Smartphones, the internet and IoT devices have made data abundant, ubiquitous and far more valuable. Virtually every activity today at home – browsing the news, going for a run or heading to the shops – and at work – weather, traffic congestion, buying behaviours – creates more raw materials. Yet like oil, if unrefined, it cannot really be used.
This is the challenge Alteryx addresses, and what has driven strong YoY revenue growth (42% in 2015 and 59% in 2016) that culminated in Alteryx’s listing on the New York Stock Exchange at the end of March.
In an interview with Information Age, Dean Stoecker – co-founder and CEO of Alteryx – discussed the importance of data analytics in tapping this fairly new, and extremely beneficial resource.
The man who is helping some of Britain’s biggest firms, charities and public sector organisations to make sense and act upon their data – including Unilever, Sainsbury’s and The National Trust – the challenges businesses face in unlocking their data and the ‘new oil’, the differences between UK and US when it comes to attitudes towards data amongst business and the impact data can and is having on organisations.
Can you explain what Alteryx does?
Alteryx is a leader is the self service data analytics space. What we have is an end to end platform that unifies the analytics experience and puts this platform in the line of business, because that is where the context exists.
It then allows analysts in a code free environment to blend and analyse the data any which way they can. It doesn’t matter if it’s big, small, structured or unstructured.
Then we allow the quants, in a code friendly space in the same platform, to be able to write complex algorithms and be able to publish them out in meaningful ways so that you can operationalise models through APIs and make machine learning embedded in the business.
How do you differentiate Alteryx from its competitors?
First and foremost we are a platform, and so it is hard to compare us to point solutions. Culturally, the CDO from the bank brought us in as a data quality product. He said I had to sell it that way to get you in.
The reality is that it is platform, and you would have to have five or six best of breed point solutions strung together to match us. So, we almost never have direct competitors.
In terms of specifics, how are you seeing the way data is being treated impacting the organisations that you help?
It’s massive in two ways. One is, we drive enormous operational efficiencies. Most of our customers report back a process that might have taken them a hundred hours usually takes five minutes.
These workers get the majority of their time back. The reason for that is analytics is 80% data prep and 20% analysis. This platform gives them back 80% of their time, so they can now ask better questions, dig deeper into the insights and ingest more data. So, operational efficiency gains are the first ways we see impact.
The second is just driving top and bottom line growth through better insights. A lot of our customers will report ridiculous changes. One of our retailers in the US drove in six months through hyper local merchandising £177 million gross margin.
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We have an airline that just completed a project where they are hedging fuel: where they work out how much fuel is needed at every airport for scheduled and unscheduled flights. Using analytics, they produced massive improvements in their hedge play. While they were doing that in operations, the guys in loyalty flyer programmes [attached to the same airline] they had an $80 million savings by predicting accurately which passengers were or were not going to regain their miles. So, they made predictive analytics models to help them achieve those savings.
Are there any challenges in unlocking the potential that data can bring to businesses?
Yes, there are lots of challenges. Most of them, if you look at digital transformation in general, I think the task of a chief data officer is to gain the networking effects of people, data and technology. And the data and the technology are pretty easy now – we spent the last dozen years building our platform, and we’ve spent the last five years talking about big data, but until you put the two together you’re never going to get value.
The missing link to all this is the CDOs challenge of somehow getting that networking effect of people, that means driving a data and analytics culture in an organisation. The biggest problem is people, a cultural change is needed.
I met with a bank earlier who is adopting Alteryx, and their CDO told me that my aim is to liberate analytics across the enterprise. He said my technique to do this is by finding all the curious and creative analysts who and provide them with an analytics platform.
With new regulations coming into place, like GDPR, is there a different attitude to data protection and cultures from the UK to the US?
Almost identical. In fact, what I’m seeing is that as we move more and more from systems of record in IT, to systems of engagement in line business. The line of business starts consuming more and more content from a variety of sources that IT doesn’t even know about.
We did a survey last year with Harvard Business Review, where we asked analysts how many databases would you need for any analytic outcome: 94% needed more than one source of data, and only 6% had all their data stored in an enterprise data warehouse. That tells you that IT has already lost control. This data is everywhere and now, to try and bring it under control people are moving towards agile, semantic layers, or data cataloging services.
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Regarding GDPR, it is important to be able to control the asset, know who is touching it and how they are using it. Alteryx Connect is a solution that enables this capability.
It also represents a social setting so that people can vote on the solution, recommend it – a Trip Advisor for data, which is what you need now because there’s just so much.
Everything now is social, and I’m hearing more and more people saying that analytics is social. The power is not in what you know, it’s in what you share. I think the millennials in particular get that, and this is forcing the Generation Xers and Yers, and the baby boomers to sit up and pay attention.
Everyone is kind of coming into the mix and we’re seeing worry now and address data governance.
Are companies just scratching the surface in terms of what data can bring to their organisations?
I think we are at the early stages. As soon as you start to see the IoT take off more and more, you’re going to see analysts in their free time creating new data sources from combining existing data sources.
And they’ll start socialising those, maybe monetising those and I think the consumer – the data creator – will become more powerful, and as consumers we’ll start monetising our data at some point, because it is valuable.
The ultimate value of content is when it becomes ubiquitous. And the only way it can become ubiquitous is if you marry it with software and analytics services, with humans in the mix.