Global CEOs name XBRL for More Useful Corporate Reporting

The Global CEOs of the top six accounting firms have called for more forward-looking information in financial statements.   They point out that financial statements give a rear-view mirror, whereas investors ought to be given more quality forward looking statements. The firms say XBRL, or Extensible Business Reporting Language, is the answer. It enables users to ask "What if" questions, construct graphs, make peer comparisons and view information in any language, currency or even different GAAPs like IFRS or US GAAP. It also makes possible daily reporting rather than reporting on the obsolete quarterly basis.

Read more at: http://www.moneycontrol.com/news/business/corporate-financial-reporting-getsnew-look_253364.html?utm_source=ref_article

AI and Big Data will Enrich Corporate Strategy

The power of data analytics has become a major element of corporate strategy. Many companies are struggling with the issue of how to convert the vast quantities of available data to competitive advantage. This has been the impact of big data, accelerated and complicated by the outpouring of IoT data that is permeating the cloud. The challenges of identifying relevant data, and lining it up with corporate strategies requires an unprecedented scale of intelligent computing power.

While companies grapple with these issues, the field of Artificial Intelligence is powering up and is about to pass the big data parade and combine forces with it.

AI is coming into its own as the vehicle for handling big data analytics in a way that will enrich corporate strategies. Such phenomena as the impact of weather on supply chains can be grappled with using AI to implement data analytics. For more on this idea, check this link.

The Open Data Exchange is Active

The Canadian Open Data Exchange is an active organization that is devoted to the idea of making public a variety of data on an open basis. That means making data available in an electronic form that can be used easily by the public for analytical purposes. It's a global movement and Canada is in the forefront of it. Check on their progress through this link.

The Fourth Industrial Revolution

A concept getting lots of attention at Davos is that of the Fourth Industrial Revolution, a concept formulated by Klaus Schwab, Founder and Executive Chairman of the World Economic Forum. Here is how it was described there:

"The First Industrial Revolution used water and steam power to mechanize production. The Second used electric power to create mass production. The Third used electronics and information technology to automate production. Now a Fourth Industrial Revolution is building on the Third, the digital revolution that has been occurring since the middle of the last century. It is characterized by a fusion of technologies that is blurring the lines between the physical, digital, and biological spheres."

The concept is borne out by the current burst in technological innovation, including artificial intelligence, access to huge amounts of data, widespread use of mobile communications devices, and the emerging and converging areas of bio and nano-technology, which ultimately may have the biggest impact of all.

The fourth industrial revolution will challenge many of our precepts about economic behaviour. It will perpetuate and perhaps intensify the digital divide, and place even more importance on the demand for highly skilled talent and less demand for unskilled labour. This of course will create more social tensions. It will create new challenges for education, government and business, all requiring a culture of constant innovation to survive.

All of this means challenges ahead. May you live in interesting times!

For a good summary of the discussion at Davos on this topic, please click this link.

iXBRL - How it Really looks and feels

XBRL International has added a new page to its website providing examples of statements coded in iXBRL. They show clearly how it is human readable - in fact looks exactly the same as any other financial statement - and also, how the embedded XBRL component can be shown and used. A few moments on this page will add tremendously to most people's understanding of iXBRL.

iXBRL is the big thing in terms of smart data for financials. ESMA recently mandated it and it is being used in the UK along with numerous other countries, and is being considered in the US. We can expect that iXBRL will be the main vehicle for presenting financial statements over the next few years. It demonstrates a new level of maturity in the use of XBRL.

For the new page, click here.

What is the role of IT in Analytics Governance

Some effort these days is being put into the question of what is the role of the IT department in handling analytics in the organization. There is an acute awareness of the importance of analytics to successful modern business. However, the question around IT is classic. Should IT lead analytics or simply support it.

There are really two major elements to analytics. One is the availability of technologies that might be useful to the business. The other is a hard-nosed definition of what analytics would be useful and needed.  

At the risk of over-simplification, IT should support the identification of the technologies that will meet the needs of the organization and the business functional leaders should identify what analytics are needed. This calls for strong coordination and that is where a Chief Analytics Officer comes in. A prime role of the CAO is to liaise between functional departments and IT to ensure an effective match between needs and technology.

For more on this issue, check out this link.

ESMA Chooses iXBRL as Single Electronic Format

Earlier today, the European Securities and Markets Authority (ESMA) announced that starting in 2020, all publicly listed companies in the EU that report consolidated IFRS financial statements must provide them in Inline XBRL. The decision was made primarily because the use of Inline XBRL enables a single document to be both machine-readable and human-readable.  Steven Maijoor, ESMA Chair, said “Financial reports are crucial for a full understanding of a company’s situation and moving to electronic reporting will facilitate analysis, comparability and accessibility of issuers’ financial statements." "We believe that the vast pool of free, structured financial information that will emerge once electronic reporting starts will trigger technological innovation. The Inline XBRL format has the potential to bring financial reporting into the digital age.” This is an important announcement for the community, and XBRL International strongly supports this move towards improved business reporting across Europe. We'll have much more on this in tomorrow's newsletter.  Read the ESMA press release and the feedback statement detailing responses to the consultation paper.

Data Analytics Disappears

It has sometimes been said that you know a technology has succeeded when it disappears. That means it has been embedded in regular day-to-day applications such that it is no longer visible to the user even though it is being used. A good example is HTML, the mark-up language used to create websites. At one time, people learned to code in HTML in order to create websites. Now that is not done any more because user friendly tools and templates exist that enable the users to create their website more effectively than ever without even seeing the HTML code, although it is still the backbone of most sites.

Analytics is being embedded in a large number of applications in just this way. People will be using data analytics every day, but will not need to see it or learn it as a separate application. Instead they will use it as part of their regular activities.

One good example is Salesforce, which now incorporates Tableau such that the power of Tableau fueled analytics can be used as part of sales force analysis. Numerous other examples are coming out as analytics becomes a part of SaaS services feeding into many applications.

All of this shows just how fast data analytics is evolving and how quickly it has become mainstream. For more on this development, click this link.

Information increases the complexity of life

Pew Research has released a major study exploring the effects of information overload on peoples' lives. The findings indicate that more people felt that information complicates their lives than felt that they feel overloaded by information. This finding held despite gender, age, ethnicity, income level, educational attainment, etc. The study also found that digital tools help in dealing with information overload. This was supported by 81% of the respondents. On the positive side, 79% felt that information gave them more control over their lives.

There is, however, an indication that there is widespread awareness that some of the information is not reliable. Nevertheless most people (80%) felt that they are able to quickly determine if it is unreliable. It was not clear, however, what criteria those people used to determine whether information is reliable. A study of how people determine this could be quite revealing. We know that false news, unchecked information and unfounded opinion proliferate on the internet. We are not sure what effect this is having on the perceptions and actions of the readers. For a summary of the study, check the Pew website here.

Securing the Internet of Things

The US Department of Homeland Security (DHS) recently issued a strategy for securing the Internet of Things. This was in response to s string of attacks that demonstrate the vulnerability of internet connected "things" to hackers and the breach of information security and privacy.

The strategy is an important document and sets out a number of principles to be followed.
The first one, that security be included at the design stage, puts manufacturers on notice that the products they make must be more secure before they are sold. For a copy of the announcements and the Strategy, check out the DHS website.

Free Software an Entry Point into Data Analytics

Would you or your organization like to venture into data analytics but can't afford the time and expense of formal training? A useful approach might be to start using free data analytics software. There are some available that have good functionality and can be used for basic data analytics. Of course, it still takes some time, but it may be that the process will yield results more quickly.

Some of the free products that may be useful include Microstrategy 10 by Microstrategy, H2O.ai, KNIME, and Google's Tensorflow. It may be hard to choose one, but you never know until you try.

The Position of the CDO in the Organization

Many companies over the past few years have developed the position of Chief Data Officer (CDO), often placing that position in the C-suite. However, exact organizations vary, as one would expect, since organizations vary in their need for data management.

A common aspect of data management in modern business, though, is that data, including big data, along with the infrastructure needed to handle and analyze and, most importantly, put it to good strategic use, is a growing and even critical phenomenon.

Nevertheless there has been debate about whether CDO's should even exist, whether they should report to the CIO, CFO, or the CEO. The roles of the CIO (chief information officer) and CDO have been evolving, particularly in terms of their relationship to the strategic aspects of the business.

It has been obvious that technology has pervaded all aspects of business over recent years. That being the case, the activities of the CIO directly affect all strategic and operational areas of the business. Accordingly some activities that at one time were traditionally CIO activities have been spun off into the functional areas, with the CIO acting as coordinator. At the same time, the CIO has assumed more of a strategic role, working with various functional areas, such as marketing and finance.

Along comes the CDO, with a knowledge of data management, data sources, data infrastructure needs and the importance of data to particular functional areas. Clearly the CDO needs to operate at a strategic level in cooperation with the affected functional areas. One challenge, therefore, is to avoid duplication of effort.

To some extent duplication is not an issue, since the CDO is focused on the data more than the infrastructure and the CIO is more focused on the infrastructure rather than the data. There is a role for both, therefore, at the C-suite table, but their roles need to be clearly defined. And they need to work together.

To have the CDO report to the CIO will likely take away some of the benefits to the organization of advanced data management, so both should report to the CEO.

According to a recent report by the Gartner Group, this is the dominant trend.

An Era of Machine Intelligence

Gartner Group recently released their annual list of the top ten strategic trends in business. These trends focus on new technologies and how they are being used. They tell us a lot about how technology is shaping our world.

One of the major underlying themes in the list they produced this year is that of intelligence. It is clear that your technology is going to be much more intelligent in future and be able to interact with users on a much more intelligent basis.

By intelligent, they mean an ability to receive input and draw conclusions from it, make decisions and recommend courses of action.

Artificial intelligence plays a big role in this trend and is already being embraced by many companies. So we will see smarter devices in the world of the Internet of Things, as well as smart apps that can make decisions on the basis of data and other input. With the growing usage of oral input to computers, where it is predicted that in the relatively near term, most interaction with computers will be oral, combined with the greater intelligence of computers, we will see the prospect of being able to discuss problems with our computers and come to better decisions. Add in virtual reality and it is possible to foresee an ability to interact in such a way that all sensory perception is used to help in analyzing data, something that could be a big help in coping with big data.

As always, there are pros and cons of these developments. Technology has already replaced a lot of jobs but smarter computers will be able to replace a lot more. So far, most of the jobs replaced have been of the menial variety - repetitious and simple. However, as the intelligence of computers grows, more complex jobs ill be replaced, including some of the traditional professions, like accounting, architecture, many aspects of law and even medicine. But new professions are being created. We already see a strong demand for data analysts. And we are beginning to see a demand for machine trainers - devoted to providing direction to that intelligence.

The question one has to ask is - when will computers be given the right to vote (sic)??

Next Generation Technologies for Mobile Commerce

Mobile Commerce has been one of the fastest growing aspects of electronic commerce. It involves the use of smart phones, tablets and other mobile devices to conduct commercial transactions.

While mobile commerce has been growing, often smaller companies are unaware of the potential for enhanced marketing techniques or if aware, are fearful that such techniques will require too much of an investment in technical IT resources.

Enhanced marketing techniques depend on adopting mobile apps that enable some interaction with the customers, such as trying out products in some way, perhaps on a virtual basis, or enabling location based services to gain certain benefits.

The idea is that the mobile devices generate data that can be revealing about the actions and preferences of the customer.

Collecting such data is becoming easier with the development of new apps that involve some such interaction.  However, the issue that arises is how to make use of these data. That's where big data analytics, particularly predictive analytics.

The ability to implement predictive analytics on big data gathered from a wide variety of mobile devices is something that takes some preparation but is becoming increasingly important to the success of mobile e-commerce and therefore to the success of most companies selling products to the public.

Customers will expect marketing efforts directed their way to be customized to their needs and habits, and this is only possible by having the company adopt mobile apps that can collect big data and develop the ability to use analytics to generate those customized marketing techniques.

Frost and Sullivan recently released a useful research report titled "Next Generation Technologies for Mobile E-commerce" which explores these issues and provides some useful guidance. Some interesting summaries of this report can be found at Information Week and on the Frost and Sullivan website.

Mobile Commerce, big data analytics and customized marketing are coming together to create important changes in customer relations.

Scotland to Start Stock Exchange Using Blockchain

Scotex, The Scottish Stock Exchange, is seeking to raise as much as 15 million pounds ($18.4 million) to start a new regulated equity market next year, according to a statement on Thursday. Executed trades will be processed by Blockchain, the distributed-ledger technology that drives bitcoin. For more on this, click here. And here.

Needing an Infrastructure for Big Data

Anytime there is need to handle data, there is a need for an underlying infrastructure. The data needs to be gathered, organized, stored, processed, and used. In the case of big data, a particular infrastructure is needed, and it often involves tools like Hadoop, Hive, Spark and visualization software. The basic elements are the same as any data, but the tools and capacity are different. Without a proper infrastructure, big data will lose some or all of it value.  Some more detailed thoughts can be found in this article.

DDD - The Move Away From Intuition

Data Driven Decision making is taking hold in large companies. Not all, but many. This according to a survey carried out by Harvard, Stanford and the US Census Bureau.

Companies have access to more data than at any time in history. They are learning to use it and finding that the quality of the decisions to be better than the largely intuitive decisions of the past. This applies in manufacturing, marketing and other areas. There is a growing preference in many organizations to make fact-based decisions rather than those based just on opinon. For a summary of this research, check this link.

The New/Old Role of Libraries

New research into the nature and role of libraries confirms that libraries are here to stay as a vital part of our communities and that they are changing forever. The days of libraries being built around rooms full of books are drawing to a close. The new libraries feature digital reading, classes in technology use, places to do research using computers and safe havens for study and contemplation.

A majority of survey respondents believe that libraries need to emphasize the use of technologies, like computers, tablets and smartphones. They include the use of 3-D printers among the skills that libraries should teach. They also believe that libraries can play a role of helping people to learn what information they can rely on, something increasingly difficult in this age of social media. Follow this link for the report on libraries 2016.

Free Predictive Analytics Software

Predictive Analytics is an increasingly useful tool for business to assess risks and opportunities in some organized fashion. It doesn't necessarily provide answers but can often offer useful insights. Free software can provide a inexpensive but potentially useful way to venture into the world of predictive analytics. Here is a summary of some of the more popular free software available, such as R, Orange, Rapidminder, Anaconda and others.

The Basics of Predictive Analytics

For those who are getting into predictive analytics, a useful article by Eric Seigel, founder of Predictive Analytics World, provides a number of definitions that are useful to understanding the basics of predictive analytics. Many applications of predictive analytics have emerged in recent years, including in auditing, finance, marketing and others. Some effort is required, such as reading , taking courses, etc, to gain a level of knowledge that enables useful applications. However, knowing the definitions of such terms as Predictive analytics itself, predictive models, uplift models, vast search and others is a starting point. The article can be found through this link.