Posted by Nathan
Tibco is one of those really important companies you've never heard of. The software company processes staggering amounts of data: Every transaction for Amazon, FedEx and Ebay. Every time at iPhone is activated with AT&T. All $1.2 quadrillion processed annually for the Chicago Mercantile Exchange.
But Tibco's CEO, Vivek Ranadivé, has a plan that goes far beyond simply processing data. He wants to use it to make companies smarter--and not in small, incremental ways. From the fascinating Esquire profile:
"I have this idea that math now trumps science," Ranadivé says. "The simplest example is the thermostat in your house. You don't need to have a Ph.D. in weather. Your thermostat simply looks at the temperature, and if it gets cold, it turns the heater on. And then the minute the temperature gets too hot, it turns the heater off. You don't need to be a weather scientist to do that, okay?"
Here's a quick case study of this philosophy at work for Indian telecom giant Reliance:
Reliance was adding something like three million wireless customers a month, but it was also losing about a million and a half, Ranadivé says. It hired Tibco to fix things. Tibco found that if a customer experienced six dropped calls in a twenty-four-hour period, he almost always switched providers. Reliance started monitoring every dropped call, and any time a customer got to five dropped calls in a day, he would receive a text message offering him free SMS messages if he topped up his prepaid card — if he resubscribed, essentially.
"Problem solved," Ranadivé says. "I don't need to be a psychologist and know why they're switching after six calls and not ten or two calls. Math is trumping science."
Here's another:
In Las Vegas, a casino might learn that when a customer is down $900, he's likely to walk out. So when the customer is down $800, software flashes, and a floor manager can tap him on the shoulder and offer him a prime reservation at the steakhouse and four tickets to a show for him and his family. The bettor, refreshed and pampered, can resume his bad luck later.
Are you scared yet?
That was a nice article, the one from Esquire, thanks for linking it here.
Posted by: Suzy Bae | 04/19/2012 at 03:22 PM