort at the idea of unsolicited advertisements, but insists users of the service would come to see it as “friendly” and “genius”.

Another company capitalising on the growing expanse of data, and one of IBM’s biggest rivals, is the Silicon Valley data-sorting company Tibco.

The company’s chief technology officer, Matt Quinn, says Tibco’s products aim to give clients the right information, at the right time, in the right place and in the right context.

One of its more unusual client groups, casino operators, use the company’s software to gauge gambler satisfaction. The system collects data each time a gambler uses their casino loyalty card – be it for gambling, purchasing food in the restaurant or paying for snacks from their room minibar – to create a pattern of their behaviour.

The system can see, for example, that the last few times a particular customer visited the casino, the customer stayed for two days and lost between $200 and $300, then promptly left the gaming floor, spent no more money and went home the next day.

“As a casino operator you don’t want that, you want to make people happy and spend more money,” Quinn says.

Enter Tibco’s event processing software. When the system detects the customer is falling into a particular pattern, such as a consistent losing streak that caused the customer to leave during the last visit, it sends an automatic note to a gaming floor attendant to offer the person a free meal, or ticket to a show.

The idea is to distract the gambler long enough that they’ll come back later and continue to play and lose money, albeit in more palatable amounts. While no Australian casinos use Tibco’s products, they are beginning to show interest, Quinn says.

Department stores, whose loyalty programs amass gigabytes of data on their shoppers’ every purchase, have also begun using Tibco’s event processing software to model their customers’ spending patterns and predict their next buy.

Quinn says the software would pick up that every year a certain customer spends a fair bit of money around the beginning of October, which could suggest they have a few birthdays around that time.

This would be a perfect time for the store to offer the customer a discount or voucher, a more effective and targeted marketing strategy than TV advertising and catalogues, he says.

“The systems we’re building are helping [companies] better understand who their customers are.”

Tibco products also analyse data to keep customers loyal.

In late 2010, Tibco bought the technology start-up Loyalty Lab, whose software platform specifies the best time for a company to engage customers in their loyalty program based on data it has collected on previous customer interactions. “It’s technology and psychology rolled into one,” Quinn says.

Specially trained loyalty scientists build systems that trawl through a company’s customer behaviour data to predict certain events, such as what might prompt a customer to leave.

Loyalty Lab’s director of global solutions strategy, Michael Greenberg, says for telcos, for example, there are several events, such as phone calls dropping out, the end of a contract, or more than two complaints, that suggest a customer may be getting ready to take their business elsewhere.

That is when Tibco advises the company to make contact with the customer and make an offer, Greenberg says.
While big businesses make up the bulk of Tibco’s clients, Nasdaq, major league baseball, the Department of Homeland Security and major hospitals also use the company’s data-sorting software.

In 2010, scientists at Melbourne’s Walter and Eliza Hall Institute of Medical Research began using Tibco’s visualisation software, Spotfire, to help identify new drug therapies for diseases such as cancer and malaria.

To locate potential drug candidates, the researchers run tests on tens of thousands of compounds each day, generating hundreds of thousands of data points for each potential therapy.

The coordinator of the medical research institute’s high-throughput laboratory, biochemist Kurt Lackovic, says the unit is capable of running 80,000 reactions a day.

Spotfire takes the results of each reaction and presents them in diagrams, making it easier for researchers to spot trends, outliers and errors rather than searching for a needle in a rapidly expanding digital haystack.

Hype notwithstanding, big data will turn out to be a useful value-adding tool rather than a ”panacea to solve everything”, says Robert Hillard, Deloitte Consulting technology lead partner.

The privacy issues raised by its use have yet to be resolved, he says. It is crucial that people are given the choice between opting in and opting out of the use of their identifiable personal data, he says.

Companies approaching customers need to be ”utterly transparent” about how they know what they know about a customer.

IBM’s Jonas, whose personal motto on privacy issues is ”don’t surprise the customer”, says it is important for people to realise how commercially powerful is the data that locates them in time and space, such as that communicated by GPS devices in cars and mobile phones. People are putting more data online about themselves than ever before, yet when signing up for the latest ”irresistible” service, few bother to read the terms of use, he says.

Read more: http://www.theage.com.au/technology/technology-news/data-miners-find-theres-gold-in-them-thar-files-20120511-1yi3q.html#ixzz1umzIvkI4

By Shaun Drummond

Most Australian companies don’t want to send business functions offshore, but many intend to outsource a lot more roles in the next two years and the primary aim isn’t to reduce costs, according to a recent survey.

The survey produced by The Sauce and endorsed by the Australian Business Process Outsourcing Association and two large outsource providers, IBM and Fuji-Xerox Australia , found 83 per cent of companies didn’t intend to send work offshore.

However, increases in outsourcing were expected across a range of areas including finance and accounting, HR, marketing, reporting and analytics and print and document management.

The smallest growth was in finance and accounting, with 13 per cent of organisations outsourcing now compared with 17 per cent within one to two years.

The biggest growth was in marketing, jumping to 24 per cent from 9 per cent, supply chain management going to 16 per cent from 6 per cent and reporting and analytics rising to 18 per cent from 6 per cent.

Seventy-one per cent said the main reason for outsourcing was global expansion, followed by “scalability” and “going green”, with 83 per cent of companies in manufacturing seeing it as a way to reduce their environmental impact. Reducing cost was one of the least cited to outsource at 21 per cent.

At a forum in Sydney on last week, participants from the ABPOA, KPMG, IBM and Fuji-Xerox said the increases were off a low base, turning around a slow uptake of outsourcing in Australia.

“One of the reasons Australia has been fairly slow moving is that most Australian companies sit in he middle of the bell curve, they are fairly comfortable,” said Peter Monk, the director of global process services at IBM Australia & NZ.

“I think we have seen a few companies who are laggards who have been forced to do something because business as usual won’t work.”

KPMG’s head of shared services and outsourcing, Michael Smart, said Australia was a long way behind the rest of the world in its uptake of BPO.

Part of the reason is that it is “inherently more difficult than IT because a business process has a lot more tentacles in an organisation – even finance and accounting, even though there are many providers that can deliver that more effectively and cheaply through global delivery models”.

Martin Conboy, president of the ABPOA, said there were four stages of outsourcing: 1.0, 2.0, 3.0 and 4.0.

The first stage is “lift and shift” of transactional functions which has been done over the past decade.

The next stage is “process re-engineering”, 3.0 is moving expenses from a capital expenditure model to an operational expenditure model, and cloud computing is part of that shift. 4.0 involves the outsourcing of data and analysis.

“From this research we have found [Australia] has just passed BPO 2.0, we are not quite at BPO 3.0,” he said.

Current and future trends in Business Process Outsourcing

Source: The Australian BPO Report 2012

The Australian Financial Review
Get your copy of the report HERE

By Phil Fersht

Boston-based Horses for Sources’ Phil Fersht with some interesting insights. In a two-part report he looks at the results of some BPO research that he undertook.

At the end of the day, it’s not all about outsourcing and it’s not all about shared services; it’s about focusing on how to globalize processes, how to transform finance (and other) functions, and how to govern it all in a global business services context. There is no dominant model; it’s more about achieving the right balance across all delivery models to achieve the best business goals.

In conjunction with global accounting body ACCA, We spoke to 682 large organizations currently running finance in either an outsourced or shared service framework (or both) – and the results are emphatic: those organizations relying predominantly on outsourced delivery, or predominantly shared services, are viewing their finance delivery performance much more skeptically:

Why do these results signal the decline of the “predominantly outsourced” model?
1) Expectations are clearly higher with outsourcing… and they’re not being met. Only the ability to meet compliance and regulatory goals (42%) is brushing up notably well with the outsourced finance functions. Everything else is mediocre-to-average, in terms of meeting finance performance objectives. This is because many buyers’ outsourcing environments are relatively nascent, and their expectations were likely set to a high level when they embarked upon their engagements. In addition, most governance staff can clearly recall what it was like before outsourcing, and find their new environment a struggle to get things ticking over like they were in the old days. Buyers are clearly finding it hard to make productivity improvements to their finance processes when they outsource heavily, with the main reasons being the cost and complexity of dealing with providers’ change-order processes and also the fact they the operational people running the engagements on both the buyer and provider side are too junior to make decisions. Instead, they get absorbed into the table-stakes of meeting SLAs and running things on budget. Other reasons we will discuss further in our upcoming Sourcing Blueprint document. Our concern at HfS is that if buyers and providers allow these relationships to stagnate, we could get left facing a dangerous commoditization of operational process outsourcing.

2) Shared Services delivery models aren’t faring much better. Those buyers sticking predominantly to a shared service model for finance are also suffering similarly mediocre performance levels to their outsourcing peers. Only their ability to standardize processes is really coming though as a major plus, with 52% experience really effective results to-date. Clearly, they find it easier to make tweaks to process flows and delivery quality issues. However, when you consider that most of these buyers have been doing shared services for an average time-span of 10-20 years, compared with 1-7 years for outsourcing, you have to conclude that a pure shared services model is not the best answer for those buyers seeking to continually improve their finance performance.

3) Hybrid shared services and outsourcing frameworks are reaping the best results. Those buyers operating hybrid SS&O frameworks are experiencing better finance performance in every single performance category. Clearly a strong, centralized retained organization that augments its shared services processes with outsourced options is enjoying the best of both worlds. Most notably, 54% of the hybrid buyers are finding genuine effectiveness with their ability to transform their finance functions, and similar proportions are encouraged by their ability to transform onto standard processes, meet compliance goals and even globalize their finance operations. Essentially, those buyers that are retaining more of their talent and working with their providers to help with achieving broader finance goals (at least initially), are developing their finance operating structure much more effectively. This indicates that buyers who leverage outsourcing to fulfill specific needs and blend it more effectively with their overall finance operations, are more comfortable with where they are going. At the end of the day, it’s not all about outsourcing and it’s not all about shared services; it’s about focusing on how to globalize processes, how to transform finance (and other) functions, and how to govern it all in a global business services context. There is no dominant model; it’s more about achieving the right balance across all delivery models to achieve the best goals.

The Bottom-line: Many buyers have little choice but to find GBS partners, or face a purgatory of inferior BPO and shared services.

Buyers need staff that is ready to embrace these new global services environments. We’ve been hearing many buyers talk about populating their retained teams with staff who’ve only really ever worked in a globally sourced environment. And on the service provider side, buyers need delivery teams, which can work with these retained teams to meet their business objectives, in addition to cranking out the administrative work. Should a provider fail to do much more than facilitate standard process delivery (yes, we all know they exist) the buyer needs to evaluate how to bring in external help to plug the gaps to globalize processes and work consultatively and strategically with the retained team.

We are now seeing the rise of Global Business Services partners to work with buyers in “process integration” roles, where they can help their clients’ retained teams manage their whole business services mix across outsourced, shared services and in-house models. This is not too dissimilar from the service integrator roles we have seen in the IT world, with some of the higher-value integrators stepping up to help their clients manage the whole morass of service delivery. However, unlike IT where it’s easier to disaggregate services and run multi-vendor environments, it’s a lot more challenging when you deal with business processes, hence we expect those buyers with provider partners which have invested in domain capabilities to have a major advantage over those providers which really can’t do much more than provide butts on seats.

We see a true divide developing between the providers only focused on standard delivery, and those that have high-caliber process experts on their bench. The problem is many buyers today do not discover how poor their provider is until after then signed the deal, and it’s not easy to put in requests for consultative help after they’ve outsourced. However, for many buyers, they don’t have a lot of choice but to start campaigning internally for funds to improve their current sourcing delivery frameworks because they are far too beholden to the capabilities of the provider they signed up with.

Essentially, if your provider is starting to sound and acts like a glorified staffing company, you might just want to open up conversations with GBS partners that can work with you to optimize what you have already invested in. However, we recommend you’re MUCH better off finding this out before you give them the kitchen sink.

By Michael Baker

The Australian BPO Report 2012 shows that online marketing will grow from 6% of major firms outsourcing online marketing to 17% in the next 1-2 years.
- Editor

The percentage of e-commerce sales in Australia is set to jump ahead in the next two years.

In the important November/December trading period in the UK last year e-commerce accounted for over 10 per cent of retail sales for the first time.

The momentum then continued breathlessly into the new year with online sales surging north of 11 per cent of the total retail takings.

Meanwhile, in the United States, e-commerce’s share of sales has still barely topped the 5 per cent barrier despite more than a decade of mainstream experience with the online channel.

This begs an obvious question: Why have the British embraced online shopping at the expense of conventional retail channels so much more than Americans? And importantly for Australian business – will Australia follow the UK’s e-commerce growth trajectory or the more subdued American one?

The stakes are huge for those heavily invested on the property side, such as retailers with stores, shopping centre operators, investors and the whole industry supply and distribution ecosystem.

The answer to the question is found in a place that is usually overlooked as an influence in the e-commerce arena, and yet exerts enormous influence right under the noses of everybody in the retail industry – the Australian and British planning bureaucracies.

Australia has come late to the internet party for a number of reasons, not the least of which are its technology-shy mainstream retailers and a parcel delivery infrastructure that elicits nostalgia for Cobb & Co. Even so, according to the most recent data from private sources, e-commerce as a percentage of retail sales in Australia is already about the same as that in the US and set to forge ahead in the next year or two.

So far then, Australia’s e-commerce growth profile is looking more like Britain’s than America’s. And as many Australian store-based retailers bemoan their slow start to 2012 and look ahead to another year of mediocre sales growth, many will blame e-commerce itself.

This is a false attribution. E-commerce is not the villain of this piece, neither is the high saving rate, neither is the weather, and neither – for heaven’s sake – is Spain’s fiscal crisis.

The reason real estate is losing market share to the internet at a faster rate in the UK and Australia than in America is that it was all planned that way.

In the UK, government planners have spent decades defending the High Street precincts by preventing the development of suburban shopping centres. The High Street hubs continued to crumble anyway and ultimately the regulators grudgingly allowed the development of some shopping centres, not out of any love for consumers but more because shopping centre developers were a ticket to economic revitalisation.

Nonetheless, the damage had already been done. UK’s shopping centre space per capita is now less than a quarter of that in the US and its total retail space per capita is less than half.

This has narrowed the choices available to British shoppers relative to the US and made online shopping vastly more attractive once the e-commerce infrastructure was put in place.

Australia’s planners have done an equally comprehensive hatchet job on retail development as their UK brethren, not just stifling competition by limiting the supply of floorspace but with prescriptive zoning practices.

This is exemplified by the obsession with herding businesses into ‘activity centres’ and even – in the case of the infamously-named ‘bulky goods’ centres – setting aside zones which lock out various kinds of retail formats.

These kinds of planning constraints have prevented the natural process of forging hybrid retail formats that evolve to meet the changing needs of shoppers in consumer-friendly countries.

The first major result of all this planning activity has been the strangulation of supply, which has left Australia with barely more retail space on a per capita basis than the UK. Result: fewer choices for Australian consumers and higher prices.

A second major outcome is that consumers are stuck with a retail hierarchy that is 30 years out of date, lacking a number of important formats that thrive overseas. Examples of formats missing from the Australian retail scene are power centres, retail parks, lifestyle centres, power towns, super-centres and, until recently, warehouse clubs. Factory outlet centres have just squeaked in under the wire, but have been mostly confined to airport land. Result: fewer choices and higher prices.

A third major outcome is the most common complaint you hear from international retailers wanting to come to Australia: the difficulty of getting appropriate sites, another corollorary effect of planning constraints. The injection of fresh blood into Australian retail from overseas has therefore been stifled by planning regulation as well. Yep, fewer choices and higher prices.

With all these strikes against the planning system, it’s small wonder that e-commerce penetration in Australia is set to follow the much more aggressive growth path of the UK rather than the more moderate path of the US where shopping options in the normal terrestrial channels have been allowed to flourish.

So, look for 10 to 15 per cent of sales to be accounted for by the internet in Australia within five years.
About the only thing that stands in the way of e-commerce now is Australia Post, which has evidently decided that the vexing ‘last mile’ of delivery is not its problem any more.

Leaving cards in letterboxes and installing lockers in its own branches are the preferred delivery solutions, keeping the onus on shoppers to drive somewhere to pick up their packages or have them returned to sender.

Michael Baker is principal of Baker Consulting and can be reached at michael@mbaker-retail.com and www.mbaker-retail.com.

Read more: http://www.smh.com.au/small-business/growing/the-ecommerce-explosion-its-all-in-the-planning-20120420-1xba3.html#ixzz1sd0BhGdg

By Sameer Murdeshwar

Last week’s Oscars had all the usual drama with the unforeseen winners and the expected list of movies winning the golden statuette. In the hours leading to the award ceremony, the Twitter-verse was abuzz with predictions and expectations from the event. And, all this time, a team from IBM was monitoring all activity on Twitter using a tool called the Senti-meter, developed in collaboration with the Los Angeles Times and the University of Southern California’s Annenberg Innovation Lab.

The Senti-meter tool tracked all the sentiments from Twitter before, during and after the Oscars to predict the winners and losers. This tool has been designed to crunch large amounts of real time data in seconds and predict public preferences. With more than 150 million tweets a day, this application has the capability to analyse public tweets and create real time dashboards of public sentiment. This technology was used for other major events as well including the Grammys, the World Series and the Super Bowl. 
 


Evolving nature of analytics


Analytics, as a technology, has evolved from sifting through existing data that has been lying around in servers for years, to a more proactive version which encompasses collecting data from various sources and producing up-to-the-second reports, analysis and trends. Services providers in this space must take a page from IBM and build capabilities which will allow them to churn out data using real time analysis.

Apart from Twitter, there are other platforms such as other micro blogging sites, social networks, blogs and forums to tap into, for social media driven online insights. Next generation analytics will be able to ignore online “noise” and focus on impactful online feedback. This service relies heavily on linguistic and semantic analysis to identify varying shades of sentiments (positive, neutral and negative) and identify sentiments which carry value. These include posts which have been retweeted / shared often, online clout of the user, the number of followers and other such parameters.



What’s in store in the future?


Social media driven analytics has far-reaching applications beyond the world of sports and entertainment. Fields such as news publications, retailers, electronics manufacturers, automotive manufacturers and brand experts can benefit from services to identify key issues that frame everything from marketing strategies to customer segmentation and brand sentiment. Social media driven predictive analytics represents a significant paradigm shift in how businesses interact, understand and discover actionable customer insights. Experts have predicted a 30-times fold increase in online data over the next decade, and this is the right moment for service providers to draw raw online data to provide real time decision support for their clients, and for the clients to harness this emerging technology to understand their customers better.

Sameer Murdeshwar, Analyst, ValueNotes Sourcing Practice
http://www.sourcingnotes.com/content/view/812/1/

In Australia 45% of major companies see the cloud as a significant influencer to outsource
Aust. BPO report 2012 – Editor

The inaugural Cloud Summit East Africa, proudly supported by the Kenya ICT Board, will be held in Nairobi from 5 to 6 June 2012. The strategic 2-day invitation-only event is hosted by international business-to-business conferencing company, Kinetic Events.

The event is aimed at IT professionals, senior decision makers and cloud computing experts from top companies in East Africa with a focus on how cloud computing is reforming the African IT market place. As a cost effective solution for businesses to acquire and use, the event will explore debatable issues currently associated with the global cloud initiative.

International investors have played a major role in boosting the African IT industry. By tagging along on Africa’s major broadband initiatives, investors can establish clouds that are strategically located in major cities across Africa.

In recent research; South Africa is considered fairly mature in cloud development, with total IT spending expected to reach an estimated $12bn (US) by the end of 2012.

Cloud computing trends will have a major impact on IT industries globally as an effective means to collaborate with peers internationally and offers longevity to information stored in the cloud.

Shannon Mackrill, Joint Managing Director of Kinetic Events says, “Cloud computing is rapidly changing the African IT industry and the way companies do business. The move from capital spending to operational spending, will offer an affordable way to access services globally.”

Undersea fibre optic cables have been implemented in recent years, resulting in the cost of broadband decreasing. African entrepreneurs are taking full advantage of this development by providing superior applications and services that were seemingly impossible to consider only 5 years ago.

With a global focus on computing, security and continuously evolving technologies, Africa has been placed in the middle of a global IT revolution. The summit will place the spotlight on cloud computing in Africa as one of the key global emerging markets for cloud services.

For more information, comment or photographs, visit www.cloud-eastafrica.com or contact Shaunei Meintjes on +27 21 555 0866 or shaunei@kineticevents.net. Follow @ITLeadersAfrica and @KineticEventsSA on Twitter for daily updates and news feeds.