In this week’s podcast Thomas McGrath, CEO of Cognition, chats to Graham and Kevin about how big data can unlock operational trapped value in your business
Who is Thomas McGrath?
He is Chief Executive at Cognition, a company specialising in the industrial Internet of things and big data strategy solutions. The aim is to reduce costs to improve efficiency and minimise wastage.
Thomas resides in Dublin, Ireland and worked for several consulting companies before launching Cognition. He suggests his accent has part Cockney because of 15 years living in London.
What question does Cognition answer?
Cognition captures data from your organisation, gets it out of the organisation, puts it into the Cloud, and generates a level of intelligence to make more management interventions. All this as opposed to businesses fumbling around in the dark. It exploits cloud and database processing power, previously not available.
What sort of information?
Thomas works with asset intensive organisations. For example regulated business, collecting data from assets, anything from pumps to buildings. Performance information. Energy, management control systems. Anything with 1s and 0s. This populates the jigsaw of the organisation.
Large organisation struggle to tap into this sort of information. There is a natural evolution of data capture. Oracle, provides legitimacy to the FD. Others on the C-suite, have accountability, but haven’t had assistance to make the right interventions.
Cognition makes the algorithms based on this data. The data arises from monitors, sucking out the information. A typical client will say they are drowning in reports, some say they don’t measure the right things and some nothing.
Applying Intelligence to the data
The intelligence often just sits inside their heads. They don’t have the sophisticated data evaluation in place. It’s about better performance.
Systematise routines in a business. Put metrics in systems which you don’t have. Monitors and control systems in silos. Cognition takes all the information to understand CAUSE and EFFECT. You start to make interventions that are intelligent.
Management hate NOT making decisions without information. Businesses do have rich data in their business, so Cognition help companies get at it.
Big Data allows you to look at issues you haven’t measured previously. The unknown unknowns. Donald Rumsfeld.
The reports you have now are the things you know about. To really get into operational improvement, data science can help you uncover stuff that can seriously help business. This is primarily an operational data science interface.
Cognition focuses on big data analytics to inform users to be more informed before they make that decision. It is resource usage and resource allocation.
Energy is a variable cost. There are things you can do to get usage down. Big Data has been used very successfully. If you want to reduce energy. How and when do you use energy. There will be lots of areas that are NOT looked at in this holistic fashion.
Without exposure to the real breakdown of costs will help organisations price their products better, because the usage will be recognised.
Monitor and track a lot more activity in the organisation, which means the FD will be able to have much more informed perspective.
Releasing Trapped Value
Trapped wind can be terribly painful. Anything that releases that trapped value. Cognition provides the right tablet to release the trapped value. Cognition advises how to understand how to avoid trapped value BEFORE it happens.
There are levers that drive cause and effect. If they pull a lever, what is the quantifiable effect. Resource or asset utilisation. How much water should you use, for example.
If you can, attach £signs next to each intervention.
Ultimately, it is a long Regression Formula. Lots of variables and possible outcomes.
Who is making progress?
GE uses sensors on airplanes and turbine engines.
The challenge is to move this operational intelligence to every part of the Profit and Loss. Companies are not there yet. But companies are using information better. The challenge is in adding new sources of information, and moving analysis into completely new areas. There are people doing sophisticated things, made easy by technology and the cloud.
Kevin provided the example of a simple sensor with a smiley face and sad face that workers touched on their way out of the factory. This went to the cloud and allowed staff to invest effort into addressing issues quickly and adroitly.
What is the root cause of staff morale and under-performance? Thomas suggests measure everything. This would provide a lot more intelligence to make proper changes.
Is the balanced scorecard of the future dynamic?
Measure what needs to be fixed. Keep measuring until it is fixed, then measure something else. In the past the key tool for measuring was excel and humans! In future you take the information, add to the cloud and do the regression analysis and use algorythms.
Thomas would like the big organisation data insights and apply them to smaller businesses. To facilitate better competition by using benchmark information. He seeks national level competition improvements.
The larger organisations will make the initial investments. But to get the right level of traction, there needs to be more of them. This will help disseminate the processes Cognition advise on to smaller companies.
As a management consultant, Thomas is used to deploying people to fix performance. Instead or as well, by tracking data across the organisation, for compliance, for performance, it will allow companies to make better decisions. It is the intelligence within that data that is valuable.
It is less about human change management, but systems, workflow track and trace, identifying problems, with a cost. Projects can then by reviewed and iterated until performance improves.
Taking Cognition to Market
They don’t have the scale. So, they are client side advisers, working through a strategy and business case and taking the action to become an intelligent company. A trusted adviser.
They want to be agnostic. However, as this whole area emerges, their business strategy might become a less agnostic player. Now, they advise people and go away and source the relevant technology. However, they could be an all-in-one solution.
Thomas has focused on where the value lies. Technology is becoming commoditised. Sensors may grow, but the rate per sensor is likely to drop.
How does he sell to the C-Suite?
Trapped value. Start with a specific pain point. What are the things you are worried about? They’ll now. What data do you have now and in the future?
Start at a specific point. Energy down. Reduce cost of reactive maintenance. My training course rooms are left empty too often.
Quantify the benefit. Install hardware to understand the problem.
Kevin mentioned, enter the conversation already going on in the operations director’s mind.There is a huge future. That’s why Thomas is spending a lot of time with clients.
As a positional strategy, Thomas is trying NOT to associate Cognition to acronyms like SMART, because that is now aged.
Strategically, Cognition has partnerships in place to provide the solutions, but without incurring the cost of data centres. There is also no personal data. Therefore, there is no link to GDPR.
Operational Big Data is the oil of 2017
It can be an awkward conversation if your data foot-faults the operational directors plans and performance.
This type of information if people ACT upon it. It is a real challenge for management. Ultimately, you want your staff to be as intelligent and informed as possibly. The alarming capability lets you know when an activity you are doing falls out of tolerance. So how can you become more intelligent, to save costs.
What’s in store for Cognition in the Next 100 Days?
- Convince clients of their need to go down this route.
- Structure technology and teams.
- Partner relations.
Dublin is a very dynamic city for data centric start-ups. Access to investment is less hard, but it is time consuming?
Focusing on clients will put Cognition in a holistic position. Bisodol fixes trapped wind, you feel fantastic as an individual. That’s what Cognition can deliver by releasing trapped value.
Their challenge is NOT being too closely associated with certain types of technology. They develop the connected enterprise. It’s not about getting a brands technology into a client’s business.
What does Thomas know about Boris Johnson?
Thomas was head of performance at the London Development Agency. He worked with Boris when he was Mayor of London. Thomas describes Boris as a great guy. He gets credit for Boris bikes, albeit a previous mayor’s idea. He also got rid of bendy buses. It was a great insight of the challenges of running a massive city.
Contact Thomas McGrath