Business Intelligence Advantages

MDM Isn’t Just About Technologies – It’s About Business Processes

The benefits of master data management (MDM) can only be achieved if the strategy is broad-reaching and comprehensive.  But, many organizations make the mistake of viewing MDM as a technical issue – a misbelief that can lead to project failure. 

The premise is quite simple.  In order for MDM to solve business problems, it must be tightly aligned with business activities. 

The truth is, MDM encompasses both business processes and technologies.  The technical solution will ultimately support the strategy – but the strategy itself must take into account the various people, policies, and procedures that play a role in data governance, access, sharing, and administration.  In order for any MDM plan to work, it must take into call for the needed process adjustments and re-alignments. 

The formalization and enforcement of data collection and management standards across the enterprise is what truly will enable the effective execution of MDM.  For example, if the accounting department archives information in one way, yet sales and marketing handle the storage of historical data in a completely different manner, the results of an MDM program will be seriously hindered.  In other words, consistent workflows must be implemented to promote the accuracy, timeliness, and integrity of corporate information. 

In fact, in a recent post on BeyeNetwork, a popular blog that covers the business intelligence and information management industries, the following steps to reaching a stage of MDM readiness were defined as critical:
•    Document business processes and how they map to application functionality
•    Define and use common information concepts
•    Assess the organization’s capabilities as they related to data quality and governance

The purpose of this exercise?  Determine where procedures are lacking, and re-structure in a way that will most effectively support the new MDM strategy. 

And, perhaps most importantly, which processes should be reviewed and assessed?  Those that relate to information creation, updating, deletion, or archiving are the activities that have the greatest impact on data quality.  Therefore, it is these procedures that must be effectively controlled in order for MDM to deliver desired returns.  

Our next post will highlight data validation techniques.  We’ll discuss the critical role they play in MDM, helping to ensure data consistency, accuracy, and integrity.

Why Business User Involvement is Critical to Your MDM Initiative

As a growing number of businesses are embarking on comprehensive master data management (MDM) strategies, more and more of them are realizing the importance of having business users actively participate in all facets of their project.  In fact, the experts agree that the most successful MDM initiatives are those that come to fruition through a close collaboration between the IT professionals who will deploy and support the environment, and the non-technical workers who will actually use the master data generated. 

A recent study from Ventana Research indicates that it should be business people – not IT staff – that serve as the driving force behind MDM.  The analyst firm claims that a company’s success will hinder greatly on its ability to rally support all the way up the chain of command – from end users and department managers, to senior and C-level executives. 

But, why is the involvement of functional representatives so important?

Relevance 
Master data must be directly tied to day-to-day activities, as well as broad-reaching corporate goals and objectives, in order to be truly useful.  David Loshin, president of Knowledge Integrity, Inc., a consultancy that specializes in enterprise-scale MDM development states that “MDM has to be driven by business needs, otherwise it may turn out to be just another database that must be synchronized with all the other ones.”

Yet, IT staff members simply don’t have the subject matter expertise needed to truly understand what master data is needed, why it is important, and how it will be used.  For example, few of them know how master data will be applied in the context of customer, sales, or financial analysis, and therefore – alone – will be unable to develop and execute an MDM plan that most effectively satisfies the needs of master data consumers.  

Adoption 
User adoption is crucial to the success of any technology effort, and MDM is no exception.  If members of the user community are involved in the creation of master data at the outset, the more likely they will be to embrace the environment once it has been implemented, and to use master data regularly to support and enhance their daily operations.  And, the more business people who consistently leverage master data, the more of an impact it will have on company performance. 

Quality
MDM is an ongoing process, one that requires continuous refinement in order to deliver maximum value over time and address evolving needs as they emerge.  Therefore, the user community must participate actively in MDM maintenance, in order to ensure the highest level of quality and accuracy at all times. 

Through teamwork, communication, and collaboration, your IT team and end users can work together to ensure the success of your MDM initiative.

How Telecommunications Firms Benefit from Business Intelligence

Companies in the telecommunications industry are facing conditions that are unlike those that exist in any other sector.  Consolidation is happening at a record pace, allowing businesses to instantly expand their product lines and enter new markets.  And convergence strategies are emerging quickly, as carriers strive to serve as “all in one” providers, offering everything from voice and Internet, to video, data, and multi-media services. 

 

These shifting business models have made the need for business intelligence extremely critical for telecommunications companies – perhaps more so than in any other industry today. For example, mergers and acquisitions make it quite difficult for organizations to achieve a complete view of operations and activities across the entire business. Information from fragmented systems, housed in various geographically dispersed locations, must be collected, aggregated, and formatted in order for executives to monitor key performance indicators, and departmental managers and employees to generate the types of operational reports needed to support day-to-day decision-making.  Without a business intelligence solution in place, this will be nearly impossible. 

 

Additionally, as telecommunications providers seek to expand market share and capture new audiences, customer and marketing intelligence has become more important than ever before.  With a BI tool in place, these organizations have the insight they need to sell more services to more people.  For example, they can analyze existing accounts to identify opportunities to up-sell and cross-sell other products from their portfolio.  They can also gain greater insight into the demographics of their potential clients, so they can develop more effective and compelling campaigns and promotions.  And, perhaps most importantly, they can obtain a full understanding of customer needs and wants, so they can enhance existing offerings, and develop new ones, to drive more sales. 

 

As the telecommunication industry experiences intensifying competition and rising churn rates, firms can leverage business intelligence to boost customer service levels, thus increasing satisfaction and retention.  By monitoring key performance indicators such as peak usage volumes, as well as other network activity patterns, service providers can make sure that their infrastructure is optimized to ensure maximum reliability and performance.  Additionally, trends in activities such as technical support calls and call center interactions can be analyzed in detail, to assess service levels and identify – and correct – areas in which customers may not be receiving the kind of experience that is conducive to ongoing loyalty. 

 

The ways in which telecommunications firms can benefit from business intelligence are endless.  By implementing a comprehensive BI environment, and leveraging it across the organization, telecommunications firms can improve service delivery, boost sales and revenues, enhance customer loyalty, increase the efficiency of core operations, and gain a significant competitive advantage.

The New Role of the BI Channel Partner

In the past, when business intelligence projects were primarily considered to be IT initiatives, BI vendors realized the importance of forming alliances with a variety of implementation partners to help them gain broader market penetration.  They joined forces with technology consultants, system integrators, value added resellers (VARs) and others who would offer their reporting and analysis solutions as part of a broader, fully integrated IT infrastructure. 

 

But in recent years, BI has become more strategic.  No longer just another software application among many in a company’s arsenal, business intelligence has transformed itself into a vital and indispensable tool that helps drive corporate performance.  As a result, functional managers and senior executives – not technical professionals – are now the “owners” and key stakeholders when it comes to BI projects. 

 

This new audience is prompting many BI solution providers to reconsider their channel sales strategies.  Technology consultants, while still valuable, may no longer have the kind of influence over business intelligence strategies that they’ve had in the past. 

 

For example, in many companies today, the CFO is spearheading BI projects, because of the mission-critical nature of financial reporting regulations.  And while supporting technologies are important, what he is really concerned with are the business challenges associated with compliance.  So, he would be unlikely to bring on a pure technologist to solve his specific business problem, and would be more inclined to turn to a strategic consultant with a business-oriented focus, who can incorporate software and hardware tools into their plans and recommendations.

 

And so, the role of the BI channel partner is changing.  Companies who used to seek to align themselves with technology solution providers are now forming partnerships with firms who deliver business solutions, with technology as a component of those offerings.  You see many BI industry leaders developing relationships with the likes of consultants who focus on procedural workflows and business process management (BPM), corporate performance management and balanced scorecards, and other high-level strategic initiatives. 

 

What’s the difference?  While the former are experts in BI technologies, the latter are not only well-trained in reporting and analysis tools, but possess in-depth insight into the underlying business issues that drive their use.  This offers the end-user even greater value by providing them with not only superior BI solutions, but with the procedures and policies that enable their most effective use. 

 

BI will continue to play an increasingly strategic role in today’s organizations.  More and more, business intelligence is becoming a means of successfully achieving corporate goals and objectives, not just a tool to satisfy departmental needs.  As a result, there will be some dramatic changes in the types of channel partners that business intelligence vendors turn to for assistance in bringing their solutions to the marketplace.  

How Government Agencies Are Using BI

The role of the government has been evolving over the last several years.  Gone are the days when agencies simply served as administrative bodies that did little more than set and enforce regulations, and collect, process, and store information.  Citizens now expect better, more convenient services and programs from their federal, state, and local entities.  That’s why many government organizations are implementing business intelligence tools, to help them better understand and address the needs of the communities they serve, while operating more productively and cost-efficiently. 

How can business intelligence solutions be applied to help government agencies improve operations?  The ways in which BI can be utilized in government are virtually unlimited, but some of the most successful ways include:

Inter- and Intra-Agency Information Sharing

In today’s age of heightened national security risks, individual agencies at the federal, state, and local level can no longer operate in a vacuum.  They must be able to instantaneously share vital, timely information from a variety of back-end data systems – not only among their own employees, but with their counterparts at other agencies.  Business intelligence makes this possible, allowing data from the disparate and fragmented sources that exist within single agencies, as well as across multiple government entities, to be easily accessed, consolidated, and analyzed in real time.  

“Customer” Intelligence

While many businesses need to know more about their customers in order to more effectively market and sell to them, government agencies are taking the same approach with the citizens they serve.   This is becoming increasingly critical, according to leading industry analyst firm DataMonitor in their recent “Business Trends: Understanding Your Government Customer” report, as constituents continue to demand a higher level of accountability and transparency from their government.  DataMonitor feels that this continued shift is the driving force behind the increased adoption of such technologies as CRM and business intelligence tools by government agencies at all levels. 

E-Government

For the past several years, there has been a major focus on initiatives for e-government, or citizen self-service.  These projects are making the services of a variety of agencies – including the DMV and Social Security – conveniently available to residents via the Web.  However, in order for these programs to work, they must give constituents fast and simple access to the data they need.  This requires the support of a comprehensive business intelligence infrastructure. 

Financial and Budget Management

No organization operates on a tighter budget than a government agency.  But, effectively managing the allocation and utilization of funds requires in-depth insight into spending patterns, as well as the ability to forecast future costs and expenses.  BI systems provide those capabilities, empowering government entities to better control and administer their budgets. 

As more and more government agencies continue to adopt innovative business intelligence solutions, the techniques they use are likely to become more sophisticated, and they ways in which they use it to support their day-to-day activities is likely to grow.  This will help foster a collaborative environment among all agencies at all levels, where they operate together in the most efficient, cost-effective, and citizen-centric fashion possible.

Putting Business Intelligence in the Hands of End Users

When business intelligence tools were first introduced decades ago, they were highly sophisticated solutions that were controlled largely by IT staff.  Report requests came in from various functional users.  Information was then accessed, consolidated, and formatted by a technical professional, who delivered it back to the user in the form of a printed document. 

But, reports would often contain errors or omissions that required the report to be re-run, or lead to additional questions that resulted in the need to generate yet another report.  This created a longer list of reports for IT teams to build.  It was a never-ending cycle. 

At the time, the available solutions were very complex, and business users simply didn’t have the technical savvy required to navigate and operate their features.  So, this heavy reliance on IT staff was the only feasible approach.  But not only did this drain a company’s already over-worked technical resources, it created data latency issues that negatively impacted corporate decision-making. 

Over the last several years, end user tools such as ad hoc and OLAP have gained prominence.  And while these, in their initial form, were far more intuitive than previous solutions, they were still way too advanced for the average departmental employee.  This limited their use to a handful of “power users” – those employees that possessed a unique blend of both technical and business skills – scattered throughout the various divisions of the company. 

So, the problem remained.  High-paid IT staff (they average approximately $33 per hour, based on surveys conducted by leading compensation management statistics aggregator Salary.com) continued to spend significant amounts of time satisfying report requests from end users, instead of working on other critical, and more strategic corporate technology initiatives. 

But, today, as operational reporting strategies – those that leverage enterprise data to support near-instantaneous day-to-day decision making – become increasingly important, more and more BI vendors are beginning to recognize the need for end users to have the ability to satisfy their own information needs in real time. 

As a result, today’s BI offerings have evolved in the form of pre-packaged functional reporting applications, more simple and user-friendly ad hoc query tools, and development environments that allow for reports to be built and deployed over the Web, where basic revisions such as filters and sorts can be performed by the end user.  Applications like these have made it easier for non-technical professionals to gather, analyze, and share information, whenever they need it, without IT intervention.  

The industry as a whole has made great strides in this area, making business intelligence more accessible to more users and more user types.  But, as the unhindered flow of information becomes more and more critical to an organization’s success, vendors will need to continue to develop BI solutions that reduce reliance on IT departments, and put the power of reporting and analysis directly into the hands of information consumers.

Build vs. Buy: Which is Better for BI?

There are many types of business intelligence tools on the market today.  But, most industry pundits would break them up into two primary categories – development tools that allow companies to rapidly build and deploy their own customized reporting environments, and prepackaged BI applications that provide “plug and play” reporting and analysis capabilities right out of the box. 

 

Analysts and other experts are divided when it comes to which is the better approach to business intelligence.  But the truth is, there are pros and cons to each method.    

 

For example, BI development tools provide companies with greater flexibility, allowing them to custom design everything from the user interface to how data is extracted, aggregated, stored, and accessed in order to meet specific information requirements. 

 

This is particularly important when it comes to operational reporting.  The processes being monitored and analyzed within operational reporting environments are unique to each and every company.  Additionally, front line workers often need to generate an ad hoc report to support an on-the-fly decision – a capability that many pre-packaged business intelligence applications do not provide.  Therefore, the “one size fits all” approach will be limited in effectiveness. 

 

BI development tools also enable more sophisticated uses of business intelligence, such as feeding data contained within reports directly to other business systems, or embedding BI functions directly into automated processes. 

 

On the other hand, pre-packaged reporting applications don’t require the same level of technical expertise or resource commitment that development tools do.  Organizations that choose to create their own business intelligence applications in-house must often employ large numbers of IT staff and/or third-party consultants who are experienced in the tool’s specific programming language. And even though many vendors offer robust GUI-style interfaces, their solutions still cannot be operated by the average business user, and require some level of technical savvy. 

 

Additionally, IT teams will often spend months dedicated solely to the design and deployment of the business intelligence system.  In fact, a study conducted by the BI Consulting Group, LLC shows that the average “build” project can take as long as 35 man weeks to complete, while prepackaged BI solutions take an average of just 17 weeks from installation to roll out. 

 

And, once the application has gone live, IT staff will continue to allocate a significant portion of their time to ongoing enhancements, upgrades, and other maintenance-related activities.  While this may work for larger enterprises that have plenty of IT professionals on hand, smaller companies may not have the bodies to spare without negatively impacting other critical technology initiatives.     

 

Pre-packaged applications also allow novice BI users to leverage some of the expertise that has been acquired by the vendor, who has probably put years and years of practical experience and success working in real customer scenarios into use when designing their reports.  Financial reporting is a good example of this.  Most business intelligence solution providers are well-versed in how financial information needs to be gathered and presented in order to comply with regulatory guidelines.  Companies who are still learning the ins and outs of Sarbanes Oxley and other statutes can fast-track their compliance efforts with a business intelligence application that includes pre-packaged financial reports. 

 

So, which method really IS better?

 

Companies can actually gain the most value from a more blended approach to BI.  Some pre-designed reports and analyses can help get them started, while the ability to tailor the solution and create custom reports and KPIs can ensure alignment with unique goals and missions.  IT resources won’t be drained, yet any and all end user demands will be satisfied.   

 

The solutions on the market are rapidly evolving to make this a reality.  Many pre-packaged applications come complete with extensive customization capabilities.  Additionally, many of the development tool vendors are offering report templates or bundles of pre-developed reports based on specific industries or business functions.  But, nowhere is this trend more evident than in the emergence of open source BI tools, which provide users with out-of-the-box functionality, yet expose all the underlying code so internal IT teams can quickly and easily alter and tailor the application as needed.

The Use of BI at Retail Organizations

For decades, business intelligence was something reserved for top-tier retailers, who used it primarily for simple financial reporting and sales analysis purposes.  Over the past few years, all that has changed.  Today, business intelligence is providing retail organizations of all sizes with a way to not only enhance operational efficiency and cost-effectiveness, but to achieve clear differentiation in an increasingly competitive and dynamic industry. 

 

In what areas of retail operations can BI provide the greatest impact?

 

Forecasting and planning

The ability to predict customer wants, needs, and behaviors, and stock store shelves to satisfy those demands, is the key to success in the retail industry.  With a business intelligence solution in place, retailers can analyze historical buyer data, and identify the patterns that will help them anticipate future shopping trends.  This, in turn, will lead to more accurate merchandising and inventory management across all outlets. 

 

Price and cost management

For many retailers, finding the balance between the prices they charge customers, and the costs of doing business, can be quite a challenge.  Products must be priced for optimal profitability, and left over stock must be handled with the utmost care (i.e. is it more cost-effective to initiate a mark-down, transfer it to another store location where it is more likely to sell, or leave it to take up valuable rack space in hopes that someone will eventually buy it?).  Business intelligence makes it easy for retail organizations to perform this kind of “what if” analysis, so they can anticipate the results of specific scenarios to make better, more informed decisions.  

 

Sales and performance analysis

Which stores are meeting their quotas, and which ones aren’t?  Which products are selling well, and which ones are sitting on the shelves?  Retailers need insight into what’s working, and what isn’t – and business intelligence can provide it.  Armed with this information, they can quickly identify underperforming stores, products, and sales representatives, and take immediate corrective action. 

 

Promotions

BI tools enable the kind of comprehensive customer profiling that retailers need to thrive.  Through in-depth insight into who is buying, what they are buying, how they are paying, and other key characteristics, retail firms can structure their marketing programs to better reach their target audience and boost results and return on investment.  This, in turn, will lead to increased awareness, sales, revenues, profit margins, and market share.

 

Not only are the applications for BI in the retail industry virtually endless, but so are the tools that retail organizations can choose from.  While needs will vary greatly based on the size and scope of the company’s operations, there are some key capabilities that all firms should look out for when choosing a business intelligence solution.  These include:

• Access to real-time data.  Retail organizations need to be completely agile.  Those on the store floor must often make decisions in a day, or in some cases, even an hour.  Outdated information can lead to poor choices that can impact sales, replenishment, staffing, and other critical functions.  
• Integration.  A variety of business applications support retail operations.  A BI solution will need to access and combine information from all of them, such as systems for sales transactions and point-of purchase activities, in-house credit management, coupon redemption, catalog and online purchases, price management, and customer-relationship management. 

Global support.  As more and more retailers seek new sales channels, many are expanding their reach by opening outlets online and around the world.  Therefore, the ability to fully enable global financial operations through such features as automatic conversion and calculation of foreign currency, and support for international regulatory requirements is critical.

Enhancing Supply Chain Operations with Business Intelligence

Over the past few decades, business intelligence has been successfully applied to many critical business functions to enable efficiency enhancements, improved decision-making, and the rapid identification of important opportunities.  But, perhaps there is no one area of an organization where business intelligence can deliver greater advantages than supply chain management.

 

Supply chains are, by nature, highly complex.  Multiple internal processes, such as purchasing, procurement, and inventory management, as well as activities like distribution, transportation, and logistics that are managed by external constituents, must be seamlessly coordinated. This requires more than just the implementation of impeccably structured workflows.  It requires the unhindered sharing of real-time information among all supply chain partners.  

 

That’s where business intelligence comes in.  While some supply chain management applications do offer basic reporting and analysis capabilities, they are really designed to deliver insight about to internal supply chain staff members about their own activities.  Few have the capacity to easily provide an in-depth look into and across the most sophisticated supply chains – those that encompass the systems and procedures of numerous outside stakeholders. 

 

A BI solution is needed to allow for the collection, aggregation, and analysis of information from across an entire supply chain.  Whether the data resides in a series of internal applications, external ones that are managed by outside partners, or market or benchmark data that exists across the Web, a business intelligence tool can gather it and transform it into vital insight that is timely, relevant, valuable – and most importantly, readily accessible – to all those involved in supply chain operations.  This, in turn, will enhance efficiency and cost-effectiveness, boost profitability, and improve customer satisfaction through the delivery of high quality products in the timeliest fashion possible. 

 

This becomes particularly important as companies continue to globalize, and expand their operations throughout multiple geographies.  Different cultures, currencies, and regulations make it increasing difficult to ensure rapid communication and collaboration among all partners – a necessity for the effective management of cross-country supply chains.  But business intelligence can help ease these issues and enable smooth supply chain operations in all regions of the world. 

By using business intelligence to enhance activity planning and execution, supply chain-intensive companies can:

• Improve workflow design, and other strategic planning activities
• Track tactical processes and identify breakdowns – before they impact fulfillment
• Better collaborate and communicate with all key stakeholders
• Accurately assess the performance of supply chain partners
• Monitor costs, and uncover areas for savings

 

The concept of supply chain intelligence is nothing new.  But, until recently, few companies had the solutions at their disposal to properly enable it. 

 

Because supply chain intelligence is about more than just simple reporting, the key to creating a truly successful strategy is through a blend of business intelligence and data integration technologies.  Some BI vendors offer both, while others have partnered with leading integration software providers to achieve the needed level of functionality to support broad-reaching supply chain intelligence initiatives. 

 

When BI and integration solutions work together, the information used to enhance activities is as comprehensive and unhindered as possible.  Additionally, information can become an ingrained part of core supply chain processes.  For example, data thresholds can be used to distribute real-time alerts when critical conditions arise.  Or, information can even be leveraged to trigger subsequent, pre-defined automated events – eliminating the need for manual action on the part of supply chain personnel.

Business Intelligence for the Healthcare Industry

Many experts believe that when it comes to business intelligence, no industry is in greater need than the healthcare sector.  Unlike other vertical markets who have readily embraced BI tools to deliver greater insight and improve operations, healthcare firms such as hospitals, clinics, and other medical facilities have been slow to adopt the needed technologies to achieve these goals.  Some analysts feel that while healthcare organizations have become proficient at collecting and storing data, they have yet to understand how to actually use it.   

 

For example, few healthcare organizations can easily consolidate and access the information that resides in various clinical, research, administration, and patient information systems (the average healthcare organization can have dozens of applications in place).  Additionally, only a handful of them are equipped to monitor the key performance indicators that provide insight into efficiency, or the true quality of patient care.  And, the instantaneous and dynamic sharing of information with partners such pharmacies, labs, and external care providers is virtually non-existent in today’s healthcare firms.   

 

Yet, with competition at an all-time high, and increasing pressure to streamline administrative activities and related expenses, while improving overall patient care, these firms need to begin leveraging the vital intelligence that exists within their infrastructures to gain an edge. 

 

How can business intelligence be most successfully applied in healthcare scenarios?  For starters, financial analysis can enable more informed budget planning and management, uncover new revenue opportunities, and help healthcare firms implement more informed and successful cost-cutting initiatives.  And, operational performance management can help locate inefficient processes and workflows, or identify areas in need of improvement.

 

But, financial and administrative uses of business intelligence-type technologies are not all that uncommon in healthcare.  However, firms in this industry have been slow to begin “thinking outside the box”, and are just now seeking new and innovative ways to leverage the benefits of BI.  For example

• Clinical data can be analyzed in great detail to uncover vital patterns and trends in diagnoses, treatments, and outcomes.
• Metrics can be defined and implemented to closely monitor patient satisfaction levels and quality of care. 
• Information can be made readily accessible to authorized users via Intranets or the Internet, to enhance collaboration between all those involved in a patient’s treatment. 

 

Some of the more leading-edge healthcare firms are even looking for ways to utilize predictive analytics to improve knowledge-building and forecasting.  This, they believe, will help enhance everything from disease prevention and control, to administrative issues like budgeting, staffing, and inventory management. 

 

But, perhaps most importantly, business intelligence can help healthcare organizations to more proactively manage their information, and track how it is being accessed and utilized.  This will facilitate better compliance with various industry regulations and standards, such as HIPAA.