The demand for business intelligence (BI) solutions is at an all time high at large enterprises as well as smaller organisations.
Times are tight and companies are investing good money to access the intelligence they need to achieve greater savings, lower costs and make more effective decisions. Happily, technology and BI skills have advanced to a point where there's a BI solution to suit almost every pocket.
Says RDB Consulting's BI Consultant, Gerrit-Jan Albers: "RDB's specialisation is databases, BI and warehousing and over the last three years one thing has become increasingly clear: the biggest BI business wins – whether aimed at optimising processes, operations or the company's bottom line — are not achieved with the biggest investments, but with the smartest planning.
"Post the credit crunch last year, organisations are investing in BI solutions – they want better graphic display, want to be able to roll down to greater detail without having to go to a third party to build the report they need. Forecasting is an especially important goal, as is driving use of BI reporting and analysis down to the lower levels of an organisation."
But 'vanilla flavoured' BI is not for everyman in the organisation, Albers notes. To achieve stated goals at line manager and operator level, the information needed to make smart decisions at these levels needs to be available in a format relevant to the user.
He explains: "Executives primarily want top level information and building a basic Key Performance Indicator (KPI) dashboard based on information extracted from the company's main transactional systems will in these instances suffice. For lower levels of the organisation, more detailed information is required, however. While a sales manager may want to know how the company's range of products is performing, a salesperson for a particular line of products or a specific region will need to know: how that line of products is selling, what stock is available, if it is selling well in a specific region.
"To extract this kind of detail it is very likely that greater integration of information systems will be necessary. In addition, if everyone is suddenly allowed to create their own queries and reports, it will put a strain on the system, slowing production systems and the operations of the company itself. A data warehouse that contains data marts (e.g., procurement, logistics, sales) — thus needs to be built. This requires a lot of system integration, costs money and requires specialised skills."
These costs need to be weighted against ongoing business losses that result from 'gut feel' decision making. For example, the cost of placing and then relocating stock is high, as is the cost of holding and then potentially having to destroy perishable stock that does not sell, or failing to take advantage of smart logistics. These are just some examples of unnecessary waste common to many businesses.
Investment in BI is never wasted, however. Building a BI system is an ongoing project for any company, Albers notes. "The better you build and the smarter the architecture of your BI system – the greater the value the business can derive from available business data," he notes.
"But," he adds, "the ultimate success of a BI solution depends on the users – their ability to ask the right questions and act on the intelligence gained. It is rare that simply buying and using off the shelf BI software with standard reports will offer sustained value to the organisation, even if you buy the very best most expensive software out there to achieve your goals."
A prime example is the value achieved by a large mining company from an Excel and SQL Server database solution. "Excel is inexpensive, staff were familiar with its features, and it sufficed to aggregate the required information and build the necessary reports. The win was instant, met the company's budget and provides a clear enough query and report 'template' for use if the company needs to further sophisticate or scale the solution.
"What this really means is that there's a tool for every budget – technology has quite simply advanced to a point where standard interfaces and sophisticated features on even low end applications enable effective BI. The technology you select will depend on the size of the solution you want to create – i.e., how many data sources you wish to extract data from; how much data you will be manipulating and the size and location of the user base."
This makes another opportunity apparent. Says Albers: "SMEs can share the costs of implementing BI. One company can acquire the license for reporting, the server can be hosted by a trusted third party, and a data warehouse can be built for each company. The license cost can then be split between the companies."
The most important questions to ask when assessing or planning a BI project are, according to Albers: is this BI project within budget, where does the company want to go with it, can it grow, how fast, can it evolve into a bigger solution, does your BI solution provider truly understand your business?
A sound foundation is also necessary, he notes. "Companies need to attend to the basics, such as ensuring they have sufficient hardware capacity, clean data and a sound data warehouse. In addition, there is such value in involving specialist from the beginning," he emphasises. "While the trend is currently to make use of a number of smaller organisations that specialise in different areas – e.g., data migration, server development – be sure these service providers will conduct an 'open' relationship with you understand your business and can be trusted."