Business Intelligence: Not just for bosses anymore
Technology is not only making the world a smaller place, it is also reducing the product life cycles and the time a company has to respond to market events. The availability of critical business intelligence is now becoming an essential requirement for every organization. BI systems allow companies to gain insights into their business processes and give them a chance to fine-tune these processes. However there are roadblocks to successfully implementing a BI project. The first is that the business process should be clearly understood. Without that the BI system will be only used for reporting, but the information extracted cannot be utilized to reduce costs or improve the efficiency of the organization. The BI tool should also be made accessible to the lower level management. A roadmap can be created to guide managers on how to react to the information so that the business benefits.
The Brain Behind the Big, Bad Burger and Other Tales of Business Intelligence
The BI system of CKE is a good example of how key insights can be derived from operational data to provide a strategic advantage to the company. Contrary to popular belief, their BI system told suggested a fattening burger. The company was able to leverage this knowledge and gain profits while the media were stumped on how such a product can gain such popularity. In general the food industry is able to adopt BI technologies more effectively because they understand the importance of the information.
In order to retrieve valuable information from BI tools, companies should first analyze how they make decisions and what information is critical to make these decisions. The BI reports should then be designed based on these decision making requirements. However in most BI implementations generally result in a BI report being created first and then unsuccessful attempts are made to use these reports to drive change.
Finally BI tools should also be able to give you a context for the data that is being presented. It should not just represent a change in profits. It should also be able to suggest possible reasons for changing profits. For example, increase in customer base, change in cost of inputs etc.
The question I would like to present to the class
It is now established that implementing a BI system is more of a business function rather than a technology function. The two parts of implementing a BI system is capturing the right type of data and interpreting it in a manner that will be valuable to the business. So as a consultant how would you go about,
- Capturing the data
- identifying at what sources should you capture the data
- what level of detail is required
- how frequent should you capture the data
- Process and report the information
- what time period will you use for the reports
- to what level of abstraction should you roll up the information in the reports
- how will you represent, growth / decline, change in growth / decline