Implementing an enterprise business intelligence system can be a significant departure from traditional business methods. As a result, it requires strong internal communication to change conventional mindsets and encourage people to embrace this type of change. It is important that IT and business managers alike be aware of common misconceptions and be committed to address them in order to take advantage of the business value of enterprise business intelligence. Common misconceptions include the following:
1. Sharing information means losing control.
2. Self-service is a waste of time for the users.
3. IT cannot understand the business. We do not need all that data anyway.
Misconception No. Means 1: Sharing Information Losing Control
Many people believe that owning a certain piece of information is the key to power. They accumulate lots of information and tend to share very little. They may share what everybody already knows, but real insights, especially ones that contradict conventional business practices, are usually not disclosed. Many managers will therefore worry that deploying an enterprise business intelligence system means they will lose control over their information. They will be hesitant about allowing employees or other departments to access their data. This is typically true for companies in which the corporate culture is fairly closed and centralized.
On the contrary, sharing information and revealing insights will allow the whole organization, and therefore the people who participate proactively, to benefit greatly. The trend to share data is inexorable and those who resist will eventually be left behind. They will be remembered as the managers of the past who were resistant to change. As competition intensifies in a new and everchanging economic environment, businesses are forced to reduce costs, improve quality, and move faster. In an effort to make their companies more reactive to change, companies need to decentralize their organization and empower workers to make faster decisions. They need to open up and to flatten their hierarchy. Resistance to the proposition of enterprise business intelligence is fortunately starting to wane, even among traditionally conservative companies.
Misconception No. 2: Self-Service Is a Waste of Time the Users
Managers may be concerned that enterprise business intelligence shifts costs from IT to end users. “My staff shouldn’t be doing IT’s work” is one way of framing the concern. “I do not pay them to sit and play with data all day” is another common way. Enterprise business intelligence indeed frees up valuable IT time, and the more advanced ad hoc querying and reporting may take up some business managers’ time. However, this is time well spent. When managers use enterprise business intelligence themselves, they get far more out of their queries and reports than when they have to request them from IT. Reports from IT can take up to several days to arrive. And when they do, they are often not exactly what the user has in mind or the information is out of date. Self-service means that users
1. Get exactly what they want
2. Get it exactly when they want it
For example: A manager is in the process of preparing a presentation, either to persuade upper management to invest in a project or to convince a client that the company’s products deliver better value than the competition’s. Suppose the manager has a notion, for example, that sales of product X do better in regions covered by a direct mail piece or that average support call resolution time has dropped over the last six months.
Getting information immediately, in the form needed, is of immense value to the manager. Given the urgency of most tasks, a manager who has to go through the IT department might not go to the trouble of getting the information, thereby losing an opportunity to make a convincing argument.
If a manager prioritizes data analysis over another activity, it means that, by
definition, the manager has decided the most important action for the success of an activity is to better understand what is happening in a particular situation.
Business intelligence relies on a very fundamental assumption: The number of potential questions a business user has about its business is almost infinite and is not predictable. Therefore, the IT staff will never be able to respond to all the questions the users will have over time.
However, the fact that users have self-service does not mean it is the only data access mechanism. Virtually all companies that use business intelligence provide a set of IT-developed and -maintained standard reports as well, and these standard reports are often the launch point for more in-depth analysis.
Misconception No. 3: IT Cannot Understand the Business
In many organizations, the IT group and the business operations are at odds with each other. IT argues that business users have unrealistic demands and have no understanding of the technical difficulties of implementation or of the need to have standards in the organization. The business users argue that IT cannot help them as they have no understanding of the business and its requirements. However, pressures of the accelerated e-business economy are driving the sometimes adversarial camps of business and IT closer together. Implementing an e-business strategy requires total cooperation between users who understand the requirements of the business and IT people who can drive the implementation of new technology platforms. One without the other cannot achieve the goals of building an intelligent e-business.
IT can help the implementation of the enterprise strategy by advocating enterprisewide business intelligence to managers who are looking at just solving their departmental information issue. As an example, the manager of the shipping and distribution department may be under the misconception that a deployment of PC desktop databases would solve the pain of his entity. To this, the savvy IT manager points out that an enterprisewide business intelligence system would enable data access and analysis of not only shipping and distribution, but the closely related business areas of manufacturing and inventory as well.
In the most advanced organizations, the ones that have implemented a successful e-business strategy, IT and business operations are cross-pollinating ideas and objectives like never before. According to a survey run by Information Week in 1999 of 375 business and IT executives, e-business initiatives are being driven by IT management.
More and more, CIOs are being viewed as business leaders. And in the process, they are changing the IT department from a cost center to a profit center. At Cisco, CIO Peter Solvik has been responsible not only for Cisco’s Internet-based customer service tools, wide and local area networks, business applications, and telecommunications, but also for leading Cisco’s Internet business organization. Under his leadership, the Cisco Connection Online site has surpassed a $4 billion annual run rate. At Schwab, CIO Dawn Lepore led the company’s online efforts by demonstrating how they could move stock trading online. Schwab is now the leader in online trading and Lepore has been promoted to vice chairman.
And these changes are not taking place just at the CIO level. They can occur at all levels of the IT organization. Don Stoller, a senior director in the IT department of the medical distributor Owens & Minor (discussed in several chapters of the book), was recently called an “IT hero” in the June 14, 1999 ComputerWorld article on “What Makes IT ‘Stars’ Shine” and was recognized in early 2000 by the same publication as one of the Top 100 Executives in IT.
As Owens & Minor’s extranet took off and started to deliver real business value to the company and its customers, Don Stoller’s career rose with it. He was promoted several times, and regularly flies on the corporate jet to demonstrate the company’s supply chain extranet to its most important customers.
Misconception No. 4: We Do Not Need All That Data Anyway
A further concern regarding enterprise business intelligence systems is that they may not be used efficiently. The fear is that introducing a new reporting tool may simply add to a manager’s pile of reports waiting in his or her inbox, or that users will get carried away with analysis for analysis’ sake.
Guy Abramo, the CIO at Ingram Micro, is sensitive to that issue: “One of the downsides to a good business intelligence tool is that the ‘gee whiz’ factor can kill you,” Abramo says. “It’s the ‘what’s interesting’ versus ‘what’s relevant’ discussion. What can happen is you get your staff wanting to build these ‘interesting’ reports, but not reports that are necessarily going to change the business. It’s really incumbent upon me to have very, very clearly defined needs for analysis, otherwise we’ll be in analysis-paralysis and all we’ll be doing is looking at streams and streams of data.”
A disciplined, well-defined system that governs the use of enterprise business intelligence tools is important to help companies maximize their rewards. The stack of reports will not grow, as only the most pertinent, summarized information is published.
In many cases, the “gee whiz” factor tends to be transient and progressively goes away as the user gets used to being information empowered. The system regulates itself after a while as the desire to “play” with information is balanced by the need to spend time on making decisions and taking actions. The new information empowerment enthusiasm must nevertheless be channeled properly: first, toward understanding how to use the tool, which typically takes one-half to one day, and second, toward understanding the meaning of the data that has been made available, which typically takes one to two days. The value of enterprise business intelligence systems is that they can provide “the right information” to answer the business users’ questions.
As a conclusion, business intelligence is an opportunity to introduce a positive cultural change in an organization. Access to information will make users more autonomous. This Information Democracy can lead to decentralization, flatter hierarchies, and a more entrepreneurial culture. However, for it to generate the greatest benefits, its implementation must not be left to the IT department alone. Business managers must drive it, as a part of the organization’s operational strategy.
Nikhil Kulkarni
Roll No 12151
Finance
Liautaud, Bernard. E-Business Intelligence : Turning Information into Knowledge and Profit.
Blacklick, OH, USA: McGraw-Hill Professional Book Group, 2000. p 281.
http://site.ebrary.com/lib/sibm/Doc?id=5001798&ppg=294
Copyright © 2000. McGraw-Hill Professional Book Group. All rights reserved.
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