Whether it`s called CPM, BPM, analytics, business intelligence (BI), DSS or any other jargon, every executive has heard how important it is to implement a well-designed BI solution to support the corporate decision-making process. Yet, just as there is a common list of reasons why a company must have a BI system, management boards across the world all have similar reasons as to why BI is not required.
Many of these reasons are based on fallacies, myths perpetuated by vendors looking to sell bit solutions without a thought to what the customer actually needs, and by management not willing to sign yet another large cheque made out to an IT vendor.
"BI is neither cheap nor easy to install, making it a grudge purchase in many instances," says Aubrey van Aswegen, MD of Knowledge Integration Dynamics (KID). "It is, however, a necessity in the new business world of compliance regulations, global competition and constantly changing markets."
With decades of experience in BI sales and implementations, the staff of KID have uncovered the seven BI myths most often relied on to postpone or cancel BI projects, always to the detriment of the company concerned. Van Aswegen notes: "While most of the myths seem to be grounded in good business or technology reasoning, a little investigation shows they do not consider all the facts, or the basic premise for buying analytical software."
Myth 1. Management already has all the information it needs
If this is true, why are executives always after another report and additional figures? In addition, how much does it cost when staff members are sent hither and thither to find information, collate data from different sources and produce a report? Moreover, who has the correct version of the data and how does one verify its accuracy when every Joe Soap is creating his own spreadsheet?
Myth 2. Our ERP system provides all we need
Many managers believe their ERP systems should deliver all their informational needs, especially when considering the expense involved. But let`s be realistic: is all a company`s data stored in its ERP database? That would be great, but it is highly unlikely. If the business restricts BI to its ERP data, it is limiting the effectiveness of its analytical applications and the reliability of its data. The same applies to other name-brand applications, such as the many CRM offerings in the market. These solutions are typically equipped with their own analytical applications designed for their area of use, but not for broad application across all areas of the company.
Myth 3. Too expensive
This is a popular fallback when all other arguments have failed. BI is indeed a costly exercise, but done correctly without cutting corners and used appropriately it will pay for itself many times over. The key here is not only the implementation, but the use of the system. No matter what system is installed, it is a white elephant if staff do not use it. In addition, what would be the cost of maintaining the status quo? Has anyone calculated the time costs of manually gathering bits of information from different departments and systems, and then collating and reconciling them in a spreadsheet or some other home-made system nobody understands? A BI system handles all this for managers, allowing them simply to get on with their jobs, confident and assured their reports are drawn from one version of the truth.
Myth 4. A data warehouse is all we need
There is no one application or solution that defines BI. Data warehouses, cubes, dashboards and even the ever-popular spreadsheet are all part of the BI landscape, but they are not standalone solutions. The only effective implementation is one in which each component is part of an overall information architecture.
Without an architecture, executives` nightmares about wasted IT spend and applications that do not integrate with the rest of the infrastructure and never deliver as promised will come true. The critical component is the architecture, not a product.
Myth 5. Build it and they will come
Perhaps this should be described as a delusion instead of a myth. No matter how fabulous the architecture is and how much was spent on it, if the result does not meet the needs of users, they are likely to ignore it and stick to what they know.
A close companion to this delusion is the belief that as long as the BI application delivers benefits, there is no reason actively to market it to users. Business benefits mean little to employees who are more comfortable doing things the way they have always been done. It`s only by selling the system to users in a way that has meaning to them that applications will be used.
Myth 6. Business units are irrelevant
Executive management may believe it is the primary beneficiary of a BI solution, but if individual business units are left out of the design loop, the system is flawed. Without understanding the unit`s data requirements and how it uses information, it is almost impossible to provide an effective analytics solution.
Myth 7. Out of the box delivers better BI
It`s always cheaper and easier to install a packaged application in the hopes that the vendor has included enough BI features to meet the requirements of many businesses. Unfortunately, a business does not thrive on templates and only grows through hard work and planning. The same applies to BI: it is not an "insert the CD and press install" type of application.
Making effective use of information is a given if corporations are to function efficiently, meet the host of new data regulations and still keep ahead of competitors. There is no quick fix when it comes to BI, however. Vendors may provide tools and solutions designed to make the process look simple and transparent, but their offerings only deliver when used as part of properly designed information architecture. BI will not deliver if there are short cuts.
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