Finnish company Houston Analytics has been selected as one of the IBM SPSS Modeler Partners highlighted on the global ICT giant’s website. The innovative Finnish company was already in the limelight in 2017, winning IBM’s Choice Award as well as the IBM Best Performing New Business Partner Award in Europe category. Houston Analytics was also a finalist in the EIT Digital Challenge, and featured in Forrester’s Customer Analytics Services Providers 2017 report, which positioned it among the major analytics players globally.
Another milestone in 2017 was the collaboration with Danish software company Agillic which resulted in the launch of Armstrong One, a subscription-based service in the cloud that predicts and analyses consumer behaviour. The service enables retailers to communicate more accurately with customers, for example by providing data when a consumer is most likely visit a particular store or website or will need to purchase something from the store again.
Inspired by data-driven management
The intellectual spark that has led to the current success Houston Analytics ignited more than 20 years ago when Syväniemi was a student writing a business studies essay and found himself fascinated by the topic of customer loyalty. In 2001 he started work in the category management unit of Kesko, one of the biggest retail companies in Finland.
“I remember already asking at the job interview what they were doing with the huge amount of customer data that they had. Soon I realised that it wasn’t very much. The customer target groups were carefully defined but this was hardly linked to the daily decision-making about product selections. People just used to come up with ideas from their heads about what the target customer might want,” he remembers.
Syväniemi and his team were inspired by the idea of data-driven management so that their work on retail selections, pricing, campaigns and product placement could more effectively implement the company’s strategy. Syväniemi revelled in the opportunity to use data mining and text analytics software applications like Clementine (later IBM SPSS Modeler) and others.
Analytics for new sectors
Houston Analytics was established in 2013 and won its first major contract after just three weeks in business. Having already used SPSS at Kesko since 2008, Syväniemi had no hesitation about partnering with IBM. The Houston Analytics team wanted to expand its experience from retail analytics to new areas after gaining experience from Kesko, and set their sights on a wider, cross-industry market.
“Some people said that I must crazy to leave a big stable company in the face of a recession, to do something that nobody understands. But I felt strongly that analytics was really going to take off soon and saw that there were not many service providers,” Syväniemi explains.
“In those early days, practically anyone who said they were doing analytics was actually focused on business intelligence reporting – cranking data manually without the analysis, prediction and optimization enabled by algorithms. We wanted to offer automated processes that were self-learning, easy-to-use solutions for specific decision-making points that served business needs, rather than providing services implemented through a company’s IT department.”
In a breakthrough project with Valmet Corporation and Teradata, Houston Analytics analysed data from 6,500 sensors on a paper production machine to develop a lifecycle model that was able to accurately forecast the servicing needs of the individual parts within the machine. This made it possible to significantly expand the service intervals and to reduce the risk of costly, unscheduled shutdowns.
Aiming for accelerated growth
Houston Analytics started its business by undertaking individual customer projects. In recent years, the company has also packaged many of its solutions into products that are available from the cloud or embedded into customers’ solutions as part of their products. With a growing customer base and products generating constant revenue, the Finnish company is now on the cusp of international expansion as data-driven management is increasingly adopted by companies of all sizes.
“The company has achieved strong indicators and recognition, so now is the time to step on the accelerator and to scale. We have several new partnerships and pilot projects currently underway in Europe and the United States, where our predictive analytics and optimization is linked to the partners’ services. We are calling this ‘embedded analytics’. One example is predictive budgeting which semiautomates the budgeting process and brings better results,” says Syväniemi.
In 2017, the Houston Analytics team was strengthened by the arrival of Colin Shearer, a data mining pioneer and the creator and architect of the Clementine system (now IBM SPSS Modeler), who had a long career at IBM. Shearer and Syväniemi have worked on joint projects over many years. Houston Analytics has expanded the use of the CRISP-DM process developed by a consortium led by Shearer in the early 2000s, enabling the utilization AI in business processes.
Seppo Heikura’s arrival on the Houston Analytics’ board of directors has boosted the company’s engagement with export and trade missions and chambers of commerce. Houston Analytics has participated in Business Finland’s export promotion activities over the past year and was chosen as a member of the Industrie 4.0 program organised by the German-Finnish Chamber of Commerce reaching out to German markets. Houston Analytics was also selected to Kasvun Roihu’s Grow to USA program for growth-hungry companies from Finland.
“It’s satisfying to go to New York and to hear from major companies that nobody else can offer the kind know-how that we have developed in Finland. Where we are today is the result of 20 years of passionate interest in analytics. Now with Colin in the team, we can also claim to be the world’s most experienced advanced analytics company,” says Syväniemi.
Visit IBM’s new SPSS Modeler website here https://www.ibm.com/products/spss-modeler. Scroll down to the partners’ band and you will see Houston Analytics as the first featured partner.
Picture: Antti Syväniemi, CEO, Houston Analytics