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As we defined earlier, our mission is “To provide best-of-breed Corporate Performance Management, Business Intelligence and Enterprise Reporting software and services that shorten the time to insight, allowing our clients to improve their decision-making and enterprise performance.”  This all has to be done cost effectively. How do you maximize your BI ROI? Let’s examine how.

Maximizing Business Intelligence ROI

BI For the Enterprise

Your organization has decided to invest in ways to improve the performance of the business. In Corporate Performance Management (CPM) terms, driving business performance means providing your information consumers with more efficient access to the critical information they need to make the business decisions that align them with enterprise goals. These goals are designed to:

*      Improve revenue, customer service, and competitive position;

*      Reduce costs and cycle times;

*      Improve operational efficiency

Objective

This paper’s objective is to offer you guidance as you endeavor to transform your corporate data into useful business information, readily available to the information consumers within your organization. The focus is to help you maximize the Return-On- Investment (ROI) by minimizing the Total Cost of Ownership (TCO) through best-practice implementation of your BI solution.

What is Business Intelligence…Why Do I Need It?

Business Intelligence (BI) is not a product that you can buy off the shelf. Business Intelligence is a goal that is achieved when the different information consumers within your organization are able to leverage the vast amounts of data that your company creates, to improve business performance.

Whether you are looking to up-sell and/or cross-sell your existing customer base, develop budgets and consolidate forecasts, identify best practices across your Sales organization, monitor Marketing campaign effectiveness, or track Call Center key performance indicators (KPI’s), you will find the need for a comprehensive BI solution.

How Do I Get BI?

Organizations that enjoy the benefits that BI promises recognize that they need more than a product to achieve their goal. They realize that success is still going to depend on how well they:

*      Implement The Information Value Chain

*      Manage The 3 P’s – People, Products, and Processes

“Business Intelligence is not a product that you can buy off the shelf. Business Intelligence is a goal…”

The Information Value Chain

Like a supply chain, raw data that is available in your organization must be transformed into information in order for it to be useful to your knowledge workers. The information must then be made available in a user-friendly context, like a report or an application, and delivered to the consumers by an efficient distribution strategy.

Tenet 1: The more efficiently you implement the information value chain, the better the chances of maximizing your ROI !

 

Figure 1: The Information Value Chain

As you run your business, your operational systems (ERP, CRM, GL/AP/AR, etc.) generate and capture detailed data…the raw material necessary for BI solutions. However, since these operational systems are capturing transactional information for the specific purpose that they were created, they are not aware that another system may be capturing different data about the same entity. For instance, your order entry system has captured a transaction where Mr. Smith from Acme Company has ordered 5 widgets, however, your CRM system is dealing with 2 outstanding customer service calls from the same Mr. Smith from Acme Company. While ERP systems integrate business processes, they do not do a good job of empowering and enabling enterprises with enough data for Business Intelligence.

Unifying Data

Data from many disparate data sources, including operational systems, spreadsheets, user databases, and 3rd party databases, needs to be consolidated and aggregated into a unified database to achieve the single version of the truth. This process, known as Extract-Transform-Load (ETL), is a major step towards the BI goal. The added-value that this step provides is:

*      A more complete view of an entity, like a customer;

*      More efficient query performance;

*      Relationships between entities are defined, ensuring correct results.

Acting on Information

After data is consolidated into a unified source (through ETL and a database), further value is added to the usability of it by creating an intuitive environment where end-users can access the data. There are many different types of front-end access tools that range from rudimentary data access capabilities to more complex data-mining. These tools fall into categories, such as:

*      Query and Reporting

*      OLAP

*      Data Visualization

*      Statistical Analysis

These tools have traditionally fallen short of the BI goal because they do not offer enough insight into the data itself, requiring the end-user to do more manual data analysis before identifying any actionable information. Additionally, they tend to be ‘one-way streets’, whereby the user can read the data, but has no ability to update it or modify it.

While data manipulation with today’s tools is relatively easy, it still consumes precious time better spent on primary job responsibilities. Therefore, these tools still find themselves in the hands of the power user, whose primarily role is to crunch and mine data for useful information nuggets that they can share with their end users.

The key to more ROI and lower TCO is empowering end users to consume the information more effectively through specifically-purposed business intelligence applications. These are applications that combine the features of Query, Reporting, OLAP, Data Visualization, and Statistical Analysis (as mentioned above) into a user-friendly interface designed with a specific business purpose in mind, such as a Forecasting & Budgeting application that facilitates consolidation, or a dashboard application that tracks key metrics that align corporate and departmental goals.

BI Applications provide the user an interface that presents more insightful information and a simple workflow that guides them through the process, to enable faster and easier adoption without the need for specific training. Additionally, applications that enable users to modify the data with write-back capabilities, enables the real-time enterprise.

“The more efficiently you implement the information value chain, the better the chances of maximizing your ROI!…”

The 3 P’s For BI Success

As you have seen thus far, solutions that enable business intelligence capabilities involve a lot more than simply purchasing and implementing technology. Once you have identified an area where a

BI solution will fit; you need to align the 3 P’s - People, Products, and Processes.

 

 

Tenet 2: The more effectively you manage the 3 P’s, the better the chances to maximize your ROI!

The people involved in the BI solution are the first critical leg of the BI success “triangle”. The end-users will have knowledge of the business issues and the type of solution that they need. The power users will know the data, including where to find it, how to manipulate it, and who needs it. Additional people may involve consultants or technologists who are architecting and building out the technical framework that will automate pieces of the Information Value Chain.

The products involved in the BI solution are the second critical leg of the BI Success triangle. After identifying the data sources, you will engage in product selections for the technology that drives the framework for the Information Value Chain. Critical product-related pieces include an ETL function, a database platform, and front-end data access technologies to support your BI initiative. t

The processes involved in the BI solution are the third critical leg of the BI success triangle. You will be identifying the processes in use today, and how they will change when the new BI solution is in place. Examples of processes that are usually reviewed include:

*      Business-oriented processes, such as: how up-sell/cross-sell campaigns are done today. What business units are involved? How do they identify target clients?

*      Data-oriented processes, such as: what are the transformation rules? How often will we update the new database? When do we want end-users to modify data? How will data be made available to the end-users?

In addition to the above processes, a cross-functional project team will be organized to handle the development of the components that make up the Information Value Chain. The development team will have a different set of processes, based on their favorite System Lifecycle Methodology. This is a methodology used by application developers to bring a system to market. It would involve phases such as Scope, Design, Build,

Integrate, Test, and Deploy.

Recommendations For Managing the 3 P’s

People

When it comes to managing the first leg of the triangle – People - the old adage, “Too many cooks spoil the soup” comes to mind. A small team of no more than 4 or 5 people should be sufficient to meet the system objectives, and is nimble enough to get the job done quickly. The team should consist of:

*      Power User

*      Business User Representative(s) – 1 or 2

*      Technical Architect

*      Expert Consultant

The Business User Representatives will be the main visionaries for the BI solution. The Power User will be the primary developer of the solution. The Technical Architect will know how to deploy software solutions within the enterprise framework. An Expert Consultant, familiar with your selected BI technology, will help you overcome any initial learning curve and provide best-practice ideas, helping you get the solution implemented on time and under budget.

Products

When it comes to managing the second leg of the triangle – Products – less is better. BI technology providers are strongly pushing the concept of BI tool standardization for the enterprise. What they most often mean by this is to select their technology as a de facto standard, such that all BI solution development will be implemented using their tools. This is the desire of all the traditional ETL, database, and front-end access tool vendors, as it promotes vendor lock-in. While a de facto standard is a paper standard, vendor lock-in will ensure that they can extract maximum license fees from you, while you have built yourself into a long-term commitment to their technology, making it difficult for you to switch.

 “The more effectively you manage the 3 P’s, the better the chances to maximize your ROI…”

 

Figure 2: Traditional BI per user/CPU pricing scales exponentially. Especially when applied to additional ETL and Database components, as well as the “modular” sale of front-end BI application components.

Additionally, they would like you to standardize on their integrated tool suites. A tool suite is really a collection of interoperable data access tools that can be configured to work together. However, do not be fooled – tool suites are often licensed individually by component, by either a Named User License (NUL) or a CPU-based license model. They are also only tools, whose shortcomings were mentioned earlier.

Licensing interoperable components - ETL, database, and front-end tool suites - from different vendors is often termed the ‘Best of Breed’ approach. This approach, combined with the license model employed by the individual vendor, will scale your license fees exponentially as you deploy to more users, making it more difficult to measure ROI.

A more reasonable approach is to find a single vendor that offers a toolkit that includes these core components, with the ability to build and deploy applications with no additional license fees, thereby getting a fix around your costs, a necessity for measuring ROI.

Process

When it comes to managing the third leg of the triangle – Process – rapid, iterative prototyping is the key. Traditionally, the build-out of the Information Value Chain tends to work from left to right, i.e. first the ETL work is done, then the database work is done, and lastly, the end-user environment is put together.

In this traditional method, there is a significant time gap from the inception of the project until an application is actually made available for the end-users. Often, so much time has passed that the business need has changed, or the development team has hit a deadline and is scrambling to get the data access solution in the hands of the users. The end result, after much time has gone by and much money has been spent, is that the end-user environment is not what was promised, and fails to meet the expectations of the business users. In fact, according to BI industry analysts 50% to 60% of data warehouse projects meet this fate!

The organization should seek an easy-to-use, yet powerful toolkit that enables them to rapidly prototype the end-user BI application. By working from ‘right to left’, the organization can quickly envision the solution that will meet the business requirements. They can quickly structure the ETL and database components to integrate the data required to enable the application. Modifications to the prototype are done quickly, in an iterative manner, so that the business users can see that their

business needs are met as they evolve.

Conclusion

In summary, it is known that enabling end-users with BI capabilities empowers them to make better business decisions that improve business performance. Therefore, to maximize value, you should strive to get this capability into the hands of as many of your knowledge workers as possible. Your Return-On-Investment (ROI) will be determined by:

*      How much value you can actually recognize, over time. This represents the benefit to your organization, and can be a combination of top line growth, cost reductions and cost avoidance.

 

*      How effectively you can manage the 3 P’s when implementing the Information Value Chain. This represents the ‘costs’ that you can control.

The organization that successfully minimizes costs, while maximizing value, will maximize the ROI.

 

At UBCsoft, we provide the software and services to manage your business and maximize your ROI.  We have two products that assist your corporation.

 

                                                              

 

 

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Last modified: 03/19/08