Post on 05-Dec-2014
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Business Intelligence
Business Intelligence
A set of technologies and processes that use data to understand and analyze business performance (Davenport and Harris, 2007).
Business information and business analyses within the context of key business processes that lead to decisions and actions and that result in improved business performance (Williams and Williams, 2007).
Business intelligence is the use of information that enables organizations to best decide, measure, manage and optimize performance to achieve efficiency and financial benefit (Gartner 2007).
Business IntelligenceBusiness
InformationBusiness Analyses
Business Decisions
Management Processes, e.g. Planning, Budgeting,Forecasting, Monitoring,
and Controlling
Revenue GeneratingProcesses, e.g.,Marketing, Sales,
CampaignManagement, and
Channel Management
Operating Processes,e.g., Customer Service,
Order Fulfillment,Billing, Manufacturing,
Logistics, and InventoryManagement
Increased Sales,Reduced Costs, and
Increased ProfitsThat Drive
In the Context of Core Business Processes
Extent of BI Adoption
0
10
20
30
40
50
60
70
Potential BI Users BI Users who useregularly
Today
In 3 years
Analytical Application Domains
0% 10% 20% 30% 40% 50% 60% 70%
Finance and Accounting
Sales
Marketing
Forecasting
Budgeting and Planning
Customer Service
Human Resources
Shipping and Logistics
Number of Users per Application
0% 5% 10% 15% 20% 25% 30% 35% 40%
1 to 10
11 to 50
51 to 100
101 to 500
501 to 5,000
5,000+
User Types
0% 10% 20% 30% 40% 50%
Consumer
Analyst
Developer
Author
Application Platforms
0% 10% 20% 30% 40% 50%
Web Application
Desktop Application
Corporate Portal
Operational Application
Mobile Devices
Report Interactivity
0% 20% 40% 60% 80% 100%
View Static Reports or Dashboards
Explore Interactive Reports
Create New Reports from Scratch
Explore Interactive Charts
Modifying Existing Reports
"What-If" Analysis
Examples
Western Digital uses BI to better manage its inventory, supply chains, product lifecycles, and customer relationships. BI has enabled the company to reduce operating costs by 50%.
Capital One uses BI to analyze and improve profitability of its product lines as well as effectiveness of its business processes and marketing programs.
Continental Airlines invested $30 million in BI to improve its business processes and customer service. Continental says it has reaped a $500 million return.
BI Drivers
Abundance of data ERP Systems Inexpensive storage Ease of collection
Network infrastructure Web technologies Mature data warehouse technologies Powerful and easy to use analytical software Need to squeeze as much as possible from business processes Recent Accenture study that found that nine in 10 senior
executives at Fortune 1000 companies place strong analytical and business intelligence capabilities at the top of their list in preparing them for their biggest challenge ahead
What does BI Include?
Data warehouses, data marts Reporting, querying Dashboards, scorecards Forecasting, statistical analysis Simulation, optimization models
Measurement Process reengineering Business Process Management (BPM)
BI and Analytics
Degree of Intelligence
Com
petit
ive
Adv
anta
ge
How many, how often, where?Ad hoc reports
Query/drill down
Alerts
Statistical analysis
Forecasting/extrapolation
Predictive modeling
Optimization
Standard reports What happened?
Where exactly is the problem?
What actions are needed?
Why is this happening?
What’s the best that can happen?
What if these trends continue?
What will happen next?Analysis
Accessand
Reporting
Corporate Information Factory
http://www.inmoncif.com/includes/contentimages/cif.gif
Closed Loop Analytical Process (Vesset, 2003)
Track
Act
Analyze
Model
Decide
Tra
nsac
tion-
Orie
nted A
nalytical
Failures
Many BI initiatives have failed to live up to their hype A recent survey in the UK found that 87% of BI
projects don’t live up to expectations Nearly a quarter of BI projects intended to improve
management decision making are going over budget.
A fifth found that data failed to reveal important information, and only half said that end-users were satisfied with the system.
Reasons for Poor Performance
Business value is not built into the project from the beginning
Many projects are led by IT and “thrown over the wall” to users
Even when business users are involved, little thought is given to how the project will effect business processes
Most technical details are well understood but often issues of data quality and integration are not given sufficient attention
Failure is rarely due to technical issues
Value Creation
Project Timeline
BI Asset Creation BI Value Capture Phase
Many BI Initiativesstop here!
But they need to gohere!
This phase encompasses all of thestrategic alignment, design, technicaldevelopment, and project managementactivities required to build, deploy, andmaintain a BI environment and BIapplications. The activities in this phasehave received most of the focus of the data warehousing industry over the past ten years.
This phase encompasses all of the processengineering and change managementactivities required to integrate BI applications intomanagement and operational processesthat drive increased revenues, reduced, costs,or both. The activities in this phase areconsidered the province of the business subjectmatter experts.
BI Preconditions for Value Creation
Strategic Alignment Process Engineering Change Management
Business Value of Business Intelligence
BI Technical Development BI Project Management