Business Intelligence (BI) for all Seasons.

How can business improve performance and reduce costs by taking advantage of the latest trends and technology in Business Intelligence? Discover why Business Intelligence is becoming an integral part of every ERP solution.

Digital information is exploding — and doubling every 18 months. Given that information is the lifeblood of many organisations today, businesses must take a strategic approach toward information strategy and architecture to ensure scalability, reliability and an infrastructure that delivers on business needs today, as well as into the future.

Business intelligence (BI) refers to skills, technologies, applications and practices used to help a business acquire a better understanding of its commercial context.

Knowledge is power

When it comes to managing their information, business intelligence (BI) is becoming top-of-mind for most businesses. It tops Gartner Inc.’s list of technology priorities, and rapidly is becoming the core of mission-critical applications. Most Global 2000 organisations are acutely aware of the need to better manage information; many companies consider it a corporate asset. But while businesses may recognize the value of their information, they struggle to manage and organise this content explosion of images, e-mail and presentations.

Important in making greater use of information throughout an organisation is providing individual business units with the BI tools and resources to make decisions. According to Craig Boddington from Alchemex, "Business intelligence will become an integral part of any ERP system, not just the ability to run reports but a more advanced level of business analysis, standard reporting is just not good enough, users want the opportunity to make decisions after interactively assessing trends."

As companies focus on spreading BI tools throughout the organisation, operational BI is becoming a top priority. Steve Fouche, Director of Orchid Systems, forecasts, "Business Intelligence is going to become more accessible to everyone in larger organisations and not just key decision makers. In the SME space Business Intelligence will become the rule, rather than the exception."

Operational BI pushes business decisions closer to the business event by putting timely information into the hands of operational-level workers for decision-making. Indeed, Gartner estimates that by the end of 2009, 90 percent of Global 2000 companies will have mission-critical BI and data warehouse systems - up from less than 25 percent in 2007.

Improving business performance

Numerous benefits may stem from pushing BI capability and resources through the organisation, rather than having a specialist unit collecting data and producing reports. Boddington comments, "Operational efficiency can be attained by reducing overheads, less time spent on manually formatting data into a reliable structure to generate reports and more time spent on making strategic decisions to improve the business."

Operational efficiency is all important in tough times and this has become a key focus for organisations which are weathering the global financial crisis effectively. "Business Intelligence can be used to highlight areas with room for improvement along with those which are working well”, states Fouche. ”It can be used to set targets and provide a mechanism to report actual against targeted performance. The measures may or may not be monetary. In addition to dollars you could be measuring delivery times, customer satisfaction scores or fault resolution times — the list is endless and varies from company to company."

Making it happen

When implementing BI, there are a number of factors to consider to ensure organisation receive a return on investment. Boddington advises, "Scalability is the key, users looking for a BI solution want something they can implement immediately to get maximum ROI, but they also need to be confident the solution can grow or change."

BI solutions need to be able to evolve with the user’s requirements, however, as Boddington advises, "Support and training are crucially important. It’s great installing a new system but if nobody knows how to use it or only your IT person and a few key accounting staff can utilise it then it defeats the purpose."

Some of the most valuable information about an organisation’s customers, suppliers and the market reside outside database applications. It is buried in e-mails, instant messages, PowerPoint presentations, audiocasts, webcasts, and other unstructured data. Fouche advises, "All organisations, big and small, hold key information in unstructured sources. The answer is to be able to link these unstructured sources to appropriate transaction and master file records within the transactional databases."

Stay focused

Information proliferates through most organisations but only a percentage of it can offer true insight into business performance. Don’t fall into the trap of being swamped by data and information that offers very little value. Fouche advises, "You must focus on the information which is critical to run your business optimally. Business Intelligence Tools can deliver a flood of information so people need to ensure they are not distracted by information which is not important. Information being used to run a business successfully needs to be accurate and opportune."

A 2009 Gartner Group paper predicted these developments in business intelligence market .[3]

  • Because of lack of information, processes, and tools, through 2012, more than 35 per cent of the top 5,000 global companies will regularly fail to make insightful decisions about significant changes in their business and markets.
  • By 2012, business units will control at least 40 per cent of the total budget for business intelligence.
  • By 2010, 20 per cent of organizations will have an industry-specific analytic application delivered via software as a service as a standard component of their business intelligence portfolio.
  • In 2009, collaborative decision making will emerge as a new product category that combines social software with business intelligence platform capabilities.
  • By 2012, one-third of analytic applications applied to business processes will be delivered through coarse-grained application mashups.
  • Business Intelligence 2.0 (BI 2.0) is a term referring to a new generation of Business Intelligence software that is more proactive than reactive (the latter merely analyzing data or reports produced after the fact). The first generation of Business Intelligence analyzed information involved in business oriented decisions while the next generation (BI 2.0) helps make decisions as or before events happen.
  • This change is partly due to the popularization of service-oriented architectures (SOA), which enables for a flexible, composable and adaptive middleware. Also open standards for exchanging data such as XBRL (Extensible Business Reporting Language) enables using data external to an organization, such as benchmarking type information. While BI 1.0 analyses or supports decisions that have already been made, BI 2.0 continuously calculates, is flexible/adaptable, intelligent (self tuning or adaptive - automatically adjusting based on results). BI 1.0 is "closed loop" (no outside input, because it happens after the events), while BI 2.0 is "open loop" (real time analysis with input as the events occur).
  • BI 2.0 defines a higher abstraction level in that it works on the semantic data model, not requiring knowledge of data structures or canonical forms. Directed search and querying, based on the meanings of and relationships among objects (s. Semantics), allows practically any person or service to find what is needed without assistance, whether it is structured information (like relational databases) or unstructured content. This "direct" understandability of data models for humans seems to be one of the core value proposition of BI 2.0 because it enables a new level of collaboration (see also Tim Berners-Lee's "unexpected reuse" or Ross Mayfield's "Power Law of Participation").