The term "business intelligence" (BI) dates all the way back to 1958 when Hans Peter Luhn, an IBM researcher described business intelligence as "the ability to apprehend the interrelationships of presented facts in such a way as to guide action towards a desired goal."
Now that we're in the era of big data, business facts are everywhere - often to the point of being overwhelming. Making sense of big data requires extracting relevant data, understanding how that data relates to other data, and using these insights to move the business toward its goals. Business intelligence is indeed alive and well over a half century after the term was born. However, many companies use BI without a strategy, making it less effective than it can be.
Why Should Businesses Create a Business Intelligence Strategy?
"A Business Intelligence Strategy is a roadmap that enables businesses to measure their performance and seek out competitive advantages and truly 'listen to their customers' using data mining and statistics."- Guy Garrett, Achieve Intelligence Limited, Brighton, East Sussex, United Kingdom (SAS Global Forum 2012)
Business intelligence without a goal can certainly yield insights, but it will never get you where you want to be because you've never defined your destination. In order to get the most out of the business data available to you, you first need to know where you're going. Once you know your destination, you can plot a course that will get you there despite the many roadblocks that get in the way. With a business intelligence strategy, you can make solid business decisions based on facts that align with your overall corporate vision.
Think about your own business for a moment. What type of information assets do you have? How are you using them to grow your business?
An automotive repair company might have customer records, auto service records, and customer satisfaction surveys. It would also know what makes and models of cars each customer currently owns. In addition, it might have access to external data such as factory recalls, marketing lists, and consumer behavior models. That's a lot of data for a small business - and it's just the tip of the iceberg. Plus, as time goes by, those information assets will grow. If not harnessed, that data could quickly become unmanageable.
It's not just a matter of categorizing data; it's also about using it intelligently to accomplish business goals. In our car repair example, some of that data is more valuable than other data. The value depends on what the company wants to accomplish. For example, if the company wants to be known as the local BMW specialist, it could use external marketing data to target BWM owners in the community or it could use BMW service bulletins and its own database of customers who own BMWs to proactively remind them about upcoming or recommended service.
As you can imagine, the larger a company becomes, the more information assets it must manage and leverage. Companies with a business intelligence strategy in place are in a better position to make and measure progress toward their goals than those lacking one.
As with any journey, roadblocks and obstacles can get in the way of reaching your destination. Below are a few common roadblocks you may encounter:
- Getting the right information - It may be difficult to gain access to the information you need. For example, a hard-to-navigate data or reporting environment may discourage users from accessing data.
- Spending more time collecting data than analyzing it - Are your top analysts spending their time analyzing data or are they too busy writing code to extract the data they need?
- Data quality - Data quality is often treated as an afterthought, yet strategic decisions will likely be made based on the figures generated making data quality a crucial factor. "Dirty data" needs to be identified and cleaned.
- Performing analysis after the fact rather than proactively - While it's helpful to find out what went wrong or where you succeeded, proactive analysis allows you to make strategic decisions.
- Unclear business performance benchmarks - Measuring progress requires clarity both in terms of where you want to go and where you came from. If you're not clear on either, it will be difficult to measure your progress.
- Underperforming business intelligence and data warehousing solutions - Information can become too siloed which can lead to accuracy and definition conflicts. In addition, many companies use multiple business intelligence tools that do not work together or align with business needs. As a result, business intelligence solutions may not be as effective as expected.
Creating a BI Roadmap
Creating a BI roadmap involves identifying where you are now, where you want to go, and how you will get there. It also involves:
- BI Scope - What is the scope of your business intelligence plan? What will it cover? What won't it cover? How does it align with your business and operational goals? Defining the scope of your BI strategy will help you to maintain focus and stay on track.
- Stakeholder Identification and Management - Once you know the scope of your BI strategy, you can then identify and manage stakeholders.
- Structure - How will the business intelligence system be structured? Should you use a cloud-based solution, self-service solution, mobile solution, all of the above? Do you prefer a hosted solution or would you rather have on-premise BI tools? What type of user permissions do you need? In addition to addressing these and other structural issues, you will likely need to update your existing infrastructure to support business intelligence and information delivery. Infrastructure changes will largely depend on the BI solution you choose.
- Training - Next, you'll need to address how you will ensure that your team has the skills needed to successfully deploy, manage, and use your business intelligence solution. While your team will certainly need training on your selected BI solution, it's smart to evaluate related business processes as part of your move to BI. Older processes may no longer be relevant. Your BI roadmap should definitely include business process evaluation and improvement as well as skills identification and training.
- Implementation - Finally, your BI roadmap is starting to take shape. You've defined its scope, identified stakeholders, described the BI architecture, and addressed important issues such as training and business process improvement. Senior management and other key stakeholders have agreed to the plan so it's now time to implement it. Start by creating a work breakdown structure so that each step is identified, budgeted for, and scheduled. Assign the right person to each task and keep everyone involved and informed.
Creating Value in Your BI Strategy
Did you know that, according to a Gartner report, nearly 70 percent of business intelligence projects failed to deliver the requirements of their users in 2012? They failed for a variety of reasons including cost overruns, poor data quality, lack of business involvement, long delivery cycles, and a lack of understanding of the BI solution's value.
For example, it's not unusual for BI purchasing decisions to be made from an IT perspective. A BI solution may be easy to implement or play nicely with the existing infrastructure, but does it deliver what the business needs? Will it be able to deliver the insights the business needs to gain a competitive advantage? Is it suitable for the company's current data maturity level? Will it grow with the business? Will it serve as a solid foundation for future BI endeavors?
Before you can create value, you must define it. The definition of value varies from one company to the next. By defining your priorities, you can more critically evaluate business intelligence solutions to determine whether or not they support your values.
In addition to value definition, creating value in your business intelligence strategy involves ensuring that both business and IT are involved. IT needs to be involved to ensure delivery while business needs to be involved to define what needs to be delivered.
For example, IT can certainly set up real-time reporting, connect to a diverse set of data sources, and display results visually; however, these analytics capabilities shouldn't exist in a vacuum or be provided as an independent function. According to Mark Andrews, Program Director of Data Warehousing for IBM, "This business intelligence information must be made available as part of a particular business process or activity that a user is involved in, and within the context of the broader business activity." By working together, true value can be created and delivered to end users.
It's also smart to roll out your business intelligence solution in phases to avoid overwhelming users, set expectations, train the team, and allow everyone to become comfortable using data to make better, more informed decisions.
Creating value in a BI strategy involves looking beyond the basics, costs, and marketing buzz. Business and IT must work together to define your priorities and then critically evaluate solutions to ensure that they support and facilitate them. You must also get buy-in from your users, train them, and empower them to make better decisions based on relevant data. With a focus on value, your BI project will be positioned to exceed expectations.
InetSoft offers easy, agile, and robust business intelligence software that supports your business values. Visually-compelling, interactive dashboards, reports, and data mashups deliver insights and empower users, resulting in greater adoption. InetSoft's visual analysis technologies coupled with efficient information access maximizes self-service and benefits business users, IT administrators, and developers alike.
Over 3,000 organizations around the world, including 25 percent of Fortune 500 companies, count on InetSoft business intelligence solutions. Contact us to learn more about creating business value within your own BI strategy.
InetSoft Technology Corp
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Piscataway, NJ 08854 USA
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Bibliography / Works Cited
InetSoft Technology: CEO Joins a Discussion of Business Intelligence Strategy -