SAP Pulls Ahead

Business Intelligence BI Application Software : SAP Pulls Ahead by Bill McDermott

April 25 - Bill McDermott, CEO of software maker SAP, discusses why the business is taking a byte out of competitors Oracle and Siebel.



Source: Business Intelligence BI Application Software video clib at businessweek.com

The Call For Basic Numeracy

BI Application Software : The Call For Basic Numeracy by George Scifo

Technology is not the fundamental challenge that organizations face when it comes to implementing business intelligence (BI) solutions. Certainly a lack of alignment between IT and business is a problem, but it's really just a byproduct of the fact that BI solutions have been so complex in the past that business users were required to bring in IT to create for them the analysis they wanted. Of course that will lead to alignment problems. Is anyone really surprised by this? When the people asking the questions can't answer them for themselves, and the people who can answer the questions are not the ones asking them, how could we really have expected that everything would be rosy without a lot of effort?

It's not lack of executive commitment. Certainly, when BI fails, lack of executive commitment plays a part. But, we have to ask why the executives weren't committed? They certainly care about growing their business, and analytics are required to do that effectively. So why aren't they committed?

It's not even the complexity of BI solutions. There have been tons of articles and blog posts written about how BI is too complicated. And often it's suggested that complexity really is the core problem. It's true that if you make things simpler, then you get rid of the great divide between business and IT because business can now be self-sufficient and answer their own questions. And BI will no longer fail because of lack of internal expertise to keep a complex system running.

Complexity is certainly a huge issue, but there is overwhelming evidence that it's not really at the core. First, for years people have been focusing on trying to make BI more accessible by simplifying the user experience. More recently, several companies, both old and new, have offered hosted, or software as a service (SaaS) BI solutions to get rid of the complexity that is involved with managing a BI solution on premise. The Holy Grail has been to make it simple so we can deliver "BI for the masses." But many BI initiatives still fail to get adopted and have impact on companies.

We're chasing the wrong grail. Simplicity is absolutely required, but simplicity alone is not enough. Once you peel away the barrier that was created by complexity and give users the ability to answer whatever questions they have, you uncover the real culprit preventing companies from being successful with BI: People have no way of knowing which questions are meaningful ones to ask, and which are meaningless.

I'm not aware of any college classes that teach people how to use numbers to analyze sales, or customer support, or human resources, or suppliers. I don't know of any business schools that teach this either. And companies don't teach their employees -- most people just end up doing something very similar to whatever they learned from their managers, if anything. To be clear, I wouldn't be surprised to discover that such classes and training programs exist somewhere, but they're certainly not common.

Imagine what would happen if you hired someone to do accounting for you who had no background in finance. They'd be forced to make it up as they go. What's the likelihood that they'd come up with the key financial metrics like ROI, Cash Flow, Liquidity Ratio, Debt to Equity Ratio, Current Ratio, Inventory Turns, EBIT, Days Sales Outstanding, etc? It's pretty unlikely. So, the financial analysis this person would do wouldn't be very useful in helping the business, so it would fall by the wayside.

This is exactly what we do with BI solutions. We ask business users to define the key metrics they need to run their business. They don't have basic background in how to use analytics to improve a business, so they have to make it up as they go. Though they come up with some good metrics, they usually miss others that are absolutely critical. So, management doesn't see much value coming from their BI initiative. Since it's not really moving the needle in their business, support wanes.

We need to give people some basic exposure about how to effectively use analytics. As a society, we teach people to read and how to interpret the meaning of what they've read. That's basic literacy. People also need exposure regarding what numbers to look at in their business, and how to interpret the numbers. We need basic numeracy to complement literacy.

How do we move people towards numeracy? Part of it will be up to analytic vendors and user communities to define and share best practices for analyzing a business. But we can greatly accelerate that process by providing users with analytic solutions that provide the key metrics for analyzing the various areas of their business built into the solutions. That's why analytic applications are so useful. They get us away from generic BI tools, and move us towards real solutions focused on addressing specific business problems and which include embedded best-practice metrics and analyses.

If you don't think this is feasible because you believe that each company does business differently and each therefore must define their own KPI's, then I can prove it to you. I can take your sales pipeline data, apply generic best practice analyses to it, and I guarantee you that I'll find important issues and opportunities regarding your pipeline. Don't believe me? Then accept my challenge and I'll prove it to you.

By removing the barrier of BI complexity, we then expose the fundamental issue that we're providing people with tools to get questions answered, but not with the context to identify which questions have the most impact. People need to demand that their BI vendors provide them not only with the ability to get answers, but also with the right questions too.

About the Author
Founded in 2005, LucidEra was formed to shake up the stagnant business intelligence industry and traditional approaches to corporate information access and analysis by delivering business visibility as an on-demand service. Know More with LucidEra. Visit http://www.lucidera.com

Source: BI Application, Business Intelligence Software information at goarticles.com

When the going gets tough, Business Intelligence could help make critical decisions

BI Application Software : When the going gets tough, Business Intelligence could help make critical decisions by Sunny Pokala

The global recession has had a diverse and ripple effect across nations and their economies. Hardly any company or sector is immune to this vicious slowdown and every business leader has been forced to react to the crisis, at some level. As credit tightens companies squeeze IT budgets and reduce investing in good business-enhancing technology. Recession is a good time though, to prioritize IT spending choices and lay the plans for future growth of your organization. Careful stewardship over existing assets and frugality concerning new investments is good policy -- in both weak and strong economic times. Reduced spending doesn't mean that IT has to stand still, but it will force a necessary examination of priorities.

To take advantage of these sluggish times, your company needs access to critical data about how well your business, your market, your competitors, and your suppliers are responding to today's challenging times. In positioning your organization to weather turbulent markets, insight and making informed, good decisions can be the critical factor that determines your success or failure, rather than depending on your instinct or guts. Most organizations are inundated with data, with more flooding in every day. This exacerbates an already difficult problem: how to manage data and extract meaningful information from it. Users typically find ways around this by generating extracts, massaging data in secondary tools, proliferating copies, and sometimes correcting the copy so it disagrees with the original. Ever-increasing regulatory pressures force retention for compliance purposes, so data deprecation becomes an important consideration that impacts storage requirements. Reducing the number of data sources and de-duplicating the data in those sources will lead to fewer errors, greater efficiency, and reduced maintenance costs. That is why it is important to understand how Business Intelligence can protect your company from the economic storm and have you emerging a winner.

Business intelligence (BI) is used to analyze and report on multiple data sources (both data at rest and in motion) to enhance business processes and inspire changes to the organization's business model. Effective BI should keep the organization from missing opportunities for business innovation. In the heightened competitive pressure that accompanies a constricting economy, BI is a wise investment. Make sure you know what you desire to know, however; otherwise, what appears to be great data mining may tell you nothing at all. BI makes business processes more efficient and information-management processes less complicated and these are some of the reasons it can play a crucial role in a weak economy.

Using Employee Metrics to Motivate Performance One way to motivate positive performance is to make employees aware of how they compare to their peers / colleagues. This information could be put to use by employees to make better decisions and also encourages them to work harder to improve their standing in the organization. A BI system can automatically update a reporting database whenever designated revenue and trading milestones are reached. Additionally, using BI technology can help create several dynamic reports to motivate employee performance. For example, the Top 5 Employees report reveals which employees are bringing in the most revenue; the Top 5 Branches ranking system encourages healthy competition among offices. These daily ranking systems, along with a cumulative Book of Records report, continually acquaint each trader, manager, and executive with the company's progress in this dynamic industry.

Using BI to Identify Cost-Saving Opportunities One of the ways BI reduces costs is by shortening the time it takes for people to get the relevant information. A BI application shrinks the process of acquiring relevant information from weeks to minutes. As it refines the predictive analysis capabilities of the information gathered, the organization is better able to react to leading indicators before they impact the product margins.

Helping a Dealer Network Reduce Costs BI technology can be applied to create a dealer reporting system that saves a few millions each year. The system identifies excessive repair costs by monitoring how much each dealer's warranty performance varies from the average performance of other dealers in the same geographic region. Helping dealers keep costs down and comply with regional averages contributes to the company's bottom line.

Using BI as a Profit Center BI can also uncover previously untapped revenue. The genesis of these initiatives is often a desire to fully analyze data about customers, products, and sales. For example, the administration department of an IT company wants to figure out how and from which sector revenue is being generated for the company. To do its job more effectively, the company can create a programme that calculates revenue and yield from each of its branches, sorted by week and month. Data visualization software uses geographic displays to reveal point-of-sale data on a world map. Linking interactive graphs makes it easier to detect correlations in the data. This leads to more productive meetings; better understanding of the issues, and more clearly defined follow-up activities. It is the same data but it is interactive, so users can isolate a certain aspect of the data, drill-down, and spot problems in specified areas. This type of analysis is better than data mining because it allows users to drill down to the core of the issue, rather than simply run predefined algorithms from a data-mining program.

Many business leaders are looking to BI for near-term solutions, but BI delivers high-value returns on many levels. BI enables companies to work smarter, even when tight financial times mean smaller IT budgets and leaner staffs. Market-leading companies in every industry are turning to Business Intelligence solutions to stay ahead. When the economy turns--as it inevitably will--these are the firms that will be in the best position to seize the next wave of opportunities.

The author is Chairman, InfoBuild India and President, Amtex Systems and can be contacted at sunny@infobuild.in

About the Author
The author is Chairman, InfoBuild India and President, Amtex Systems and can be contacted at sunny@infobuild.in

Source: BI Application, Business Intelligence Software information at goarticles.com