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April 15, 2010

Why Isn't Business Intelligence More Pervasive?

Pervasive business intelligence (BI) is loosely defined as BI for the masses; empowering everyone in the organization, at all levels, with analytics, alerts and feedback mechanisms to make the right decision at the right time.

Pervasive BI: The Hype

For the past several years there have been widespread projections of pervasive BI: accessible by employees, partners, and customers by the, and I quote, “millions.” Not just for “quants” any more, with today’s tools, “anyone with access to a computer, PDA or smartphone can do analytics.”

Pervasive BI: The Reality

 Fueled by the possibilities described in Thomas Davenport’s 2006 Harvard Business Review article “Competing on Analytics,” many organizations aim to deploy advanced analytics and extend use of the data warehouse (DW) to a wider community of users, supporting operational as well as strategic decisions.

But the reality of pervasive BI has fallen far short of the hype. In a case study published in August 2008, IDC analysts made the point that “Despite the fact that the term Business Intelligence was first coined in 1958 and the first BI software tools emerged in the 1970s, BI is not truly pervasive in any organization.”

And according to BI tools guru Cindi Howson, in 2009 the percentage of employees using BI was 24%, down from 25% in 2007. Even today, BI is used mostly by business analysts and power users (roughly 50% penetration vs. 23% use among field staff).

Pervasive BI: The Obstacles

It’s not for a lack of promise that BI holds, but there are a number of reasons why it has not become more pervasive, despite intent on the part of many.

• Tools have historically been expensive and in many cases, too difficult to use by the business masses.
• Tools and the way they’ve been implemented don’t always match the needs of all users.
• The BI systems in place today were built for strategic decisions, the sweet spot of traditional BI. They don’t lend themselves easily to expansion to real-time analysis based on real-time data to support operational decisions.
• Most organizations strive to protect and leverage the investment that they’ve already made. It’s difficult to build out a system that supports everyone from a conglomeration of departmental data marts, each designed for a single specific application or use.
• BI has historically been considered discretionary. Investing in it to exploit data beyond support for business analysts has not been deemed a high priority.
• Despite a growing trend toward fact-based decision-making, many companies adhere to a culture of making decisions by gut feel.
• Even after 20 years of building DW/BI systems, few organizations have established data integration and enterprise information management as a strategic competence. Issues of poor data quality, data hidden in tightly coupled systems, as well as lack of master data management, data governance, metadata management or any automated means to reconcile differences between data from different sources are widespread and create barriers to reliable analytics.

BI is critical to competitive success, but before organizations can take full advantage, they need to overcome these obstacles.

Technology to the Rescue

Not to worry. In the high tech industry, there is never a shortage of solutions. Here are just a few of the new technologies (and some not so new, but marketed with renewed vigor) standing ready to make BI more pervasive:

• Open source BI tools – Solve the price issue and you’ve solved the problem.
• SaaS BI – By replacing upfront licensing fees and yearly maintenance costs with a monthly or annual subscription fee, SaaS BI “breaks the barriers preventing the spread of BI outside the executive suite.”
• Leveraging new architecture – One vendor offers “components for building pervasive BI systems where data is stored in memory, allowing quick access and easy scaling with growing demands.”
• Excel – the interface users know and love, with access to live data
• Web-based BI – enables deployment of “large groups of users at the click of a mouse.”
• Overlay mash-ups and dashboards – In the world of web-based BI, these two main kinds of mash-ups are “among several BI 2.0 innovations that help spread BI wider and deeper across organizations; a concept known as pervasive BI.” 

Pervasive BI: The First Step

Depending on your infrastructure, one of more of these may help ease the issues of performance, data access, cost, and management overhead. But fundamentally, inconsistent data does create barriers to reliable analytics and strategic use of data. Organizations need to overcome that before BI can be pervasive.

HP consultants worked with client Steven Yon, Division Director, Common Services, Corporate Operations and Information Services at National City, one of the largest financial holding companies in the US, to develop a standard process for enterprise information management and information governance. He talks about how important it was to establish an environment of data governance with consistent metrics and rules, allowing National City to exploit their data as a strategic asset in order to better serve their customers: “If data must go through several conversion steps before it can be used, it makes it difficult to respond to customer needs. We can’t be agile unless data is integrated and coherent. The result is better customer experience. Differentiating ourselves through insight into customer behavior allows us to win relationships even in a commodity business.”

Our research and consulting work at HP indicate an increasing recognition that to truly make the most of BI and analytics, you need to “get the data right.”

Click here for more information about HP’s Information Governance Services to help clients protect, manage and develop data as a valued asset.

Posted by HP Business Intelligence Solutions at April 15, 2010 4:47 AM