Description
The MicroStrategy architecture is selected by organizations with varying needs – from those starting with a single application to those deploying enterprise-wide.
Seven Leading Applications of Business
Intelligence Software
Applications of Industrial-Strength
business Intelligence
I can’t think of a more exciting time for
business intelligence than today.
”
“
At MicroStrategy, we’re dedicated to helping organizations make better business decisions that drive
performance improvements through pervasive access to better information by all personnel. As a
recognized leader in business intelligence, we continue to set the pace of innovation in our industry.
We’ve assembled a team of experts from a variety of disciplines who are committed to our mission
and who have bonded together to create world-class, relevant technology. This team has delivered
a business intelligence architecture that serves as the standard for reporting, analysis, and monitoring
for organizations worldwide.
The MicroStrategy architecture is selected by organizations with varying needs – from those starting
with a single application to those deploying enterprise-wide. Organizations require the unique capabilities
of MicroStrategy: scalability to thousands of users, scalability to terabytes of data, boardroom quality
report presentation, and unconstrained analytical flexibility.
Those organizations who start small with MicroStrategy soon discover MicroStrategy’s unparalleled
power to report, analyze, and monitor information and go on to build additional corporate performance
management applications. Today, we’re finding that many of these companies have fielded a wide variety
of MicroStrategy-based business intelligence applications ranging from financial reporting to sales analysis
to advanced transactional fraud detection and prevention. Our customers’ demands to better understand
their operational data, to deliver higher quality insight information with greater frequency, and to gain
competitive advantage by leveraging this insight have pushed our technology like no other in the market.
On average, MicroStrategy’s enterprise customers have multiple applications and over one thousand users.
We are honored to be able to serve our customers and are dedicated to providing products and services to
ensure their long-term success. The following pages explore a few of the business intelligence applications
enabled by our technology. While they represent only a subset of the applications that are being
successfully constructed and deployed, we hope they convey the variety and richness of applications that
can easily be built using the MicroStrategy Business Intelligence Platform.
As you read on, we trust you’ll agree that there is no more exciting time in the history of business
intelligence than today.
Thank you for your support.
MICHAEL J. SAYLOR,
CHAIRMAN OF THE BOARD AND
CHIEF EXECUTIVE OFFICER,
MICROSTRATEGY INCORPORATED
TO OUR CURRENT AND PROSPECTIVE CUSTOMERS:
Table of Contents
Overview 4
Industry Presence 11
Reporting and Analysis Applications 27
Finance 28
Human Resources 36
Sales Forecast 44
Customer Relationship Management 50
Product Sales 60
Supply Chain and Operations 68
Web Site Analysis 78
Index 84
Building the Best Business Intelligence Software in the World
Company Overview
4 Implementing Industrial-Strength BUSINESS INTELLIGENCE
WHAT IS BUSINESS INTELLIGENCE?
Business intelligence (BI) software allows
companies to tap into their many data-
bases and deliver easy-to-comprehend
insights to employees, management, and
business partners.
Business intelligence software is already
being used by thousands of companies to
find new revenue opportunities, reduce
costs, reallocate resources, and improve
operational efficiency.
THE MICROSTRATEGY MISSION:
HELPING BUSINESSES MAKE BETTER
DECISIONS EVERY DAY
Our mission is to allow every business per-
son to make more informed decisions by
providing them timely, relevant, and accu-
rate answers to their business questions.
To achieve this mission, we have built the
best business intelligence software in the
world. MicroStrategy software provides
analytical insights in a manner that busi-
ness people can easily digest, ranging
from intuitive, graphical dashboards to
highly formatted operational reports.
We meticulously engineer our software to
guarantee its reliability, scalability, security,
and ease of administration for organiza-
tions of all sizes.
UNIFIED REPORTING, ANALYSIS,
AND MONITORING
MicroStrategy offers an unprecedented
range of reporting, analyzing, and moni-
toring capabilities to allow users to make
better business decisions every day.
Report on Detailed Information for
Day-to-Day Decision Making.
MicroStrategy reporting delivers detailed
data on current and historical perfor-
mance to users across the enterprise.
MicroStrategy’s intuitive user interface and
Web reporting allows businesses to deliver
insight to everyone for better decision
making, every day.
Analyze Data to Uncover Root Causes
and Trends in Business Performance.
MicroStrategy provides detailed insight
into business so that managers can
uncover the causes of performance prob-
lems, identify opportunities, and predict
results. Users leverage MicroStrategy’s
advanced analysis to reveal reasons for
performance peaks or aberrations.
Monitor Corporate Performance at
All Levels and in Real-Time.
MicroStrategy provides monitoring tech-
nology to constantly track business metrics.
Companies use their scorecards and dash-
boards to create actionable information
and alerts about ongoing business activity.
Building the Best Business Intelligence Software in the World
MicroStrategy: Best in Business Intelligence 5
Better Business Decisions
Integrated Reporting and Analysis
BUSINESS INTELLIGENCE
PERFORMANCE IMPROVEMENT
Companies need the full cycle of busi-
ness performance insight to achieve
improved corporate performance. The
iterative and ongoing cycle of decision
making is based on reporting on key
metrics, rigorously analyzing data, and
monitoring key indicators. This complete
business analysis cycle enables users to
refine how they manage their business
units and the entire organization.
INTEGRATING REPORTING
AND ANALYSIS
MicroStrategy is the first and only busi-
ness intelligence architecture to unify
reporting, analysis, and real-time monitor-
ing into one seamless experience for the
business user, into one efficient and scal-
able architecture for the IT professional,
and into one economical and extensible
utility for the CIO.
“ We’re excited about the
efficiencies we’re realizing by
standardizing on MicroStrategy
for enterprise monitoring,
reporting, and analysis,” said
Raymond Appel, Information
Technology Manager at
Oakwood Homes.
Business users rely on MicroStrategy software at every step in the cycle of corporate performance improvement. Users review operational
reports, move into seamless analysis of root causes, and are alerted to important changes via scorecards and e-mail alerts. At any step,
users can create different views of the data, explore anywhere in the database, and change their focus to monitor other KPIs for continuous
performance improvement.
MONITOR
Dashboards
Real-Time Alerts
Scorecards
Corporate
Performance
Improvement
Cycle
ANALYZE
Root Causes
Exceptions
Trends
REPORT
Operational Reports
Financial Reports
Performance Reports
6 Implementing Industrial-Strength BUSINESS INTELLIGENCE
Analyst Recognition
MICROSTRATEGY CUSTOMERS ARE
MOST LOYAL
Successful organizations across all indus-
tries choose MicroStrategy technology to
conquer their BI challenges.
Once again, MicroStrategy has outper-
formed the competition in The OLAP
Survey 6, an annual real-world market
survey. The OLAP Surveys are the largest
independent surveys of the BI market
space and products, and are conducted
annually by Survey.com.
For three consecutive years, MicroStrategy
had the highest customer loyalty of any BI
vendor in the entire survey. MicroStrategy’s
leading Overall Customer Loyalty Score of
83.3% is nearly 50% higher than the
Overall Customer Loyalty Score of 56.4%
for Business Objects, which scored tenth
in the overall survey in this area.
MAJORITY SELECT MICROSTRATEGY
AS THEIR ENTERPRISE STANDARD
According to The OLAP Survey 6,
MicroStrategy was the top BI product
selected by customers asked to choose
one product for BI standardization. When
respondents were asked why they selected
MicroStrategy, they cited product features,
its ability to support large numbers of
concurrent users, Web deployability, and
multi-platform support.
MicroStrategy has been a consistent leader
in The OLAP Survey, sometimes by a wide
margin, in multiple categories with the
gap between MicroStrategy’s leadership
position and other vendors growing at an
increasing rate.
“ MicroStrategy, which has concentrated on a single product architecture and has
grown organically, came out on top yet again,” explains Nigel Pendse, the author
of The OLAP Survey 6.
“The fact that MicroStrategy was
rated number one in customer
loyalty for the third year in a row
is a remarkable achievement,”
said Nigel Pendse, author of The
OLAP Survey 6. “The fact that
no other product has achieved
such consistency suggests that
many of MicroStrategy’s cust-
omers are fiercely loyal and see
no alternative to the product.”
MicroStrategy is Ranked #1 by The OLAP Survey 6
BI Vendor
Customer
Loyalty Rank
Overall Loyalty
Score
MicroStrategy 1 83.3%
Cognos Analysis 2 73.8%
SAP BW 3 66.7%
Hyperion Essbase 4 64.0%
Business Objects 5 56.4%
Chart drawn by MicroStrategy using data from The OLAP Survey 6,
comparing MicroStrategy and its “peer group” subset.
Product
Rank: Preferred Products to
Standardize On
MicroStrategy 1
SAP BW 2
Cognos Analysis 3
Hyperion Essbase 4
Business Objects 5
Table compiled by MicroStrategy using data from The OLAP Survey 6,
comparing MicroStrategy and its “peer group” subset.
Key: 1: Most preferred product to standardize on, 5: Least.
MicroStrategy: Best in Business Intelligence 7
MicroStrategy 8
MICROSTRATEGY SOFTWARE:
INTEGRATING BUSINESS REPORTING
AND ANALYSIS
The MicroStrategy platform was designed
to address the most pressing challenge in
BI today. That challenge is to help com-
panies empower their personnel and
business partners to make better busi-
ness decisions every day.
With MicroStrategy, companies no longer
need numerous distinct products from differ-
ent vendors to provide reporting, analysis,
and performance monitoring. With a scalable
architecture and a single metadata, users
can navigate seamlessly from scorecards and
dashboards to reports and analysis without
being forced to open and close multiple BI
tools and navigate dissimilar interfaces.
MicroStrategy 8 has radically reduced the
time to design and deploy new reports with
what-you-see-is-what-you-get (WYSIWYG)
report design. MicroStrategy 8 broadens
the universe of data sources that business
users can access for their reporting and
analysis activity. Business users can directly
query data stored in financial, human
resources, supply chain, and other opera-
tions systems without having to first move
this data into a data mart or data cube.
MICROSTRATEGY DYNAMIC
ENTERPRISE DASHBOARDS
MicroStrategy Dynamic Enterprise Dash-
boards deliver a new caliber of information
dashboards. MicroStrategy combined state-
of-the-art data visualization and interactivity
with its industrial-strength business intelli-
gence platform to create dashboards that
yield greater business insight and are usable
by more people than ever before.
Dashboards provide easy-to-use access to
enterprise data and help organizations
track performance and optimize decision
making. At-a-glance, executives, manag-
ers, and business users can immediately
understand their organization’s health
through a range of insightful data
visualizations, such as key performance
indicators (KPIs), tables, graphs, trend
indicators, gauges, heat maps, and many
more. MicroStrategy dashboards incor-
porate Adobe
®
Flash
®
, providing a wide
range of information views and increased
information exploration options. Using
MicroStrategy’s zero-footprint WYSIWYG
Web interface, business users can create
dashboards using simple drag and drop
actions, increasing the use and adoption
of business intelligence systems.
“ We are impressed with the rich platform of MicroStrategy 8.1, especially the new graphs,
panels, and selectors,” said Jordan Silvergleid, Managing Director at the Advisory
Board Company. “MicroStrategy Dynamic Enterprise Dashboards are truly engaging
and can be intuitively designed, built, and deployed with ease over the Web.”
The Next Generation BI Platform
“ MicroStrategy Dynamic
Enterprise Dashboards
represent a new caliber
of dashboard,” said Ryan
Osterhues, MicroStrategy
Administrator at PETCO
Animal Supplies, Inc.
“With MicroStrategy 8.1,
there are many ways in
which our data can be
visualized and displayed
to our decision makers.”
8 Implementing Industrial-Strength BUSINESS INTELLIGENCE
Highest Data Scalability
SELECT CUSTOMER DEPLOYMENTS WITH LARGE DATA SCALE
20 Terabytes
eBay Retail >25 TB Teradata 2,800 Users
Catalina Marketing
Corporation
Media 28 TB Netezza 350 Users
METRO Group Retail 34 TB Teradata 2,500 Users
Nationwide Insurance 44 TB Teradata 20,000 Users
U.S. Postal Service Government 60 TB Teradata 50,000 Users
*Data collected as of August 2007. Data sizes are expected to increase further.
MICROSTRATEGY IS THE INDUSTRY
LEADER IN DATA SCALABILITY
During the preceding decade, companies
have experienced an explosion in the vol-
ume and scope of data they generate. The
advent of a myriad of systems — ERP,
CRM, Web site, sales force automation,
SEC compliance, supply chain, inventory,
POS, and even RFID — has contributed to
this massive influx of data.
An enterprise BI architecture must be
able to access the full depth and breadth
of all of these databases to be truly effec-
tive for the enterprise. MicroStrategy’s
ROLAP architecture was designed to
access the largest databases with the
highest performance.
Customers Rely on MicroStrategy to Support
High Data Scalability
“For the sixth consecutive year,
MicroStrategy sites have reported
the largest data volumes of all,
with a substantial gap between
MicroStrategy and the second
place product,” said Nigel Pendse,
author of The OLAP Survey.
MicroStrategy: Best in Business Intelligence 9
Highest User Scalability
SELECT CUSTOMER DEPLOYMENTS WITH LARGE USER SCALE
1,000 – 5,000 Users
Amway Consumer Goods 1.5 TB SQL Server 2000 2,000 Users
Telefónica Telecommunications 1.5 TB IBM DB2 >10,000 Users
>20,000 Users
Ingenix Healthcare 1.6 TB Oracle 20,000 Users
Nationwide Insurance 44 TB Teradata 20,000 Users
The First American
Corporation
Financial Services 3.5 TB SQL Server 30,000 Users
U.S. Postal Service Government 60 TB Teradata 50,000 Users
*Data collected as of August 2007. User bases are expected to expand further.
SCALABILITY TO THOUSANDS
OF USERS
An enterprise BI architecture must be able
to support tens of thousands of users, all of
whom can interactively access the same
reports, scorecards, and analyses. While
many BI vendors cite customers with large
user populations, they do not mention
these high numbers are really just aggrega-
tions of many small isolated BI applications,
or that their implementations require
massive server farms.
MicroStrategy delivers full 64-bit BI, allow-
ing it to deliver the most user sessions on
the fewest servers. And, MicroStrategy
is one of the few with this technol-
ogy to support large user scalability.
MicroStrategy customers routinely run
single BI applications to thousands of
people through the interface of their
choice, using just a few servers, and with
high performance.
Customers Rely on MicroStrategy to Support
High User Scalability
“ Despite many vendors claim-
ing to be able to handle large,
detailed applications, it is
clear that only MicroStrategy’s
customers are actually imple-
menting such transaction-level
BI databases. MicroStrategy
continues to be the clear lead-
er in the enterprise-scale BI
segment,” said Nigel Pendse,
author of The OLAP Survey.
CHOSEN AS THE BI STANDARD BY GLOBAL LEADERS
Many of the leading FORTUNE
®
Global 500 companies rely on MicroStrategy for their
business intelligence solutions.
MicroStrategy customers represent:
• 9 of the top 10 global pharmaceutical companies
• 8 of the top 10 global telecommunications companies
• 8 of the top 10 global healthcare companies
• 7 of the top 10 global retailers
• 7 of the top 10 global commercial banks
• 7 of the top 10 global manufacturing companies
• 5 of the top 7 global consumer goods companies
• 4 of the top 5 U.S. diversified financial services companies
• 4 of the top 5 global insurers
• Federal, State, and Local Government agencies
Indeed, world-class companies across all industries depend on MicroStrategy to improve
corporate performance and streamline operations. MicroStrategy customers are making
thousands of better business decisions every day as they deploy MicroStrategy to their
business users, customers, and suppliers.
The following pages present snapshots of MicroStrategy success across many industries,
including Retail, Financial Services, Telecommunications, Pharmaceutical, Healthcare,
Consumer Goods and Manufacturing, and Insurance. The MicroStrategy team has
amassed in-depth experience in deploying successful applications for customers across
each of these industries.
Industry Presence
12 Implementing Industrial-Strength BUSINESS INTELLIGENCE
RETAIL SEGMENTS: Apparel, Department Stores, Discount Drugstores, Discount
Retailers, Electronics, Home Improvement, Specialty Grocery, Specialty Retailers
CORPORATE EXPRESS
2007 TDWI Best Practices Award Winner in Predictive
Analytics
APPLICATIONS
Market Basket Analysis, Marketing Analysis, Predictive
Analytics, Sales Analysis
DEPLOYMENT
Database: Netezza DB Size: 8 Terabytes Users: Up to
10,000 total Architecture: Intranet, Extranet
Corporate Express, a 2007 TDWI Best Practices Award
Winner, is using its market basket application to track the
baskets of all of its online customers, and can identify
which SKUs are most profitable or poor performers when
purchased in combinations.
LIMITED BRANDS
Unlimited Access to Insight
APPLICATIONS
Category Management, Human Resources, Inventory
Management, Marketing Analysis, Merchandise
Management, Store Operations
DEPLOYMENT
Database: Teradata DB Size: 8 Terabytes Users:
1,000 financial and marketing managers, and analysts
Interface: Desktop and Web Architecture: Intranet
Limited Brands currently uses MicroStrategy for customer
analysis, financial analysis, inventory management, sales
analysis, and category management reporting across all
of its brands (including Victoria’s Secret, Express, Bath &
Body Works, and Henri Bendel).
Retail Customers Include:
Aeropostale
Ahold
American Signature, Inc.
Applebee’s International Inc.
Barnesandnoble.com
Belk
Boots The Chemists
Borders Group, Inc.
Boscov’s Department Stores
Charming Shoppes
Circuit City Stores
Comet
The Container Store
Corporate Express
CSK Auto Corporation
Darden Restaurants
David’s Bridal
Dick’s Sporting Goods
eBay
Eckerd
Faith Shoes
Food Lion
GUESS?, Inc.
Hannaford Bros. Co.
Hard Rock Cafe
Harris Teeter
HE Butt Grocery Company
Hudson’s Bay Company
KB Toys, Inc.
Limited Brands
Liz Claiborne
Lloydspharmacy
Lowe’s Companies, Inc.
Meijer Stores
METRO Group
Michaels Stores
Micro Center
Office Depot
O’Reilly Automotive
Pacific Sunwear
Petco Animal Supplies
PF Chang’s
Priceline.com
Raley’s
Roundy’s Supermarkets, Inc.
Shoppers Drug Mart Inc.
Starbucks Corporation
Victoria’s Secret, Inc.
Virgin Retail
Yahoo!
LIZ CLAIBORNE, INC.
Uncovering Revenue Opportunities
APPLICATIONS
Category Management, Inventory Management,
Merchandise Management, Planning, Sales Analysis,
Store Operations
DEPLOYMENT
Database: Oracle Users: Over 250 Liz Claiborne
managers and analysts Architecture: Intranet
A customer since 2000, Liz Claiborne’s employees are
analyzing financial, sales, and inventory data across
30,000 points of sale worldwide — department stores,
specialty stores, and catalogs/Internet — to uncover
revenue opportunities.
LOWE’S COMPANIES
Building Strong Revenues
APPLICATIONS
Inventory Management, Merchandise Management,
Merchandising and Executives Dashboards, Operations
Management, Supply Chain Management
DEPLOYMENT
Database: Teradata DB Size: 20 Terabytes Users: 3,500
active employees and vendors Interface: Web, E-mail
Architecture: Intranet, Extranet
Lowe’s is the second-largest home improvement retailer in
the world. Lowe’s employees from multiple business areas
use MicroStrategy to manage inventory, improve margins,
review market specificity, and identify sales opportunities.
Snapshot of MicroStrategy Technology at Work in the Retail Industry:
7 of the Top 10 Global Retailers are MicroStrategy Customers
Industry: Retail
MicroStrategy: Best in Business Intelligence 13
“As a result of using the MicroStrategy platform, Lowe’s is realizing significant
benefits through improved merchandising decisions, more timely responses to
information requests, cost reduction initiatives, enhanced employee productivity,
and better service to our customers.”
Steve Stone, Senior Vice President and Chief Information Officer, Lowe’s Companies
Customer Applications
Category Management
Assortment Optimization
Category Contribution
Category Scorecards
Item Definitions
Market Comparison
Pricing Modules
Role Analysis
Season Changeover
Share of Shelf
SKU Rationalization
Vendor Performance
Loss Prevention
Backorders
Cancels
Distribution Shrink
Hot Customer
Hot Staff
Hot Stores
Markdowns
Natural Losses
Return Rates
Shrink Analysis
Vendor Rationalization
Market Basket
Attachment Rates
Basket-Register Correlation
Brand Switching
Core Item Frequency
Core Items
Customer Loyalty
Demographic Baskets
In-Basket Price
Items per Basket
Revenue Contribution
Shopper Penetration
Marketing Analysis
Ad Blocks
Channel Share
Coupon Distribution
End-Cap Efficiency
Feature vs. Display
Grand Openings
Marketing Areas
Market Share
Price Points
Promo Lift
Seasonal Events
Merchandise Management
Department Contribution
Hot Item Report
In Stock %
Inventory Turns
Lineal Feet
Mark Down %
Pull-Through
Reallocations
Seasonal Buying
Sell-Through
Weeks of Supply
Store Operations
Asset Turnover
Competitor Stores
Comp Store Sales
Front Store Sales
Inventory Turnover
Labor Cost Analysis
Reallocation / DSD
Register Usage Analysis
ROA
Sales & Margin
Sales / Square Foot
14 Implementing Industrial-Strength BUSINESS INTELLIGENCE
THE FIRST AMERICAN CORPORATION
Enterprise Reporting and Executive Dashboards
APPLICATIONS
Analytical Reporting, Business Performance, Compliance
Reporting, Enterprise Reporting, Extranet Reporting,
Operational Reporting
DEPLOYMENT
Database: SQL Server DB Size: 3.5 Terabytes Users:
30,000 total Architecture: Intranet, Extranet
MicroStrategy fuels a variety of applications, including
business performance dashboards for executives,
operational reporting for channel vendor manage-
ment, and compliance reporting for partner lending
institutions.
H&R BLOCK
Providing Highly Secure Access to Business
Information
APPLICATIONS
Customer Analysis, Employee Performance
DEPLOYMENT
Database: Oracle DB Size: 1 Terabyte Users: 1,000
financial advisors and analysts Architecture: Intranet
MicroStrategy provides highly secure access to business
information for its 1,000 financial advisors by e-mailing
5,000 reports containing customer activity data on a
weekly basis. Financial analysts use MicroStrategy to
analyze employee performance for annual and quarterly
achievement recognition.
Financial Services
Customers Include:
1st Financial Bank USA
21st Century Insurance
ABN AMRO
Banco Espirito Santo
Banco Itaú
Banco Patagonia
Bank of the West
BNL
BNP Paribas
Caixa Laietana
Capital One Services Inc.
Capitol Indemnity Corporation
Cetelem
Deutsche Bank
Deutsche Börse
Fannie Mae
Finansbank
The First American Corporation
First Franklin Financial Corporation
Franfinance
Freddie Mac
GE Consumer Finance
H&R Block
Industrial Bank of Korea
Intesa Mediofactoring
KeyBank National Association
Korea Federation of Savings Banks
Land Bank of Taiwan
LowerMyBills
Macquarie Bank
People’s Bank of China
PRG-Schultz International
Redecard
Redwood Trust
Sparda Bank
Swedbank
TRX Data Services Inc.
Universal-Investment
Wells Fargo Bank
Wells Fargo Home Mortgage
LA CAIXA
Investing in Innovative Technology
APPLICATIONS
Cash Flow, Credit Card Analysis, Electronic Banking and
Online Services, Marketing Analysis, Product Profitability,
Risk Management, Web Click Stream Analysis
DEPLOYMENT
Database: Oracle, DB2 DB Size: 1.7 Terabytes Users:
3,000 accessing monthly Mgmt. Info., 180 business
analysts accessing >50 projects Interface: Desktop, Web
Architecture: Intranet
La Caixa currently has more than 50 applications
dependent on MicroStrategy technology.
TRX INC.
Deploying Self-Service Extranet Reporting to
Thousands of Users in Four Months
APPLICATIONS
Customer Relationship Management, Financial Analysis,
Fraud Profiling, and Risk Analysis
DEPLOYMENT
Database: DB2 UDB EEE DB Size: >1.5 Terabytes
Users: >10,000 Interface: Web Architecture: Extranet
Operating System: I-Server Universal and Web Universal
running on IBM AIX
The joint MicroStrategy/TRX solution at one of the top five
financial institutions is enabling multinational commercial
clients to report and analyze charge card and travel data
from 29 countries and in 11 languages.
Snapshot of MicroStrategy Technology at Work in the Financial Services Industry:
FINANCIAL SERVICES SEGMENTS: Asset Management Brokerage, Consumer Credit,
Debt and Equity, Individual / Institutional Investment Banking, Retail Banking
7 of the top 10 global commercial banks are microstrategy customers
Industry: Financial Services
MicroStrategy: Best in Business Intelligence 15
“We’ve selected MicroStrategy over competing products because of its outstanding
scalability for large numbers of users and its superior capability to generate user-friendly
reports with highly detailed analysis of granular-level data.“
Gus Tepper, Vice President of Software Development, Interactive Division, First American Corporation
Customer Applications
Advisory Services
Asset Management
Confirmation Alerts
Customer Alerts
Customer Profitability Analysis
Customer Statements
Portfolio Analysis
Portfolio Risk Analysis
Product Introduction
Research Distribution
Tax Notification
What-if Analysis
Financial Analysis and
Compliance
Budget Variance Analysis
Compliance Alerting
Cost Analysis
FAS 133 Analysis
Loan Analysis
Margin Analysis
Portfolio Analysis
P&L Reporting
Revenue Reporting
Taxes
Trade Floor Reporting
Fraud Profiling and
Risk Analysis
Claims Analysis
Credit Risk Management
Customer Risk Scoring
Exceptions Risk Management
Exposure Reporting
Fraud Risk Management
Hedge Slippage Alerts
Index Performance Alerts
Prepayment Risk
Underwriting Scorecards
Value At Risk Analysis
Marketing
Campaign Analysis
Channel Efficiency
Cross-Sell Analysis
Customer Analysis
Customer Loyalty Analysis
Market Basket Analysis
Marketing Segmentation
Product Management
Product Profitability Analysis
Up-Sell Analysis
Web Traffic Analysis
Operations
Branch Office Scorecards
Call Center Management
Channel Management
Commission Reporting
Customer Statements
Financial Reporting
Swap Mark to Markets
Trade Confirmations
Trade Floor Reporting
Trade Settlement Alerts
Wire Transfer Alerts
Sales and Trading
Client Loyalty Analysis
FAS 133 Analysis
Financial / P&L Reporting
Hedge Slippage Alerts
Market Data Analysis
Portfolio Analysis
Position Reporting
Refinance Risk Analysis
Research Distribution
Trade Floor Reporting
Transaction Volume Analysis
16 Implementing Industrial-Strength BUSINESS INTELLIGENCE
CHARTER COMMUNICATIONS, INC.
Giving Users the Ability to Act on Valuable Customer
Case, Billing, Sales, and Marketing Data
APPLICATIONS
Billing Analysis, Customer Analysis,
Marketing Analysis, Sales Analysis
DEPLOYMENT
Database: Oracle Users: 1,500 Interface: Web
Architecture: Intranet
Charter uses MicroStrategy for reporting on and
analyzing key business areas, including customer care,
billing, sales, marketing, and technical operations.
MicroStrategy provides Charter personnel with a plat-
form for strategic, internal intelligence gathering and
gives users easy access to information about many
of Charter’s critical business functions.
SPRINT
Reaching a Large User Community Through
Enterprise-Wide Business Intelligence
APPLICATIONS
Campaign Management, Customer Analysis / CRM,
Enterprise Reporting, Financial Reporting and Analysis,
Human Resources, Marketing Analysis, Sales Analysis
DEPLOYMENT
Database: Teradata, Oracle, and Informix Users: 10,000
Interface: Desktop and Web Architecture: Intranet
More than 10,000 Sprint employees use
MicroStrategy for 30 critical BI applications across
the enterprise.
Telco Customers Include:
Alcatel Lucent Portugal
Alltel Communications Products
Angola Telecom
Belgacom
Bell Canada
Charter Communications, Inc.
Deutsche Telekom AG
era - Polska Telefonia Cyfrowa
Eurotel
Fastweb
Fujians Telecoms
Hanaro Telecoms
Jupiter Telecommunications
MACH
Nextel Communications Argentina
SFR
Singtel
Sprint
Telefónica de Espana
Telefónica movil
Telephia
Turkcell
Verizon Communications
Versatel
Vodafone Italy
TELEPHIA
Deploying Dashboards, Scorecards, and Interactive
Reports for Multiple BI Applications
APPLICATIONS
Advertising Effectiveness, Content Audience, Customer
Satisfaction, Device Share, Network Quality, Revenue
Share, Subscriber Share
DEPLOYMENT
Database: Teradata DB Size: CHARMING SHOPPES, INC.
Using Business Intelligence Across the Retail Enterprise to Improve Decision Making
Charming Shoppes, Inc. uses the MicroStrategy platform across its enterprise. Charming Shoppes is
the largest plus-size specialty apparel retailer in America, with more than 2,300 stores nationwide.
Charming Shoppes’ extensive use of the MicroStrategy platform generates daily and weekly
reports on an array of company activity. These highly detailed reports encompass merchandise
sales and inventory analysis; assessments of the history of customer traf?c in and out of stores;
analysis of point-of-sales transaction details and promotion history; evaluations of transaction
and promotion history for identi?ed customers; HR/payroll reviews of store payroll hours and
budget data; and analysis of accounts payable, the general ledger and ?xed asset information.
These applications, running against a 2-terabyte Teradata data warehouse, involve each
division headquarters and store operations’ ?eld of?ce and more than 800 Charming Shoppes
employees, a number that is expected to grow.
CUSTOMER VIGNETTES: IMPLEMENTING BI FOR FINANCE
30 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Finance
Key Performance
I ndi cators
Current Ratio
Quick Ratio
Period over Period Variance
Return on Assets
Return on Equity
Assets Turnover Ratio
Market to Book Ratio
Inventory Turn and Forecasting
Risk Management
The Balance Sheet is one of the fundamental reports of corporate accounting. Balance sheets
are produced multiple times during the close cycle to verify accuracy before one ?nal version
is released to shareholders, government agencies, and the public. BI enables the consolidation
of the Balance Sheet much more rapidly than typical ERP systems – reducing the time to close.
The most basic level of reporting is the automated consolidation of the balance sheet and the
electronic distribution of the report securely to all approving authorities. Typical analytical areas
include interactive investigation of balance sheet anomalies, drilling to more detailed subaccounts
through simple point and click, and the creation of custom divisional or regional balance sheets.
Sample Report: “Drillable” Balance Sheet
Balance Sheet Reporting and Analysis
COMMON BUSINESS QUESTIONS
• How do the balance sheets of different subsidiaries compare?
• What is the variance of assets, liabilities, and equity between two selected time periods?
• What is the Net Working Capital of the company?
• Which business unit caused cash drain in a particular period?
• What is the breakdown of shareholders equity in a certain period?
• What is the leverage and liquidity of the company?
Period Ending 31-Dec-06 30-Sep-06 30-Jun-06 31-Mar-06
Current Assets
Cash and Cash Equivalents
Short Term Investments
Net Receivables
Inventory
Other Current Assets
Total Current Assets
Long Term Investments
Long Term Investments
Property Plant and Equipment
Goodwill
Intangible Assets
Other Assets
Total Long Term Assets
Total Assets $ 89,326,000 $ 82,832,000 $ 95,894,000 $ 95,297,000
31,209,000
56,000
28,690,000
890,000
5,032,000
65,877,000
$
$
$
$
$
$
N/A
18,471,000
540,000
3,214,000
1,224,000
23,449,000
$
$
$
$
$
28,385,000
53,000
19,850,000
930,000
4,685,000
54,083,00
$
$
$
$
$
$
N/A
20,161,000
2,775,000
N/A
5,813,000
28,749,000
$
$
$
$
37,292,000
N/A
22,761,000
784,000
3,100,000
63,937,000
$
$
$
$
$
N/A
22,291,000
3,575,000
N/A
6,091,000
31,957,000
$
$
$
$
32,821,000
590,000
22,652,000
945,000
4,436,000
61,664,000
$
$
$
$
$
$
N/A
24,303,000
4,437,000
N/A
5,913,000
34,653,000
$
$$
$
$
This balance sheet report helps accountants close the books more quickly by allowing direct analysis
of line items from summary data. Clicking on the account links in the left hand columns, users can
immediately drop to the subaccount level. Potential anomolies are highlighted based on the accountant’s
business rules, e.g., numbers that are more than 10% out of trend. As a next step, the analyst can view
key ?nancial ratios (quick ratio, current ratio, return on assets), and determine if these have changed
materially from prior periods.
MicroStrategy: Best in Business Intelligence 31
The pro?t and loss (P&L) statement, detailing revenue and costs, is a key component of certain
SEC ?lings and is also a useful tool for understanding the health of a business. Executives and
managers continually monitor P&L actuals versus budgets and forecasts to ensure their business
is operating on plan. Automatically generated P&L reports allow managers to see current period
revenue, costs, and pro?tability, period over period and business unit to business unit comparisons,
and actuals to plan. Business intelligence also permits development of more accurate and timely
quarterly and yearly performance analysis, allows navigation to detailed revenue and cost
components, and enables more re?ned margin and contribution assessment.
Sample Report: Abbreviated Pro?t & Loss Summary by Region
Region: Latin America
Month: Sep-07
Pro?t and Loss/Income Statement Analysis
COMMON BUSINESS QUESTIONS
• What is the profit margin of each business unit and/or geographic region?
• How have margins changed month-to-month over the past year?
• Which business units are hitting their margin targets? Which are falling short?
• Which business units are more than 10% above/below their contribution targets?
• Which units or regions are over budget by more than 5%?
• Which departments have the highest contribution per employee?
• Are there trends underlying any revenue or expense categories that need immediate attention?
Account Type Actual YTD ($) YTD Budget Through
Current Month ($)
YTD Budget
Variance ($)
YTD Budget
Variance ($)
TeleSales Revenue
Store Revenue
Internet Revenue
Other Revenue
8,947,825
10,589,423
2,456,812
56,892
9,256,340
10,245,675
3,012,500
0
(308,515)
343,748
(555,688)
56,892
(-3%)
3%
(-18%)
100%
Total 22,050,952 22,514,515 (463,563) -2%
Salaries & Commissions
T&E
Communications
Shipping, Printing, Supplies
Marketing
Depreciation
Rent and Related Of?ce Exp
3,256,425
245,987
66,487
51,987
1,356,789
215,874
103,452
3,385,500
250,000
65,000
50,000
1,350,000
225,000
103,475
10,075
4,013
(1,487)
(1,987)
(6,789)
9,126
23
0%
2%
(-2%)
(-4%)
(-1%)
4%
0%
Total
Contribution
5,416,001
16,634,951
5,428,975
17,085,540
$ 12,974
(485,589)
0%
-3%
Key Performance
I ndi cators
Gross Profit Margin
Income
Net Operating Income
Net Operating Loss
Operating Expense to Sales
Contribution per Employee
Payout Ratio
Operating Margin
Earnings per Share
This example of a P&L highlights a company’s Latin American business for the year to date. With built-
in security ?lters, the General Manager for Latin America can see only the ?nancial data related to
her region. Negative variances are highlighted in red. By monitoring this report monthly, the Regional
Manager can see that she’s managed costs effectively but revenue is trailing plan. A next step would be
to drill on the Internet and Telesales Revenue, which have the highest negative variance, at the country
level to determine if the problem is due to one country or the entire region.
32 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Finance
Key Performance
I ndi cators
Changes in Net Working Capital
Foreign Exchange Impact
Average Daily Balance
Bad Debt Accrual
Variance in Interest Income
Variance in Interest Expense
Top 10 Payables
Top 10 Receivables
Investment Allocation
A Cash Flow Statement is one of the standard components of certain SEC ?lings that
summarizes the operating activity of a business and provides insight into its ability to generate
cash. Executives, treasurers, accounting professionals, and investors rely on cash ?ow statements
to make ?nancing, operating, and investing decisions. Standard ?nancial systems, which aren’t
optimized to handle large amounts of transaction-level data, take many hours to consolidate
cash ?ow reports and can’t automatically distribute these reports. Business intelligence provides
automatic, near real-time generation and distribution of the cash ?ow statement. Business
intelligence seamlessly integrates sophisticated analysis including foreign currency exposure,
optimized payables schedules, and cash ?ow predictions to ensure investments in short-term
and long-term instruments are aligned with cash requirements.
Sample Report: Operational Cash Flow Changes
Corporation: France
Cash Flow Analysis
COMMON BUSINESS QUESTIONS
• Can the company finance itself internally or will it need additional outside financing for its
future growth opportunities?
• What is the cash position for each subsidiary in both local and home currency?
• What is the cash risk associated with exchange rates?
• On average, how long does a particular entity take to pay invoices? Collect receivables?
• What impact does a change to depreciation method have?
• What is the trend in liabilities and will the current ratio suffer as a result?
• What investing activities are yielding the best results? Worst results?
Period Ending 31-Mar-07 31-Dec-06 31-Sep-06 30-Jun-06
Net Income (000) $ 1,273 $ 1,494 $ 1,494 $ 910
- Cash Flow Operating Activities
+ Depreciation $ 387 $ 434 $ 410 $ 505
+ Adjustments to Net Income $ 111 $ 24 $ 142 $ 140
+ Changes in Accounts Receivables $ 300 (73) $ (44) $ 86
+ Changes in Liabilities $ 350 88 $ (15) $ (377)
+ Changes in Inventories $ (132) $ 16 $ (105) $ 385
+ Changes in Other Operating Activities $ 124 $ 333 $ 158 $ 662
- Cash Flows From Operating Activities $ 2,413 $ 2,316 $ 2,010 $ 2,311
+ Cash Flows From Investing Activities $ (482) (312) $ (195) $ (224)
+ Cash Flows From Financing Activities $ 1,516 $ (1,623) $ (524) $ (1,746)
Effect of Exchange Rate $ (8) $ 22 $ (15) $ 25
Change in Cash and Cash Equivalents $ 407 $ 403 $ 1,276 $ 366
This example shows a segment of a standard Statement of Cash Flows with items highlighted that are
more than 25% out-of-trend with the annual average. The outline mode shown here is automatically
generated and allows quick access to the line items comprising a summary account. Highlighted items
suggest areas for further investigation, such as Accounts Receivable, to determine the cause of the
increase like a large customer not paying a bill or exposure to a troubled industry or geography.
MicroStrategy: Best in Business Intelligence 33
Companies track Accounts Receivable (A/R) and Payable (A/P) to manage operating cash
?ow. Basic A/R and A/P reports includes tracking the value of accounts that are 30, 60, or
90 days past due, monitoring distribution of receivables across customers, and reviewing
payment trends for vendors across periods. More sophisticated analysis includes predicting
potential bad debts, forecasting cash outlays, and tracking invoices and journal entries to the
corresponding accounting representative. Businesses adding business intelligence to their A/P
and A/R functions are bene?tting from more ef?cient cash management.
Sample Report: Accounts Receivable Summary for Selected Organizations
Accounts Receivable and Accounts Payable Reporting
and Analysis
COMMON BUSINESS QUESTIONS
• What is the aging distribution of accounts receivable?
• What is the total amount of money in collections?
• Which are my poor-payment history customers by dollar amount and/or invoice quantity?
• Which sales representatives need to be notified to assist in the collection process?
• What is our predicted bad debt?
• What is the aging distribution of our accounts payable?
• To which vendors does each business unit owe money? When do they need to pay?
• With which vendors do we do the highest volume of business?
• What is the forecasted impact on working capital?
Account Type Payment History INVOICE ID TOTAL AR Paid Last 90 Days 30 Days 31 to 60 Days 60 to 90 Days 90 to 180 Days
Party Supply
Comany
Good 14567 $9,342 $3,114 $3,114 $6,228
12765 $0 $9,000
18222 $7,626 $7,625 $3,813 $3,813
$16,968 $19,739 $3,813 $6,927 $0 $6,228
Parts
Manufacturer
Fair 57990 $70,250 $70,250
70002 $35,886 $35,886
71225 $9,899 $9,899
$116,035 $0 $9,899 $0 $106,136
$133,003 $19,739 $3,813 $16,826 $0 $112,364
Link to detailed invoice payment report
Key Performance
I ndi cators
Sales Outstanding
Amount Outstanding
Predicted Bad Debt
Change in Working Capital
Least Desirable Customers
Most Valuable Customers
Vendors with Discount
Potential
Aging Distribution
A/R Turnover Ratio
This summary report links invoice detail, A/R aging, and customer payment history. The report contains
links to the invoice detail providing access to invoiced items, purchase order number, and approver
name. The payment history ?eld is based on the organization’s de?nitions for payment scoring and is
calculated based on historic payment patterns. As a next step, users can navigate to reports showing all
receivables more than 90 days old, receivables greater than a certain dollar amount, or trends in certain
geographies or industries.
34 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Finance
Key Performance
I ndi cators
Forecasted Revenue
Forecasted Expenses
Forecasted Contribution Margin
Revenue Probability
Variance to Plan
% of Compensation Target
Top 5 Business Units
Exceeding Plan
Top 5 Salespeople by
Forecasted Revenue
Financial budgeting and forecasting is an essential part of the business planning process.
Executives and managers continually revisit forecasts as actuals are reported to determine how
their business is performing relative to plan. Forecast reports allow detailed analysis by budget
owners at every level of the organization and set the stage for determining sources of revenue
and spending priorities. From simple reporting on actual performance versus budget to more
sophisticated “what if” scenario creation and predictive modeling, organizations use business
intelligence to make fact-based business plans and better monitor performance.
Sample Report: Field Sales Regional Dashboard > Western Region
Financial Budgeting and Forecasting
COMMON BUSINESS QUESTIONS
• What is the variance between my revenue forecast, budget, and compensation target by
service line?
• How much revenue does each region/district/business unit expect to earn in the coming quarter?
• Which regions’ forecasts are above corporate plan?
• What is the variance between my forecast product revenue and my compensation target?
• Does one unit predict significantly more or less revenue than last quarter? Why?
• Which forecasts are more than 10% below expectations?
• Which business units have historically performed 5% above or below plan?
Business Unit: North America
Quarter: Q1 2007
Business Unit Owner: Amanda Phillips
Account Actual QTD QTD Budget ($) QTD Budget Variance ($)
REVENUE
Product License $ 65,236,584 $ 78,523,698 $ (13,287,114)
Services $ 56,325,874 $ 51,232,156 $ 5,093,718
Other $ 2,154,885 $ 7,654,896 $ (5,500,011)
TOTAL $ 123,717,343 $ 137,410,750 $ (13,693,407)
COSTS
Salaries $ 53,663,095 $ 52,610,878 $ (1,052,218)
Rent $ 33,639,034 $ 34,325,545 $ 686,511
Fixed Allocations $ 5,026,205 $ 5,128,780 $ 102,576
Sales and Marketing $ 19,238,306 $ 19,630,925 $ 392,618
Communications $ 325,432 $ 451,023 $ 125,592
TOTAL COSTS $ 111,892,071 $ 112,147,150 $ 255,079
CONTRIBUTION $ 11,825,272 $ 25,263,600 $ (13,438,328)
This dashboard is an example of a report that might be deployed to each regional sales manager
comparing revenue, compensation targets, and quarterly forecasts. Sales managers can quickly see how
close they are to the revenue goal and the opportunities they should focus on in the short-term to
reach their goals. Sales managers can click from the summary to speci?c deal details to identify sales
representative assignment, customer contacts, and next action items.
MicroStrategy: Best in Business Intelligence 35
Credit risk, contract risk, currency risk, fraud risk, and audit risk – all are becoming increasingly
important components of risk that must be controlled by corporations and government
agencies. Credit risk management, by combining data from publicly available sources with
corporate customer and sales data, focuses on the determination of credit ratings, credit risk
exposure in a particular country or industry, or the impact of increased customer defaults.
Currency risk analysis involves evaluation of exchange rate exposure and predictive modeling
of the impact of currency ?uctuations on forecasted pro?t margin. Fraud risk analysis, through
the use of statistical data mining techniques, can uncover patterns of activity correlated to
fraudulent events. Business intelligence, by enabling the use of data mining and statistical
techniques for risk detection and management, empowers wider worker populations to help
mitigate the various forms of corporate risk.
Sample Report: Credit Risk Assessment
COMMON BUSINESS QUESTIONS
• What is a customer’s payment history?
• At the current exchange rate, how do revenues and expenses convert to local currency?
• What is the variance on forecasted profit margin at the current exchange rate and at the year
end projected exchange rate?
• How does the current cost of capital affect margin compared to last year?
• Is the average age of A/R increasing or decreasing?
• What five foreign currencies represent the most exposure?
Key Performance
I ndi cators
Average Outstanding Balance
Payment Behavior Index
Exchange Rate Volatility
Top 5 Exposure Currencies
Top 5 Exposure Industries
Average Daily Balance/Assets
% Change in Receivables
Change in Credit Rating
The Clothing Company
Credit
Rating
Total Credit
Line
Credit
Available
% Credit Line
Available
Deposits and
Other Assets
Payment
History
Ocean Airline Aaa $ 575,138 $ 57,892 10% $ 8,503,990 Good
Global Industries Bbb $ 651,822 $ 324,587 50% $ 9,637,840 Fair
The Clothing Company bbb $ 452,846 $ 325,698 72% $ 6,695,781 Fair
Financial Instruments Aaa $ 373,053 $ 372,154 100% $ 5,515,962 Good
NSP Co. Bbb $ 360,991 $ 123 0% $ 5,337,613 Poor
Great Motors AAA $ 369,115 $ 89,654 24% $ 5,457,734 Good
Light Food Aaa $ 261,363 $ 154,789 59% $ 3,864,513 Fair
Eyeshapers Inc. Aaa $ 172,513 $ 65,218 38% $ 2,550,777 Poor
Internet Solutions LLC Bbb $ 153,339 $ 125,698 82% $ 2,267,270 Good
University of Vienna Aaa $ 173,818 $ 154,898 89% $ 2,570,073 Good
Risk Management
This report illustrates one of several analysis steps that may be used when determining the ?nancial
risk associated with extending additional credit to customers. In assessing credit risk, it is important
to determine various characteristics of a customer/organization including credit score/credit rating,
transaction history, and balances. The next steps would be to investigate the recent transaction details
and ?nancial statements of customers approaching their credit limit with poor payment histories.
Forwarding a report on individual customers to the respective credit managers can aid in collections
and risk management.
36 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Human Resources
Overview
MicroStrategy customers are increasingly making HR analysis and reporting a strategic component
of the HR function. They choose MicroStrategy for its unique flexibility in reporting and its ability
to analyze all relevant corporate data. The following pages illustrate common areas of analysis that
have enabled MicroStrategy customers to improve the efficiency of the human resources function.
Key Anal ysi s Areas
Headcount Trends
Compensation
Employee Expenses
Career Path
Benefits Administration
Time & Labor Management
Customers i n thi s
Area I ncl ude:
Charming Shoppes, Inc.
Darden Restaurants
Limited Brands
Logan’s Roadhouse
Lowe’s Companies
Oakwood Homes
Premier, Inc.
Sprint
State of Tennessee
Texas Department
of Agriculture
The University
of Bologna
The University of Miami
As organizations continue to adopt self-service models for personnel bene?ts enrollment
and reporting, business intelligence has provided easy-to-use tools for employees to view
and report on their personal bene?ts over the Web. With the resultant elimination of much
of the administration of personnel bene?ts, human resources personnel are spending more
of their time ensuring compliance with government regulations and ?nding opportunities
to better manage their human resource investment. Business intelligence is meeting this
challenge as well, providing a complete platform for HR personnel to investigate employee
data, in aggregate or at an individual level, with employee anonymity or speci?c employee
detail. Multiple levels of security within the business intelligence product must ensure the
con?dentiality of employee records. Ultimately, HR departments are becoming increasingly
dependent on business intelligence to better service the employee base, report on regulatory
compliance, and understand patterns of attrition and compensation to lower the ongoing cost
of the organization’s human resource investment.
BUSINESS CHALLENGES SOLVED WITH BUSINESS INTELLIGENCE
Personalized access to bene?ts information. Web portals are becoming the standard access method
for employees to view their insurance coverage, vacation time, paycheck and expense reimburse-
ment status, and stock option and portfolio performance. Business intelligence allows secure, per-
sonalized information access over the Web through an intuitive, “no training required” interface.
Complete access to employee, regulatory, and bene?ts information. Human resources analysis
requires access to employee, regulatory, and bene?ts information to adequately understand
recruitment, compensation, retention, attrition, and job performance results. Business intelligence
provides trend reports with the ability to drill into individual employee and policy detail.
Flexible support for changing organizational structures. In today’s environment, businesses
are constantly re-aligning themselves to improve ef?ciencies and focus on core operations.
Reporting structure changes are dif?cult to make and almost impossible to view in most
legacy HR systems. The BI application provides the ?exibility to easily view changes in reporting
structures, and graphically review career progression.
Automated delivery of organizational scorecards. Employee satisfaction, survey results, retention
and attrition statistics, headcount trends, recruitment metrics, compensation trends, and employee
performance – all are measures of organizational health that comprise the HR scorecard. Business
intelligence combines tabular and graphical representations of these metrics into integrated score-
cards that can be automatically delivered to executives and HR personnel on a regular basis.
> DARDEN RESTAURANTS, INC.
Reducing Employee Turnover and Costs
At Darden Restaurants, Inc. the MicroStrategy platform currently anchors 12 business
intelligence applications across 17 business areas – assessing sales, ?nance, human resources,
and competitiveness.
A MicroStrategy customer since 1997, Darden Restaurants, Inc. is the largest casual dining
restaurant company in the world, operating more than 1,400 Red Lobster, Olive Garden,
Bahama Breeze, Smokey Bones, and Seasons 52 restaurants in North America.
More than 250 of Darden Restaurant’s ?nancial and marketing analysts, operations and human
resource personnel, and executive management use MicroStrategy to track, analyze, and report
on pro?tability and marketing promotions, guest satisfaction scores, employee retention, as
well as perform market basket analyses, inventory and scenario planning. Employees are able
to determine, for example, the impact on a restaurant’s pro?tability if 50 percent of its patrons
purchased an additional appetizer. Darden recently expanded its enterprise reporting, utilizing
Report Services and Narrowcast Server to deliver sales and guest count trend reporting to
restaurant managers and senior executives.
> THE UNIVERSITY OF MIAMI
Driving Decisions on Student Admissions and Enrollment Processes
The University of Miami is using MicroStrategy to gain insight into its academic environment
and student population and drive decision making on admissions and enrollment processes.
The University of Miami, which offers a wide selection of academic disciplines from accounting
to women’s studies, is comprised of twelve schools and colleges and has approximately 15,250
undergraduate and graduate students from around the world.
The University of Miami uses MicroStrategy software to analyze its student data in order to get
a better pro?le of its applicant pool and existing student body. End users across the various
schools and colleges are able to run reports that examine current student reporting, fundraising,
campaign results, equality administration, ?nancial aid, human resources, purchasing, student
admissions, and student employment information. Analysis of the data can be done across
the student body or at the individual level, with student-speci?c identi?ers removed to ensure
individual privacy. The institution is developing two additional business intelligence applications –
?nancial records and facilities management – that will deploy on the MicroStrategy platform.
CUSTOMER VIGNETTES: IMPLEMENTING BI FOR
HUMAN RESOURCES
MicroStrategy: Best in Business Intelligence 37
“ The professional look and feel of
Report Services documents allow
us to deliver presentation ready
reports quickly and easily.”
Karol Keranen,
Project Leader for Business
Intelligence Systems,
Darden Restaurants, Inc.
“ MicroStrategy software provides
the University of Miami with an
innovative way to organize and
share information about our
students, and drive our
admissions and enrollment
decisions. With MicroStrategy,
we can easily pull up reports
about our current student body
or applicant pool and make
important decisions on
admissions acceptances and
enrollment questions.”
Mary Sapp,
Executive Director of Planning
and Institutional Research,
The University of Miami
38 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Human Resources
Key Performance
I ndi cators
Attrition Rate
Months in Position
Annual Headcount Variance
Quarterly Headcount Variance
Rate of Attrition to New Hires
Headcount Growth Rate
Top 10 Units by Attrition Rate
Top 10% of States by
Headcount Growth
Headcount trend analysis provides useful information about employee movement into,
out of, and within a corporation, division, or department. HR analysts and business unit
managers monitor headcount, payroll, and job satisfaction metrics to identify over- and under-
performing managers, attrition risk within departments, recruitment and compensation trends
affecting human resources costs, and trends in employee performance. These analyses reveal
areas for training investment, areas of potential product or service delivery risk, and required
compensation and recruitment budget revisions.
Sample Report: Attrition Trends by Department
Headcount Trend Analysis
COMMON BUSINESS QUESTIONS
• What has been the effect of involuntary layoffs on voluntary attrition over time?
• How has our attrition rate fluctuated over the last two years?
• How has headcount varied quarter over quarter by department?
• Given the current attrition rate, how many new employees do I need to hire to maintain the
current growth rate?
• Who has transferred in the last 30 days?
• Which 10 units have the highest attrition rates?
• Which business units or regions experienced employee flux rates higher than 10% this year?
140
120
100
80
60
40
20
0
Q
4
0
5
Q
1
0
6
Q
2
0
6
Q
3
0
6
Q
4
0
6
Q
1
0
7
Q
2
0
7
V
o
l
u
n
t
a
r
y
D
e
p
a
r
t
u
r
e
s
600
500
400
300
200
100
0
I
n
v
o
l
u
n
t
a
r
y
D
e
p
a
r
t
u
r
e
s
Quarter
Attrition Trends
Involuntary Departures
Voluntary Departures
Department 1
Voluntary Departures
Department 2
Voluntary Departures
Department 3
This sample report shows the relationship between voluntary and involuntary departures. It is immediately
apparent that the large reduction in force in Q306 resulted in increased voluntary departures in subsequent
quarters. From this summary report, an HR analyst could drill to more detailed reports to determine
whether particular job functions, departments, management levels, or geographic regions have been
more impacted than others.
MicroStrategy: Best in Business Intelligence 39
Employee compensation affects employee morale and retention in addition to the corporate
expense line. Employers often benchmark compensation trends across similar employee groups
to ensure all employees are being compensated equitably within the organization and on par with
industry averages. Compensation reports identify compensation anomalies that management
can adjust to keep employee morale high and corporate expenses in check. Data from HR,
payroll, and ?nance systems provide the comprehensive picture of compensation, including
salary, bonus, vacation, stock option value, T&E budgets, tuition payments and policies, health
and life insurance, and other perks. Sensitive compensation and employee identity information
must be securely distributed to appropriate users based on security privileges.
Sample Report: Percentage of Total Compensation
COMMON BUSINESS QUESTIONS
• What is the salary distribution of all employees in my company with the title “Sales
Representative”?
• Are there any regions where managers make significantly more money than their subordinates
(more than 1 standard deviation)?
• What has a certain person’s history of bonuses and raises been during her career?
• Was Employee X given a raise last year?
• What is the average bonus to base salary ratio?
• By department, what is the bonus to salary ratio?
• In rank order, which sales representatives achieved their quota last year?
Key Performance
I ndi cators
Total Labor Cost Revenue %
% Raise
Bonus as % of Salary
Value of Options Granted
Avg. Compensation Changes
Rank of Total Compensation
by Job Title
Compensation Reporting and Analysis
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Sales
Base Salary
Bonus/Commission Potential Compensation Reporting and Analysis
Marketing Finance Administration Operations Human
Resources
Product
Development
This graph shows the relative contributions of salary and bonus/commission potential to total employee
compensation for different divisions. Human Resources would use this analysis to amend compensation
plans to be more or less performance-based. A next step would be to analyze the compensation plans
within departments to identify individuals whose plans do not ?t the model.
40 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Human Resources
Key Performance
I ndi cators
Airfare Expense
Average Cellular Phone
Expense per Employee
Total Entertainment-related
Expenses
Average Travel Expense
per Employee
Top 10% of Workforce with
Highest Reimbursements
Top 10% of Workforce
with Highest Average
Airfare Expenditures
Employees within an organization routinely incur business-related expenses and bill them back
to their employer in line with corporate policy. Employee expense reporting reveals amounts
incurred by expense category, with totals by employee and group. These summaries can be
viewed graphically, and out-of-trend activity automatically detected and highlighted. From
these summaries, managers are able to drill down to individual expense item detail, allowing
thorough investigation of all areas of the expense process. Business intelligence systematizes
the complete review cycle through automated delivery of expense reports to managers and
employees prior to each reimbursement cycle.
Sample Report: Regional Expenses by Expense Category
Employee Expense Reporting
COMMON BUSINESS QUESTIONS
• Which employees expensed the highest amounts for cellular phone use in February?
• Which employees are spending the most money?
• Which business unit is expending the largest percentage of its budget on expense reimbursements?
• What types of expenses are responsible for most of our costs?
• Which employees spent over $1,000 on airfare this quarter?
• How many days passed between the date the expense was incurred and the date the employee
submitted this expense for reimbursement?
• Did any employees submit expenses outside the usual categories of travel and communications?
• Why did this employee incur this expense? What was this purchase for?
This report graphically reveals trends in spending areas for a region and provides detail on an area with
noticeable relative increase in spending – in this case airfare expenses. From this report, a manager could
drill to transaction-level detail to see exact expense items, and further to the individuals submitting those
items. Further analysis might include investigating a single employee’s complete expense report, trending
of expenses within the cost account, or a comparison to expense limits.
$80,000
$70,000
$60,000
$50,000
$40,000
$30,000
$20,000
$10,000
–
Q1 2007 Quarter
Cell Phone Home Office
E
x
p
e
n
s
e
A
m
o
u
n
t
Airfare Hotel Car Rental Other Travel
Q2 2007
Q2 2007 Airfare Expenses by Airline
World Air
45%
Air One
22%
Go Jet
19%
Trans Air
14%
MicroStrategy: Best in Business Intelligence 41
Career path reporting and analysis helps companies track employee job function movements
and chart employee career paths. HR professionals analyze employee background, current and
prior positions, and performance review results (both quantitative and qualitative). Through
studying average job tenure, job function transitions, performance ratings, and attrition rates.
Human Resources is able to identify segments of employees who may be ?ight risks, recognize
patterns in departures, and make adjustments to keep its most valuable employees. Business
intelligence allows the analysis of large personnel data sets from multiple source systems and
provides role-based security to protect sensitive employee information.
Sample Report: Career Advancement Analysis
COMMON BUSINESS QUESTIONS
• For each employee that began as a Production Assistant, what position do they currently hold?
• What is the average tenure by current position?
• What has been the career track of a particular employee?
• Are they progressing toward their goals?
• Who are all the employees that work in a particular business unit or geographic region?
• Who in my department has been an employee for five years? 10 years?
• What is this employee’s current home address?
• For the past five years, how has this employee rated in the “Skills Assessment” section of his/ her
annual performance review?
Key Performance
I ndi cators
Tenure
Time in Current Position
Performance Assessment Rating
Job Functions with Highest
Attrition
Top 10 Career Paths
Bottom 10% Performers
Career Path Reporting and Analysis
Career Path for:
Current Title
Count of
Employees
Average Length of
Time to Promotion
Production Assistant 7565 2.20
Senior Production Assistant 1345 5.24
Product Lead 567 8.67
Section Supervisor 24 12.54
Division Supervisor 13 15.24
Plant Manager 4 17.95
Operations Planning 2 8.56
District Sales Representative 15 12.76
Union Representative 1 24.50
Production Assistant 6
This report provides insight into logical career paths for the position of production assistant, then
calculates the average time to promotion (for those promoted). HR managers are able to follow career
paths through the organization to assist employees with career planning. A next step might be to drill
on a title within this report to view the career paths of speci?c individuals, or add new metrics like
Average Salary or Number of Employees Managed.
42 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Human Resources
Key Performance
I ndi cators
Benefits Elections
401(k) Contribution
Vacation Accrual per Employee
Sick Days Taken
Average Tenure of Employees
Average Healthcare Cost
per Employee
Bene?ts administration has traditionally been a function of Human Resource departments
and includes reporting of employee insurance, paid time off, and other non-salary item data.
Business intelligence, when applied to bene?ts administration, allows employees to view vacation
accrual, stock plans, and ?exible spending accounts over the Web without help from their HR
representative. HR departments can also apply business intelligence to bene?ts reporting to
ensure they are providing the appropriate bene?ts packages to their employees at competitive
prices. As Human Resources departments increasingly move bene?ts administration to a self-
service model, bene?ts administration applications are integrated with corporate portals and
intranets for one-stop HR reporting and analysis.
Sample Report: Employee Bene?ts Pro?le and Status
Bene?ts Administration Reporting
COMMON BUSINESS QUESTIONS
• How many paid vacation days do I have remaining?
• Which healthcare insurance package am I signed up for?
• How many stock options has this employee been granted? What is the vesting schedule?
• Which employees have their five-year anniversary with the company this month?
• What is the average 401(k) contribution by employee?
• What was the corporation’s payment to 401(k) plans in 2006?
• What is the aggregate cost to the company of vacation days granted in the retention package?
• How many employees take advantage of the flexible spending option?
Jane Johnson’s Bene?ts Pro?le
Bene?ts Current Election Type Available Used Pending
401(k) 7% Vacation 8.16 1.00 1.00
Employee Stock Plan Non-participant Sick 1.26 1.00 –
Health Insurance Plan Enhanced Personal 1.00 – –
Flexible Spending Account $1,000 Comp. Days Awarded 0 – –
Education Reimbursement 1 course/term Personal – –
Jury Duty – –
Start Date End Date Days Type Paid/Unpaid Family Leave – –
1/2/2007 1/2/2007 1.00 vacation paid Bereavement – –
3/31/2007 3/31/2007 1.00 sick paid
4/21/2007 4/21/2007 1.00 vacation paid
Total: 3
This dashboard enables employees to see their current paid time off and bene?t elections without the
help of HR. Companies using intranets or portals can link this dashboard into existing projects to provide
employees with real-time access to their HR pro?le. The next step would be to enable HR professionals to
access this same employee information with enhanced drilling capabilities to assist users with questions,
make updates to elections, and perform trend analysis across groups of employees.
MicroStrategy: Best in Business Intelligence 43
Time and labor management applications track a wide range of employee details, from
paid leave to billable time to vacation accruals. Combining data from both HR and ?nance
allows HR professionals to perform analysis on staf?ng, revenue forecasting, and compensation
impacts. Understanding utilization rates, contractor billing rates versus employee labor rates
and overtime, and corporate overhead costs allows an organization to optimize labor expenses
and set policy.
Sample Report: Employee Utilization Rate Report
COMMON BUSINESS QUESTIONS
• What are the utilization rates of my employees?
• What is the average utilization rate this year?
• How many hours were billed in March?
• What portion of revenue is from billable employees?
• What is my employee forecast for the next quarter?
• Which employees attained their bonuses this year?
• What percentage of my employees are approaching overtime?
• When will my department hit overtime?
• What is my leave liability?
Key Performance
I ndi cators
Billable Hourly Rate
Total Hours Billed
Utilization Rate
% Contract Hours
Billable Hours Forecast
Forecast Utilization
Average Bonus Attainment
Period over Period
Time and Labor Management Reporting
Thomas
Elm
Smith
Grant
Miller
Berlin
Car
Spear
Johnson
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Utilization Rate
E
m
p
l
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y
e
e
N
a
m
e
This example colorcodes zones of employee utilization rates for a department. Managers from call centers
to manufacturing use this type of analysis to ensure service levels, reward top performers, and coach
underperformers. Further analysis might include trending of individual employee utilization, drilling to an
employee’s time sheet, or performing predictive analysis to determine future staf?ng needs.
44 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Sales Forecast
Overview
Reporting, analysis, and distribution of sales forecast data have unique user scalability, visualization,
and security requirements. The following pages illustrate how MicroStrategy customers have
successfully deployed sales reporting applications to thousands of end users, with meaningful
analyses and reports that have driven increased sales efficiency for their organizations.
Key Anal ysi s Areas
Sales Pipeline
Channel
Competitor
Sales Force Performance
Customers i n thi s
Area I ncl ude:
Amlin
AstraZeneca
AutoTrader.com
Corporate Express
Esteé Lauder
Lowe’s Companies
Novartis
U.S. Borax
Wilton Industries
Sales forecast reporting and analysis provides visibility into a company’s sales pipeline,
integrating information from sales, customer, and ?nancial sources for a complete picture of
sales performance. Business intelligence-enabled sales forecasts allow sales management to
monitor and act on individual opportunities, more accurately forecast current and future period
revenues, and understand the drivers that distinguish won versus lost deals. Executives can use
graphical dashboards to quickly assess actual sales performance versus corporate targets and
sales management forecasts. Marketing users can analyze lead progression through each stage
of the sales cycle to quantify the effectiveness and revenue impact of marketing efforts. Business
intelligence enables organizations to associate sales pipeline data with ?nancial, marketing, and
customer information to make informed, strategic decisions to improve sales effectiveness.
BUSINESS CHALLENGES SOLVED WITH BUSINESS INTELLIGENCE
Secure reporting to multiple layers of sales management. Enterprise-wide sales forecast
reporting requires that each manager in the sales chain-of-command, each sales representative,
each marketing and product analyst, and each executive has personalized access to sales
pipeline information. Deploying reporting over the Web requires robust security to protect
sensitive information and a scalable infrastructure to distribute reports to potentially thousands
of geographically distributed sales force personnel.
Forecasting effectively through trend analysis and close probabilities. Sales managers and
corporate executives demand accurate revenue forecasts that blend up-to-the minute sales cycle
information with historically realistic close probabilities. BI provides easy-to-understand graphical
and tabular forecast reports as well as statistical analysis to enable predictive modeling.
Analyzing sales pipeline data from different business perspectives. Executives and managers
need to understand the underlying trends that create sales opportunities and result in deal
wins/ losses. These trends may vary according to geography, sales representative characteristics
(tenure, experience, education, and quota achievement), competitor presence, and product.
Business intelligence provides reporting ?exibility to view sales pipeline data along the attributes
of choice, while providing direct access to the deal speci?cs when needed.
Combining sales force data with product, customer, and marketing data. Sales and marketing
analysts require access to information beyond what typically resides in SFA (sales force
automation) systems. Reports identifying product pro?tability, potential revenue by customer
segment, and campaigns generating leads all require data from other corporate systems. BI
integrates data from any number of corporate systems, allowing complete visibility into all
variables affecting a company’s sales pipeline.
“ Corporate Express is honored to
receive this prestigious award
from TDWI. Our MicroStrategy-
based market basket application
removes the guesswork and
enables us to make analytically-
based decisions that enhance the
online customer experience.”
Jay Mutschler,
Chief Operating Officer,
Corporate Express US
> CORPORATE EXPRESS
Maximizing Revenue with an Award-Winning Predictive Analytics Application
In June 2007, Corporate Express US received the 2007 Best Practices Award from The Data
Warehousing Institute (TDWI) for a MicroStrategy-based business intelligence application.
Corporate Express US took top honors in the predictive analytics category. TDWI’s Best Practices
Awards program is designed to identify and honor companies that have demonstrated excellence
in developing, deploying, and maintaining BI and data warehouse (DW) applications.
Corporate Express built a market basket application, leveraging MicroStrategy’s business
intelligence technology, to improve its online business. The application looks at each item
purchased and determines a list of complementary items to recommend to purchasers. The
market basket application uncovered insightful new data about the items that customers
typically purchase together, enabling Corporate Express to present these items as complementary
offerings to online customers. As a result, the average order size for orders with the market
basket pairings is more than twice the average order size for orders without pairings.
In addition, the information has helped Corporate Express to better serve its customers, with a
deeper understanding of purchasing preferences.
> U.S. BORAX
Reporting on Marketing and Sales Trends Worldwide
U.S. Borax, Inc., a member of the Rio Tinto group, supplies nearly half the world’s demand for
re?ned borates – essential nutrients for plants, part of a healthy human diet, and key ingredients
in ?berglass, ceramics, detergents, fertilizers, and wood preservatives. The company employs
nearly 1,500 people worldwide and ships its products to customers in nearly 100 countries.
U.S. Borax, Inc. uses the MicroStrategy Business Intelligence Platform as its enterprise-wide
business intelligence standard. U.S. Borax harnesses MicroStrategy for analysis of and reporting
on its marketing and sales trends worldwide. U.S. Borax primarily utilizes MicroStrategy for its
extensive “Marketing and Reporting System” (MARS). This system is used to report on sales
?gures, forecast projections, estimate competitive sales, and gauge the state of the business.
MicroStrategy users include U.S. Borax executives, marketing analysts, sales representatives,
?nancial analysts, distribution analysts, and production supervisors.
CUSTOMER VIGNETTES: IMPLEMENTING BI FOR
SALES FORECAST
MicroStrategy: Best in Business Intelligence 45
46 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Sales Forecast
Key Performance
I ndi cators
Forecast Revenue
% of Deals Closed
% of Deals Lost
Win to Raw Lead Ratio
% of Quota
Length of Sales Cycle
Sales pipeline reporting focuses on the continual tracking and study of sales opportunities
from raw lead to closed sale. Sales managers monitor key performance indicators to ensure
marketing activities are generating the number, quality, and ?ow of leads necessary to meet
sales targets and that sales cycles are progressing towards closure. Sales pipeline reports show
the status and value of deals currently in the pipeline and probability-weighted forecasts. They
also allow sales teams to drill to particular deal terms and conditions, and update material deal
terms as negotiations occur. Business intelligence-enabled sales pipeline reporting not only
generates and delivers these reports on a regular basis, but also allows managers to uncover
competitive trends and performance anomalies by region, product, or customer segment.
Sample Report: Deal Progression by Sales Representative
Sales Pipeline Reporting and Analysis
COMMON BUSINESS QUESTIONS
• What is the weighted opportunity size of a particular deal?
• How does the total weighted opportunity size in the pipeline compare with revenue forecasts?
• Has the duration of the average sales cycle increased?
• Which deals have been in the pipeline the longest?
• What is the most important reason for lost deals?
• What are the terms of a particular contract?
• What is the conversion rate of leads to closed deals?
• What is the total potential revenue of all opportunities with Customer X?
Opportunity
Owner
Owner
Role
Opportunity Name
Lead
Source
Opportunity
Size $
Expected
Revenue
Probability
(%) Age
S. Grant South East - AE LBC City Music Cold Call $5,310,164 $1,062,033 20% 236
S. Grant South East - AE Krazy Kites Existing Customer $215,489 $86,196 40% 127
A. Nobel South East - AE Sam’s Videos Existing Customer $1,850,000 $1,110,000 60% 78
A. Nobel South East - AE Dairy Shop, Inc. Existing Customer $654,214 $261,686 40% 16
M. Lawlor EMEA UK - AE Nigel’s Avionics Incoming Call $1,721,765 $344,353 20% 45
M. Lawlor EMEA UK - AE Kings Corner Email Lead $65,874 $52,699 80% 52
B. Morsch West - AE West Accountants Incoming Call $1,375,000 $275,000 20% 358
B. Morsch West - AE Writers Guild Customer Referral $1,197,598 $479,039 40% 152
T. Smith Central - AE Marketing Surrogates LLC Email Lead $254,187 $203,350 80% 32
T. Smith Central - AE PeopleNet Partner Referral $1,140,000 $684,000 60% 189
L. Zeiss Partner - Germany Munich Crystal Gmbh Tradeshow $368,745 $73,749 20% 68
L. Zeiss Partner - Germany Deutsche Air Gmhb Email Lead $56,234 $22,494 40% 99
Quarter Q3 2007 6
This detailed sales pipeline report shows the weighted opportunity size for a sales team in the quarter
selected. Dashboard capabilities include thresholds to highlight large revenue opportunities, as well
as opportunities that are aged longer than the average, simplifying analysis by sales managers and
executives. Further analysis can focus on which products/services are selling well, the effectiveness of
individual sales people or regions, and sales results versus plan.
MicroStrategy: Best in Business Intelligence 47
Companies use a variety of channels to promote products to customers. Retailers use stores,
catalogs, and Web sites to merchandise their offerings. Technology companies depend on direct
sales forces, OEM partners, resellers, and systems integrators to deliver products to customers.
Channel analysis allows organizations to understand the effectiveness of various sales channels,
gauge channel growth, and compare channel margins. By reviewing channel comparisons, sales,
channel, and marketing managers can focus resources on building and maintaining the channels
that best meet their customers’ sales and service needs. Basic channel analysis includes sales and
margin performance by channel, trends in channel utilization over time, and comparisons of channel
performance by customer segment. More advanced analysis enables users to drill to individual
channel partners, optimize pricing by channel, or match channel supply to channel demand.
Sample Report: Quarterly Sales Channel Analysis
COMMON BUSINESS QUESTIONS
• Which channels are exceeding sales projections? Underachieving?
• Which channel(s) generate the most profit per transaction?
• Which channel has the highest growth rate year over year?
• In Region A, which channel do customers prefer?
• Through what channel are my most profitable customers buying?
• Which promotions have been the most effective in this channel?
• How does the price of Product Z vary by channel?
• Is one channel cannibalizing another?
Key Performance
I ndi cators
Revenue Growth Year
over Year
Profit per Transaction
Price Variance b/n Channels
Top Promotion by Channel
Top 25 Products by Channel
Margin by Channel
% of Total Sales Sold Direct
% Profit on Partner Sales
Channel Analysis
Direct and Internet Sales by Region
Asia
Europe
North America
7,000
6,000
5,000
4,000
3,000
2,000
1,000
Direct Sales
$$$
Direct Internet
Q1
Direct Internet
Q2
Direct Internet
Q3
Direct Internet
Q4
Quarter 1
Quarter 2
Quarter 3
Quarter 4
Total
Sales Last Year
$ 6,340
$ 4,378
$ 5,430
$ 4,598
$ 20,746
$ 19,086
$ 824
$ 999
$ 1,234
$ 2,131
$ 5,188
$ 4,773
$ 536
$ 649
$ 802
$ 1,385
$ 3,372
$ 3,103
$ 59
$ 71
$ 88
$ 152
$ 371
$ 341
Direct Internet Telesales Distributor
$29,667
$27,303
Total
Sales Last Year
Annual Sales
This report details the total sales for each distribution channel over time and drills into the geographic sales
breakdown for the direct and Internet channel. Understanding channel effectiveness helps Sales and Marketing
analysts to determine the impact of promotions, ad spending, staf?ng, service, training, and distribution.
Drilling further on this graph will reveal individual product sales by channel, sub-region, and month.
48 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Sales Forecast
Key Performance
I ndi cators
% Wins vs. Competitor
Revenue Lost to Competitor
Top 3 Competitors
# of Deals Lost at Existing
Customers
Total Opportunities with
Competitor Present
Top 10 Sales Representatives
Winning against Competitor B
Sales forecast reporting is not complete without a review of competitive forces in sales
cycles, their effect on revenue, and their implications for product development. Sales executives
identify competitive win/loss performance at the region, sales representative, and individual
sales cycle level. Basic competitive reporting measures competitive presence during the sales
cycle and the success rates against each competitor. More advanced analysis enables users to
drill into sales cycles of individual sales representatives to assess effectiveness in competitive
situations, review transaction detail including products and options sold, or analyze discount
programs used against various competitors.
Sample Report: Competitive Activity by Quarter
Competitor Analysis
COMMON BUSINESS QUESTIONS
• What competitor activity have we seen across various accounts?
• Is there a trend in activity with Competitor A?
• Who are our Top 3 Competitors by number of opportunities present?
• How much revenue have we lost to our top competitor this year?
• How often do we win versus Competitor A?
• How often do we lose when Product X is being sold?
• What products were part of the contract offered Customer A?
Primary Competitor Quarter
Opportunities
with Competitor
Present
Wins vs.
Competitor
% Wins vs.
Competitor
Losses vs.
Competitor
% Losses vs.
Competitor
Wizard Corporation
2006 Q1 41 16 39% 22 54%
2006 Q2 56 30 54% 16 29%
2006 Q3 22 4 18% 15 68%
2006 Q4 30 12 40% 12 40%
Total: 149 62 42% 65% 44%
Sphynx Solutions
2006 Q1 14 11 79% 2 14%
2006 Q2 23 7 30% 12 52%
2006 Q3 56 29 52% 25 45%
2006 Q4 33 21 64% 10 30%
Total: 126 68 54% 49% 39%
Pulsar Applications
2006 Q1 10 7 70% 2 20%
2006 Q2 6 1 17% 3 50%
2006 Q3 21 13 62% 7 33%
2006 Q4 15 9 60% 4 27%
Total: 52 126 58% 16 31%
Total: 327 160 49% 130 40%
This quarterly report of sales cycles against top three competitors allows competitive intelligence analysts,
product managers, and sales management to measure competitive effectiveness. The report automatically
highlights quarters where percentage wins and losses are signi?cant. Next step analyses include sales
representative wins versus losses, wins and losses in existing customers versus prospects, and average
deal size for wins versus losses.
MicroStrategy: Best in Business Intelligence 49
Sales Performance Reporting provides insight into expected and actual achievement of
the members of the sales organization. Executives and sales managers can view dashboards
summarizing sales representatives’ quota achievements, detailed reports on sales representatives’
pipelines, and benchmark reports that compare sales representative performance. Drilling to
pipeline detail can reveal factors contributing to the over- and under-performance of regions
and/or representatives. By constantly reviewing sales representative performance versus quota
and benchmarked relative to relevant peers, sales management can proactively develop
performance improvement plans for under-performing sales representatives and provide
appropriate motivational recognition for top performers.
Sample Report: Sales Performance versus Plan
COMMON BUSINESS QUESTIONS
• Are sales representatives on track to meet their sales targets?
• What is the sales trend in the East Region?
• Who lost the most deals in terms of revenue? Number of deals?
• Who are the best performers in terms of percentage of opportunities closed?
• Who are my top 20% and bottom 20% sales performers over the last four rolling quarters?
• What products have the most sales opportunities over the last 24 months by geography?
• What lead channel is driving the most successful sales opportunities?
• What products are most of my sales people positioning?
• What is the most common product offered in a subsequent sales cycle?
Key Performance
I ndi cators
% of Target
Opportunity Age
Average Sales per Sales
Representative
Bottom 20% of Sales
Representatives
Top 10 Deals by Revenue
Top 5 Opportunities
Weighted Pipeline Revenue
% of Quota
Cost of Sales
% Leads Converted to Sales
Sales Force Performance Reporting
Northeast Sales Representative Performance vs. Plan
Sales
Plan
$1,000,000
$800,000
$600,000
$400,000
$200,000
$0
M
i
c
k
y
H
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p
t
o
n
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h
o
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a
s
S
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G
a
r
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i
a
Region
No r theast
Mid-Atlantic
Southeast
Central
South
No r thwest
Southwest
Sales to Dat e
2,500,000
9.000.000
2,500.000
2,000.000
2,500.000
2,000.000
4,000.000
Sales Plan
3,500,000
10,000,000
5,000,000
4,000,000
7,500,000
6,000,000
5,000,000
2006 Revenu e
+
+
+
+
+
+
+
-
-
-
-
-
-
-
This is an example of a basic sales performance dashboard with detail on the performance of individual
sales representatives in a particular region. Executives and Regional Sales Managers use this report to
monitor individual employee performance within their region at a glance. A next level of analysis would
be to drill into the individual sales representative sales to date, historical performance versus plan, and
the pipeline to determine if any action is necessary.
50 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Customer and marketing analysis presents unique data complexity and analytical workflow
challenges. The analytical power combined with the intuitive interface of the MicroStrategy
platform makes examining customer behavior, uncovering trends, and taking action easy. The
following pages illustrate the most commonly deployed customer and marketing applications.
Key Anal ysi s Areas
Customer Segmentation
Customer Profitability
Customer Cross-Sell
Customer Acquisition,
Retention, and Attrition
Loyalty
Campaign
Customer Service
Customer Scorecards
Customers i n thi s
Area I ncl ude:
21st Century Insurance
Acturis
Ahold
AutoTrader.com
Boots The Chemists
Charter Communications
Children International
Consortium Health Plans
Corporate Express
Cortal Consors
dm-drogerie markt
Faith Shoes
Grange Insurance
Henry Schein, Inc.
Ingenix
The Katz Group
Kent School District
Limited Brands
Lotte Mart
Lowe’s Companies, Inc.
Marcus Corporation
Meredith Corporation
Oakwood Homes
Ohio Department of Education
Premier, Inc.
Prescription Solutions
Quixtar, Inc.
Redecard
Republic National Distributing Co.
Roche Pharma España
Samsung Life Insurance
ShopKo Stores, Inc.
Sprint
Texas Department of Agriculture
TRX, Inc.
Wells Fargo
Wilton Industries
Yahoo!
Over the past few years, many companies have implemented operational customer relationship
management (CRM) systems, and these companies are now analyzing the behavior of their
customer base to plan and optimize marketing tactics and improve customer service programs.
Using customer analytics, companies identify the tastes and preferences of particular target
markets to create more relevant offerings and improve the ef?ciency of marketing dollars. With
the growing availability and volume of customer data, including call center data, point-of-sale
transaction detail, and credit or loyalty card identi?cation, businesses can more easily determine
what types of customers are buying what kinds of items, and which marketing tactics drive sales
from each customer type. Additionally, customer service representatives can pull up individual
customer information in real-time, allowing for more informed service and providing real-time
suggestions for additional product or service sales tailored to the preferences of the customer.
BUSINESS CHALLENGES SOLVED WITH BUSINESS INTELLIGENCE
Access a 360-degree view of each customer at any touch point. To effectively personalize
marketing and sales tactics, users need a complete view of a customer consolidated from any
number of corporate systems. With the increased collection of customer-focused information
and the growing need for transaction-level insight, companies rely on business intelligence to
summarize terabytes of data while enabling access to individual customer detail.
Segment, analyze, and pro?le customers for targeted marketing campaigns. Marketing teams
use a variety of analytics to segment customers by past behavior, demographics, and lifetime
value, as well as gain an understanding of marketing effectiveness. Business intelligence provides
a ?exible and intuitive reporting environment to distill relevant marketing insight from a broad
range of customer characteristics.
Alert management to campaign and customer behavior changes. Customer relationship
managers and marketing teams alike depend on timely noti?cation of customer and campaign
events, like large customer deposits or purchases, and campaign responses rates. Proactive
information delivery via Web, e-mail, or wireless device allows sales, service, and marketing
personnel to improve customer relationships and build customer loyalty.
Predict customer pro?tability. Sophisticated customer calculations such as lifetime value help
marketing departments determine how to invest marketing budgets to service and retain the
most pro?table customers. Business intelligence provides both the advanced analytics needed
for pro?tability analysis and prediction and the information delivery capability to ensure
customer pro?tability information is delivered to all sales and service personnel who interact
with customers.
Customer Relationship Management
Overview
> BOOTS THE CHEMISTS
Analyzing Purchasing Behavior to Develop More Effective Personalized Marketing
Boots The Chemists uses the MicroStrategy Business Intelligence Platform to deliver improved
analysis and reporting of loyalty data to a wide range of users. Part of the Boots Group Plc,
Boots The Chemists is the UK’s leading health and beauty retailer and one of the best known
names in the UK.
Boots utilizes MicroStrategy for a variety of applications, including basket analysis, customer
segmentation, and direct marketing, using the vast amount of data collected from its Advantage Card
loyalty program. By upgrading its MicroStrategy platform, Boots also provides more sophisticated
analysis to its existing user base and allows more internal users to gain access to its core marketing
database. The retailer has improved its one-to-one marketing efforts and increased the pro?tability
and lifetime value of each customer. Boots also provides access to loyalty information through
the MicroStrategy Web interface to external parties in its supply chain.
> NETFLIX
Analyzing Marketing and Movie Recommendation Data to Better Serve
6.8 Million Subscribers
In 2007, Net?ix, Inc. selected MicroStrategy as its enterprise reporting and analysis standard.
Net?ix is the world’s largest online movie rental service.
Net?ix will utilize MicroStrategy for reporting and analysis of ?nancial data, marketing
campaigns, and movie recommendations. With MicroStrategy, Net?ix users will gain valuable
insight into critical marketing data to evaluate marketing campaigns and personalized movie
recommendation data, enhance its marketing programs, and better serve its subscriber base of
6.8 million members. MicroStrategy was selected by Net?ix for its ease-of-use, robust reporting
and analytical capabilities, and scalability for large databases.
CUSTOMER VIGNETTES: IMPLEMENTING BI FOR CUSTOMER
RELATIONSHIP MANAGEMENT
MicroStrategy: Best in Business Intelligence 51
“ The Web-based nature of
MicroStrategy and its intuitive,
customizable reporting allows us to
roll it out to new groups of users
quickly and easily. In the past,
analysts were using MicroStrategy to
extract insight from purchasing data,
but now we are able to empower a
wider range of business users with
critical information to help make our
individual customer propositions more
focused and deliver competitive
advantage in our market.”
Scott Sommerville,
Business Consulting Manager,
The Boots Company Plc
“ We evaluated several other business
intelligence products and found
that MicroStrategy offers us the
flexibility and scalability we need to
support our growing business
intelligence applications. We are
impressed with MicroStrategy’s
intuitive Web interface, which will
enable our users to make strategic,
analytically-based decisions to better
serve our growing business.”
Wayne Peacock,
Vice President of
Business Intelligence,
Netflix
52 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Customer Relationship Management
Key Performance
I ndi cators
Lifetime Value Score
Profit Decile
Campaign Response Rate
Revenue per Customer
Top 5 Customer Segments
by Revenue
Bottom 10% of Segments
by Contribution
Gross Margin per Customer
Profit Margin per Segment
Active Customers
Customer segmentation analysis allows organizations to identify groups of like customers based
on their transaction history and then study behavioral patterns within these groups. Armed with a
better understanding of their customer base, marketing managers can design targeted marketing
and service campaigns to reach speci?c customer segments with offers that are suited to their
needs and preferences. Segmentation analysis has as inputs customer transactional, demographic,
and psychographic data. Business intelligence provides statistical techniques and data mining
algorithms to analyze any number of customer attributes to uncover patterns in behavior. Ad hoc
analysis functions are seamlessly integrated with data mining to allow analysts to investigate the
characteristics of uncovered segments and generate speci?c customer lists within each segment.
These lists may feed campaign management systems, be used for calling campaigns, or feed Web
site content management applications to serve up offerings relevant to the segment.
Sample Report: Customer Segmentation Visualization and Drill-down
Customer Segmentation Analysis
COMMON BUSINESS QUESTIONS
• What is the current distribution of customers by demographic?
• How has the age distribution within our customer base changed over the past 10 years?
• What is the distribution of customers by lifetime value?
• What percent of my revenues are contributed by a given segment of customers?
• What are the revenue, profit, and margin contributions by customer profile?
• Which segment of customers responded best to our recent e-mail campaign?
• Which customer segment is our most profitable?
• Which campaign has been the most effective with Segment X?
• Is there a trend in buying behavior by segment?
Customer Segmentation
#
T
r
a
n
s
a
c
t
i
o
n
s
p
e
r
m
o
n
t
h
Age
15
without
loyalty card
with
loyalty card
10
5
35-54 18-34 55+
55+ Age Group
77%
23%
This statistical scatter plot is a ?rst step in segmentation analysis where data is mined for trends and
patterns. A marketing analyst can perform this type of analysis using any number or combination of
metrics to look for emerging patterns that can be used to segment customers. In this report, customer
segments along age can be seen from the tighter groupings of dots. Further drilling into one of the
segments reveals that a majority of these customers use a loyalty card when shopping. Clicking on the pie
segment representing customers without a loyalty card will generate the associated customer mailing list.
MicroStrategy: Best in Business Intelligence 53
Organizations use customer pro?tability analysis to identify the most valuable customers or
customer segments to prioritize marketing, sales, and service investments. By studying pro?tability
metrics such as lifetime value, repeat purchase rate, and churn rate, analysts can identify pro?table
segments, uncover de?ning characteristics of those segments, and target similar populations for
acquisition. Similarly, retention programs may be created for particularly pro?table customers.
Business intelligence provides the statistical and data mining capabilities to calculate lifetime
value, identify product af?nities for cross-sell campaigns, and perform predictive analysis of pro?ts
resulting from additional marketing investment. Customer segments or individual customers may
be further investigated through ad hoc analysis, lists of customer segments may be automatically
generated, or alerting rules may be applied to customer segments to automatically notify
relationship managers when pro?table customers have executed a transaction.
Sample Report: Customer Pro?tability Segments by Channel
COMMON BUSINESS QUESTIONS
• What is the breakdown of customer profitability segments by channel?
• What is the current profitability of highest quartile of customers in 2006?
• What are the most profitable customers buying?
• Who are our least profitable customers?
• Which products are most often purchased with the most profitable products?
• What services do our most profitable customers use?
• How do our most profitable customers prefer to be contacted?
• How much have we spent to attract our most profitable customers?
• What is the churn rate within the most profitable customer segment?
Key Performance
I ndi cators
Profit by Customer Quartile
Revenue per Customer Segment
Attrition Rate
% Variance in Profit
Bottom 25% of Customers
by Profit
Top 15 Products by Profit
Lifetime Value
Dollars Spent per Customer
Product Affinity Rate
Customer Pro?tability Analysis
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
18 - 30
Low
18 - 30
Med
18 - 30
High
30 - 50
Low
30 - 50
Med
30 - 50
High
50 - 65
Low
50 - 65
Med
50 - 65
High
65+
Low
65+
Med
65+
High
Customer Attributes (Age and Income)
Existing Customer Profitability by Segment
P
r
o
f
i
t
a
b
i
l
i
t
y
%
This customer pro?tability report analyzes customer pro?t for a selected segment by customer attributes.
Marketing strategists and campaign managers use this type of analysis to understand which customer
segments to target with campaigns and loyalty rewards programs so the most pro?table customers
are attracted and retained, and less pro?table customers are not sought. A next step might be to
analyze which products/services customers are buying, which channels they are utilizing, and which
complementary products/services to offer with promotions.
54 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Customer Relationship Management
Key Performance
I ndi cators
Product Affinity Rate
% Change in Product Sales
Top 3 Related Products
by Profit
Forecast Profit
% Penetration in Market
Campaign ROI
% Change in Margin Year
over Year
Lifetime Value
Sales and marketing managers rely on cross-sell analysis to identify customers who might
be interested in buying products and services that are complementary to products and services
already bought. Cross-sell analysis begins with determination of which product pairs are often
bought together by customers (product af?nity) and then involves identifying which customers
bought one but not both products. By identifying and targeting these customers, companies
can reduce total campaign costs, increase response rates, and drive increased sales. Detailed,
atomic-level capture and retrieval of every customer’s pro?le, preferences, and transaction
history enables basic cross-sell analysis. More advanced analysis uses statistical and data mining
techniques to identify product af?nities, explore historical sales trends, and predict sales as a
result of cross-sell campaigns.
Sample Report: “Market Basket” Analysis and Cross-Sell Campaign Results
Customer Cross-Sell Analysis
COMMON BUSINESS QUESTIONS
• Which products sell well together?
• Which products have an increasing sales momentum?
• What is the chronology of purchases?
• What are the characteristics of customers who have purchased both Product A and Product B?
• What discount was offered to customers who also bought Product B?
• What was the cost associated with a cross-sell campaign?
• Was a cross-sell offer presented to customers during the initial purchase process?
• What is the expected profit from up-sell opportunities this quarter?
"Product A" Cross-Sell Opportunities
Total # Product A sold: 3,909,642
Product
A
B
C
D
E
F
% of Product A
Market Baskets
Including Product
X (Affiinty)
3%
24%
14%
32%
19%
Number of
customers
owning both
products
548,789
1,784,259
843,210
2,154,870
1,256,453
Cross-sell opp.
(own Product
A but not
Product X)
86.0%
54.4%
87.4%
44.9%
67.9%
Campaign
Name
July 4th Promo
Back to School
Halloween
Campaign
Cost
$456,653
$25,000
$155,563
Channel
30 day free trial
E-mail
Direct Mail
Response
Rate
0.50%
2.17%
1.23%
Related
Sales
$452,312
$65,498
$125,687
Products A and B
2006 cross-selling campaigns
Campaign
ROI
-1%
162%
-19%
This product cross-sell or af?nity report shows the percent of “market baskets,” or total set of items
purchased by a customer during any one time period, containing Product A that also contain Product
“X”. Marketing analysts use this information to understand what products would be good candidates to
market to customers who already own Product A. Those products with high af?nity for Product A which
also have a high cross-sell opportunity (top ?ve of customer base who own Product A but not Product
X) are good candidates. The follow-on report shows the results of the campaigns executed promoting
Product E to customers who own Product A.
MicroStrategy: Best in Business Intelligence 55
Characteristics of new, loyal, and lost customers are particularly important for companies
to understand. Marketing analysts group customers into segments of recent new purchasers,
high-volume purchasers, and non-purchasers using customer transaction data, and analyze
the resulting segments to identify their common characteristics. Attributes of new customers
provide the pro?le of a company’s likely acquisition target market. Similarly, characteristics of
lost customers may de?ne less desirable market segments, or may reveal problems in customer
service or product satisfaction. Improvements in retention programs are saving companies
signi?cant time and money – keeping existing customers buying is much less expensive than
acquiring new customers. Predictive modeling of acquisition, retention, and attrition rates feeds
the business planning and budgeting process.
Sample Report: Call Center Inbound Customer Calls
COMMON BUSINESS QUESTIONS
• Have the rates of customer attrition, retention, and acquisition changed over time?
• What is the correlation between customer loyalty and profitability?
• What is the impact of tenure on customer retention and attrition?
• What is the revenue loss attributable to customer attrition?
• What is the average revenue per new customer in the past year?
• Which campaigns attracted the most new customers?
• How effective have specific retention offers been?
• At current rates, what will our attrition rate be in six months?
Key Performance
I ndi cators
% Attrition
Retention Offer Success Rate
New to Loyal Customer
Conversion Rate
Top 3 Retention Offers
Top 10 Reasons for Attrition
Revenue per New Customer
Profit Margin per New Customer
Forecast Attrition Rate
% Change in Acquisition Year
over Year
Customer Acquisition, Retention, and Attrition Analysis
Discount
Coupon
45%
100%
Refund
25%
None
15%
Free
Product
Coupon
15%
Q1 Retention Offer Summary
Call Type: Complaints
Q1 - Total Unique Customers with Complaint: 623
Attrition Projections
Total:
Offer Extended
Discount Coupon
100% Refund
Free Product
Coupon
None
Projected
Redemption Rate
15%
95%
45%
N/A
Projected
Attrition Rate
50%
45%
35%
80%
Projected
Lost Customers
140
70
33
75
318
This dashboard enables managers to quickly review the effectiveness of retention strategies by projecting
redemption and attrition rates based on offers extended to customers. Marketing, sales, and customer
service departments use this type of analysis to judge the effectiveness of available retention offers.
Next steps would be to add projected cost per offer to estimate the cost of each program, perform
trend analysis on a single offer, or drill into attrition rate to reveal lost customer pro?les to better target
retention offers.
56 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Customer Relationship Management
Key Performance
I ndi cators
Attrition Rate
Ratio of New Customers to
Lost Customers
% Change in # of Loyal
Customers
Variance in Satisfaction Level
Duration of Relationship
Lifetime Value
Products Owned by Customer
% Change in # of Annual Visits
Top 25% of Customers by Sales
Profit per Loyalty Card
Sales and marketing managers analyze customer data to identify pro?les of loyal customers,
track their behavior, and develop loyalty programs that maximize pro?tability. Segmenting
customers by pro?tability and lifetime value allows marketing analysts to identify the best
target for loyalty programs. Depending on the characteristics of the segment, loyalty programs
are created and generated to keep top customers engaged and satis?ed while limiting lost
revenue. The effectiveness of loyalty programs is studied continuously to ensure that both
of these objectives are being optimally met. Integrated predictive analysis capabilities allow
marketers to run “what if” scenarios to further re?ne loyalty program terms and conditions,
and provide input into the company’s budgeting and planning process.
Sample Report: Forecasted Loyalty Program Performance
Loyalty Analysis
COMMON BUSINESS QUESTIONS
• Has our customer loyalty program been successful in generating new revenue?
• Who are my top 10 customers according to frequency of visits?
• What is the lifetime value of my top 25 customers?
• What customers have bought multiple products over time?
• Is there a relationship between the number of products held by a customer and the duration of
the customer relationship?
• What is the relationship between customer satisfaction and duration of the customer relationship?
• What are the characteristics of customers who have cancelled a product in the last two years?
• Of loyal customers a year ago, who has stopped purchasing our products and services?
Total Frequent Flyer Miles
Earned (000)
Frequent Flyer Miles
Redeemed (000)
Change in Frequent Flyer
Mile Liability (000)
$ Change in Frequent
Flyer Mile Liability (000)
2005 Actual 777,147 116,572 660,575 $ 1,982
2006 Actual 950,257 114,031 836,226 $ 2,509
2007 Forecast 695,589 118,250 577,339 $ 1,732
2006- 2007 Variance -27% 4% -31% -31%
This report shows the common metrics used to assess the performance of a frequent ?yer loyalty program.
The chart allows the analyst to predict the results of the program given different projections of revenue
per ?ight mile. Here, the analyst has predicted revenue per ?ight mile to decrease by 4%. The impact on
the other metrics is automatically calculated, and negatively impacted areas are automatically highlighted
in red. Next the analyst may drill to speci?c geographic reports to see if passenger traf?c has changed
materially, individual customer reports to determine who has stopped ?ying, or fare change reports to
predict revenue per mile.
MicroStrategy: Best in Business Intelligence 57
Campaign analysis enables organizations to gauge the success of various campaigns by
measuring campaign costs, leads generated, and leads converted to customers. Campaign
analysis begins by trending campaign costs and targets over time, calculating the return on
investment for executed campaigns, and measuring the variance in lead generation and
costs against goals. Using statistical techniques to identify characteristics of top-performing
campaigns, customer and product buying af?nities, and pro?les of converted customers, future
campaigns can be optimized for more targeted customer segments with more targeted product
offers. In combination with campaign management tools, these analyses are being automated,
with feedback from executed campaigns improving offers and generating prospect lists for
follow-up campaigns.
Sample Report: Call Center Inbound Customer Calls
Customer Acquisition Campaign
Channel Effectiveness
Quarter: 1
COMMON BUSINESS QUESTIONS
• How effective were the channels used for the customer acquisition campaign?
• What is the most cost-effective marketing campaign by interaction type?
• What is the monthly trend in interactions, purchases, and response rates by customer segment?
• Who is likely to buy only if contacted in person?
• What percentage of all transactions contains at least one promotional item?
• How do the sales volumes compare between promotional and non-promotional periods?
• Which age segment is most likely to respond to a reduced price promotion?
• What were the sales and inventories each week of each promotion?
• Is our marketing strategy impacting profitability and retention as predicted?
Key Performance
I ndi cators
% Variance from Forecast Leads
Cost per Lead
Response Rate
Affinity Rate
% Change in Sales Volume
Month over Month
Attrition Rate
Profit Margin per Product
Top 3 Campaigns by Sales
Bottom 10% of Campaigns
by Profit
Lead Quality Rating
Campaign Analysis
Channel $ Spent
Leads
Target
Leads
Generated
Variance in Lead
Generation
Targeted Cost
per Lead
Actual Cost
per Lead
+ Banner Ads 60,000 1,000 849 -15% $ 60.00 $ 70.67
+ Magazine Reader Response Card 95,000 1,500 1,384 -8% $ 63.33 $ 68.64
+ Direct Email 75,000 1,600 1,822 14% $ 46.88 $ 41.16
- Search Engine Sponsorships
“Stain Removal” 10,000 150 170 13% $ 66.67 $ 58.82
“Cleaning Supplies” 10,000 150 164 9% $ 66.67 $ 60.98
“Spot Removal” 10,000 150 153 2% $ 66.67 $ 65.36
AVERAGE 3% $ 61.70 $ 60.94
This campaign analysis report measures the effectiveness of tactics through various marketing channels
and highlights results that show under- and over-performance. The outline format allows analysts to
quickly review details of individual tactics in a single channel. Additional analysis reveals the quality
of leads generated from each tactic, either by revenue closed or opportunities generated in the sales
pipeline, or shows period-over-period performance trends.
58 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Customer Relationship Management
Key Performance
I ndi cators
Issue Response Time
# Issues Resolved
# Issues Outstanding
Daily Call Count
Cost of Service
% of Calls Blocked
Top 10 Products Resulting
in Complaint
Customer Satisfaction Rating
Forecast Staff for Desired
Service Level
Customer service analysis investigates customer interactions with an organization, including
point-of-sale, service delivery, and follow-on support, to ensure customers are being serviced
well. Executives and marketers monitor service and satisfaction levels over time to measure
business effectiveness in retaining and attracting customers. Summary reporting shows service
levels at customer touchpoints, tracks issue resolution rates, and graphs period-over-period
changes in customer complaints, returns, or inquires. More detailed analysis drills into service
metrics by agent, location, and time, calculates cost of service, and predicts future needs for
staff, services, and training.
Sample Report: Customer Inquiry Trend Report
Customer Service Analysis
COMMON BUSINESS QUESTIONS
• What is the trend in customer complaints this quarter?
• Where are the bottlenecks that cause me to miss service level targets?
• What is the distribution of complaints by complaint type, salesperson, and region?
• What is the average time for a customer complaint to be resolved through a call center?
• What percent of customers are satisfied with their customer service level?
• What is the customer satisfaction rating of the top 20% of customers?
• What complaints are correlated with a particular product?
• Are call centers or online help centers more effectively addressing customer needs?
1400
1200
1000
800
600
400
200
0
Open Inquiries
% Inquiries Unresolved for 3+months
Closed Inquiries
January February March April May June
#
o
f
C
a
s
e
s
%
o
f
C
a
s
e
s
14%
12%
10%
8%
6%
4%
2%
0%
This customer service report highlights trends in the number of inbound customer support cases and
their resolution status. Customer service managers use this analysis to gauge customer satisfaction and
performance over time. Additional analysis on the types of cases reported, product or service enhancement
requests, and response rate detail reveals opportunities for improvement.
MicroStrategy: Best in Business Intelligence 59
Customer scorecards are “at-a-glance” reporting mechanisms that provide insight into
the health of a customer relationship. Scorecard contents vary and are typically customized
to the needs of an organization. Scorecards include both a comprehensive view of a single
customer and a bird’s eye view of trends across a company’s customer base. Scorecards help
align executives, sales representatives, and marketing managers to focus on the key drivers of
pro?t and long-term customer relationships. Scorecards give users the ability to view data from
multiple data sources in a single, intuitive format – combining tables, charts, and graphics. More
advanced users can drill into the scorecard to understand transaction detail, review pro?tability,
or monitor interactions.
Sample Report: Scorecard for Individual Customer
COMMON BUSINESS QUESTIONS
• What has been the migration of customers across revenue bands over time?
• What is the churn rate within the most profitable customer segment?
• What is the distribution of new and existing customers for the current year?
• What are the average acquisition costs for all customers per quarter?
• What is the monthly trend in counts of active, new, lost, and retained customers?
• What products does Customer X own?
• How do this year’s customer satisfaction levels compare to last year’s?
• What is the regional distribution of the most profitable customer segment?
Key Performance
I ndi cators
% Change in Satisfaction Rating
Top 10 Orders per Region
Sales by Related Product
Average Revenue per Customer
Bottom 10% of Customers
Profit per Customer
Lifetime Value
Cost per Campaign
ROI per Customer Segment
% Conversion of Customers
to Loyal
Customer Scorecards
Customer Scorecard
Customer: P.J. Pixelman & Family
Customer Since: 28-May-95
Report Date: 30-Jun-07
FICO: 640
FICO: 30-Jun-07
Available Credit: $25,000
Products Owned
Personal Checking
Home Equity
CD - 12 month
Mortgage
Balance
$5,451
($89,564)
$65,421
($326,580)
Notes
Balance never > $15K
Missed 2 interest pmts
last 12 mos.
Due 10/15/07
5.5%, due May 2028
$1,861 monthly pmt
Recommended Products
Investment Account
Car Loan
Credit Card
529 Plan
Last Transaction
$525 Deposit 8/22/07
Drawdown $5,000 7/31/07
Interest credit
$1,861 payment 8/1/07
L
H
M
Profibility Rating
This customer scorecard offers a quick snapshot of an individual customer relationship, recommended
products for cross-sell, and customer pro?tability. Sales professionals, customer service representatives,
or marketing analysts would use this information to make decisions when preparing for a customer
meeting or actively serving a customer. Next steps in this analysis would be to develop plans to cross-sell
to this customer, analyze trends in individual product balances and payments, or research the trend in
the customer’s credit worthiness.
60 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Product Sales
Overview
MicroStrategy’s unmatched data scalability and analytical richness make it the BI standard for the
retail industry. Large volumes of transactional data and sophisticated analytical techniques are
characteristic of product sales analysis. Following are some of the more common applications in
product sales analysis.
Key Anal ysi s Areas
Category Performance/
Category Management
Inventory
Merchandising
Fraud Analysis and Loss
Prevention
Product Scorecards
Discounts and Promotions
Customers i n thi s
Area I ncl ude:
Ahold
Boots The Chemists
Comet
The Container Store
Corporate Express
Dick’s Sporting Goods, Inc.
dm-drogerie markt
Faith Shoes
Forest Laboratories
Grange Insurance
Hallmark Cards
H-E-B
Henry Schein, Inc.
Herbalife
Hudson’s Bay Company
The Katz Group
KB Toys, Inc.
La Rinascente
Limited Brands
Liquor Control Board of Ontario
Liz Claiborne, Inc.
Lotte Mart
Lowe’s Companies
METRO Group
O’Reilly Automotive
Patterson Dental Company
Quixtar
Raley’s
Republic National Distributing Co.
Samsung Life Insurance
ShopKo Stores, Inc.
Sprint
Stage Stores
Telefónica
Thomas Cook AG
U.S. Borax
U.S. Postal Service
Wilton Industries
Product sales analysis, most commonly used by retailers, enables the continuous monitoring
of point-of-sale data to uncover sales trends, investigate product demand, and optimize
merchandising strategies. Various levels of analysis, from summary reporting to statistical trending,
are required by executives, store managers, product managers, and marketing analysts, as well
as external suppliers who provide materials or ?nished goods. Business intelligence makes sense
of the growing volume of transactional data by identifying trends and opportunities that create
competitive advantage for companies that know and understand their sales drivers.
BUSINESS CHALLENGES SOLVED WITH BUSINESS INTELLIGENCE
Understand which products are selling. The ability to gain a detailed knowledge of where,
when, and why speci?c products are selling ensures optimal stocking and merchandising, and
maximizes sales. Business intelligence provides an easy-to-use interface for complex product
mix analysis and statistical data mining for a complete picture of sales patterns and trends.
Develop strategies to detect and mitigate fraud. While fraud is one of the largest costs some
businesses incur, it is being uncovered and minimized using business intelligence. Business
intelligence not only allows fraud detection through statistical analysis, but also provides pro?ling
capabilities for identifying high probability areas of fraud to prevent loss before it happens.
Analyze the effectiveness of programs and promotions. Sales and marketing managers require
the ability to analyze the effectiveness of existing programs to optimize their marketing spend
and better merchandise their products. Scheduled dashboard reporting combined with the
transaction-level drill down reveals at-a-glance results with instant access to the underlying facts.
Alert managers to potential lost sales. Executives and sales managers cannot constantly monitor
data from point-of-sale systems – there is too much data to sift through for even the most data-
savvy managers. Comprehensive BI platforms provide alert-based reporting to notify managers
and suppliers of inventory short falls, delivery problems, and sales anomolies.
“ MicroStrategy allows us to under-
stand how recent product innovations,
such as our ‘Cards with Sound’ line
are performing in the marketplace.
The scalability and usability of
MicroStrategy enables us to distrib-
ute performance information
throughout the organization so our
business users can focus on our
mission of delivering products and
services that enrich people’s lives.”
Paul Wolters,
Business Intelligence Manager,
Hallmark Cards, Inc.
“ Lowe’s is committed to information-
driven decision making. We have
used decision support and data
warehousing for more than 13 years
and have invested heavily in improv-
ing our data warehouse and business
intelligence programs. As a result of
using the MicroStrategy platform,
Lowe’s is realizing significant benefits
through improved merchandising
decisions, more timely responses to
information requests, cost reduction
initiatives, enhanced employee
productivity, and better service to
our customers.”
Steve Stone,
Senior Vice President and
Chief Information Officer,
Lowe’s Companies
> HALLMARK CARDS, INC.
Distributing Performance Insight Across Various Channels, Product Groups,
and Business Units
Hallmark Cards, Inc. has expanded its use of MicroStrategy software for enterprise-wide
reporting and analysis. Hallmark, based in Kansas City, is known throughout the world for its
greeting cards and related personal expression products.
MicroStrategy’s integrated business intelligence platform supports a wide range of reporting
and analysis applications for Hallmark, providing insights into business performance across the
company. Retail and sales productivity applications provide company-wide insight into product
performance across various channels, product groups, and business units. MicroStrategy-based
applications also analyze the effectiveness of consumer marketing campaigns, and consumer
market basket and cross-buying behavior.
> LOWE’S COMPANIES
Using a BI Center of Excellence to Realize Signi?cant Bene?ts
Lowe’s, the second-largest home improvement retailer in the world, has a primary data
warehouse containing more than 20 terabytes of data and has grown by more than 20 percent
per year over the past few years. The company’s BI environment contains industry-leading
technology from MicroStrategy, Teradata, Informatica, and IBM. There are more than 30 full-time
professionals and contractors dedicated to building a BI Center of Excellence at Lowe’s, with 25
reporting and analysis applications.
The MicroStrategy implementation at Lowe’s, called DART (Data Access and Reporting Tool),
provides employees greater insight into key performance metrics. More than 150,000 reports
are run each week, and Lowe’s employees from multiple business areas use the data to manage
inventory, improve margins, review market speci?city, and identify sales opportunities. Lowe’s
also uses BI to analyze demographic attribute data to better anticipate the products that its
customers will buy.
CUSTOMER VIGNETTES: IMPLEMENTING BI FOR
PRODUCT SALES
MicroStrategy: Best in Business Intelligence 61
62 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Product Sales
Key Performance
I ndi cators
% Change in # Orders
Top 10 Products in Sales
Profit per Unit
Top 3 Related Products
% Change in Sales
Bottom 10% of Products
by Sales
Cumulative Profit by Customer
Units per Transaction
Category performance analysis, also often referred to as category management, provides
insight into merchandise performance by product, category, geography, and vendor. Product,
store, and channel managers analyze sales performance to understand which products and
categories are selling well and which are selling poorly, in which geographies and stores, during
which time periods. Just this basic level of knowledge allows managers to optimize their product
mix, ensure inventory levels are appropriate, and offer speci?c product selections demanded
locally by consumers. Using more advanced features of business intelligence, marketers are
able to identify statistically signi?cant product relationships (which products sell well together,
which products sell well at the POS) and optimize merchandising strategies through “what if”
analysis and predictive modeling.
Sample Report: Geographic Product Trends
Category Performance Analysis/Category Management
COMMON BUSINESS QUESTIONS
• Which regions are experiencing the most growth in Product A sales?
• What are my top selling products?
• What other products are selling at the same time as my top seller?
• What is the contribution to sales of my top products?
• Which products have declining sales momentum?
• How have sales of Product A changed year over year?
• What items did Customer X buy in her last transaction?
• What is the annual sales trend of each product?
• What is the profit per unit for Product A?
Flavor Store Price
Tier
Average
Retail Price
Retail
Promotion
Quantity -
Previous
Quantity -
Current
Volume
Difference
Volume %
Change
Vanilla
Chocolate
Strawberry
Marketfresh
Fresh Fods
Corner Mart
Marketfresh
Fresh Foods
Corner Mart
Marketfresh
Fresh Foods
Corner Mart
Full
33% off
Full
Full
Full
10% off
25% off
Full
Full
$ 2.49
$ 1.74
$ 2.99
$ 2.49
$ 2.49
$ 2.71
$ 1.89
$ 2.49
$ 2.99
no
yes
yes
no
no
yes
yes
no
no
65,421
98,132
32,547
32,547
48,821
16,274
12,548
18,822
6,547
70,655
107,945
32,987
25,387
49,854
20,324
16,689
15,654
4,897
5,234
9,813
440
(7,160)
1,034
4,068
4,141
(3,168)
(1,650)
8%
10%
1%
-22%
2%
25%
33%
-17%
-25%
ICUP Ice Cream Company
Sales Geography: Metro Washington DC Sales Type: Retailer
Segment: Grocery Product Type: Print
Chain/Independent: Chain
This report shows overall changes in sales volume by region for an ice cream manufacturer. Sales, product,
merchandising, and marketing managers can see at-a-glance which territories require attention. By drilling
into the ?avor sales distribution for underperforming regions at the region, ?avor, or store level, managers
can identify factors contributing to under- or over-performance and correct or replicate tactics.
MicroStrategy: Best in Business Intelligence 63
The continuous analysis of product inventory helps an organization match supply to demand,
saving money in idle inventory and making money by preventing lost sales. Product, sales, and
logistics managers monitor important inventory indicators like consumption, turnover, returns,
and material movements in order to minimize inventory while still ensuring adequate product
supply exists to satisfy demand. First-order inventory analysis consists of reporting current
inventory status, analyzing inventory levels by location, and notifying managers of shortages via
alerts. Business intelligence can also quantify the monetary impact of inventory shortfalls on sales,
predict future inventory needs, and automate the reorder process based on demand forecasts.
Sample Report: Sales and Inventory Forecast
COMMON BUSINESS QUESTIONS
• How much is the inventory of Product XYZ worth?
• What products are in danger of stock out?
• What is the inventory capital effectiveness?
• What impact are my current sales having on my inventory plans?
• What is the trend for inventory turns by product type? Color? Size?
• What are the trends in returns and what impact will this have on inventory?
• What can I do to decrease inventory turns?
• What are my projected warehouse space requirements?
Key Performance
I ndi cators
Inventory Turn Rate
% Change to Sales Forecast
Returns Rate
Stock Out Rate
Inventory Carrying Cost
Days on Hand
Vendor Rating
Projected Inventory Surplus
Inventory Shortage as %
of Demand
Inventory Analysis
Sales Forecast and Inventory Levels for Full Suspension Mountain Bikes
Distribution
Center
Inventory as of
Today (BOH)
Sales
Last Month
Sales This
Month Last Yr
Projected Sales
for This Month
Inventory Surplus
(Projected EOH)
Northeast 100 66 35 51 50
Southeast 180 200 210 205 (25)
Northcentral 60 40 80 60 0
Southcentral 225 325 300 313 (88)
Rocky Mountain 175 155 215 185 (10)
Northwest 150 60 90 75 75
Southwest 320 315 425 370 (50)
This report links sales forecasts and inventory levels to ensure the right products are available in the
right distribution centers to support sales demand. Sales and Distribution Managers use this report to
reallocate existing stock, proactively route current orders to high-demand regions, and place new bike
orders. Beginning-on-hand (BOH) and end-on-hand (EOH) are common measures of inventory levels at
the beginning and end of a time period. A next step would analyze projected inventory surplus over
time, drill to another product to see if multiple products need to be rerouted, or create “what if” sales
and inventory scenarios.
64 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Product Sales
Key Performance
I ndi cators
Traffic Rate
% of Shelf Space Allotted
Top 10 SKUs by Location
within Store
Price Variance b/n Store
Placements
Bottom 3 Product Sizes
Cost per Package Type
% of Product Purchased
at Discount
Product Affinity Rate
Merchandising analysis allows a company to improve the planning, placement, and
presentation of products for identi?ed target markets, with the goal of optimizing the product
mix to drive traf?c and pro?tability. Sales, product, and store managers monitor the impact of
merchandising attributes like product placement, packaging, and shelf-space area on metrics
such as product sales and pro?tability. Additionally, understanding what, when, and where
speci?c segments that customers buy enables more effective store design, better product mix,
and better placement of products relative to each other. Business intelligence also provides
statistical tools to identify product af?nities (which products sell well together) and predictive
models that can be used to forecast sales quantities.
Sample Report: Merchandising Optimization
Merchandising Analysis
COMMON BUSINESS QUESTIONS
• How do I increase sales with the current product mix?
• How do I manage the increasing number of products (#’s of SKUs)?
• What are the sales trends and results with different product/service placements?
• What are the market trends by geography for identical products?
• What is the sales impact of packaging variations?
• How do I optimize my shelf space given the store configuration?
• How do I increase sales of my most profitable products?
• Which products need to be localized to suit international markets?
• How can I alter the store layout to increase traffic through the electronics department?
Products Most Commonly Sold Together Film Sales by Display Location within Store
3000
2500
2000
1500
1000
500
0
Jan Feb Mar
U
n
i
t
S
a
l
e
s
Product Category: Photography
Subcategory: Film and Storage Memory
Region: Southeast
Checkout Aisles Electronics Section
Month
35mm Film
ISO 200
ISO 400
APS Film
Bright Sun
B & W
Digital Memory
128 MB
256 MB
Most
Common
AA Batteries
Chewing Gum
Blue Sunglasses
Cubs Hat
Lithium Battery
Camera Case
2nd Most
Common
Diet Cola
ISO 200 Film
Sun Block - SPF 15
Newspaper
Tissues
Photo Magazine
This combination report illustrates the product category af?nity along with the sales trends for numerous
display locations in a store. By performing “Market Basket Analysis,” product sales, brand, and store
managers can determine optimal product placement across a retail environment. Next steps are to
investigate trends across regions, analyze sales of products where ?lm is complementary, and drill to SKUs
stocked at each location to determine which type of ?lm is selling best.
MicroStrategy: Best in Business Intelligence 65
Fraud and theft are major cost components in retail environments, where large numbers of
employees and customers have easy access to products and even the cash receipts of the business.
By understanding what is normal and what is anomalous in daily operations, regional, store, and
risk managers can identify and proactively address fraudulent behavior to minimize loss. Loss
prevention results in reduced operating costs, increased pro?ts, and better managerial controls
across the organization. Business intelligence allows real-time detection of pre-de?ned fraud
patterns and consequent noti?cation by e-mail, page, or wireless device to proper authorities.
Statistical and data mining functionality enables fraud patterns to be uncovered and intricate
pro?les created for future detection, as well as predictive analysis of loss.
Sample Report: Refund Fraud Analysis by Payment Category
COMMON BUSINESS QUESTIONS
• What types of sales have the most fraudulent returns?
• Where in my supply chain is most of the anomalous behavior occurring?
• Which products are subject to the most fraud?
• What is the total cost of the loss associated with cash refunds?
• Is most of my fraud risk from employees or customers?
• What are the details of the transaction immediately following a return?
• Which employees are associated with Fraud Pattern x?
Key Performance
I ndi cators
% Merchandise Returned
# of Cash Refunds
Rate of Credit Card Fraud
Total Loss per Product
Annual % Change in Loss
Top 10 Suspect Transactions
Suspect Transactions over
$10,000
Top 25 At-Risk Products
Top 50 Employees by # of
Returns
Fraud Analysis and Loss Prevention
Fraud Analysis and Loss Prevention
Store 1
Store 2
Store 3
Standard Deviation
(as % of sales) -3 -2 -1 1 2 3
Total Refunds
Cash Refunds
Credit Card Refunds
Merchandise Exchange
Total Refunds
Cash Refunds
Credit Card Refunds
Merchandise Exchange
Total Refunds
Cash Refunds
Credit Card Refunds
Merchandise Exchange
Fraud Analysis and Loss Prevention
Store 1
Store 2
Store 3
Standard Deviation
(as % of sales) -3 -2 -1 1 2 3
Total Refunds
Cash Refunds
Credit Card Refunds
Merchandise Exchange
Total Refunds
Cash Refunds
Credit Card Refunds
Merchandise Exchange
Total Refunds
Cash Refunds
Credit Card Refunds
Merchandise Exchange
This report compares refund rates of different stores with respect to the mean to show potential areas
of fraud. Here, Store 1 is signi?cantly above average in its cash refunds, signaling an employee or group
of employees is likely stealing cash from registers. Regional, store, and risk managers use this type of
report to spot unusual activity, and drill into suspect stores to show refunds by employees, time of day,
and register ID to narrow down the likely source of the fraud.
66 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Product Sales
Key Performance
I ndi cators
Product Sales by Region
Top 10 Products by
Profit Margin
% Change in Sales
Period-to-Period
% Change in Margin
Period-to-Period
ROI per Product
Top 10 Orders per Region
Cost per Campaign
Profit by Channel
Units Ordered
Total Delivery Time by
Shipping Point
% Delivery Late
Top Competitor by Category
Product scorecards provide “at-a-glance” insight into key product and service drivers. Brand
and product managers are able to track and analyze factors that in?uence product pro?tability
and optimize product mix across channels, lines, categories, and brands. Scorecards are comprised
of various quantitative and visual components, ranging from tables and graphs to more symbolic
performance indicators such as speedometers, gauges, traf?c lights, and color-coded ?ags.
Scheduled delivery of product scorecards allow managers to see up-to-date performance indicators
in highly visual formats, allowing instant identi?cation of risk areas. Business intelligence delivers
interactive scorecards through e-mail, Web, and Microsoft
®
Excel, with complete integration of
reporting, ad hoc analysis, data mining functions, and access to transactional systems to provide
the most ef?cient environment for detection, analysis, and action.
Sample Report: Weekly Product Scorecard
Product Scorecards
COMMON BUSINESS QUESTIONS
• What is the forecast versus plan unit demand for the next four weeks?
• Display the breakdown of fixed and variable product costs for the quarter as a bar chart with
percentage and currency.
• Show me product sales compared to the same period last year, with increases over 10% high-
lighted in green and decreases over 10% highlighted in red.
• Provide a stoplight on my scorecard if customer calls related to my product are above average
for the week.
Product Manager Weekly Scorecard: Week ending 9/5/07
Product: Widget XYZ
Weekly Sales Summary
Weekly Deliver Summary by Shipping Point - Week Ending 9/5/07
Products Owned
% Change from
Last Week
Sales Order Items
Net Sales Order Amount]
Cost Sales Orders
Net Margin Sales Orders
% Net Margin Sales Orders
Avg Net $ per Sales Order Item
Sales Order Quantity (Base Units)
(27%)
(29%)
(22%)
(39%)
(15%)
(2%)
(27%)
Week Ending
9/5/03
Last Week
$0K
$1K
$2K
$3K
$4K
Sales Actual vs. Plan
Quarter-to-Date (000)
$0K
$4K
$8K
$12K
$16K
Units Ordered
Quarter-to-Date (000)
40%
38%
36%
34%
32%
30% Month
1 2 3 4 5 6 7 8 9 10 11 12
Average Profit
Margin Trend
2,394
$ 299,250
$ 204,089
$ 95,162
31.8%
$ 125
1,017,450
3,285
$ 420,480
$ 263,220
$ 157,260
37.4%
$ 128
1,396,125
Q3
Quarter-to-Date
12,870
$ 1,535,391
$ 991,863
$ 543,528
35.4%
$ 119
5,469,750
Q2
Quarter-to-Date
14,622
$ 2,017,863
$ 1,255,094
$ 762,742
37.8%
$ 138
6,214,350
Average Quarter-
To-Date 2007
13,945
$ 1,729,180
$ 1,092,842
$ 636,338
36.8%
$ 124
5,926,625
Products Owned
Outbound Delivery Items
Delivered Quantity (Base Units) for Outbound Delivery
% Contribution to Material Outbound Delivery Quantities
Average Total Delivery Time for Outbound Deliveries (Days)
Average Transportation Time for Outbound Deliveries (Days)
Average Shipping Processing Time for Outbound Deliveries (Days)
Average Delay Confirmed to Actual Delivery for Outbound Deliveries (Days)
% Delivery Items Delivered Late vs. Total
San Diego, CA
63
328,000
32%
7.2
5.3
1.9
1
12%
Trenton, NJ
83
754,000
68%
6.4
3.2
3.2
1.3
8.20%
3K
2K
1K
0K
Month
1 2 3 4 5 6 7 8 9 10 11 12
Customer Service Calls
This product scorecard is delivered every Monday to a product manager. The scorecard contains the key
performance indicators pertaining to this particular product, and allows the product manager to see trends
in product sales, achievement of planned sales and margin targets, distribution metrics by geography, and
trends in customer call volumes. Each of these areas may highlight potential problems that the product
manager should address. The scorecard is the entry point for the product manager to dive into the
underlying details – in this case, to see cost of sales breakdown and distribution center points.
MicroStrategy: Best in Business Intelligence 67
Companies often use discounts and promotions to entice customers to buy goods or services
or increase the size of a sale by bundling items together. Discounts often drive sales but may
have a deleterious effect on pro?tability if price elasticity models have not been well-formed.
Unfortunately, increased sales often don’t offset promotion costs. Analyzing discounts and
promotions enables sales and marketing managers to identify the most relevant and successful
offers for any product or customer segment. Sales discount and promotion analysis starts with
trending of campaign success over time by product, channel, or offer, and then calculates the
return on investment for executed campaigns. More advanced analysis uses statistical techniques
to identify product af?nities (products that sell well together) for promotions, to pro?le customer
segments likely to be attracted by speci?c discounts, and to predict ROI for future campaigns.
Sample Report: Q1 2007 Promotional Effectiveness
COMMON BUSINESS QUESTIONS
• What marketing tactics are driving sales?
• How much discounting are we doing relative to last year?
• What discounts are most popular? Least popular?
• What promotions are most popular? Least popular?
• What are the geographic discount/promotional trends?
• What is the cost of the discount/promotion compared to the increase in sales?
• What promotions are resonating with different customer segments?
• Which sales people are more reliant on discounts/promotions?
• Which promotions most significantly impact sales for my most profitable products?
Key Performance
I ndi cators
% Discount Offered
Return on Investment
Campaign
Coupon Redemption Rate
Variance from List Price
Net Cost of Campaign
Forecast Sales from Promotion
Bottom 10% of Promotions
by Sales
Discounts and Promotions Analysis
J an Profit Feb Profit Mar P ro fit Quarterly Promotion Cost
$$$
10% of f of 1st W SJ Ad M ag. Ad W eb Site Dir ect Mai l
time customer code: pr omo code: sale 15% of f 20% of f
Promotion
ROI 42% 3% -41% 5% -31%
$1,400,000
$1,200,000
$1,000,000
$800,000
$600,000
$400,000
$200,000
Prom o
Cost
($000)
$876,876
$868,669
$900,000
$368,577
$400,000
Promotion
10% of f of 1st
time customer
W SJ Ad
code: pr om o
M ag. Ad
code: sale
W eb Site
15% of f
Dir ect M ail
20% of f
ROI
42%
3%
-41%
5%
-31%
Jan
Profit
$432,536
$435,423
$243,534
$76,867
$98,590
Feb
Profit
$432,536
$435,423
$243,534
$76,867
$98,590
Mar
Profit
$432,536
$435,423
$243,534
$76,867
$98,590
Related Product ($000)
This report analyzes pro?t attributable to promotions, the cost of the promotion, and promotion ROI.
Sales and marketing managers use this report to understand sales impact, determine the effectiveness
of promotional efforts, and make decisions on future campaign design. Further analysis would reveal
those products with statistically signi?cant changes in sales as a result of each promotion, sales increase
by customer segment by promotion, or pro?t optimization varying dollar spend by channel.
68 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Overview
The report distribution, visualization, and advanced analytical capabilities required for supply chain
analysis demand an integrated reporting, analysis, and information delivery platform to distill
relevant information and deliver it to every party involved in optimizing the supply chain. The
following pages show the more common types of analyses enabled by MicroStrategy technology.
Key Anal ysi s Areas
Supply and Demand Planning
Manufacturing Scheduling
and Production Planning
Regulatory Management
Order Fulfillment
Strategic Sourcing and
Vendor Scorecards
Quality Control
Network Optimization
Call Center
Customers i n thi s
Area I ncl ude:
The Advisory Board
Company
Avon Products
dm-drogerie markt
Esteé Lauder
Faith Shoes
GT Nexus
Gucci
Hallmark Cards
Hudson’s Bay Company
The Katz Group
KB Toys, Inc.
La Rinascente
Liquor Control Board
of Ontario
Lowe’s Companies, Inc.
METRO Group
Michelin North America
Oakwood Homes
Porsche Cars
North America
Raley’s
Republic National
Distributing Company
Samsung Life Insurance
Sennheiser electronic
GmbH & Co. KG
Transportation Security
Administration
U.S. Postal Service
The predictable, reliable, and ef?cient movement of materials, components, and ?nished
products is critical to the success of every manufacturer, supplier, distributor, and retailer. The
importance of optimizing this supply chain has made supply chain analysis one of the fastest
growing business intelligence application areas. The proliferation of automated tracking systems,
supply chain transaction systems, and electronic data interchange (EDI) systems has contributed
to the rapid increase of data related to supply chain management. Business intelligence solutions
are required to turn these rapidly growing data stores into actionable information, allowing
managers and analysts to understand inventory trends, track vendor performance, analyze
distribution network ef?ciency, and respond more quickly and accurately to demand feedback
from the marketplace.
BUSINESS CHALLENGES SOLVED WITH BUSINESS INTELLIGENCE
Deploying vendor scorecards to manage inventory. Executives and trading partners require a
summary view of vendor performance versus plan for key business metrics such as on-time
and complete shipments. Scorecards integrate data elements from multiple sources into visual
representations of performance, such as graphs and gauges, to provide a complete picture of
supply chain performance at-a-glance.
Develop strategies to detect and mitigate fraud. Statistical quality control, process capability
studies, and acceptance testing allow managers to assess the quality of supply inputs and select
the most reliable sources. Users require an easy way to investigate complex manufacturing and
distribution processes using a full range of analytical and data mining functions.
Proactive alerts of product and material shortages. Production, sales, and supplier managers
need to review inventory levels broken down by both in-transit and ?nished goods location
on a programmatic and alert basis. Information must be delivered according to user-de?ned
business rules to their device of choice (Web, e-mail, pager) through data-driven thresholds
and schedules.
Sharing information securely with a distributed user community. Supply chain and back
of?ce operations have a diverse reporting population spanning geographies and time zones.
Information assets must be tightly secured, while allowing access via the Web, e-mail, and
Microsoft
®
Excel so the proper individuals can see the data for which they have privileges.
Supply Chain and Operations
“ Our customer base is very diverse
and a one-size-fits-all approach to
reporting and analytics does not work
for us. By embedding MicroStrategy,
we give our customers the ability to
build their own unique reports and
analytics. We conducted a thorough
assessment of BI products and it
was apparent, early on, that
MicroStrategy’s technology was
ahead of the game in many key
areas. We were particularly impressed
with MicroStrategy’s full-featured
Web interface with drag-and-drop
interactivity to meet the needs of our
diverse user population. Scalability
to handle volumes of data and an
integrated architecture for a seamless
user experience were two other
important decision criteria for us.”
Andy Stinnes,
VP of Products and Corporate Strategy,
GT Nexus
“ We selected MicroStrategy because
of its scalability, user-friendly Web
interface, and robust reporting
features that help us to make fact-
based decisions which impact our
bottom line. MicroStrategy provides
the ability for hundreds of concurrent
users to quickly retrieve and analyze
large volumes of detailed data and
efficiently monitor performance of
key business metrics.”
Tim Armstrong,
Director of Analytical Business Solutions,
KB Toys
> GT NEXUS
Identifying Ways for Companies to Reduce Costs and Improve Operational Ef?ciencies
In 2006, GT Nexus selected MicroStrategy to power the customer-facing analytics and reporting
capabilities on its Global Trade and Logistics portal. The GT Nexus portal is an on-demand
technology platform that is used by importers, exporters, transportation carriers, suppliers,
banks, and other partners to manage goods that are moving around the world.
The GT Nexus system captures and stores hard-to-get data associated with global supply chains,
and then fuels a range of Web applications that can be used by constituents to lower supply
chain costs and improve control. MicroStrategy will help GT Nexus to deliver a wide range of
analytics and reporting capabilities to its customers, which include Home Depot, Kmart, Xerox,
Weyerhaeuser, and American Eagle Out?tters.
By embedding MicroStrategy’s business intelligence technology into its portal, GT Nexus
enables customers to analyze their global supply chains and the performance of their
partners. With this data, GT Nexus customers can identify weak spots in their supply chain
and make analytically-based decisions that can reduce costs, improve operational ef?ciencies,
and enhance business performance.
> KB TOYS, INC.
Adding to the Bottom Line at the Nation’s Largest Mall-Based Specialty Toy Retailer
In 2007, KB Toys, Inc. selected MicroStrategy as its business intelligence platform. KB Toys, Inc.
is the nation’s largest mall-based specialty toy retailer.
Initially, KB Toys plans to use MicroStrategy for reporting on key merchandising and supply chain
metrics to improve the management of inventory from its vendors to its stores. MicroStrategy
will be used to manage product life cycles, track customer demand, and monitor inventory
levels through dashboards and exception reporting, enabling KB Toys to enhance customer
service levels while improving return on inventory.
“We are evolving our approach to buying, planning, product allocation, and store operations,”
said Frank Andryauskas, Chief Information Of?cer at KB Toys. “MicroStrategy will enable us
to better understand inventory trends, track product demand, and analyze the ef?ciency of
store operations.”
CUSTOMER VIGNETTES: IMPLEMENTING BI FOR SUPPLY
CHAIN AND OPERATIONS
MicroStrategy: Best in Business Intelligence 69
70 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Supply Chain and Operations
Key Performance
I ndi cators
Predicted Demand
Required Materials
Supply on Hand
Geographic Trends
Pricing Analysis
Inventory Turn Rate
% Change to Sales Forecast
Days on Hand
Supply and demand planning is continuously performed during the manufacturing and
distribution process to ensure planned production will meet forecasted demand and the
appropriate amount of raw materials and goods are available for production runs. Beyond basic
analysis of current supply and past demand, supply and demand planning requires predictive
modeling, statistical forecasting, and the ability to drill into demand detail by region, customer
segment, or product category. Shortfalls in supply can be detected or predicted, with automatic
alerts sent to managers or triggering a reorder process.
Sample Report: Product Demand and Component Inventory
Supply and Demand Planning
COMMON BUSINESS QUESTIONS
• What materials are used in the production of each product?
• How many products by type did we sell over the last five years?
• What was the geographic demand for our products?
• How many suppliers do we rely on for our products?
• Does regional manufacturing capacity align with demand?
• How is demand impacted by seasons?
• Which material(s) have the most price volatility by vendor?
• What customers will demand which products? Are there customer segment patterns?
T itanium Driver: Product Demand and Component Inventor y
Pe riod: Q3 2007
Comp 4 Comp 5
Product A
Product B
Product C
2
2
15094
28999
Forecast Demand (units )
2835
4712
1372
Comp 3
6
28272
36899
Comp 2
1
2
5579
4892
reorder
Comp 1
4
1 1340
13688
5
3
4
33799
291 12
reorder
T otal Components Required
I nventory on Hand
This sample report tracks forecasted demand to required product components. Combining the forecasted
demand with actual inventory on hand, the report highlights areas where inventory shortfalls are present.
This type of report can be generated daily and e-mailed to a Production Manager or be part of a dashboard
as a starting point for planning production. HTML links in the report allow users to drill into components to
determine why there is a shortfall, identify the suppliers, and quote prices of the items required in order to
meet production schedules. Reorder links allow immediate action to ensure correct supply.
MicroStrategy: Best in Business Intelligence 71
Manufacturing planning encompasses the hourly/daily/weekly/monthly production and
machine schedules across multiple plants or production lines to meet orders or forecasted demand.
Success hinges on accurate materials planning. Manufacturing managers, product managers, and
purchasing analysts review metrics such as production capacity and current inventories to plan
appropriate production schedules, ensure raw material availability, and make plant reallocation
decisions when appropriate. Basic analysis includes real-time status of plant utilization and trends
in market demand versus planned production runs. Advanced analysis includes hedging analysis
on commodities used in production, forecasting of machine output, and linear programming to
optimize production resources.
Sample Report: Utilization and Capacity Analysis
COMMON BUSINESS QUESTIONS
• What are the current machine utilization rates?
• Which plants/lines are operating with excess capacity?
• What percent of forecast is represented by planned manufacturing capacity?
• How much product(s) do we need to produce to meet existing demand?
• How much product(s) do we need to produce to meet anticipated demand?
• What are the planned machine/line downtimes and how will they affect product supplies?
• Which products are scheduled to have a major update this year? Will we be able to meet the
new demand?
Key Performance
I ndi cators
Production Capacity Trends
Projected Inventory Surplus
Days on Hand
Production Shortage as %
of Demand
Inventory Turn
Production Cycle
Equipment Utilization %
Manufacturing Scheduling and Production Planning
Model Line XYZ Current Production and Plant Utilization
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Plant 1 Plant 2 Plant 3 Plant 4 Plant 5
U
t
i
l
i
z
a
t
i
o
n
Forecasted Demand 485,000
Plant 1
Plant 2
Plant 3
Plant 4
Plant 5
Capacity
125,000
120,000
100,000
140,000
100,000
Current Production
112,500
48,000
100,000
119,000
75,000
Model XYZ Summary
Total 585,000 454,500
Shortfall with Current Production 30,500
This report summarizes current production for Model XYZ and combines it with the product demand
forecast showing a potential shortfall at the current output levels. This type of report helps managers
optimize ?xed investments in plant and equipment by keeping them running near 100% of capacity and
working to meet market demand. A next level of analysis would be to drill into the production status
of Plant 2 to determine what other products are being produced there, the margins on these products
versus Model XYZ, and market demand for the products being produced at Plant 2.
72 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Supply Chain and Operations
Key Performance
I ndi cators
Variance to Expected Outcome
Top 10 Malfunctions
Top 10 Side Effects
Variance to Acceptable Levels
Average Result of All Tests
Predicted Outcome
Statistical Significance
of Results
Standard Deviation of Results
Many industries must operate in tightly regulated environments with government reporting
and substantiation of ?lings critical to product and service delivery. Manufacturers, transportation,
defense, consumer goods and food, pharmaceutical, telecommunications, ?nancial services,
insurance, and utilities are just a few of the industries that must furnish regulatory information.
Engineering, manufacturing, and legal professionals perform analyses on performance against
predetermined and internal standards. Business intelligence provides basic analyses such as
performance versus standard levels as well as statistical signi?cance of acceptance or failure rates.
Sample Report: Clinical Trial Results, HIPAA Compliant
Regulatory Management
COMMON BUSINESS QUESTIONS
• What is my product’s performance versus approval standards?
• What clinical trials are currently underway?
• What is the user acceptance rate of a new product?
• Are any products in noncompliance with government or industry standards?
• How do trial results vary from expectations?
• Can these results be extrapolated to the general user population?
• What are the countries of origin for all my production components?
• What countries have we sold products to? Where are service calls coming from?
Patient Code Gender Group
6 Mo.
Effectiveness Rate
Patient Reported
Side Effects
P1102 M Test 90% None
P1105 F Control N/A None
P1107 F Test 70% Nausea
P1110 F Test 95% Slight nausea on one occasion
P1117 M Test 50% Nausea, sleeplessness, cough
P1118 M Control N/A Cough
P1122 F Test 88% Sleeplessness
P1124 M Control N/A None
P1125 F Test 86% Occasional nausea
Clinical Trial: A2B3452 6
This reports shows a sample of the results of a clinical trial for a new drug compound, and is a good
example of a report containing mostly qualitative data. Due to HIPAA and con?dentiality requirements,
patient identities have been masked, but a Clinical Manager can see who received a trial drug versus
placebo, the patient’s gender, and reported side effects. A next level of analysis is drilling into the details
on the side effects for each patient during monthly visits -- the same as drilling into individual transactions
with other analyses. While this example addresses regulatory needs in the pharmaceutical industry, the
concept can easily be adapted to meet the needs of a manufacturer with regulatory requirements.
MicroStrategy: Best in Business Intelligence 73
Logistics and operations managers analyze total processing time from order to ful?llment, the
variances between the original order and the delivered goods, and the business impact of goods
that are returned, damaged, or delivered incorrectly. The customers’ ability to track the status
of orders adds to satisfaction and ensures orders are accurately and promptly ful?lled as placed.
Reporting on the status of orders, tracking the time to ful?llment across product categories and
geographies, and analyzing the variance in delivery costs versus standards are ?rst steps in order
ful?llment reporting applications. Advanced analyses include trending performance against
service levels, drilling into individual orders across ful?llment metrics, and performing time series
analyses on ful?llment steps to optimize results.
Sample Report: Order Ful?llment Performance by Region
COMMON BUSINESS QUESTIONS
• What is the average total order processing time?
• What percent of orders were delivered on time?
• What customers have the most delivery delays? The least?
• What are the trends in fulfillment across product line and geography?
• How many items are in the backlog?
• What is the average delivery time?
• Was there a variance between the quantity ordered and the quantity delivered?
• Which orders are in transit?
• Do we have delivery confirmation for all of today’s deliveries?
Key Performance
I ndi cators
Backlog Moving Average
Trend in Delivery Time
% Orders Returned
Trend in Delivery Method
% Delivered on Time
Variance in Delivery vs. Order
Order Ful?llment Analysis
Cases Ordered
(000)
% Delivered
on Time
# Cases
Damaged (000)
% Cases
Damaged (000)
Lost Sales Due to
Stockouts (000)
Trend in Performance
vs. Last Month
North America 4,587 98% 11.8 0.257% $ 97.74 ?
Latin America 5,645 97% 20.1 0.356% $169.35 Ú
Europe 6,587 96% 12.3 0.187% $263.48 Ò
Asia 4,198 92% 6.6 0.157% $335.84 Ú
Chicken Soup (12oz.) Ful?llment Analysis - May 2007
This report summarizes information on the ful?llment results across regions for a particular product,
highlighting anomalies, and providing a visual snapshot of performance trends. An operations analyst
will use this report to determine regional performance and determine if steps need to be taken to
mitigate lost sales and damaged goods. From the links embedded in the report, users may look at
regions to determine causes for lost sales, including supply shortages, impact of new packaging, or
variation in performance of delivery methods – rail, sea, air, or truck.
74 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Supply Chain and Operations
Key Performance
I ndi cators
Inventory Turnover Rate
Price Variance to Order
# Stockouts Prevented
Days Until Reorder
Vendor Quality Rating
Product Delivery Date Variance
Vendor Quality Ranking
Top 5 Stockout Suppliers
Manufacturers analyze vendor performance at all entry points in the supply chain. Vendor
scorecards allow both a customer and vendor to compare performance against agreed upon
accuracy and delivery time service levels. Logistics, supply, purchasing, ?nance, and manufacturing
analysts and managers use this information to analyze the customer-supplier relationship and
ensure that the correct products and materials get to the right place at the right time – saving time
and money. Standard analysis focuses on tracking inventory levels, ranking vendor performance,
and showing the status of orders. Optimization techniques include predicting vendor performance,
based on past behavior, proactive alerts of potential stockouts and delivery status, and optimizing
scenarios for different sourcing mixes.
Sample Report: Vendor Performance Scorecard
Strategic Sourcing Analysis and Vendor Scorecards
COMMON BUSINESS QUESTIONS
• How many times have orders been placed with this vendor in the last year?
• How many different employees ordered from this vendor?
• What is the total dollar value spent with this vendor year over year?
• What is this vendor’s on-time delivery percentage?
• What is a vendor’s performance against predetermined performance metrics?
• Has this vendor been late to deliver in the past?
• Who are the top three low-cost bidders for a particular product?
• What components have the most price volatility over the last two years?
• Who are the suppliers with the most price volatility?
Month
Numer of
Shipments in Period
%
Complete
%
On Time
% On Time and
Complete
Vendor
Performance Rating
TARGETS ? 95% ? 95% ? 90% ? B%
April 542 98% 95% 94% A-
May 654 96% 92% 91% B+
June 602 96% 85% 82% C
Vendor: Oceans Soda Company
Reporting Period: Q2 2007
This vendor scorecard highlights summary performance of a single vendor, Ocean Soda Company, for the
desired reporting period with thresholding (red) used to show where performance deviates from Service
Level Agreements (SLAs). Sales, purchasing, logistics, and ?nance professionals both internally and at the
vendor organization will use this scorecard to monitor performance.
MicroStrategy: Best in Business Intelligence 75
To ensure ?nished products adhere to an organization’s quality standards while minimizing
costs, companies use business intelligence to develop product and component sourcing
scenarios. Managers and analysts in manufacturing, procurement, and customer service rely on
quality reporting to determine if a production run needs to be halted, to determine if a vendor
is having increased quality problems, or to identify customers who need to be contacted for a
recall. Understanding which products need to be recalled by production time or run, trends in
quality, and the costs of defects are ?rst-order analyses in quality control. Statistical sampling and
analysis on defect rates, proactive alerts sent to production managers when quality thresholds are
exceeded, and the ability to track the location of any component in a product in real-time are the
functions enabling companies to achieve true competitive advantage.
Sample Report: Quality Control Metrics by Product and Supplier
COMMON BUSINESS QUESTIONS
• What percentage of product is defective?
• How many of each product had to be discarded for defects?
• What dollar value did the discarded inventory represent?
• What is the standard deviation of quality ratings?
• What suppliers are linked to defective products?
• What are my defect rates compared to this same period last year?
• What is the trend in product quality?
Key Performance
I ndi cators
Overall % Defective
$ Value of Defective Product
# of Defects that Reached
Customers
Top 5 Vendors with
Components in Recall
Potential Cost of Recall
% Change in Quality Year
over Year
Top 10 Vendors with Lowest
Defect Rate
Customer Ranking by #
Exchanges
Top 5 Facilities in Quality
Production
Quality Control
Product
Total 2006
Production
2006 #
Defects
Defect
Rate
Production
Cost/Item
Total $ Loss
on Defect
Production
Defective
Part ID
Defective Part
Vendor
ABC 1,254,648 25,094 2% $50.26 $1,261,208 456 Jones Corp.
DEF 45,789,633 1,373,689 3% $25.29 $34,740,595 123 Smith Corp.
GHI 3,246,323 162,316 5% $30.54 $4,942,527 789 Smith Corp.
TOTALS 50,290,640 1,561,099 3% $40,944,330
Product: DEF Quarterly Defect Summary Production Run Units Produced Defects Defect Rate
Supplier: Smith Corporation Run 1 15,263,211 346,578 2.27%
Run 2 14,195,120 472,598 3.33%
Run 3 13,582,487 326,798 2.41%
Totals: 43,040,818 1,145,974
Production Summary
This report demonstrates a simple quality analysis that highlights the material defect rates and costs to
the organization, with details of one of the production runs. With user-de?ned thresholds, a ?nancial,
operations, or supplier analyst can perform this type of analysis to see if there are immediate problems
that need to be addressed or in preparation for discussions with a vendor on the quality of product
supplied. A next level of analysis would be to drill into individual production runs to determine if a
particular product run had a statistically signi?cant defect rate, or drill into the details of all products
supplied by a particular organization that may be having quality problems.
76 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Supply Chain and Operations
Key Performance
I ndi cators
% of Capacity
Utilization Rate
Top 10 Assets Serviced the
Most? The Least?
Trend in Maintenance Costs
Predicted Network Downtime
Variance to Standard
Network Capacity
Top 5 Production Bottlenecks
Developing a robust manufacturing and supply distribution network requires a large capital
investment. Manufacturing managers monitor machine utilization rates, capacity versus
demand, and load versus defect rates to optimize production lines. In communications networks,
information technology managers continuously monitor switches, channels, and the overall
network to determine usage rates, balance load, and plan capacity investments. Metrics often
tracked include infrastructure availability, up-time, and utilization. Predictive analysis is used to
determine future infrastructure requirements, and “what-if” analysis shows the tradeoffs of
different con?guration and load scenarios.
Sample Report: Network Performance and Downtime
Network Optimization
COMMON BUSINESS QUESTIONS
• What is the network utilization versus downtime?
• What percent of capacity is this location operating at on average?
• What is the trend in volume over the past year?
• How much downtime do we experience per month?
• What is the maximum traffic our network can handle?
• What machines require maintenance today? This week? This month?
• What machines are nearing the end of their productive life?
• What will our required network investments be next year?
Number of Outages
J an F eb M ar Apr M ay Jun Jul Aug Sep O ct N ov D ec Jan F eb Ma r Apr
06 06 06 06 06 06 06 06 06 06 06 06 07 07 07 07
Duratio n
# of O utages
14:00
12:00
10:00
8:00
6:00
4:00
2:00
0:00
#
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This report demonstrates the trend in the number and duration of plant/network outages over a 16-month
window. The positive trend can be the result of a number of factors including a completed modernization
effort, increased training, or more proactive maintenance. By viewing this report, an operations, information
systems, or production analyst can see the amount of time lost due to outages and drill into the months
where there were anomalies. Typical follow-on analysis includes comparing ROI of upgrade/training/
maintenance (costs versus increased product sales or productivity measures), drilling into the cause and
location of outages, or implementing a proactive noti?cation process whenever there is downtime.
MicroStrategy: Best in Business Intelligence 77
Because of their low cost per touch, call centers have become an increasingly important customer
touchpoint for many businesses. Changes in call volumes, response times, and satisfaction levels
are all key to understanding the ef?ciency and ef?cacy of call center operations. Customer service
and telecommunications managers analyze these metrics to determine staf?ng levels, plan for
infrastructure investments, and ensure proper customer satisfaction levels. Basic reporting delivers
scorecards on call volume, response times, and call duration. Advanced analysis involves individual
call detail access, predictive modeling on staf?ng and infrastructure requirements, and analysis of
call volume by geography, customer segment, or product ownership.
Sample Report: Call Duration Trend Report
COMMON BUSINESS QUESTIONS
• What is the trend in call volume this month?
• What is my blocked call rate?
• How does the average response time compare to this month last year?
• How much capacity will be required next year if we continue at this rate?
• What products/services are inbound callers most frequently requesting?
• Which employees take the most calls?
• Which employees spend the longest time on the phone per customer?
Key Performance
I ndi cators
Variance in Call Volume by
Customer Segment
Average Response Time
Forecasted Call Volume
Average Call Length
Call Type (Sales, Service) as %
of Total Inquiries
Top 10 Customer Service
Representatives
Top 100 Customers by #
Inbound Calls
Average Number of Outbound
Calls to Sell a Product
Change in Customer
Satisfaction Rating
Call Center Analysis
January Incoming Call Duration Analysis
5-14 min
15-29 min
30-44 min < 4 min
< 5 min
Call Type: > 45 min
Sales 24%
Service 66%
General Info 10%
This report shows the breakdown of incoming call volume for a user selected time period. By drilling
into any of the pie sections, an operations or customer service analyst can determine the types of calls
in the duration segment. Further analyses of interest might be departments to which calls were routed,
individual agent activity records, or call duration for different customer segments.
78 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Web Site Analysis
Overview
Key Anal ysi s Areas
Web Traffic
Web Visitors
Web Navigation
eCommerce
Customers i n thi s
Area I ncl ude:
AutoTrader.com
Barnesandnoble.com
Brickstream
Corporate Express
Cortal Consors
eBay
Edmunds.com
La Caixa
Monster.com
Netflix
Nygard International
Ohio Department
of Education
Priceline.com
Quixtar
Sprint
Telefónica
Vodafone
Yahoo!
Companies study Web site visitor activity to understand customer and prospective buyer
interests, improve Web site design and navigation, and increase the pro?tability of the online
sales process. By tracking and analyzing Web traf?c patterns, site navigation, page views, and
transactions, online marketers can design more compelling Web sites and give visitors better
incentive to buy and return. With the low switching costs present on the World Wide Web,
companies know that a visitor’s experience must offer enough value to induce repeat visits.
Companies rigorous in their analytical approach to online merchandising and/or sales are
realizing lower marketing costs, higher online revenue, and improved customer loyalty.
BUSINESS CHALLENGES SOLVED WITH BUSINESS INTELLIGENCE
Investigate online visitor behavior trends to optimize Web site design. Web site design must be
optimized to induce speci?c visitor actions, for example, completing checkout once items have
been added to a shopping cart. BI allows paths of interest to be de?ned and tracked, related
pages to be grouped into a single de?ned interest area, and customer data to be combined
with Web traf?c data to better understand the behavior of particular visitor segments.
Combine of?ine and online customer detail to uncover marketing opportunities. Combining
Web log information with customer information from other corporate systems provides
marketers a unique opportunity to connect customers to page views, allowing offers to include
items speci?cally known to have been viewed by the customer. Business intelligence not only
enables this identi?cation process, but automatically creates and delivers targeted offers through
the Web, e-mail, and wireless devices.
Understand marketing campaign effectiveness through tracking of online results. Marketing
campaigns with Web-based calls-to-action can be effectively tracked near-real-time through
Web data analysis. E-mail, Web site, and other banner ad campaigns tagged with campaign
identi?ers can be tracked from click-through to response to closed sale. Understanding the
relative effectiveness of list targets, creative design, and offer content allows marketers to
optimize their marketing spend.
Provide real-time alerting of Web traf?c performance indicators and anomalies. Web site managers
must be noti?ed immediately when a Web site goes down. Other traf?c pattern and transaction
changes can indicate navigation problems, merchandising errors, and personalization errors. BI
provides statistical measures of traf?c, conversions, and page views relative to average for a de?ned
time period, and automatically alerts managers of anomalies based on prede?ned thresholds.
MicroStrategy’s unique ability to handle the growing volumes of Web data and combine it with data
from across the enterprise have won the business of many of the world’s most prestigious online
companies, including Yahoo! and eBay. The following pages review some of the most common areas
of Web data analysis and the benefits BI offers when applied to Web log data.
“ eBay selected MicroStrategy
because of its exceptional user
scalability and its ability to support
advanced reporting and analysis.
MicroStrategy also provides
excellent query performance with
our rapidly growing multi-terabyte
data warehouse.”
Brad Peterson,
CIO,
eBay
“ We were looking for a business
intelligence product that provides
excellent query performance
against our rapidly growing multi-
terabyte data warehouse. With
MicroStrategy, our marketing team
will have the information they
need to make strategic, data-
driven decisions to help drive
business growth.”
Ron Rose,
CIO,
Priceline.com
> eBAY
Providing Excellent Query Performance for a Rapidly Growing Multi-Terabyte
Data Warehouse
eBay relies on the MicroStrategy platform to analyze the ongoing performance of the many
different categories of products and services for sale on its Web sites. On any given day, there
are more than 16 million items listed on eBay across 27,000 categories.
> PRICELINE.COM
Enhancing Marketing Campaigns to Help Drive Business Growth
Priceline.com has chosen MicroStrategy to anchor key marketing reporting capabilities.
Priceline.com is an Internet-based travel service that offers leisure airline tickets, hotel rooms,
rental cars, vacation packages, and cruises.
Priceline.com selected MicroStrategy to enhance its analytic and reporting capabilities and provide
greater insight into key operational data for search engine marketing. With the ability to obtain
and analyze granular data, Priceline.com marketing analysts will have actionable data that they
can use to improve the return-on-ad-spend of its search engine marketing campaigns.
MicroStrategy was selected by Priceline.com for its Web-based platform, data and user
scalability, advanced reporting and analytical capabilities, and integrated metadata for
automated maintainability.
> YAHOO! INC.
Providing a Complete Understanding of Online Interactions
Recently, MicroStrategy customer Yahoo! expanded its use of the MicroStrategy Business
Intelligence Platform. For these new applications, MicroStrategy was selected primarily because
of its powerful analytics.
Yahoo! uses MicroStrategy’s software for customer analysis, sales analysis, advertising assessments,
and transaction activity reviews. Yahoo! Inc. is a leading provider of comprehensive online products
and services to consumers and businesses worldwide. Yahoo! is the No. 1 Internet brand globally
and the most traf?cked Internet destination worldwide.
CUSTOMER VIGNETTES: IMPLEMENTING BI FOR
WEB SITE ANALYSIS
MicroStrategy: Best in Business Intelligence 79
80 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Web Site Analysis
Key Performance
I ndi cators
Page View Count
Session Count
Unique Visitor Count
Average Session Depth
Average Session Duration
Click-through Count
Page Ranks
The analysis of Web traf?c metrics such as page views, visitor count, visit duration, and click-
throughs provide the most basic understanding of the attractiveness of a corporate Web site.
Traf?c trends are often ?rst reviewed for the Web site homepage and then for various major Web
subsections, portals, and microsites. Time-based traf?c comparisons highlight cyclical, seasonal,
or day-of-the-week visitation variations that can in?uence when new Web content should be
posted. Generally, Web traf?c analysis provides a good ?rst order indication of the effectiveness of
a company’s marketing message, since increased market awareness tends to drive additional Web
visits. Business intelligence additionally provides an early warning system for Web site availability
or design problems, as it is able to alert Web administrators when traf?c is unusually light. Overall,
Web traf?c analysis provides a better understanding of the level of interest in a company and its
offerings, helping marketers tune their messages to increase prospect and customer visitation.
Sample Report: Web Traf?c Trends by Content Section
Web Traf?c Analysis
COMMON BUSINESS QUESTIONS
• What is the trend in the number of unique visitors across corporate Web sites over the past year
for a particular visitor segment?
• Are there any unusual, non-seasonal changes or trends that need further investigation?
• What are the peak hours for Web traffic each weekday versus the weekend?
• Is there a correlation between changes in Web site design and Web site visitor activity?
• Which landing page has been the most active over the past year?
• Is there a correlation between Web site performance and visitor retention and/or attrition?
• What is the online behavior of the most valuable segment of my offline customers?
400K
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Launch
Customer
Promotion
Homepage
Redesign
New
CEO
Sections of website
Product
Services
Customers
Company
This report shows the trend of Web site visitors for different sections of a corporate Web site, overlayed with
some major corporate and marketing events. Marketing managers can determine the impact of speci?c
events on overall market interest, the effectiveness of campaigns on driving behavior, and the impact
of Web design on navigation paths. This overall picture leads to detailed visitor analysis of competitor,
customer, prospect, and investor segments, conversion to leads, and page stickiness. Proactive alerting of
signi?cant out-of-trend session numbers can also notify Web system managers of potential service issues.
MicroStrategy: Best in Business Intelligence 81
In order to better understand the needs of prospects and customers, companies often pro?le
individual Web visitors and analyze their visitation patterns. This visitor analysis and segmentation
is used to drive marketing campaigns, such as targeted cross-sell or up-sell campaigns, as well
as Web site design optimization. Accurate visitor pro?ling requires a combination of input
variables, from length of stay to page views to paths, combined with customer characteristics
and transactional history from the Web site and other customer touchpoints. “Stickiness” is a
common term used to characterize the attractiveness of a site, section, or page, and is measured
by the average number of page views, session duration, and page depth. In addition, Web visitors
identi?able through login or cookies may be tied to customer data from other systems to create
personalized campaigns by customer segment or by individual customer. Business intelligence
applied to Web visitor analysis is being used to feed campaign management systems for these
highly personalized and automated campaigns.
Sample Report: Web Visitor Breakdown by Segment
COMMON BUSINESS QUESTIONS
• What is the success rate in converting “visitors” to “repeat visitors” to “customers”?
• Which ad banners and other referrals are attracting the most qualified visitors?
• Is my defined target audience actually the majority of visitors I’m attracting?
• How often do my online customers also purchase offline?
• How effectively am I driving my offline customers to transact through my Web site?
• What is the demographic profile of visitors who have viewed Product X?
• What products are being viewed by customers who have purchased Product Y?
Key Performance
I ndi cators
Page Views
Traffic Counts
Visitors
Frequency
Click-throughs
Stickiness
Conversions
Referrals
Banner
Keyword
Web Visitor Analysis
100%
80%
60%
40%
20%
0%
Total Visitors
%
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t
Q1 2007 Q2 2007
8,392 7,037
Strangers (%)
Friends (%)
One-time Customers (%)
Loyal Customers (%)
Former Customers (%)
In the above example, even though the number of total visitors to this corporate Web site has decreased
from Q1 to Q2, the number of repeat visitors, termed “friends,” is increasing. This segment, now
familiar with the corporate message, may be ready for a purchase solicitation. The fact that visits by
“strangers,” or new visitors, are decreasing suggests prospecting tactics are becoming less effective.
82 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Web Site Analysis
Key Performance
I ndi cators
Page Views
Visits
Visitors
Click-throughs
Conversions
Ranks
Visit Type
Banner
Search Keyword
Domain
A corporate Web site typically consists of many navigation paths and hierarchies stemming
from the site’s homepage. Whether the primary goal of the Web site is information dissemination,
lead generation, or actual product purchase, the paths of a Web site may be monitored to
determine whether Web visitors are taking a desired course of action. Web navigation analysis
studies the relative attractiveness of a Web site’s navigation paths to optimize site navigation
structures and to determine customer interest in speci?c content. Navigation analysis combines
individual and aggregate visitor activity, key-word search results, banner ad clicks, purchase
transaction activity, and page view duration. Optimization of site navigation is having a direct
impact on conversion of “lookers to bookers,” increasing the number of visitors that either
complete a transaction or stay engaged long enough to receive a desired message.
Sample Report: Campaign Effectiveness on Product Views
Web Navigation Analysis
COMMON BUSINESS QUESTIONS
• How effective are each of my banners at attracting visitors to my Web site?
• How are first time visitors using my site versus repeat visitors?
• How can I optimize page sequences for best conversion rates?
• What pages cause visitors to drop out?
• Is my image placement creating enough click-throughs to justify the real estate use?
• What is the average download size and time of my pages?
Pr oduct s
Web Ser ver
Repor t Wr i t er
Dat a Agent
Dat a Mi ner
7, 416
2, 654
1, 547
2, 569
646
6, 671
1, 254
2, 187
3, 230
25, 417
8, 965
2, 541
1, 756
1, 285
3, 658
2, 266
2, 365
852
1, 258
541
123
443
Consul t i ng
Educat i on
Suppor t
Ret ai l
Fi nanci al Ser vi ces
Telecommunications
Manuf act ur i ng
Ent er t ai nment
Over vi ew
Car eer s
Event s
Locat i ons
Pr ess
Ser vi ces
HOMEPAGE
Cust omer s Company
Web Navigation Analysis Week Ending: August 17, 2007
This report shows the Web page navigation paths for a selected week. A Web marketer or editor can use
this information to determine the logic taken by visitors to their Web site and the popularity of Web pages.
Further analysis can determine the pages that are exited most often, most popular calls to action invoked
by page, and referring source to the page.
MicroStrategy: Best in Business Intelligence 83
Web site transaction analysis (also commonly referred to as eCommerce analysis) provides insight
into the effectiveness of the online sales transaction process. In industry parlance, companies try
to convert “lookers to bookers” and use business intelligence to identify points of customer
attrition in the online transaction process. Analysis of the abandonment rate of shopping carts
is the ?rst step in optimizing the checkout process to convert more sales to closure. “Market-
basket” analysis of products being bought together allows marketers to execute targeted follow-
up campaigns to customers or present in real-time banners offering products associated with
items in a shopper’s cart. Given the low switching costs of Web purchasing, a site must create
value for the visitor, provide him with relevant, personalized information, and make it easy to
move from browsing to buying.
Sample Report: Abandonment During Checkout Process
COMMON BUSINESS QUESTIONS
• How many people abandon their shopping cart before check-out?
• What was my gross conversion rate of lookers to bookers?
• Which are my best selling products online?
• Which are my most profitable products sold online?
• Which online products sell well together?
• What percentage of up-sell opportunities closed?
• What percentage of online products were bought as a result of an e-mail promotion or campaign?
• For a visitor viewing a certain item, which items should be merchandised on the page based on
past visitor buying behavior?
Key Performance
I ndi cators
Abandonment Rate
Avg. Session Time
# Repeat Visitors
# New Visitors
# Unique Visitors
Avg. # of Pages per Session
Conversion Rate
Lookers to Bookers
eCommerce Analysis
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t
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f
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a
l
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e
r
a
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t
.
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e
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Customer Detail > Abandoned Shopping Carts
Customer
Jesse Smith
John Johnson
Haley Wilson
Michelle Wright
Jim Patterson
Earl Greene
6,000
5,000
4,000
3,000
2,000
1,000
0
Email
[email protected]
[email protected]
[email protected]
[email protected]
[email protected]
[email protected]
Product(s) Abandoned
Blue sandals
Red silk scarf, umbrella
Silver tie, cuff links
Leather boots
Socks, black slacks
White tennis shoes
Opt-in
Y
Y
N
Y
Y
N
Checkout Process
#
o
f
V
i
s
i
t
o
r
s
The following report illustrates the number of people who abandoned the online shopping process at
various stages. Each stage can be de?ned by the user to include any number of pages and links in the
purchase process. Web marketers can analyze this information to make decisions about Web site design
based on abandonment rates. A next step would be to develop targeted campaigns (electronic and postal)
to individuals who abandoned the buying process, promoting items contained in their shopping carts.
INDEX
FINANCE, 28
Accounts Receivable and Payable Reporting
and Analysis, 33
Balance Sheet Reporting and Analysis, 30
Cash Flow Analysis, 32
Financial Budgeting and Forecasting, 34
Profit and Loss/Income Statement Analysis, 31
Risk Management, 35
HUMAN RESOURCES, 36
Benefits Administration Reporting, 42
Career Path Reporting and Analysis, 41
Compensation Reporting and Analysis, 39
Employee Expense Reporting, 40
Headcount Trend Analysis, 38
Time and Labor Management Reporting, 43
SALES FORECAST, 44
Channel Analysis, 47
Competitor Analysis, 48
Sales Force Performance Reporting, 49
Sales Pipeline Reporting and Analysis, 46
CUSTOMER RELATIONSHIP MANAGEMENT, 50
Campaign Analysis, 57
Customer Aquisition, Retention, and Attrition
Analysis, 55
Customer Cross-Sell Analysis, 54
Customer Profitability Analysis, 53
Customer Scorecards, 59
Customer Segmentation Analysis, 52
Customer Service Analysis, 58
Loyalty Analysis, 56
PRODUCT SALES, 60
Category Performance Analysis/Category
Management, 62
Discounts and Promotions Analysis, 67
Fraud Analysis and Loss Prevention, 65
Inventory Analysis, 63
Merchandising Analysis, 64
Product Scorecards, 66
SUPPLY CHAIN AND OPERATIONS, 68
Call Center Analysis, 77
Manufacturing Scheduling and Production
Planning, 71
Network Optimization, 76
Order Fulfillment Analysis, 73
Quality Control, 75
Regulatory Management, 72
Strategic Sourcing Analysis and Vendor
Scorecards, 74
Supply and Demand Planning, 70
WEB SITE ANALYSIS, 78
eCommerce Analysis, 83
Web Navigation Analysis, 82
Web Traffic Analysis, 80
Web Visitor Analysis, 81
CUSTOMER VIGNETTES
Boots The Chemists, 51
Charming Shoppes, Inc., 29
Corporate Express, 45
Darden Restaurants, Inc., 37
eBay, 79
GT Nexus, 69
Hallmark Cards, 61
KB Toys, Inc., 69
Lowe’s Companies, 61
Netflix, 51
Priceline.com, 79
State of Tennessee, 29
The University of Miami, 37
U.S. Borax, 45
Yahoo!, 79
84 Implementing Industrial-Strength BUSINESS INTELLIGENCE
The future of business intelligence is limitless.
” “
COLL-0738 0907
COPYRIGHT INFORMATION
All Contents Copyright © 2007 MicroStrategy Incorporated. All Rights Reserved.
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Platform Built For The Enterprise, The Intelligence Company, The Platform For Intelligent E-Business, The Power Of Intelligent eBusiness, The Power Of Intelligent E-Business, The Scalable
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All other products are trademarks of their respective holders. Specifications subject to change without notice. MicroStrategy is not responsible for errors or omissions. MicroStrategy makes
no warranties or commitments concerning the availability of future products or versions that may be planned or under development.
PATENT INFORMATION
This product is patented. One or more of the following patents may apply to the product sold herein: U.S. Patent Nos. 6,154,766, 6,173,310, 6,260,050, 6,263,051, 6,269,393,
6,279,033, 6,501,832, 6,567,796, 6,587,547, 6,606,596, 6,658,093, 6,658,432, 6,662,195, 6,671,715, 6,691,100, 6,694,316, 6,697,808, 6,704,723, 6,707,889, 6,741,980,
6,765,997, 6,768,788, 6,772,137, 6,788,768, 6,792,086, 6,798,867, 6,801,910, 6,820,073, 6,829,334, 6,836,537, 6,850,603, 6,859,798, 6,873,693, 6,885,734, 6,888,929,
6,895,084, 6,940,953, 6,964,012, 6,977,992, 6,996,568, 6,996,569, 7,003,512, 7,010,518, 7,016,480, 7,020,251, 7,039,165, 7,082,422, 7,113,993, 7,127,403, 7,174,349,
7,194,457, 7,197,461, 7,228,303, 7,260,577, 7,266,181 and 7,272,212. Other patent applications are pending.
doc_580308315.pdf
The MicroStrategy architecture is selected by organizations with varying needs – from those starting with a single application to those deploying enterprise-wide.
Seven Leading Applications of Business
Intelligence Software
Applications of Industrial-Strength
business Intelligence
I can’t think of a more exciting time for
business intelligence than today.
”
“
At MicroStrategy, we’re dedicated to helping organizations make better business decisions that drive
performance improvements through pervasive access to better information by all personnel. As a
recognized leader in business intelligence, we continue to set the pace of innovation in our industry.
We’ve assembled a team of experts from a variety of disciplines who are committed to our mission
and who have bonded together to create world-class, relevant technology. This team has delivered
a business intelligence architecture that serves as the standard for reporting, analysis, and monitoring
for organizations worldwide.
The MicroStrategy architecture is selected by organizations with varying needs – from those starting
with a single application to those deploying enterprise-wide. Organizations require the unique capabilities
of MicroStrategy: scalability to thousands of users, scalability to terabytes of data, boardroom quality
report presentation, and unconstrained analytical flexibility.
Those organizations who start small with MicroStrategy soon discover MicroStrategy’s unparalleled
power to report, analyze, and monitor information and go on to build additional corporate performance
management applications. Today, we’re finding that many of these companies have fielded a wide variety
of MicroStrategy-based business intelligence applications ranging from financial reporting to sales analysis
to advanced transactional fraud detection and prevention. Our customers’ demands to better understand
their operational data, to deliver higher quality insight information with greater frequency, and to gain
competitive advantage by leveraging this insight have pushed our technology like no other in the market.
On average, MicroStrategy’s enterprise customers have multiple applications and over one thousand users.
We are honored to be able to serve our customers and are dedicated to providing products and services to
ensure their long-term success. The following pages explore a few of the business intelligence applications
enabled by our technology. While they represent only a subset of the applications that are being
successfully constructed and deployed, we hope they convey the variety and richness of applications that
can easily be built using the MicroStrategy Business Intelligence Platform.
As you read on, we trust you’ll agree that there is no more exciting time in the history of business
intelligence than today.
Thank you for your support.
MICHAEL J. SAYLOR,
CHAIRMAN OF THE BOARD AND
CHIEF EXECUTIVE OFFICER,
MICROSTRATEGY INCORPORATED
TO OUR CURRENT AND PROSPECTIVE CUSTOMERS:
Table of Contents
Overview 4
Industry Presence 11
Reporting and Analysis Applications 27
Finance 28
Human Resources 36
Sales Forecast 44
Customer Relationship Management 50
Product Sales 60
Supply Chain and Operations 68
Web Site Analysis 78
Index 84
Building the Best Business Intelligence Software in the World
Company Overview
4 Implementing Industrial-Strength BUSINESS INTELLIGENCE
WHAT IS BUSINESS INTELLIGENCE?
Business intelligence (BI) software allows
companies to tap into their many data-
bases and deliver easy-to-comprehend
insights to employees, management, and
business partners.
Business intelligence software is already
being used by thousands of companies to
find new revenue opportunities, reduce
costs, reallocate resources, and improve
operational efficiency.
THE MICROSTRATEGY MISSION:
HELPING BUSINESSES MAKE BETTER
DECISIONS EVERY DAY
Our mission is to allow every business per-
son to make more informed decisions by
providing them timely, relevant, and accu-
rate answers to their business questions.
To achieve this mission, we have built the
best business intelligence software in the
world. MicroStrategy software provides
analytical insights in a manner that busi-
ness people can easily digest, ranging
from intuitive, graphical dashboards to
highly formatted operational reports.
We meticulously engineer our software to
guarantee its reliability, scalability, security,
and ease of administration for organiza-
tions of all sizes.
UNIFIED REPORTING, ANALYSIS,
AND MONITORING
MicroStrategy offers an unprecedented
range of reporting, analyzing, and moni-
toring capabilities to allow users to make
better business decisions every day.
Report on Detailed Information for
Day-to-Day Decision Making.
MicroStrategy reporting delivers detailed
data on current and historical perfor-
mance to users across the enterprise.
MicroStrategy’s intuitive user interface and
Web reporting allows businesses to deliver
insight to everyone for better decision
making, every day.
Analyze Data to Uncover Root Causes
and Trends in Business Performance.
MicroStrategy provides detailed insight
into business so that managers can
uncover the causes of performance prob-
lems, identify opportunities, and predict
results. Users leverage MicroStrategy’s
advanced analysis to reveal reasons for
performance peaks or aberrations.
Monitor Corporate Performance at
All Levels and in Real-Time.
MicroStrategy provides monitoring tech-
nology to constantly track business metrics.
Companies use their scorecards and dash-
boards to create actionable information
and alerts about ongoing business activity.
Building the Best Business Intelligence Software in the World
MicroStrategy: Best in Business Intelligence 5
Better Business Decisions
Integrated Reporting and Analysis
BUSINESS INTELLIGENCE
PERFORMANCE IMPROVEMENT
Companies need the full cycle of busi-
ness performance insight to achieve
improved corporate performance. The
iterative and ongoing cycle of decision
making is based on reporting on key
metrics, rigorously analyzing data, and
monitoring key indicators. This complete
business analysis cycle enables users to
refine how they manage their business
units and the entire organization.
INTEGRATING REPORTING
AND ANALYSIS
MicroStrategy is the first and only busi-
ness intelligence architecture to unify
reporting, analysis, and real-time monitor-
ing into one seamless experience for the
business user, into one efficient and scal-
able architecture for the IT professional,
and into one economical and extensible
utility for the CIO.
“ We’re excited about the
efficiencies we’re realizing by
standardizing on MicroStrategy
for enterprise monitoring,
reporting, and analysis,” said
Raymond Appel, Information
Technology Manager at
Oakwood Homes.
Business users rely on MicroStrategy software at every step in the cycle of corporate performance improvement. Users review operational
reports, move into seamless analysis of root causes, and are alerted to important changes via scorecards and e-mail alerts. At any step,
users can create different views of the data, explore anywhere in the database, and change their focus to monitor other KPIs for continuous
performance improvement.
MONITOR
Dashboards
Real-Time Alerts
Scorecards
Corporate
Performance
Improvement
Cycle
ANALYZE
Root Causes
Exceptions
Trends
REPORT
Operational Reports
Financial Reports
Performance Reports
6 Implementing Industrial-Strength BUSINESS INTELLIGENCE
Analyst Recognition
MICROSTRATEGY CUSTOMERS ARE
MOST LOYAL
Successful organizations across all indus-
tries choose MicroStrategy technology to
conquer their BI challenges.
Once again, MicroStrategy has outper-
formed the competition in The OLAP
Survey 6, an annual real-world market
survey. The OLAP Surveys are the largest
independent surveys of the BI market
space and products, and are conducted
annually by Survey.com.
For three consecutive years, MicroStrategy
had the highest customer loyalty of any BI
vendor in the entire survey. MicroStrategy’s
leading Overall Customer Loyalty Score of
83.3% is nearly 50% higher than the
Overall Customer Loyalty Score of 56.4%
for Business Objects, which scored tenth
in the overall survey in this area.
MAJORITY SELECT MICROSTRATEGY
AS THEIR ENTERPRISE STANDARD
According to The OLAP Survey 6,
MicroStrategy was the top BI product
selected by customers asked to choose
one product for BI standardization. When
respondents were asked why they selected
MicroStrategy, they cited product features,
its ability to support large numbers of
concurrent users, Web deployability, and
multi-platform support.
MicroStrategy has been a consistent leader
in The OLAP Survey, sometimes by a wide
margin, in multiple categories with the
gap between MicroStrategy’s leadership
position and other vendors growing at an
increasing rate.
“ MicroStrategy, which has concentrated on a single product architecture and has
grown organically, came out on top yet again,” explains Nigel Pendse, the author
of The OLAP Survey 6.
“The fact that MicroStrategy was
rated number one in customer
loyalty for the third year in a row
is a remarkable achievement,”
said Nigel Pendse, author of The
OLAP Survey 6. “The fact that
no other product has achieved
such consistency suggests that
many of MicroStrategy’s cust-
omers are fiercely loyal and see
no alternative to the product.”
MicroStrategy is Ranked #1 by The OLAP Survey 6
BI Vendor
Customer
Loyalty Rank
Overall Loyalty
Score
MicroStrategy 1 83.3%
Cognos Analysis 2 73.8%
SAP BW 3 66.7%
Hyperion Essbase 4 64.0%
Business Objects 5 56.4%
Chart drawn by MicroStrategy using data from The OLAP Survey 6,
comparing MicroStrategy and its “peer group” subset.
Product
Rank: Preferred Products to
Standardize On
MicroStrategy 1
SAP BW 2
Cognos Analysis 3
Hyperion Essbase 4
Business Objects 5
Table compiled by MicroStrategy using data from The OLAP Survey 6,
comparing MicroStrategy and its “peer group” subset.
Key: 1: Most preferred product to standardize on, 5: Least.
MicroStrategy: Best in Business Intelligence 7
MicroStrategy 8
MICROSTRATEGY SOFTWARE:
INTEGRATING BUSINESS REPORTING
AND ANALYSIS
The MicroStrategy platform was designed
to address the most pressing challenge in
BI today. That challenge is to help com-
panies empower their personnel and
business partners to make better busi-
ness decisions every day.
With MicroStrategy, companies no longer
need numerous distinct products from differ-
ent vendors to provide reporting, analysis,
and performance monitoring. With a scalable
architecture and a single metadata, users
can navigate seamlessly from scorecards and
dashboards to reports and analysis without
being forced to open and close multiple BI
tools and navigate dissimilar interfaces.
MicroStrategy 8 has radically reduced the
time to design and deploy new reports with
what-you-see-is-what-you-get (WYSIWYG)
report design. MicroStrategy 8 broadens
the universe of data sources that business
users can access for their reporting and
analysis activity. Business users can directly
query data stored in financial, human
resources, supply chain, and other opera-
tions systems without having to first move
this data into a data mart or data cube.
MICROSTRATEGY DYNAMIC
ENTERPRISE DASHBOARDS
MicroStrategy Dynamic Enterprise Dash-
boards deliver a new caliber of information
dashboards. MicroStrategy combined state-
of-the-art data visualization and interactivity
with its industrial-strength business intelli-
gence platform to create dashboards that
yield greater business insight and are usable
by more people than ever before.
Dashboards provide easy-to-use access to
enterprise data and help organizations
track performance and optimize decision
making. At-a-glance, executives, manag-
ers, and business users can immediately
understand their organization’s health
through a range of insightful data
visualizations, such as key performance
indicators (KPIs), tables, graphs, trend
indicators, gauges, heat maps, and many
more. MicroStrategy dashboards incor-
porate Adobe
®
Flash
®
, providing a wide
range of information views and increased
information exploration options. Using
MicroStrategy’s zero-footprint WYSIWYG
Web interface, business users can create
dashboards using simple drag and drop
actions, increasing the use and adoption
of business intelligence systems.
“ We are impressed with the rich platform of MicroStrategy 8.1, especially the new graphs,
panels, and selectors,” said Jordan Silvergleid, Managing Director at the Advisory
Board Company. “MicroStrategy Dynamic Enterprise Dashboards are truly engaging
and can be intuitively designed, built, and deployed with ease over the Web.”
The Next Generation BI Platform
“ MicroStrategy Dynamic
Enterprise Dashboards
represent a new caliber
of dashboard,” said Ryan
Osterhues, MicroStrategy
Administrator at PETCO
Animal Supplies, Inc.
“With MicroStrategy 8.1,
there are many ways in
which our data can be
visualized and displayed
to our decision makers.”
8 Implementing Industrial-Strength BUSINESS INTELLIGENCE
Highest Data Scalability
SELECT CUSTOMER DEPLOYMENTS WITH LARGE DATA SCALE
20 Terabytes
eBay Retail >25 TB Teradata 2,800 Users
Catalina Marketing
Corporation
Media 28 TB Netezza 350 Users
METRO Group Retail 34 TB Teradata 2,500 Users
Nationwide Insurance 44 TB Teradata 20,000 Users
U.S. Postal Service Government 60 TB Teradata 50,000 Users
*Data collected as of August 2007. Data sizes are expected to increase further.
MICROSTRATEGY IS THE INDUSTRY
LEADER IN DATA SCALABILITY
During the preceding decade, companies
have experienced an explosion in the vol-
ume and scope of data they generate. The
advent of a myriad of systems — ERP,
CRM, Web site, sales force automation,
SEC compliance, supply chain, inventory,
POS, and even RFID — has contributed to
this massive influx of data.
An enterprise BI architecture must be
able to access the full depth and breadth
of all of these databases to be truly effec-
tive for the enterprise. MicroStrategy’s
ROLAP architecture was designed to
access the largest databases with the
highest performance.
Customers Rely on MicroStrategy to Support
High Data Scalability
“For the sixth consecutive year,
MicroStrategy sites have reported
the largest data volumes of all,
with a substantial gap between
MicroStrategy and the second
place product,” said Nigel Pendse,
author of The OLAP Survey.
MicroStrategy: Best in Business Intelligence 9
Highest User Scalability
SELECT CUSTOMER DEPLOYMENTS WITH LARGE USER SCALE
1,000 – 5,000 Users
Amway Consumer Goods 1.5 TB SQL Server 2000 2,000 Users
Telefónica Telecommunications 1.5 TB IBM DB2 >10,000 Users
>20,000 Users
Ingenix Healthcare 1.6 TB Oracle 20,000 Users
Nationwide Insurance 44 TB Teradata 20,000 Users
The First American
Corporation
Financial Services 3.5 TB SQL Server 30,000 Users
U.S. Postal Service Government 60 TB Teradata 50,000 Users
*Data collected as of August 2007. User bases are expected to expand further.
SCALABILITY TO THOUSANDS
OF USERS
An enterprise BI architecture must be able
to support tens of thousands of users, all of
whom can interactively access the same
reports, scorecards, and analyses. While
many BI vendors cite customers with large
user populations, they do not mention
these high numbers are really just aggrega-
tions of many small isolated BI applications,
or that their implementations require
massive server farms.
MicroStrategy delivers full 64-bit BI, allow-
ing it to deliver the most user sessions on
the fewest servers. And, MicroStrategy
is one of the few with this technol-
ogy to support large user scalability.
MicroStrategy customers routinely run
single BI applications to thousands of
people through the interface of their
choice, using just a few servers, and with
high performance.
Customers Rely on MicroStrategy to Support
High User Scalability
“ Despite many vendors claim-
ing to be able to handle large,
detailed applications, it is
clear that only MicroStrategy’s
customers are actually imple-
menting such transaction-level
BI databases. MicroStrategy
continues to be the clear lead-
er in the enterprise-scale BI
segment,” said Nigel Pendse,
author of The OLAP Survey.
CHOSEN AS THE BI STANDARD BY GLOBAL LEADERS
Many of the leading FORTUNE
®
Global 500 companies rely on MicroStrategy for their
business intelligence solutions.
MicroStrategy customers represent:
• 9 of the top 10 global pharmaceutical companies
• 8 of the top 10 global telecommunications companies
• 8 of the top 10 global healthcare companies
• 7 of the top 10 global retailers
• 7 of the top 10 global commercial banks
• 7 of the top 10 global manufacturing companies
• 5 of the top 7 global consumer goods companies
• 4 of the top 5 U.S. diversified financial services companies
• 4 of the top 5 global insurers
• Federal, State, and Local Government agencies
Indeed, world-class companies across all industries depend on MicroStrategy to improve
corporate performance and streamline operations. MicroStrategy customers are making
thousands of better business decisions every day as they deploy MicroStrategy to their
business users, customers, and suppliers.
The following pages present snapshots of MicroStrategy success across many industries,
including Retail, Financial Services, Telecommunications, Pharmaceutical, Healthcare,
Consumer Goods and Manufacturing, and Insurance. The MicroStrategy team has
amassed in-depth experience in deploying successful applications for customers across
each of these industries.
Industry Presence
12 Implementing Industrial-Strength BUSINESS INTELLIGENCE
RETAIL SEGMENTS: Apparel, Department Stores, Discount Drugstores, Discount
Retailers, Electronics, Home Improvement, Specialty Grocery, Specialty Retailers
CORPORATE EXPRESS
2007 TDWI Best Practices Award Winner in Predictive
Analytics
APPLICATIONS
Market Basket Analysis, Marketing Analysis, Predictive
Analytics, Sales Analysis
DEPLOYMENT
Database: Netezza DB Size: 8 Terabytes Users: Up to
10,000 total Architecture: Intranet, Extranet
Corporate Express, a 2007 TDWI Best Practices Award
Winner, is using its market basket application to track the
baskets of all of its online customers, and can identify
which SKUs are most profitable or poor performers when
purchased in combinations.
LIMITED BRANDS
Unlimited Access to Insight
APPLICATIONS
Category Management, Human Resources, Inventory
Management, Marketing Analysis, Merchandise
Management, Store Operations
DEPLOYMENT
Database: Teradata DB Size: 8 Terabytes Users:
1,000 financial and marketing managers, and analysts
Interface: Desktop and Web Architecture: Intranet
Limited Brands currently uses MicroStrategy for customer
analysis, financial analysis, inventory management, sales
analysis, and category management reporting across all
of its brands (including Victoria’s Secret, Express, Bath &
Body Works, and Henri Bendel).
Retail Customers Include:
Aeropostale
Ahold
American Signature, Inc.
Applebee’s International Inc.
Barnesandnoble.com
Belk
Boots The Chemists
Borders Group, Inc.
Boscov’s Department Stores
Charming Shoppes
Circuit City Stores
Comet
The Container Store
Corporate Express
CSK Auto Corporation
Darden Restaurants
David’s Bridal
Dick’s Sporting Goods
eBay
Eckerd
Faith Shoes
Food Lion
GUESS?, Inc.
Hannaford Bros. Co.
Hard Rock Cafe
Harris Teeter
HE Butt Grocery Company
Hudson’s Bay Company
KB Toys, Inc.
Limited Brands
Liz Claiborne
Lloydspharmacy
Lowe’s Companies, Inc.
Meijer Stores
METRO Group
Michaels Stores
Micro Center
Office Depot
O’Reilly Automotive
Pacific Sunwear
Petco Animal Supplies
PF Chang’s
Priceline.com
Raley’s
Roundy’s Supermarkets, Inc.
Shoppers Drug Mart Inc.
Starbucks Corporation
Victoria’s Secret, Inc.
Virgin Retail
Yahoo!
LIZ CLAIBORNE, INC.
Uncovering Revenue Opportunities
APPLICATIONS
Category Management, Inventory Management,
Merchandise Management, Planning, Sales Analysis,
Store Operations
DEPLOYMENT
Database: Oracle Users: Over 250 Liz Claiborne
managers and analysts Architecture: Intranet
A customer since 2000, Liz Claiborne’s employees are
analyzing financial, sales, and inventory data across
30,000 points of sale worldwide — department stores,
specialty stores, and catalogs/Internet — to uncover
revenue opportunities.
LOWE’S COMPANIES
Building Strong Revenues
APPLICATIONS
Inventory Management, Merchandise Management,
Merchandising and Executives Dashboards, Operations
Management, Supply Chain Management
DEPLOYMENT
Database: Teradata DB Size: 20 Terabytes Users: 3,500
active employees and vendors Interface: Web, E-mail
Architecture: Intranet, Extranet
Lowe’s is the second-largest home improvement retailer in
the world. Lowe’s employees from multiple business areas
use MicroStrategy to manage inventory, improve margins,
review market specificity, and identify sales opportunities.
Snapshot of MicroStrategy Technology at Work in the Retail Industry:
7 of the Top 10 Global Retailers are MicroStrategy Customers
Industry: Retail
MicroStrategy: Best in Business Intelligence 13
“As a result of using the MicroStrategy platform, Lowe’s is realizing significant
benefits through improved merchandising decisions, more timely responses to
information requests, cost reduction initiatives, enhanced employee productivity,
and better service to our customers.”
Steve Stone, Senior Vice President and Chief Information Officer, Lowe’s Companies
Customer Applications
Category Management
Assortment Optimization
Category Contribution
Category Scorecards
Item Definitions
Market Comparison
Pricing Modules
Role Analysis
Season Changeover
Share of Shelf
SKU Rationalization
Vendor Performance
Loss Prevention
Backorders
Cancels
Distribution Shrink
Hot Customer
Hot Staff
Hot Stores
Markdowns
Natural Losses
Return Rates
Shrink Analysis
Vendor Rationalization
Market Basket
Attachment Rates
Basket-Register Correlation
Brand Switching
Core Item Frequency
Core Items
Customer Loyalty
Demographic Baskets
In-Basket Price
Items per Basket
Revenue Contribution
Shopper Penetration
Marketing Analysis
Ad Blocks
Channel Share
Coupon Distribution
End-Cap Efficiency
Feature vs. Display
Grand Openings
Marketing Areas
Market Share
Price Points
Promo Lift
Seasonal Events
Merchandise Management
Department Contribution
Hot Item Report
In Stock %
Inventory Turns
Lineal Feet
Mark Down %
Pull-Through
Reallocations
Seasonal Buying
Sell-Through
Weeks of Supply
Store Operations
Asset Turnover
Competitor Stores
Comp Store Sales
Front Store Sales
Inventory Turnover
Labor Cost Analysis
Reallocation / DSD
Register Usage Analysis
ROA
Sales & Margin
Sales / Square Foot
14 Implementing Industrial-Strength BUSINESS INTELLIGENCE
THE FIRST AMERICAN CORPORATION
Enterprise Reporting and Executive Dashboards
APPLICATIONS
Analytical Reporting, Business Performance, Compliance
Reporting, Enterprise Reporting, Extranet Reporting,
Operational Reporting
DEPLOYMENT
Database: SQL Server DB Size: 3.5 Terabytes Users:
30,000 total Architecture: Intranet, Extranet
MicroStrategy fuels a variety of applications, including
business performance dashboards for executives,
operational reporting for channel vendor manage-
ment, and compliance reporting for partner lending
institutions.
H&R BLOCK
Providing Highly Secure Access to Business
Information
APPLICATIONS
Customer Analysis, Employee Performance
DEPLOYMENT
Database: Oracle DB Size: 1 Terabyte Users: 1,000
financial advisors and analysts Architecture: Intranet
MicroStrategy provides highly secure access to business
information for its 1,000 financial advisors by e-mailing
5,000 reports containing customer activity data on a
weekly basis. Financial analysts use MicroStrategy to
analyze employee performance for annual and quarterly
achievement recognition.
Financial Services
Customers Include:
1st Financial Bank USA
21st Century Insurance
ABN AMRO
Banco Espirito Santo
Banco Itaú
Banco Patagonia
Bank of the West
BNL
BNP Paribas
Caixa Laietana
Capital One Services Inc.
Capitol Indemnity Corporation
Cetelem
Deutsche Bank
Deutsche Börse
Fannie Mae
Finansbank
The First American Corporation
First Franklin Financial Corporation
Franfinance
Freddie Mac
GE Consumer Finance
H&R Block
Industrial Bank of Korea
Intesa Mediofactoring
KeyBank National Association
Korea Federation of Savings Banks
Land Bank of Taiwan
LowerMyBills
Macquarie Bank
People’s Bank of China
PRG-Schultz International
Redecard
Redwood Trust
Sparda Bank
Swedbank
TRX Data Services Inc.
Universal-Investment
Wells Fargo Bank
Wells Fargo Home Mortgage
LA CAIXA
Investing in Innovative Technology
APPLICATIONS
Cash Flow, Credit Card Analysis, Electronic Banking and
Online Services, Marketing Analysis, Product Profitability,
Risk Management, Web Click Stream Analysis
DEPLOYMENT
Database: Oracle, DB2 DB Size: 1.7 Terabytes Users:
3,000 accessing monthly Mgmt. Info., 180 business
analysts accessing >50 projects Interface: Desktop, Web
Architecture: Intranet
La Caixa currently has more than 50 applications
dependent on MicroStrategy technology.
TRX INC.
Deploying Self-Service Extranet Reporting to
Thousands of Users in Four Months
APPLICATIONS
Customer Relationship Management, Financial Analysis,
Fraud Profiling, and Risk Analysis
DEPLOYMENT
Database: DB2 UDB EEE DB Size: >1.5 Terabytes
Users: >10,000 Interface: Web Architecture: Extranet
Operating System: I-Server Universal and Web Universal
running on IBM AIX
The joint MicroStrategy/TRX solution at one of the top five
financial institutions is enabling multinational commercial
clients to report and analyze charge card and travel data
from 29 countries and in 11 languages.
Snapshot of MicroStrategy Technology at Work in the Financial Services Industry:
FINANCIAL SERVICES SEGMENTS: Asset Management Brokerage, Consumer Credit,
Debt and Equity, Individual / Institutional Investment Banking, Retail Banking
7 of the top 10 global commercial banks are microstrategy customers
Industry: Financial Services
MicroStrategy: Best in Business Intelligence 15
“We’ve selected MicroStrategy over competing products because of its outstanding
scalability for large numbers of users and its superior capability to generate user-friendly
reports with highly detailed analysis of granular-level data.“
Gus Tepper, Vice President of Software Development, Interactive Division, First American Corporation
Customer Applications
Advisory Services
Asset Management
Confirmation Alerts
Customer Alerts
Customer Profitability Analysis
Customer Statements
Portfolio Analysis
Portfolio Risk Analysis
Product Introduction
Research Distribution
Tax Notification
What-if Analysis
Financial Analysis and
Compliance
Budget Variance Analysis
Compliance Alerting
Cost Analysis
FAS 133 Analysis
Loan Analysis
Margin Analysis
Portfolio Analysis
P&L Reporting
Revenue Reporting
Taxes
Trade Floor Reporting
Fraud Profiling and
Risk Analysis
Claims Analysis
Credit Risk Management
Customer Risk Scoring
Exceptions Risk Management
Exposure Reporting
Fraud Risk Management
Hedge Slippage Alerts
Index Performance Alerts
Prepayment Risk
Underwriting Scorecards
Value At Risk Analysis
Marketing
Campaign Analysis
Channel Efficiency
Cross-Sell Analysis
Customer Analysis
Customer Loyalty Analysis
Market Basket Analysis
Marketing Segmentation
Product Management
Product Profitability Analysis
Up-Sell Analysis
Web Traffic Analysis
Operations
Branch Office Scorecards
Call Center Management
Channel Management
Commission Reporting
Customer Statements
Financial Reporting
Swap Mark to Markets
Trade Confirmations
Trade Floor Reporting
Trade Settlement Alerts
Wire Transfer Alerts
Sales and Trading
Client Loyalty Analysis
FAS 133 Analysis
Financial / P&L Reporting
Hedge Slippage Alerts
Market Data Analysis
Portfolio Analysis
Position Reporting
Refinance Risk Analysis
Research Distribution
Trade Floor Reporting
Transaction Volume Analysis
16 Implementing Industrial-Strength BUSINESS INTELLIGENCE
CHARTER COMMUNICATIONS, INC.
Giving Users the Ability to Act on Valuable Customer
Case, Billing, Sales, and Marketing Data
APPLICATIONS
Billing Analysis, Customer Analysis,
Marketing Analysis, Sales Analysis
DEPLOYMENT
Database: Oracle Users: 1,500 Interface: Web
Architecture: Intranet
Charter uses MicroStrategy for reporting on and
analyzing key business areas, including customer care,
billing, sales, marketing, and technical operations.
MicroStrategy provides Charter personnel with a plat-
form for strategic, internal intelligence gathering and
gives users easy access to information about many
of Charter’s critical business functions.
SPRINT
Reaching a Large User Community Through
Enterprise-Wide Business Intelligence
APPLICATIONS
Campaign Management, Customer Analysis / CRM,
Enterprise Reporting, Financial Reporting and Analysis,
Human Resources, Marketing Analysis, Sales Analysis
DEPLOYMENT
Database: Teradata, Oracle, and Informix Users: 10,000
Interface: Desktop and Web Architecture: Intranet
More than 10,000 Sprint employees use
MicroStrategy for 30 critical BI applications across
the enterprise.
Telco Customers Include:
Alcatel Lucent Portugal
Alltel Communications Products
Angola Telecom
Belgacom
Bell Canada
Charter Communications, Inc.
Deutsche Telekom AG
era - Polska Telefonia Cyfrowa
Eurotel
Fastweb
Fujians Telecoms
Hanaro Telecoms
Jupiter Telecommunications
MACH
Nextel Communications Argentina
SFR
Singtel
Sprint
Telefónica de Espana
Telefónica movil
Telephia
Turkcell
Verizon Communications
Versatel
Vodafone Italy
TELEPHIA
Deploying Dashboards, Scorecards, and Interactive
Reports for Multiple BI Applications
APPLICATIONS
Advertising Effectiveness, Content Audience, Customer
Satisfaction, Device Share, Network Quality, Revenue
Share, Subscriber Share
DEPLOYMENT
Database: Teradata DB Size: CHARMING SHOPPES, INC.
Using Business Intelligence Across the Retail Enterprise to Improve Decision Making
Charming Shoppes, Inc. uses the MicroStrategy platform across its enterprise. Charming Shoppes is
the largest plus-size specialty apparel retailer in America, with more than 2,300 stores nationwide.
Charming Shoppes’ extensive use of the MicroStrategy platform generates daily and weekly
reports on an array of company activity. These highly detailed reports encompass merchandise
sales and inventory analysis; assessments of the history of customer traf?c in and out of stores;
analysis of point-of-sales transaction details and promotion history; evaluations of transaction
and promotion history for identi?ed customers; HR/payroll reviews of store payroll hours and
budget data; and analysis of accounts payable, the general ledger and ?xed asset information.
These applications, running against a 2-terabyte Teradata data warehouse, involve each
division headquarters and store operations’ ?eld of?ce and more than 800 Charming Shoppes
employees, a number that is expected to grow.
CUSTOMER VIGNETTES: IMPLEMENTING BI FOR FINANCE
30 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Finance
Key Performance
I ndi cators
Current Ratio
Quick Ratio
Period over Period Variance
Return on Assets
Return on Equity
Assets Turnover Ratio
Market to Book Ratio
Inventory Turn and Forecasting
Risk Management
The Balance Sheet is one of the fundamental reports of corporate accounting. Balance sheets
are produced multiple times during the close cycle to verify accuracy before one ?nal version
is released to shareholders, government agencies, and the public. BI enables the consolidation
of the Balance Sheet much more rapidly than typical ERP systems – reducing the time to close.
The most basic level of reporting is the automated consolidation of the balance sheet and the
electronic distribution of the report securely to all approving authorities. Typical analytical areas
include interactive investigation of balance sheet anomalies, drilling to more detailed subaccounts
through simple point and click, and the creation of custom divisional or regional balance sheets.
Sample Report: “Drillable” Balance Sheet
Balance Sheet Reporting and Analysis
COMMON BUSINESS QUESTIONS
• How do the balance sheets of different subsidiaries compare?
• What is the variance of assets, liabilities, and equity between two selected time periods?
• What is the Net Working Capital of the company?
• Which business unit caused cash drain in a particular period?
• What is the breakdown of shareholders equity in a certain period?
• What is the leverage and liquidity of the company?
Period Ending 31-Dec-06 30-Sep-06 30-Jun-06 31-Mar-06
Current Assets
Cash and Cash Equivalents
Short Term Investments
Net Receivables
Inventory
Other Current Assets
Total Current Assets
Long Term Investments
Long Term Investments
Property Plant and Equipment
Goodwill
Intangible Assets
Other Assets
Total Long Term Assets
Total Assets $ 89,326,000 $ 82,832,000 $ 95,894,000 $ 95,297,000
31,209,000
56,000
28,690,000
890,000
5,032,000
65,877,000
$
$
$
$
$
$
N/A
18,471,000
540,000
3,214,000
1,224,000
23,449,000
$
$
$
$
$
28,385,000
53,000
19,850,000
930,000
4,685,000
54,083,00
$
$
$
$
$
$
N/A
20,161,000
2,775,000
N/A
5,813,000
28,749,000
$
$
$
$
37,292,000
N/A
22,761,000
784,000
3,100,000
63,937,000
$
$
$
$
$
N/A
22,291,000
3,575,000
N/A
6,091,000
31,957,000
$
$
$
$
32,821,000
590,000
22,652,000
945,000
4,436,000
61,664,000
$
$
$
$
$
$
N/A
24,303,000
4,437,000
N/A
5,913,000
34,653,000
$
$$
$
$
This balance sheet report helps accountants close the books more quickly by allowing direct analysis
of line items from summary data. Clicking on the account links in the left hand columns, users can
immediately drop to the subaccount level. Potential anomolies are highlighted based on the accountant’s
business rules, e.g., numbers that are more than 10% out of trend. As a next step, the analyst can view
key ?nancial ratios (quick ratio, current ratio, return on assets), and determine if these have changed
materially from prior periods.
MicroStrategy: Best in Business Intelligence 31
The pro?t and loss (P&L) statement, detailing revenue and costs, is a key component of certain
SEC ?lings and is also a useful tool for understanding the health of a business. Executives and
managers continually monitor P&L actuals versus budgets and forecasts to ensure their business
is operating on plan. Automatically generated P&L reports allow managers to see current period
revenue, costs, and pro?tability, period over period and business unit to business unit comparisons,
and actuals to plan. Business intelligence also permits development of more accurate and timely
quarterly and yearly performance analysis, allows navigation to detailed revenue and cost
components, and enables more re?ned margin and contribution assessment.
Sample Report: Abbreviated Pro?t & Loss Summary by Region
Region: Latin America
Month: Sep-07
Pro?t and Loss/Income Statement Analysis
COMMON BUSINESS QUESTIONS
• What is the profit margin of each business unit and/or geographic region?
• How have margins changed month-to-month over the past year?
• Which business units are hitting their margin targets? Which are falling short?
• Which business units are more than 10% above/below their contribution targets?
• Which units or regions are over budget by more than 5%?
• Which departments have the highest contribution per employee?
• Are there trends underlying any revenue or expense categories that need immediate attention?
Account Type Actual YTD ($) YTD Budget Through
Current Month ($)
YTD Budget
Variance ($)
YTD Budget
Variance ($)
TeleSales Revenue
Store Revenue
Internet Revenue
Other Revenue
8,947,825
10,589,423
2,456,812
56,892
9,256,340
10,245,675
3,012,500
0
(308,515)
343,748
(555,688)
56,892
(-3%)
3%
(-18%)
100%
Total 22,050,952 22,514,515 (463,563) -2%
Salaries & Commissions
T&E
Communications
Shipping, Printing, Supplies
Marketing
Depreciation
Rent and Related Of?ce Exp
3,256,425
245,987
66,487
51,987
1,356,789
215,874
103,452
3,385,500
250,000
65,000
50,000
1,350,000
225,000
103,475
10,075
4,013
(1,487)
(1,987)
(6,789)
9,126
23
0%
2%
(-2%)
(-4%)
(-1%)
4%
0%
Total
Contribution
5,416,001
16,634,951
5,428,975
17,085,540
$ 12,974
(485,589)
0%
-3%
Key Performance
I ndi cators
Gross Profit Margin
Income
Net Operating Income
Net Operating Loss
Operating Expense to Sales
Contribution per Employee
Payout Ratio
Operating Margin
Earnings per Share
This example of a P&L highlights a company’s Latin American business for the year to date. With built-
in security ?lters, the General Manager for Latin America can see only the ?nancial data related to
her region. Negative variances are highlighted in red. By monitoring this report monthly, the Regional
Manager can see that she’s managed costs effectively but revenue is trailing plan. A next step would be
to drill on the Internet and Telesales Revenue, which have the highest negative variance, at the country
level to determine if the problem is due to one country or the entire region.
32 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Finance
Key Performance
I ndi cators
Changes in Net Working Capital
Foreign Exchange Impact
Average Daily Balance
Bad Debt Accrual
Variance in Interest Income
Variance in Interest Expense
Top 10 Payables
Top 10 Receivables
Investment Allocation
A Cash Flow Statement is one of the standard components of certain SEC ?lings that
summarizes the operating activity of a business and provides insight into its ability to generate
cash. Executives, treasurers, accounting professionals, and investors rely on cash ?ow statements
to make ?nancing, operating, and investing decisions. Standard ?nancial systems, which aren’t
optimized to handle large amounts of transaction-level data, take many hours to consolidate
cash ?ow reports and can’t automatically distribute these reports. Business intelligence provides
automatic, near real-time generation and distribution of the cash ?ow statement. Business
intelligence seamlessly integrates sophisticated analysis including foreign currency exposure,
optimized payables schedules, and cash ?ow predictions to ensure investments in short-term
and long-term instruments are aligned with cash requirements.
Sample Report: Operational Cash Flow Changes
Corporation: France
Cash Flow Analysis
COMMON BUSINESS QUESTIONS
• Can the company finance itself internally or will it need additional outside financing for its
future growth opportunities?
• What is the cash position for each subsidiary in both local and home currency?
• What is the cash risk associated with exchange rates?
• On average, how long does a particular entity take to pay invoices? Collect receivables?
• What impact does a change to depreciation method have?
• What is the trend in liabilities and will the current ratio suffer as a result?
• What investing activities are yielding the best results? Worst results?
Period Ending 31-Mar-07 31-Dec-06 31-Sep-06 30-Jun-06
Net Income (000) $ 1,273 $ 1,494 $ 1,494 $ 910
- Cash Flow Operating Activities
+ Depreciation $ 387 $ 434 $ 410 $ 505
+ Adjustments to Net Income $ 111 $ 24 $ 142 $ 140
+ Changes in Accounts Receivables $ 300 (73) $ (44) $ 86
+ Changes in Liabilities $ 350 88 $ (15) $ (377)
+ Changes in Inventories $ (132) $ 16 $ (105) $ 385
+ Changes in Other Operating Activities $ 124 $ 333 $ 158 $ 662
- Cash Flows From Operating Activities $ 2,413 $ 2,316 $ 2,010 $ 2,311
+ Cash Flows From Investing Activities $ (482) (312) $ (195) $ (224)
+ Cash Flows From Financing Activities $ 1,516 $ (1,623) $ (524) $ (1,746)
Effect of Exchange Rate $ (8) $ 22 $ (15) $ 25
Change in Cash and Cash Equivalents $ 407 $ 403 $ 1,276 $ 366
This example shows a segment of a standard Statement of Cash Flows with items highlighted that are
more than 25% out-of-trend with the annual average. The outline mode shown here is automatically
generated and allows quick access to the line items comprising a summary account. Highlighted items
suggest areas for further investigation, such as Accounts Receivable, to determine the cause of the
increase like a large customer not paying a bill or exposure to a troubled industry or geography.
MicroStrategy: Best in Business Intelligence 33
Companies track Accounts Receivable (A/R) and Payable (A/P) to manage operating cash
?ow. Basic A/R and A/P reports includes tracking the value of accounts that are 30, 60, or
90 days past due, monitoring distribution of receivables across customers, and reviewing
payment trends for vendors across periods. More sophisticated analysis includes predicting
potential bad debts, forecasting cash outlays, and tracking invoices and journal entries to the
corresponding accounting representative. Businesses adding business intelligence to their A/P
and A/R functions are bene?tting from more ef?cient cash management.
Sample Report: Accounts Receivable Summary for Selected Organizations
Accounts Receivable and Accounts Payable Reporting
and Analysis
COMMON BUSINESS QUESTIONS
• What is the aging distribution of accounts receivable?
• What is the total amount of money in collections?
• Which are my poor-payment history customers by dollar amount and/or invoice quantity?
• Which sales representatives need to be notified to assist in the collection process?
• What is our predicted bad debt?
• What is the aging distribution of our accounts payable?
• To which vendors does each business unit owe money? When do they need to pay?
• With which vendors do we do the highest volume of business?
• What is the forecasted impact on working capital?
Account Type Payment History INVOICE ID TOTAL AR Paid Last 90 Days 30 Days 31 to 60 Days 60 to 90 Days 90 to 180 Days
Party Supply
Comany
Good 14567 $9,342 $3,114 $3,114 $6,228
12765 $0 $9,000
18222 $7,626 $7,625 $3,813 $3,813
$16,968 $19,739 $3,813 $6,927 $0 $6,228
Parts
Manufacturer
Fair 57990 $70,250 $70,250
70002 $35,886 $35,886
71225 $9,899 $9,899
$116,035 $0 $9,899 $0 $106,136
$133,003 $19,739 $3,813 $16,826 $0 $112,364
Link to detailed invoice payment report
Key Performance
I ndi cators
Sales Outstanding
Amount Outstanding
Predicted Bad Debt
Change in Working Capital
Least Desirable Customers
Most Valuable Customers
Vendors with Discount
Potential
Aging Distribution
A/R Turnover Ratio
This summary report links invoice detail, A/R aging, and customer payment history. The report contains
links to the invoice detail providing access to invoiced items, purchase order number, and approver
name. The payment history ?eld is based on the organization’s de?nitions for payment scoring and is
calculated based on historic payment patterns. As a next step, users can navigate to reports showing all
receivables more than 90 days old, receivables greater than a certain dollar amount, or trends in certain
geographies or industries.
34 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Finance
Key Performance
I ndi cators
Forecasted Revenue
Forecasted Expenses
Forecasted Contribution Margin
Revenue Probability
Variance to Plan
% of Compensation Target
Top 5 Business Units
Exceeding Plan
Top 5 Salespeople by
Forecasted Revenue
Financial budgeting and forecasting is an essential part of the business planning process.
Executives and managers continually revisit forecasts as actuals are reported to determine how
their business is performing relative to plan. Forecast reports allow detailed analysis by budget
owners at every level of the organization and set the stage for determining sources of revenue
and spending priorities. From simple reporting on actual performance versus budget to more
sophisticated “what if” scenario creation and predictive modeling, organizations use business
intelligence to make fact-based business plans and better monitor performance.
Sample Report: Field Sales Regional Dashboard > Western Region
Financial Budgeting and Forecasting
COMMON BUSINESS QUESTIONS
• What is the variance between my revenue forecast, budget, and compensation target by
service line?
• How much revenue does each region/district/business unit expect to earn in the coming quarter?
• Which regions’ forecasts are above corporate plan?
• What is the variance between my forecast product revenue and my compensation target?
• Does one unit predict significantly more or less revenue than last quarter? Why?
• Which forecasts are more than 10% below expectations?
• Which business units have historically performed 5% above or below plan?
Business Unit: North America
Quarter: Q1 2007
Business Unit Owner: Amanda Phillips
Account Actual QTD QTD Budget ($) QTD Budget Variance ($)
REVENUE
Product License $ 65,236,584 $ 78,523,698 $ (13,287,114)
Services $ 56,325,874 $ 51,232,156 $ 5,093,718
Other $ 2,154,885 $ 7,654,896 $ (5,500,011)
TOTAL $ 123,717,343 $ 137,410,750 $ (13,693,407)
COSTS
Salaries $ 53,663,095 $ 52,610,878 $ (1,052,218)
Rent $ 33,639,034 $ 34,325,545 $ 686,511
Fixed Allocations $ 5,026,205 $ 5,128,780 $ 102,576
Sales and Marketing $ 19,238,306 $ 19,630,925 $ 392,618
Communications $ 325,432 $ 451,023 $ 125,592
TOTAL COSTS $ 111,892,071 $ 112,147,150 $ 255,079
CONTRIBUTION $ 11,825,272 $ 25,263,600 $ (13,438,328)
This dashboard is an example of a report that might be deployed to each regional sales manager
comparing revenue, compensation targets, and quarterly forecasts. Sales managers can quickly see how
close they are to the revenue goal and the opportunities they should focus on in the short-term to
reach their goals. Sales managers can click from the summary to speci?c deal details to identify sales
representative assignment, customer contacts, and next action items.
MicroStrategy: Best in Business Intelligence 35
Credit risk, contract risk, currency risk, fraud risk, and audit risk – all are becoming increasingly
important components of risk that must be controlled by corporations and government
agencies. Credit risk management, by combining data from publicly available sources with
corporate customer and sales data, focuses on the determination of credit ratings, credit risk
exposure in a particular country or industry, or the impact of increased customer defaults.
Currency risk analysis involves evaluation of exchange rate exposure and predictive modeling
of the impact of currency ?uctuations on forecasted pro?t margin. Fraud risk analysis, through
the use of statistical data mining techniques, can uncover patterns of activity correlated to
fraudulent events. Business intelligence, by enabling the use of data mining and statistical
techniques for risk detection and management, empowers wider worker populations to help
mitigate the various forms of corporate risk.
Sample Report: Credit Risk Assessment
COMMON BUSINESS QUESTIONS
• What is a customer’s payment history?
• At the current exchange rate, how do revenues and expenses convert to local currency?
• What is the variance on forecasted profit margin at the current exchange rate and at the year
end projected exchange rate?
• How does the current cost of capital affect margin compared to last year?
• Is the average age of A/R increasing or decreasing?
• What five foreign currencies represent the most exposure?
Key Performance
I ndi cators
Average Outstanding Balance
Payment Behavior Index
Exchange Rate Volatility
Top 5 Exposure Currencies
Top 5 Exposure Industries
Average Daily Balance/Assets
% Change in Receivables
Change in Credit Rating
The Clothing Company
Credit
Rating
Total Credit
Line
Credit
Available
% Credit Line
Available
Deposits and
Other Assets
Payment
History
Ocean Airline Aaa $ 575,138 $ 57,892 10% $ 8,503,990 Good
Global Industries Bbb $ 651,822 $ 324,587 50% $ 9,637,840 Fair
The Clothing Company bbb $ 452,846 $ 325,698 72% $ 6,695,781 Fair
Financial Instruments Aaa $ 373,053 $ 372,154 100% $ 5,515,962 Good
NSP Co. Bbb $ 360,991 $ 123 0% $ 5,337,613 Poor
Great Motors AAA $ 369,115 $ 89,654 24% $ 5,457,734 Good
Light Food Aaa $ 261,363 $ 154,789 59% $ 3,864,513 Fair
Eyeshapers Inc. Aaa $ 172,513 $ 65,218 38% $ 2,550,777 Poor
Internet Solutions LLC Bbb $ 153,339 $ 125,698 82% $ 2,267,270 Good
University of Vienna Aaa $ 173,818 $ 154,898 89% $ 2,570,073 Good
Risk Management
This report illustrates one of several analysis steps that may be used when determining the ?nancial
risk associated with extending additional credit to customers. In assessing credit risk, it is important
to determine various characteristics of a customer/organization including credit score/credit rating,
transaction history, and balances. The next steps would be to investigate the recent transaction details
and ?nancial statements of customers approaching their credit limit with poor payment histories.
Forwarding a report on individual customers to the respective credit managers can aid in collections
and risk management.
36 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Human Resources
Overview
MicroStrategy customers are increasingly making HR analysis and reporting a strategic component
of the HR function. They choose MicroStrategy for its unique flexibility in reporting and its ability
to analyze all relevant corporate data. The following pages illustrate common areas of analysis that
have enabled MicroStrategy customers to improve the efficiency of the human resources function.
Key Anal ysi s Areas
Headcount Trends
Compensation
Employee Expenses
Career Path
Benefits Administration
Time & Labor Management
Customers i n thi s
Area I ncl ude:
Charming Shoppes, Inc.
Darden Restaurants
Limited Brands
Logan’s Roadhouse
Lowe’s Companies
Oakwood Homes
Premier, Inc.
Sprint
State of Tennessee
Texas Department
of Agriculture
The University
of Bologna
The University of Miami
As organizations continue to adopt self-service models for personnel bene?ts enrollment
and reporting, business intelligence has provided easy-to-use tools for employees to view
and report on their personal bene?ts over the Web. With the resultant elimination of much
of the administration of personnel bene?ts, human resources personnel are spending more
of their time ensuring compliance with government regulations and ?nding opportunities
to better manage their human resource investment. Business intelligence is meeting this
challenge as well, providing a complete platform for HR personnel to investigate employee
data, in aggregate or at an individual level, with employee anonymity or speci?c employee
detail. Multiple levels of security within the business intelligence product must ensure the
con?dentiality of employee records. Ultimately, HR departments are becoming increasingly
dependent on business intelligence to better service the employee base, report on regulatory
compliance, and understand patterns of attrition and compensation to lower the ongoing cost
of the organization’s human resource investment.
BUSINESS CHALLENGES SOLVED WITH BUSINESS INTELLIGENCE
Personalized access to bene?ts information. Web portals are becoming the standard access method
for employees to view their insurance coverage, vacation time, paycheck and expense reimburse-
ment status, and stock option and portfolio performance. Business intelligence allows secure, per-
sonalized information access over the Web through an intuitive, “no training required” interface.
Complete access to employee, regulatory, and bene?ts information. Human resources analysis
requires access to employee, regulatory, and bene?ts information to adequately understand
recruitment, compensation, retention, attrition, and job performance results. Business intelligence
provides trend reports with the ability to drill into individual employee and policy detail.
Flexible support for changing organizational structures. In today’s environment, businesses
are constantly re-aligning themselves to improve ef?ciencies and focus on core operations.
Reporting structure changes are dif?cult to make and almost impossible to view in most
legacy HR systems. The BI application provides the ?exibility to easily view changes in reporting
structures, and graphically review career progression.
Automated delivery of organizational scorecards. Employee satisfaction, survey results, retention
and attrition statistics, headcount trends, recruitment metrics, compensation trends, and employee
performance – all are measures of organizational health that comprise the HR scorecard. Business
intelligence combines tabular and graphical representations of these metrics into integrated score-
cards that can be automatically delivered to executives and HR personnel on a regular basis.
> DARDEN RESTAURANTS, INC.
Reducing Employee Turnover and Costs
At Darden Restaurants, Inc. the MicroStrategy platform currently anchors 12 business
intelligence applications across 17 business areas – assessing sales, ?nance, human resources,
and competitiveness.
A MicroStrategy customer since 1997, Darden Restaurants, Inc. is the largest casual dining
restaurant company in the world, operating more than 1,400 Red Lobster, Olive Garden,
Bahama Breeze, Smokey Bones, and Seasons 52 restaurants in North America.
More than 250 of Darden Restaurant’s ?nancial and marketing analysts, operations and human
resource personnel, and executive management use MicroStrategy to track, analyze, and report
on pro?tability and marketing promotions, guest satisfaction scores, employee retention, as
well as perform market basket analyses, inventory and scenario planning. Employees are able
to determine, for example, the impact on a restaurant’s pro?tability if 50 percent of its patrons
purchased an additional appetizer. Darden recently expanded its enterprise reporting, utilizing
Report Services and Narrowcast Server to deliver sales and guest count trend reporting to
restaurant managers and senior executives.
> THE UNIVERSITY OF MIAMI
Driving Decisions on Student Admissions and Enrollment Processes
The University of Miami is using MicroStrategy to gain insight into its academic environment
and student population and drive decision making on admissions and enrollment processes.
The University of Miami, which offers a wide selection of academic disciplines from accounting
to women’s studies, is comprised of twelve schools and colleges and has approximately 15,250
undergraduate and graduate students from around the world.
The University of Miami uses MicroStrategy software to analyze its student data in order to get
a better pro?le of its applicant pool and existing student body. End users across the various
schools and colleges are able to run reports that examine current student reporting, fundraising,
campaign results, equality administration, ?nancial aid, human resources, purchasing, student
admissions, and student employment information. Analysis of the data can be done across
the student body or at the individual level, with student-speci?c identi?ers removed to ensure
individual privacy. The institution is developing two additional business intelligence applications –
?nancial records and facilities management – that will deploy on the MicroStrategy platform.
CUSTOMER VIGNETTES: IMPLEMENTING BI FOR
HUMAN RESOURCES
MicroStrategy: Best in Business Intelligence 37
“ The professional look and feel of
Report Services documents allow
us to deliver presentation ready
reports quickly and easily.”
Karol Keranen,
Project Leader for Business
Intelligence Systems,
Darden Restaurants, Inc.
“ MicroStrategy software provides
the University of Miami with an
innovative way to organize and
share information about our
students, and drive our
admissions and enrollment
decisions. With MicroStrategy,
we can easily pull up reports
about our current student body
or applicant pool and make
important decisions on
admissions acceptances and
enrollment questions.”
Mary Sapp,
Executive Director of Planning
and Institutional Research,
The University of Miami
38 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Human Resources
Key Performance
I ndi cators
Attrition Rate
Months in Position
Annual Headcount Variance
Quarterly Headcount Variance
Rate of Attrition to New Hires
Headcount Growth Rate
Top 10 Units by Attrition Rate
Top 10% of States by
Headcount Growth
Headcount trend analysis provides useful information about employee movement into,
out of, and within a corporation, division, or department. HR analysts and business unit
managers monitor headcount, payroll, and job satisfaction metrics to identify over- and under-
performing managers, attrition risk within departments, recruitment and compensation trends
affecting human resources costs, and trends in employee performance. These analyses reveal
areas for training investment, areas of potential product or service delivery risk, and required
compensation and recruitment budget revisions.
Sample Report: Attrition Trends by Department
Headcount Trend Analysis
COMMON BUSINESS QUESTIONS
• What has been the effect of involuntary layoffs on voluntary attrition over time?
• How has our attrition rate fluctuated over the last two years?
• How has headcount varied quarter over quarter by department?
• Given the current attrition rate, how many new employees do I need to hire to maintain the
current growth rate?
• Who has transferred in the last 30 days?
• Which 10 units have the highest attrition rates?
• Which business units or regions experienced employee flux rates higher than 10% this year?
140
120
100
80
60
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20
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v
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D
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p
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s
Quarter
Attrition Trends
Involuntary Departures
Voluntary Departures
Department 1
Voluntary Departures
Department 2
Voluntary Departures
Department 3
This sample report shows the relationship between voluntary and involuntary departures. It is immediately
apparent that the large reduction in force in Q306 resulted in increased voluntary departures in subsequent
quarters. From this summary report, an HR analyst could drill to more detailed reports to determine
whether particular job functions, departments, management levels, or geographic regions have been
more impacted than others.
MicroStrategy: Best in Business Intelligence 39
Employee compensation affects employee morale and retention in addition to the corporate
expense line. Employers often benchmark compensation trends across similar employee groups
to ensure all employees are being compensated equitably within the organization and on par with
industry averages. Compensation reports identify compensation anomalies that management
can adjust to keep employee morale high and corporate expenses in check. Data from HR,
payroll, and ?nance systems provide the comprehensive picture of compensation, including
salary, bonus, vacation, stock option value, T&E budgets, tuition payments and policies, health
and life insurance, and other perks. Sensitive compensation and employee identity information
must be securely distributed to appropriate users based on security privileges.
Sample Report: Percentage of Total Compensation
COMMON BUSINESS QUESTIONS
• What is the salary distribution of all employees in my company with the title “Sales
Representative”?
• Are there any regions where managers make significantly more money than their subordinates
(more than 1 standard deviation)?
• What has a certain person’s history of bonuses and raises been during her career?
• Was Employee X given a raise last year?
• What is the average bonus to base salary ratio?
• By department, what is the bonus to salary ratio?
• In rank order, which sales representatives achieved their quota last year?
Key Performance
I ndi cators
Total Labor Cost Revenue %
% Raise
Bonus as % of Salary
Value of Options Granted
Avg. Compensation Changes
Rank of Total Compensation
by Job Title
Compensation Reporting and Analysis
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Sales
Base Salary
Bonus/Commission Potential Compensation Reporting and Analysis
Marketing Finance Administration Operations Human
Resources
Product
Development
This graph shows the relative contributions of salary and bonus/commission potential to total employee
compensation for different divisions. Human Resources would use this analysis to amend compensation
plans to be more or less performance-based. A next step would be to analyze the compensation plans
within departments to identify individuals whose plans do not ?t the model.
40 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Human Resources
Key Performance
I ndi cators
Airfare Expense
Average Cellular Phone
Expense per Employee
Total Entertainment-related
Expenses
Average Travel Expense
per Employee
Top 10% of Workforce with
Highest Reimbursements
Top 10% of Workforce
with Highest Average
Airfare Expenditures
Employees within an organization routinely incur business-related expenses and bill them back
to their employer in line with corporate policy. Employee expense reporting reveals amounts
incurred by expense category, with totals by employee and group. These summaries can be
viewed graphically, and out-of-trend activity automatically detected and highlighted. From
these summaries, managers are able to drill down to individual expense item detail, allowing
thorough investigation of all areas of the expense process. Business intelligence systematizes
the complete review cycle through automated delivery of expense reports to managers and
employees prior to each reimbursement cycle.
Sample Report: Regional Expenses by Expense Category
Employee Expense Reporting
COMMON BUSINESS QUESTIONS
• Which employees expensed the highest amounts for cellular phone use in February?
• Which employees are spending the most money?
• Which business unit is expending the largest percentage of its budget on expense reimbursements?
• What types of expenses are responsible for most of our costs?
• Which employees spent over $1,000 on airfare this quarter?
• How many days passed between the date the expense was incurred and the date the employee
submitted this expense for reimbursement?
• Did any employees submit expenses outside the usual categories of travel and communications?
• Why did this employee incur this expense? What was this purchase for?
This report graphically reveals trends in spending areas for a region and provides detail on an area with
noticeable relative increase in spending – in this case airfare expenses. From this report, a manager could
drill to transaction-level detail to see exact expense items, and further to the individuals submitting those
items. Further analysis might include investigating a single employee’s complete expense report, trending
of expenses within the cost account, or a comparison to expense limits.
$80,000
$70,000
$60,000
$50,000
$40,000
$30,000
$20,000
$10,000
–
Q1 2007 Quarter
Cell Phone Home Office
E
x
p
e
n
s
e
A
m
o
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n
t
Airfare Hotel Car Rental Other Travel
Q2 2007
Q2 2007 Airfare Expenses by Airline
World Air
45%
Air One
22%
Go Jet
19%
Trans Air
14%
MicroStrategy: Best in Business Intelligence 41
Career path reporting and analysis helps companies track employee job function movements
and chart employee career paths. HR professionals analyze employee background, current and
prior positions, and performance review results (both quantitative and qualitative). Through
studying average job tenure, job function transitions, performance ratings, and attrition rates.
Human Resources is able to identify segments of employees who may be ?ight risks, recognize
patterns in departures, and make adjustments to keep its most valuable employees. Business
intelligence allows the analysis of large personnel data sets from multiple source systems and
provides role-based security to protect sensitive employee information.
Sample Report: Career Advancement Analysis
COMMON BUSINESS QUESTIONS
• For each employee that began as a Production Assistant, what position do they currently hold?
• What is the average tenure by current position?
• What has been the career track of a particular employee?
• Are they progressing toward their goals?
• Who are all the employees that work in a particular business unit or geographic region?
• Who in my department has been an employee for five years? 10 years?
• What is this employee’s current home address?
• For the past five years, how has this employee rated in the “Skills Assessment” section of his/ her
annual performance review?
Key Performance
I ndi cators
Tenure
Time in Current Position
Performance Assessment Rating
Job Functions with Highest
Attrition
Top 10 Career Paths
Bottom 10% Performers
Career Path Reporting and Analysis
Career Path for:
Current Title
Count of
Employees
Average Length of
Time to Promotion
Production Assistant 7565 2.20
Senior Production Assistant 1345 5.24
Product Lead 567 8.67
Section Supervisor 24 12.54
Division Supervisor 13 15.24
Plant Manager 4 17.95
Operations Planning 2 8.56
District Sales Representative 15 12.76
Union Representative 1 24.50
Production Assistant 6
This report provides insight into logical career paths for the position of production assistant, then
calculates the average time to promotion (for those promoted). HR managers are able to follow career
paths through the organization to assist employees with career planning. A next step might be to drill
on a title within this report to view the career paths of speci?c individuals, or add new metrics like
Average Salary or Number of Employees Managed.
42 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Human Resources
Key Performance
I ndi cators
Benefits Elections
401(k) Contribution
Vacation Accrual per Employee
Sick Days Taken
Average Tenure of Employees
Average Healthcare Cost
per Employee
Bene?ts administration has traditionally been a function of Human Resource departments
and includes reporting of employee insurance, paid time off, and other non-salary item data.
Business intelligence, when applied to bene?ts administration, allows employees to view vacation
accrual, stock plans, and ?exible spending accounts over the Web without help from their HR
representative. HR departments can also apply business intelligence to bene?ts reporting to
ensure they are providing the appropriate bene?ts packages to their employees at competitive
prices. As Human Resources departments increasingly move bene?ts administration to a self-
service model, bene?ts administration applications are integrated with corporate portals and
intranets for one-stop HR reporting and analysis.
Sample Report: Employee Bene?ts Pro?le and Status
Bene?ts Administration Reporting
COMMON BUSINESS QUESTIONS
• How many paid vacation days do I have remaining?
• Which healthcare insurance package am I signed up for?
• How many stock options has this employee been granted? What is the vesting schedule?
• Which employees have their five-year anniversary with the company this month?
• What is the average 401(k) contribution by employee?
• What was the corporation’s payment to 401(k) plans in 2006?
• What is the aggregate cost to the company of vacation days granted in the retention package?
• How many employees take advantage of the flexible spending option?
Jane Johnson’s Bene?ts Pro?le
Bene?ts Current Election Type Available Used Pending
401(k) 7% Vacation 8.16 1.00 1.00
Employee Stock Plan Non-participant Sick 1.26 1.00 –
Health Insurance Plan Enhanced Personal 1.00 – –
Flexible Spending Account $1,000 Comp. Days Awarded 0 – –
Education Reimbursement 1 course/term Personal – –
Jury Duty – –
Start Date End Date Days Type Paid/Unpaid Family Leave – –
1/2/2007 1/2/2007 1.00 vacation paid Bereavement – –
3/31/2007 3/31/2007 1.00 sick paid
4/21/2007 4/21/2007 1.00 vacation paid
Total: 3
This dashboard enables employees to see their current paid time off and bene?t elections without the
help of HR. Companies using intranets or portals can link this dashboard into existing projects to provide
employees with real-time access to their HR pro?le. The next step would be to enable HR professionals to
access this same employee information with enhanced drilling capabilities to assist users with questions,
make updates to elections, and perform trend analysis across groups of employees.
MicroStrategy: Best in Business Intelligence 43
Time and labor management applications track a wide range of employee details, from
paid leave to billable time to vacation accruals. Combining data from both HR and ?nance
allows HR professionals to perform analysis on staf?ng, revenue forecasting, and compensation
impacts. Understanding utilization rates, contractor billing rates versus employee labor rates
and overtime, and corporate overhead costs allows an organization to optimize labor expenses
and set policy.
Sample Report: Employee Utilization Rate Report
COMMON BUSINESS QUESTIONS
• What are the utilization rates of my employees?
• What is the average utilization rate this year?
• How many hours were billed in March?
• What portion of revenue is from billable employees?
• What is my employee forecast for the next quarter?
• Which employees attained their bonuses this year?
• What percentage of my employees are approaching overtime?
• When will my department hit overtime?
• What is my leave liability?
Key Performance
I ndi cators
Billable Hourly Rate
Total Hours Billed
Utilization Rate
% Contract Hours
Billable Hours Forecast
Forecast Utilization
Average Bonus Attainment
Period over Period
Time and Labor Management Reporting
Thomas
Elm
Smith
Grant
Miller
Berlin
Car
Spear
Johnson
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Utilization Rate
E
m
p
l
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y
e
e
N
a
m
e
This example colorcodes zones of employee utilization rates for a department. Managers from call centers
to manufacturing use this type of analysis to ensure service levels, reward top performers, and coach
underperformers. Further analysis might include trending of individual employee utilization, drilling to an
employee’s time sheet, or performing predictive analysis to determine future staf?ng needs.
44 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Sales Forecast
Overview
Reporting, analysis, and distribution of sales forecast data have unique user scalability, visualization,
and security requirements. The following pages illustrate how MicroStrategy customers have
successfully deployed sales reporting applications to thousands of end users, with meaningful
analyses and reports that have driven increased sales efficiency for their organizations.
Key Anal ysi s Areas
Sales Pipeline
Channel
Competitor
Sales Force Performance
Customers i n thi s
Area I ncl ude:
Amlin
AstraZeneca
AutoTrader.com
Corporate Express
Esteé Lauder
Lowe’s Companies
Novartis
U.S. Borax
Wilton Industries
Sales forecast reporting and analysis provides visibility into a company’s sales pipeline,
integrating information from sales, customer, and ?nancial sources for a complete picture of
sales performance. Business intelligence-enabled sales forecasts allow sales management to
monitor and act on individual opportunities, more accurately forecast current and future period
revenues, and understand the drivers that distinguish won versus lost deals. Executives can use
graphical dashboards to quickly assess actual sales performance versus corporate targets and
sales management forecasts. Marketing users can analyze lead progression through each stage
of the sales cycle to quantify the effectiveness and revenue impact of marketing efforts. Business
intelligence enables organizations to associate sales pipeline data with ?nancial, marketing, and
customer information to make informed, strategic decisions to improve sales effectiveness.
BUSINESS CHALLENGES SOLVED WITH BUSINESS INTELLIGENCE
Secure reporting to multiple layers of sales management. Enterprise-wide sales forecast
reporting requires that each manager in the sales chain-of-command, each sales representative,
each marketing and product analyst, and each executive has personalized access to sales
pipeline information. Deploying reporting over the Web requires robust security to protect
sensitive information and a scalable infrastructure to distribute reports to potentially thousands
of geographically distributed sales force personnel.
Forecasting effectively through trend analysis and close probabilities. Sales managers and
corporate executives demand accurate revenue forecasts that blend up-to-the minute sales cycle
information with historically realistic close probabilities. BI provides easy-to-understand graphical
and tabular forecast reports as well as statistical analysis to enable predictive modeling.
Analyzing sales pipeline data from different business perspectives. Executives and managers
need to understand the underlying trends that create sales opportunities and result in deal
wins/ losses. These trends may vary according to geography, sales representative characteristics
(tenure, experience, education, and quota achievement), competitor presence, and product.
Business intelligence provides reporting ?exibility to view sales pipeline data along the attributes
of choice, while providing direct access to the deal speci?cs when needed.
Combining sales force data with product, customer, and marketing data. Sales and marketing
analysts require access to information beyond what typically resides in SFA (sales force
automation) systems. Reports identifying product pro?tability, potential revenue by customer
segment, and campaigns generating leads all require data from other corporate systems. BI
integrates data from any number of corporate systems, allowing complete visibility into all
variables affecting a company’s sales pipeline.
“ Corporate Express is honored to
receive this prestigious award
from TDWI. Our MicroStrategy-
based market basket application
removes the guesswork and
enables us to make analytically-
based decisions that enhance the
online customer experience.”
Jay Mutschler,
Chief Operating Officer,
Corporate Express US
> CORPORATE EXPRESS
Maximizing Revenue with an Award-Winning Predictive Analytics Application
In June 2007, Corporate Express US received the 2007 Best Practices Award from The Data
Warehousing Institute (TDWI) for a MicroStrategy-based business intelligence application.
Corporate Express US took top honors in the predictive analytics category. TDWI’s Best Practices
Awards program is designed to identify and honor companies that have demonstrated excellence
in developing, deploying, and maintaining BI and data warehouse (DW) applications.
Corporate Express built a market basket application, leveraging MicroStrategy’s business
intelligence technology, to improve its online business. The application looks at each item
purchased and determines a list of complementary items to recommend to purchasers. The
market basket application uncovered insightful new data about the items that customers
typically purchase together, enabling Corporate Express to present these items as complementary
offerings to online customers. As a result, the average order size for orders with the market
basket pairings is more than twice the average order size for orders without pairings.
In addition, the information has helped Corporate Express to better serve its customers, with a
deeper understanding of purchasing preferences.
> U.S. BORAX
Reporting on Marketing and Sales Trends Worldwide
U.S. Borax, Inc., a member of the Rio Tinto group, supplies nearly half the world’s demand for
re?ned borates – essential nutrients for plants, part of a healthy human diet, and key ingredients
in ?berglass, ceramics, detergents, fertilizers, and wood preservatives. The company employs
nearly 1,500 people worldwide and ships its products to customers in nearly 100 countries.
U.S. Borax, Inc. uses the MicroStrategy Business Intelligence Platform as its enterprise-wide
business intelligence standard. U.S. Borax harnesses MicroStrategy for analysis of and reporting
on its marketing and sales trends worldwide. U.S. Borax primarily utilizes MicroStrategy for its
extensive “Marketing and Reporting System” (MARS). This system is used to report on sales
?gures, forecast projections, estimate competitive sales, and gauge the state of the business.
MicroStrategy users include U.S. Borax executives, marketing analysts, sales representatives,
?nancial analysts, distribution analysts, and production supervisors.
CUSTOMER VIGNETTES: IMPLEMENTING BI FOR
SALES FORECAST
MicroStrategy: Best in Business Intelligence 45
46 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Sales Forecast
Key Performance
I ndi cators
Forecast Revenue
% of Deals Closed
% of Deals Lost
Win to Raw Lead Ratio
% of Quota
Length of Sales Cycle
Sales pipeline reporting focuses on the continual tracking and study of sales opportunities
from raw lead to closed sale. Sales managers monitor key performance indicators to ensure
marketing activities are generating the number, quality, and ?ow of leads necessary to meet
sales targets and that sales cycles are progressing towards closure. Sales pipeline reports show
the status and value of deals currently in the pipeline and probability-weighted forecasts. They
also allow sales teams to drill to particular deal terms and conditions, and update material deal
terms as negotiations occur. Business intelligence-enabled sales pipeline reporting not only
generates and delivers these reports on a regular basis, but also allows managers to uncover
competitive trends and performance anomalies by region, product, or customer segment.
Sample Report: Deal Progression by Sales Representative
Sales Pipeline Reporting and Analysis
COMMON BUSINESS QUESTIONS
• What is the weighted opportunity size of a particular deal?
• How does the total weighted opportunity size in the pipeline compare with revenue forecasts?
• Has the duration of the average sales cycle increased?
• Which deals have been in the pipeline the longest?
• What is the most important reason for lost deals?
• What are the terms of a particular contract?
• What is the conversion rate of leads to closed deals?
• What is the total potential revenue of all opportunities with Customer X?
Opportunity
Owner
Owner
Role
Opportunity Name
Lead
Source
Opportunity
Size $
Expected
Revenue
Probability
(%) Age
S. Grant South East - AE LBC City Music Cold Call $5,310,164 $1,062,033 20% 236
S. Grant South East - AE Krazy Kites Existing Customer $215,489 $86,196 40% 127
A. Nobel South East - AE Sam’s Videos Existing Customer $1,850,000 $1,110,000 60% 78
A. Nobel South East - AE Dairy Shop, Inc. Existing Customer $654,214 $261,686 40% 16
M. Lawlor EMEA UK - AE Nigel’s Avionics Incoming Call $1,721,765 $344,353 20% 45
M. Lawlor EMEA UK - AE Kings Corner Email Lead $65,874 $52,699 80% 52
B. Morsch West - AE West Accountants Incoming Call $1,375,000 $275,000 20% 358
B. Morsch West - AE Writers Guild Customer Referral $1,197,598 $479,039 40% 152
T. Smith Central - AE Marketing Surrogates LLC Email Lead $254,187 $203,350 80% 32
T. Smith Central - AE PeopleNet Partner Referral $1,140,000 $684,000 60% 189
L. Zeiss Partner - Germany Munich Crystal Gmbh Tradeshow $368,745 $73,749 20% 68
L. Zeiss Partner - Germany Deutsche Air Gmhb Email Lead $56,234 $22,494 40% 99
Quarter Q3 2007 6
This detailed sales pipeline report shows the weighted opportunity size for a sales team in the quarter
selected. Dashboard capabilities include thresholds to highlight large revenue opportunities, as well
as opportunities that are aged longer than the average, simplifying analysis by sales managers and
executives. Further analysis can focus on which products/services are selling well, the effectiveness of
individual sales people or regions, and sales results versus plan.
MicroStrategy: Best in Business Intelligence 47
Companies use a variety of channels to promote products to customers. Retailers use stores,
catalogs, and Web sites to merchandise their offerings. Technology companies depend on direct
sales forces, OEM partners, resellers, and systems integrators to deliver products to customers.
Channel analysis allows organizations to understand the effectiveness of various sales channels,
gauge channel growth, and compare channel margins. By reviewing channel comparisons, sales,
channel, and marketing managers can focus resources on building and maintaining the channels
that best meet their customers’ sales and service needs. Basic channel analysis includes sales and
margin performance by channel, trends in channel utilization over time, and comparisons of channel
performance by customer segment. More advanced analysis enables users to drill to individual
channel partners, optimize pricing by channel, or match channel supply to channel demand.
Sample Report: Quarterly Sales Channel Analysis
COMMON BUSINESS QUESTIONS
• Which channels are exceeding sales projections? Underachieving?
• Which channel(s) generate the most profit per transaction?
• Which channel has the highest growth rate year over year?
• In Region A, which channel do customers prefer?
• Through what channel are my most profitable customers buying?
• Which promotions have been the most effective in this channel?
• How does the price of Product Z vary by channel?
• Is one channel cannibalizing another?
Key Performance
I ndi cators
Revenue Growth Year
over Year
Profit per Transaction
Price Variance b/n Channels
Top Promotion by Channel
Top 25 Products by Channel
Margin by Channel
% of Total Sales Sold Direct
% Profit on Partner Sales
Channel Analysis
Direct and Internet Sales by Region
Asia
Europe
North America
7,000
6,000
5,000
4,000
3,000
2,000
1,000
Direct Sales
$$$
Direct Internet
Q1
Direct Internet
Q2
Direct Internet
Q3
Direct Internet
Q4
Quarter 1
Quarter 2
Quarter 3
Quarter 4
Total
Sales Last Year
$ 6,340
$ 4,378
$ 5,430
$ 4,598
$ 20,746
$ 19,086
$ 824
$ 999
$ 1,234
$ 2,131
$ 5,188
$ 4,773
$ 536
$ 649
$ 802
$ 1,385
$ 3,372
$ 3,103
$ 59
$ 71
$ 88
$ 152
$ 371
$ 341
Direct Internet Telesales Distributor
$29,667
$27,303
Total
Sales Last Year
Annual Sales
This report details the total sales for each distribution channel over time and drills into the geographic sales
breakdown for the direct and Internet channel. Understanding channel effectiveness helps Sales and Marketing
analysts to determine the impact of promotions, ad spending, staf?ng, service, training, and distribution.
Drilling further on this graph will reveal individual product sales by channel, sub-region, and month.
48 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Sales Forecast
Key Performance
I ndi cators
% Wins vs. Competitor
Revenue Lost to Competitor
Top 3 Competitors
# of Deals Lost at Existing
Customers
Total Opportunities with
Competitor Present
Top 10 Sales Representatives
Winning against Competitor B
Sales forecast reporting is not complete without a review of competitive forces in sales
cycles, their effect on revenue, and their implications for product development. Sales executives
identify competitive win/loss performance at the region, sales representative, and individual
sales cycle level. Basic competitive reporting measures competitive presence during the sales
cycle and the success rates against each competitor. More advanced analysis enables users to
drill into sales cycles of individual sales representatives to assess effectiveness in competitive
situations, review transaction detail including products and options sold, or analyze discount
programs used against various competitors.
Sample Report: Competitive Activity by Quarter
Competitor Analysis
COMMON BUSINESS QUESTIONS
• What competitor activity have we seen across various accounts?
• Is there a trend in activity with Competitor A?
• Who are our Top 3 Competitors by number of opportunities present?
• How much revenue have we lost to our top competitor this year?
• How often do we win versus Competitor A?
• How often do we lose when Product X is being sold?
• What products were part of the contract offered Customer A?
Primary Competitor Quarter
Opportunities
with Competitor
Present
Wins vs.
Competitor
% Wins vs.
Competitor
Losses vs.
Competitor
% Losses vs.
Competitor
Wizard Corporation
2006 Q1 41 16 39% 22 54%
2006 Q2 56 30 54% 16 29%
2006 Q3 22 4 18% 15 68%
2006 Q4 30 12 40% 12 40%
Total: 149 62 42% 65% 44%
Sphynx Solutions
2006 Q1 14 11 79% 2 14%
2006 Q2 23 7 30% 12 52%
2006 Q3 56 29 52% 25 45%
2006 Q4 33 21 64% 10 30%
Total: 126 68 54% 49% 39%
Pulsar Applications
2006 Q1 10 7 70% 2 20%
2006 Q2 6 1 17% 3 50%
2006 Q3 21 13 62% 7 33%
2006 Q4 15 9 60% 4 27%
Total: 52 126 58% 16 31%
Total: 327 160 49% 130 40%
This quarterly report of sales cycles against top three competitors allows competitive intelligence analysts,
product managers, and sales management to measure competitive effectiveness. The report automatically
highlights quarters where percentage wins and losses are signi?cant. Next step analyses include sales
representative wins versus losses, wins and losses in existing customers versus prospects, and average
deal size for wins versus losses.
MicroStrategy: Best in Business Intelligence 49
Sales Performance Reporting provides insight into expected and actual achievement of
the members of the sales organization. Executives and sales managers can view dashboards
summarizing sales representatives’ quota achievements, detailed reports on sales representatives’
pipelines, and benchmark reports that compare sales representative performance. Drilling to
pipeline detail can reveal factors contributing to the over- and under-performance of regions
and/or representatives. By constantly reviewing sales representative performance versus quota
and benchmarked relative to relevant peers, sales management can proactively develop
performance improvement plans for under-performing sales representatives and provide
appropriate motivational recognition for top performers.
Sample Report: Sales Performance versus Plan
COMMON BUSINESS QUESTIONS
• Are sales representatives on track to meet their sales targets?
• What is the sales trend in the East Region?
• Who lost the most deals in terms of revenue? Number of deals?
• Who are the best performers in terms of percentage of opportunities closed?
• Who are my top 20% and bottom 20% sales performers over the last four rolling quarters?
• What products have the most sales opportunities over the last 24 months by geography?
• What lead channel is driving the most successful sales opportunities?
• What products are most of my sales people positioning?
• What is the most common product offered in a subsequent sales cycle?
Key Performance
I ndi cators
% of Target
Opportunity Age
Average Sales per Sales
Representative
Bottom 20% of Sales
Representatives
Top 10 Deals by Revenue
Top 5 Opportunities
Weighted Pipeline Revenue
% of Quota
Cost of Sales
% Leads Converted to Sales
Sales Force Performance Reporting
Northeast Sales Representative Performance vs. Plan
Sales
Plan
$1,000,000
$800,000
$600,000
$400,000
$200,000
$0
M
i
c
k
y
H
a
m
p
t
o
n
T
h
o
m
a
s
S
c
o
t
t
D
o
n
n
a
G
r
o
o
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e
i
g
h
W
a
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r
B
r
y
a
n
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a
r
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e
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o
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t
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e
R
a
y
F
a
u
z
m
a
n
F
r
a
n
k
G
a
r
c
i
a
Region
No r theast
Mid-Atlantic
Southeast
Central
South
No r thwest
Southwest
Sales to Dat e
2,500,000
9.000.000
2,500.000
2,000.000
2,500.000
2,000.000
4,000.000
Sales Plan
3,500,000
10,000,000
5,000,000
4,000,000
7,500,000
6,000,000
5,000,000
2006 Revenu e
+
+
+
+
+
+
+
-
-
-
-
-
-
-
This is an example of a basic sales performance dashboard with detail on the performance of individual
sales representatives in a particular region. Executives and Regional Sales Managers use this report to
monitor individual employee performance within their region at a glance. A next level of analysis would
be to drill into the individual sales representative sales to date, historical performance versus plan, and
the pipeline to determine if any action is necessary.
50 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Customer and marketing analysis presents unique data complexity and analytical workflow
challenges. The analytical power combined with the intuitive interface of the MicroStrategy
platform makes examining customer behavior, uncovering trends, and taking action easy. The
following pages illustrate the most commonly deployed customer and marketing applications.
Key Anal ysi s Areas
Customer Segmentation
Customer Profitability
Customer Cross-Sell
Customer Acquisition,
Retention, and Attrition
Loyalty
Campaign
Customer Service
Customer Scorecards
Customers i n thi s
Area I ncl ude:
21st Century Insurance
Acturis
Ahold
AutoTrader.com
Boots The Chemists
Charter Communications
Children International
Consortium Health Plans
Corporate Express
Cortal Consors
dm-drogerie markt
Faith Shoes
Grange Insurance
Henry Schein, Inc.
Ingenix
The Katz Group
Kent School District
Limited Brands
Lotte Mart
Lowe’s Companies, Inc.
Marcus Corporation
Meredith Corporation
Oakwood Homes
Ohio Department of Education
Premier, Inc.
Prescription Solutions
Quixtar, Inc.
Redecard
Republic National Distributing Co.
Roche Pharma España
Samsung Life Insurance
ShopKo Stores, Inc.
Sprint
Texas Department of Agriculture
TRX, Inc.
Wells Fargo
Wilton Industries
Yahoo!
Over the past few years, many companies have implemented operational customer relationship
management (CRM) systems, and these companies are now analyzing the behavior of their
customer base to plan and optimize marketing tactics and improve customer service programs.
Using customer analytics, companies identify the tastes and preferences of particular target
markets to create more relevant offerings and improve the ef?ciency of marketing dollars. With
the growing availability and volume of customer data, including call center data, point-of-sale
transaction detail, and credit or loyalty card identi?cation, businesses can more easily determine
what types of customers are buying what kinds of items, and which marketing tactics drive sales
from each customer type. Additionally, customer service representatives can pull up individual
customer information in real-time, allowing for more informed service and providing real-time
suggestions for additional product or service sales tailored to the preferences of the customer.
BUSINESS CHALLENGES SOLVED WITH BUSINESS INTELLIGENCE
Access a 360-degree view of each customer at any touch point. To effectively personalize
marketing and sales tactics, users need a complete view of a customer consolidated from any
number of corporate systems. With the increased collection of customer-focused information
and the growing need for transaction-level insight, companies rely on business intelligence to
summarize terabytes of data while enabling access to individual customer detail.
Segment, analyze, and pro?le customers for targeted marketing campaigns. Marketing teams
use a variety of analytics to segment customers by past behavior, demographics, and lifetime
value, as well as gain an understanding of marketing effectiveness. Business intelligence provides
a ?exible and intuitive reporting environment to distill relevant marketing insight from a broad
range of customer characteristics.
Alert management to campaign and customer behavior changes. Customer relationship
managers and marketing teams alike depend on timely noti?cation of customer and campaign
events, like large customer deposits or purchases, and campaign responses rates. Proactive
information delivery via Web, e-mail, or wireless device allows sales, service, and marketing
personnel to improve customer relationships and build customer loyalty.
Predict customer pro?tability. Sophisticated customer calculations such as lifetime value help
marketing departments determine how to invest marketing budgets to service and retain the
most pro?table customers. Business intelligence provides both the advanced analytics needed
for pro?tability analysis and prediction and the information delivery capability to ensure
customer pro?tability information is delivered to all sales and service personnel who interact
with customers.
Customer Relationship Management
Overview
> BOOTS THE CHEMISTS
Analyzing Purchasing Behavior to Develop More Effective Personalized Marketing
Boots The Chemists uses the MicroStrategy Business Intelligence Platform to deliver improved
analysis and reporting of loyalty data to a wide range of users. Part of the Boots Group Plc,
Boots The Chemists is the UK’s leading health and beauty retailer and one of the best known
names in the UK.
Boots utilizes MicroStrategy for a variety of applications, including basket analysis, customer
segmentation, and direct marketing, using the vast amount of data collected from its Advantage Card
loyalty program. By upgrading its MicroStrategy platform, Boots also provides more sophisticated
analysis to its existing user base and allows more internal users to gain access to its core marketing
database. The retailer has improved its one-to-one marketing efforts and increased the pro?tability
and lifetime value of each customer. Boots also provides access to loyalty information through
the MicroStrategy Web interface to external parties in its supply chain.
> NETFLIX
Analyzing Marketing and Movie Recommendation Data to Better Serve
6.8 Million Subscribers
In 2007, Net?ix, Inc. selected MicroStrategy as its enterprise reporting and analysis standard.
Net?ix is the world’s largest online movie rental service.
Net?ix will utilize MicroStrategy for reporting and analysis of ?nancial data, marketing
campaigns, and movie recommendations. With MicroStrategy, Net?ix users will gain valuable
insight into critical marketing data to evaluate marketing campaigns and personalized movie
recommendation data, enhance its marketing programs, and better serve its subscriber base of
6.8 million members. MicroStrategy was selected by Net?ix for its ease-of-use, robust reporting
and analytical capabilities, and scalability for large databases.
CUSTOMER VIGNETTES: IMPLEMENTING BI FOR CUSTOMER
RELATIONSHIP MANAGEMENT
MicroStrategy: Best in Business Intelligence 51
“ The Web-based nature of
MicroStrategy and its intuitive,
customizable reporting allows us to
roll it out to new groups of users
quickly and easily. In the past,
analysts were using MicroStrategy to
extract insight from purchasing data,
but now we are able to empower a
wider range of business users with
critical information to help make our
individual customer propositions more
focused and deliver competitive
advantage in our market.”
Scott Sommerville,
Business Consulting Manager,
The Boots Company Plc
“ We evaluated several other business
intelligence products and found
that MicroStrategy offers us the
flexibility and scalability we need to
support our growing business
intelligence applications. We are
impressed with MicroStrategy’s
intuitive Web interface, which will
enable our users to make strategic,
analytically-based decisions to better
serve our growing business.”
Wayne Peacock,
Vice President of
Business Intelligence,
Netflix
52 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Customer Relationship Management
Key Performance
I ndi cators
Lifetime Value Score
Profit Decile
Campaign Response Rate
Revenue per Customer
Top 5 Customer Segments
by Revenue
Bottom 10% of Segments
by Contribution
Gross Margin per Customer
Profit Margin per Segment
Active Customers
Customer segmentation analysis allows organizations to identify groups of like customers based
on their transaction history and then study behavioral patterns within these groups. Armed with a
better understanding of their customer base, marketing managers can design targeted marketing
and service campaigns to reach speci?c customer segments with offers that are suited to their
needs and preferences. Segmentation analysis has as inputs customer transactional, demographic,
and psychographic data. Business intelligence provides statistical techniques and data mining
algorithms to analyze any number of customer attributes to uncover patterns in behavior. Ad hoc
analysis functions are seamlessly integrated with data mining to allow analysts to investigate the
characteristics of uncovered segments and generate speci?c customer lists within each segment.
These lists may feed campaign management systems, be used for calling campaigns, or feed Web
site content management applications to serve up offerings relevant to the segment.
Sample Report: Customer Segmentation Visualization and Drill-down
Customer Segmentation Analysis
COMMON BUSINESS QUESTIONS
• What is the current distribution of customers by demographic?
• How has the age distribution within our customer base changed over the past 10 years?
• What is the distribution of customers by lifetime value?
• What percent of my revenues are contributed by a given segment of customers?
• What are the revenue, profit, and margin contributions by customer profile?
• Which segment of customers responded best to our recent e-mail campaign?
• Which customer segment is our most profitable?
• Which campaign has been the most effective with Segment X?
• Is there a trend in buying behavior by segment?
Customer Segmentation
#
T
r
a
n
s
a
c
t
i
o
n
s
p
e
r
m
o
n
t
h
Age
15
without
loyalty card
with
loyalty card
10
5
35-54 18-34 55+
55+ Age Group
77%
23%
This statistical scatter plot is a ?rst step in segmentation analysis where data is mined for trends and
patterns. A marketing analyst can perform this type of analysis using any number or combination of
metrics to look for emerging patterns that can be used to segment customers. In this report, customer
segments along age can be seen from the tighter groupings of dots. Further drilling into one of the
segments reveals that a majority of these customers use a loyalty card when shopping. Clicking on the pie
segment representing customers without a loyalty card will generate the associated customer mailing list.
MicroStrategy: Best in Business Intelligence 53
Organizations use customer pro?tability analysis to identify the most valuable customers or
customer segments to prioritize marketing, sales, and service investments. By studying pro?tability
metrics such as lifetime value, repeat purchase rate, and churn rate, analysts can identify pro?table
segments, uncover de?ning characteristics of those segments, and target similar populations for
acquisition. Similarly, retention programs may be created for particularly pro?table customers.
Business intelligence provides the statistical and data mining capabilities to calculate lifetime
value, identify product af?nities for cross-sell campaigns, and perform predictive analysis of pro?ts
resulting from additional marketing investment. Customer segments or individual customers may
be further investigated through ad hoc analysis, lists of customer segments may be automatically
generated, or alerting rules may be applied to customer segments to automatically notify
relationship managers when pro?table customers have executed a transaction.
Sample Report: Customer Pro?tability Segments by Channel
COMMON BUSINESS QUESTIONS
• What is the breakdown of customer profitability segments by channel?
• What is the current profitability of highest quartile of customers in 2006?
• What are the most profitable customers buying?
• Who are our least profitable customers?
• Which products are most often purchased with the most profitable products?
• What services do our most profitable customers use?
• How do our most profitable customers prefer to be contacted?
• How much have we spent to attract our most profitable customers?
• What is the churn rate within the most profitable customer segment?
Key Performance
I ndi cators
Profit by Customer Quartile
Revenue per Customer Segment
Attrition Rate
% Variance in Profit
Bottom 25% of Customers
by Profit
Top 15 Products by Profit
Lifetime Value
Dollars Spent per Customer
Product Affinity Rate
Customer Pro?tability Analysis
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
18 - 30
Low
18 - 30
Med
18 - 30
High
30 - 50
Low
30 - 50
Med
30 - 50
High
50 - 65
Low
50 - 65
Med
50 - 65
High
65+
Low
65+
Med
65+
High
Customer Attributes (Age and Income)
Existing Customer Profitability by Segment
P
r
o
f
i
t
a
b
i
l
i
t
y
%
This customer pro?tability report analyzes customer pro?t for a selected segment by customer attributes.
Marketing strategists and campaign managers use this type of analysis to understand which customer
segments to target with campaigns and loyalty rewards programs so the most pro?table customers
are attracted and retained, and less pro?table customers are not sought. A next step might be to
analyze which products/services customers are buying, which channels they are utilizing, and which
complementary products/services to offer with promotions.
54 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Customer Relationship Management
Key Performance
I ndi cators
Product Affinity Rate
% Change in Product Sales
Top 3 Related Products
by Profit
Forecast Profit
% Penetration in Market
Campaign ROI
% Change in Margin Year
over Year
Lifetime Value
Sales and marketing managers rely on cross-sell analysis to identify customers who might
be interested in buying products and services that are complementary to products and services
already bought. Cross-sell analysis begins with determination of which product pairs are often
bought together by customers (product af?nity) and then involves identifying which customers
bought one but not both products. By identifying and targeting these customers, companies
can reduce total campaign costs, increase response rates, and drive increased sales. Detailed,
atomic-level capture and retrieval of every customer’s pro?le, preferences, and transaction
history enables basic cross-sell analysis. More advanced analysis uses statistical and data mining
techniques to identify product af?nities, explore historical sales trends, and predict sales as a
result of cross-sell campaigns.
Sample Report: “Market Basket” Analysis and Cross-Sell Campaign Results
Customer Cross-Sell Analysis
COMMON BUSINESS QUESTIONS
• Which products sell well together?
• Which products have an increasing sales momentum?
• What is the chronology of purchases?
• What are the characteristics of customers who have purchased both Product A and Product B?
• What discount was offered to customers who also bought Product B?
• What was the cost associated with a cross-sell campaign?
• Was a cross-sell offer presented to customers during the initial purchase process?
• What is the expected profit from up-sell opportunities this quarter?
"Product A" Cross-Sell Opportunities
Total # Product A sold: 3,909,642
Product
A
B
C
D
E
F
% of Product A
Market Baskets
Including Product
X (Affiinty)
3%
24%
14%
32%
19%
Number of
customers
owning both
products
548,789
1,784,259
843,210
2,154,870
1,256,453
Cross-sell opp.
(own Product
A but not
Product X)
86.0%
54.4%
87.4%
44.9%
67.9%
Campaign
Name
July 4th Promo
Back to School
Halloween
Campaign
Cost
$456,653
$25,000
$155,563
Channel
30 day free trial
Direct Mail
Response
Rate
0.50%
2.17%
1.23%
Related
Sales
$452,312
$65,498
$125,687
Products A and B
2006 cross-selling campaigns
Campaign
ROI
-1%
162%
-19%
This product cross-sell or af?nity report shows the percent of “market baskets,” or total set of items
purchased by a customer during any one time period, containing Product A that also contain Product
“X”. Marketing analysts use this information to understand what products would be good candidates to
market to customers who already own Product A. Those products with high af?nity for Product A which
also have a high cross-sell opportunity (top ?ve of customer base who own Product A but not Product
X) are good candidates. The follow-on report shows the results of the campaigns executed promoting
Product E to customers who own Product A.
MicroStrategy: Best in Business Intelligence 55
Characteristics of new, loyal, and lost customers are particularly important for companies
to understand. Marketing analysts group customers into segments of recent new purchasers,
high-volume purchasers, and non-purchasers using customer transaction data, and analyze
the resulting segments to identify their common characteristics. Attributes of new customers
provide the pro?le of a company’s likely acquisition target market. Similarly, characteristics of
lost customers may de?ne less desirable market segments, or may reveal problems in customer
service or product satisfaction. Improvements in retention programs are saving companies
signi?cant time and money – keeping existing customers buying is much less expensive than
acquiring new customers. Predictive modeling of acquisition, retention, and attrition rates feeds
the business planning and budgeting process.
Sample Report: Call Center Inbound Customer Calls
COMMON BUSINESS QUESTIONS
• Have the rates of customer attrition, retention, and acquisition changed over time?
• What is the correlation between customer loyalty and profitability?
• What is the impact of tenure on customer retention and attrition?
• What is the revenue loss attributable to customer attrition?
• What is the average revenue per new customer in the past year?
• Which campaigns attracted the most new customers?
• How effective have specific retention offers been?
• At current rates, what will our attrition rate be in six months?
Key Performance
I ndi cators
% Attrition
Retention Offer Success Rate
New to Loyal Customer
Conversion Rate
Top 3 Retention Offers
Top 10 Reasons for Attrition
Revenue per New Customer
Profit Margin per New Customer
Forecast Attrition Rate
% Change in Acquisition Year
over Year
Customer Acquisition, Retention, and Attrition Analysis
Discount
Coupon
45%
100%
Refund
25%
None
15%
Free
Product
Coupon
15%
Q1 Retention Offer Summary
Call Type: Complaints
Q1 - Total Unique Customers with Complaint: 623
Attrition Projections
Total:
Offer Extended
Discount Coupon
100% Refund
Free Product
Coupon
None
Projected
Redemption Rate
15%
95%
45%
N/A
Projected
Attrition Rate
50%
45%
35%
80%
Projected
Lost Customers
140
70
33
75
318
This dashboard enables managers to quickly review the effectiveness of retention strategies by projecting
redemption and attrition rates based on offers extended to customers. Marketing, sales, and customer
service departments use this type of analysis to judge the effectiveness of available retention offers.
Next steps would be to add projected cost per offer to estimate the cost of each program, perform
trend analysis on a single offer, or drill into attrition rate to reveal lost customer pro?les to better target
retention offers.
56 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Customer Relationship Management
Key Performance
I ndi cators
Attrition Rate
Ratio of New Customers to
Lost Customers
% Change in # of Loyal
Customers
Variance in Satisfaction Level
Duration of Relationship
Lifetime Value
Products Owned by Customer
% Change in # of Annual Visits
Top 25% of Customers by Sales
Profit per Loyalty Card
Sales and marketing managers analyze customer data to identify pro?les of loyal customers,
track their behavior, and develop loyalty programs that maximize pro?tability. Segmenting
customers by pro?tability and lifetime value allows marketing analysts to identify the best
target for loyalty programs. Depending on the characteristics of the segment, loyalty programs
are created and generated to keep top customers engaged and satis?ed while limiting lost
revenue. The effectiveness of loyalty programs is studied continuously to ensure that both
of these objectives are being optimally met. Integrated predictive analysis capabilities allow
marketers to run “what if” scenarios to further re?ne loyalty program terms and conditions,
and provide input into the company’s budgeting and planning process.
Sample Report: Forecasted Loyalty Program Performance
Loyalty Analysis
COMMON BUSINESS QUESTIONS
• Has our customer loyalty program been successful in generating new revenue?
• Who are my top 10 customers according to frequency of visits?
• What is the lifetime value of my top 25 customers?
• What customers have bought multiple products over time?
• Is there a relationship between the number of products held by a customer and the duration of
the customer relationship?
• What is the relationship between customer satisfaction and duration of the customer relationship?
• What are the characteristics of customers who have cancelled a product in the last two years?
• Of loyal customers a year ago, who has stopped purchasing our products and services?
Total Frequent Flyer Miles
Earned (000)
Frequent Flyer Miles
Redeemed (000)
Change in Frequent Flyer
Mile Liability (000)
$ Change in Frequent
Flyer Mile Liability (000)
2005 Actual 777,147 116,572 660,575 $ 1,982
2006 Actual 950,257 114,031 836,226 $ 2,509
2007 Forecast 695,589 118,250 577,339 $ 1,732
2006- 2007 Variance -27% 4% -31% -31%
This report shows the common metrics used to assess the performance of a frequent ?yer loyalty program.
The chart allows the analyst to predict the results of the program given different projections of revenue
per ?ight mile. Here, the analyst has predicted revenue per ?ight mile to decrease by 4%. The impact on
the other metrics is automatically calculated, and negatively impacted areas are automatically highlighted
in red. Next the analyst may drill to speci?c geographic reports to see if passenger traf?c has changed
materially, individual customer reports to determine who has stopped ?ying, or fare change reports to
predict revenue per mile.
MicroStrategy: Best in Business Intelligence 57
Campaign analysis enables organizations to gauge the success of various campaigns by
measuring campaign costs, leads generated, and leads converted to customers. Campaign
analysis begins by trending campaign costs and targets over time, calculating the return on
investment for executed campaigns, and measuring the variance in lead generation and
costs against goals. Using statistical techniques to identify characteristics of top-performing
campaigns, customer and product buying af?nities, and pro?les of converted customers, future
campaigns can be optimized for more targeted customer segments with more targeted product
offers. In combination with campaign management tools, these analyses are being automated,
with feedback from executed campaigns improving offers and generating prospect lists for
follow-up campaigns.
Sample Report: Call Center Inbound Customer Calls
Customer Acquisition Campaign
Channel Effectiveness
Quarter: 1
COMMON BUSINESS QUESTIONS
• How effective were the channels used for the customer acquisition campaign?
• What is the most cost-effective marketing campaign by interaction type?
• What is the monthly trend in interactions, purchases, and response rates by customer segment?
• Who is likely to buy only if contacted in person?
• What percentage of all transactions contains at least one promotional item?
• How do the sales volumes compare between promotional and non-promotional periods?
• Which age segment is most likely to respond to a reduced price promotion?
• What were the sales and inventories each week of each promotion?
• Is our marketing strategy impacting profitability and retention as predicted?
Key Performance
I ndi cators
% Variance from Forecast Leads
Cost per Lead
Response Rate
Affinity Rate
% Change in Sales Volume
Month over Month
Attrition Rate
Profit Margin per Product
Top 3 Campaigns by Sales
Bottom 10% of Campaigns
by Profit
Lead Quality Rating
Campaign Analysis
Channel $ Spent
Leads
Target
Leads
Generated
Variance in Lead
Generation
Targeted Cost
per Lead
Actual Cost
per Lead
+ Banner Ads 60,000 1,000 849 -15% $ 60.00 $ 70.67
+ Magazine Reader Response Card 95,000 1,500 1,384 -8% $ 63.33 $ 68.64
+ Direct Email 75,000 1,600 1,822 14% $ 46.88 $ 41.16
- Search Engine Sponsorships
“Stain Removal” 10,000 150 170 13% $ 66.67 $ 58.82
“Cleaning Supplies” 10,000 150 164 9% $ 66.67 $ 60.98
“Spot Removal” 10,000 150 153 2% $ 66.67 $ 65.36
AVERAGE 3% $ 61.70 $ 60.94
This campaign analysis report measures the effectiveness of tactics through various marketing channels
and highlights results that show under- and over-performance. The outline format allows analysts to
quickly review details of individual tactics in a single channel. Additional analysis reveals the quality
of leads generated from each tactic, either by revenue closed or opportunities generated in the sales
pipeline, or shows period-over-period performance trends.
58 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Customer Relationship Management
Key Performance
I ndi cators
Issue Response Time
# Issues Resolved
# Issues Outstanding
Daily Call Count
Cost of Service
% of Calls Blocked
Top 10 Products Resulting
in Complaint
Customer Satisfaction Rating
Forecast Staff for Desired
Service Level
Customer service analysis investigates customer interactions with an organization, including
point-of-sale, service delivery, and follow-on support, to ensure customers are being serviced
well. Executives and marketers monitor service and satisfaction levels over time to measure
business effectiveness in retaining and attracting customers. Summary reporting shows service
levels at customer touchpoints, tracks issue resolution rates, and graphs period-over-period
changes in customer complaints, returns, or inquires. More detailed analysis drills into service
metrics by agent, location, and time, calculates cost of service, and predicts future needs for
staff, services, and training.
Sample Report: Customer Inquiry Trend Report
Customer Service Analysis
COMMON BUSINESS QUESTIONS
• What is the trend in customer complaints this quarter?
• Where are the bottlenecks that cause me to miss service level targets?
• What is the distribution of complaints by complaint type, salesperson, and region?
• What is the average time for a customer complaint to be resolved through a call center?
• What percent of customers are satisfied with their customer service level?
• What is the customer satisfaction rating of the top 20% of customers?
• What complaints are correlated with a particular product?
• Are call centers or online help centers more effectively addressing customer needs?
1400
1200
1000
800
600
400
200
0
Open Inquiries
% Inquiries Unresolved for 3+months
Closed Inquiries
January February March April May June
#
o
f
C
a
s
e
s
%
o
f
C
a
s
e
s
14%
12%
10%
8%
6%
4%
2%
0%
This customer service report highlights trends in the number of inbound customer support cases and
their resolution status. Customer service managers use this analysis to gauge customer satisfaction and
performance over time. Additional analysis on the types of cases reported, product or service enhancement
requests, and response rate detail reveals opportunities for improvement.
MicroStrategy: Best in Business Intelligence 59
Customer scorecards are “at-a-glance” reporting mechanisms that provide insight into
the health of a customer relationship. Scorecard contents vary and are typically customized
to the needs of an organization. Scorecards include both a comprehensive view of a single
customer and a bird’s eye view of trends across a company’s customer base. Scorecards help
align executives, sales representatives, and marketing managers to focus on the key drivers of
pro?t and long-term customer relationships. Scorecards give users the ability to view data from
multiple data sources in a single, intuitive format – combining tables, charts, and graphics. More
advanced users can drill into the scorecard to understand transaction detail, review pro?tability,
or monitor interactions.
Sample Report: Scorecard for Individual Customer
COMMON BUSINESS QUESTIONS
• What has been the migration of customers across revenue bands over time?
• What is the churn rate within the most profitable customer segment?
• What is the distribution of new and existing customers for the current year?
• What are the average acquisition costs for all customers per quarter?
• What is the monthly trend in counts of active, new, lost, and retained customers?
• What products does Customer X own?
• How do this year’s customer satisfaction levels compare to last year’s?
• What is the regional distribution of the most profitable customer segment?
Key Performance
I ndi cators
% Change in Satisfaction Rating
Top 10 Orders per Region
Sales by Related Product
Average Revenue per Customer
Bottom 10% of Customers
Profit per Customer
Lifetime Value
Cost per Campaign
ROI per Customer Segment
% Conversion of Customers
to Loyal
Customer Scorecards
Customer Scorecard
Customer: P.J. Pixelman & Family
Customer Since: 28-May-95
Report Date: 30-Jun-07
FICO: 640
FICO: 30-Jun-07
Available Credit: $25,000
Products Owned
Personal Checking
Home Equity
CD - 12 month
Mortgage
Balance
$5,451
($89,564)
$65,421
($326,580)
Notes
Balance never > $15K
Missed 2 interest pmts
last 12 mos.
Due 10/15/07
5.5%, due May 2028
$1,861 monthly pmt
Recommended Products
Investment Account
Car Loan
Credit Card
529 Plan
Last Transaction
$525 Deposit 8/22/07
Drawdown $5,000 7/31/07
Interest credit
$1,861 payment 8/1/07
L
H
M
Profibility Rating
This customer scorecard offers a quick snapshot of an individual customer relationship, recommended
products for cross-sell, and customer pro?tability. Sales professionals, customer service representatives,
or marketing analysts would use this information to make decisions when preparing for a customer
meeting or actively serving a customer. Next steps in this analysis would be to develop plans to cross-sell
to this customer, analyze trends in individual product balances and payments, or research the trend in
the customer’s credit worthiness.
60 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Product Sales
Overview
MicroStrategy’s unmatched data scalability and analytical richness make it the BI standard for the
retail industry. Large volumes of transactional data and sophisticated analytical techniques are
characteristic of product sales analysis. Following are some of the more common applications in
product sales analysis.
Key Anal ysi s Areas
Category Performance/
Category Management
Inventory
Merchandising
Fraud Analysis and Loss
Prevention
Product Scorecards
Discounts and Promotions
Customers i n thi s
Area I ncl ude:
Ahold
Boots The Chemists
Comet
The Container Store
Corporate Express
Dick’s Sporting Goods, Inc.
dm-drogerie markt
Faith Shoes
Forest Laboratories
Grange Insurance
Hallmark Cards
H-E-B
Henry Schein, Inc.
Herbalife
Hudson’s Bay Company
The Katz Group
KB Toys, Inc.
La Rinascente
Limited Brands
Liquor Control Board of Ontario
Liz Claiborne, Inc.
Lotte Mart
Lowe’s Companies
METRO Group
O’Reilly Automotive
Patterson Dental Company
Quixtar
Raley’s
Republic National Distributing Co.
Samsung Life Insurance
ShopKo Stores, Inc.
Sprint
Stage Stores
Telefónica
Thomas Cook AG
U.S. Borax
U.S. Postal Service
Wilton Industries
Product sales analysis, most commonly used by retailers, enables the continuous monitoring
of point-of-sale data to uncover sales trends, investigate product demand, and optimize
merchandising strategies. Various levels of analysis, from summary reporting to statistical trending,
are required by executives, store managers, product managers, and marketing analysts, as well
as external suppliers who provide materials or ?nished goods. Business intelligence makes sense
of the growing volume of transactional data by identifying trends and opportunities that create
competitive advantage for companies that know and understand their sales drivers.
BUSINESS CHALLENGES SOLVED WITH BUSINESS INTELLIGENCE
Understand which products are selling. The ability to gain a detailed knowledge of where,
when, and why speci?c products are selling ensures optimal stocking and merchandising, and
maximizes sales. Business intelligence provides an easy-to-use interface for complex product
mix analysis and statistical data mining for a complete picture of sales patterns and trends.
Develop strategies to detect and mitigate fraud. While fraud is one of the largest costs some
businesses incur, it is being uncovered and minimized using business intelligence. Business
intelligence not only allows fraud detection through statistical analysis, but also provides pro?ling
capabilities for identifying high probability areas of fraud to prevent loss before it happens.
Analyze the effectiveness of programs and promotions. Sales and marketing managers require
the ability to analyze the effectiveness of existing programs to optimize their marketing spend
and better merchandise their products. Scheduled dashboard reporting combined with the
transaction-level drill down reveals at-a-glance results with instant access to the underlying facts.
Alert managers to potential lost sales. Executives and sales managers cannot constantly monitor
data from point-of-sale systems – there is too much data to sift through for even the most data-
savvy managers. Comprehensive BI platforms provide alert-based reporting to notify managers
and suppliers of inventory short falls, delivery problems, and sales anomolies.
“ MicroStrategy allows us to under-
stand how recent product innovations,
such as our ‘Cards with Sound’ line
are performing in the marketplace.
The scalability and usability of
MicroStrategy enables us to distrib-
ute performance information
throughout the organization so our
business users can focus on our
mission of delivering products and
services that enrich people’s lives.”
Paul Wolters,
Business Intelligence Manager,
Hallmark Cards, Inc.
“ Lowe’s is committed to information-
driven decision making. We have
used decision support and data
warehousing for more than 13 years
and have invested heavily in improv-
ing our data warehouse and business
intelligence programs. As a result of
using the MicroStrategy platform,
Lowe’s is realizing significant benefits
through improved merchandising
decisions, more timely responses to
information requests, cost reduction
initiatives, enhanced employee
productivity, and better service to
our customers.”
Steve Stone,
Senior Vice President and
Chief Information Officer,
Lowe’s Companies
> HALLMARK CARDS, INC.
Distributing Performance Insight Across Various Channels, Product Groups,
and Business Units
Hallmark Cards, Inc. has expanded its use of MicroStrategy software for enterprise-wide
reporting and analysis. Hallmark, based in Kansas City, is known throughout the world for its
greeting cards and related personal expression products.
MicroStrategy’s integrated business intelligence platform supports a wide range of reporting
and analysis applications for Hallmark, providing insights into business performance across the
company. Retail and sales productivity applications provide company-wide insight into product
performance across various channels, product groups, and business units. MicroStrategy-based
applications also analyze the effectiveness of consumer marketing campaigns, and consumer
market basket and cross-buying behavior.
> LOWE’S COMPANIES
Using a BI Center of Excellence to Realize Signi?cant Bene?ts
Lowe’s, the second-largest home improvement retailer in the world, has a primary data
warehouse containing more than 20 terabytes of data and has grown by more than 20 percent
per year over the past few years. The company’s BI environment contains industry-leading
technology from MicroStrategy, Teradata, Informatica, and IBM. There are more than 30 full-time
professionals and contractors dedicated to building a BI Center of Excellence at Lowe’s, with 25
reporting and analysis applications.
The MicroStrategy implementation at Lowe’s, called DART (Data Access and Reporting Tool),
provides employees greater insight into key performance metrics. More than 150,000 reports
are run each week, and Lowe’s employees from multiple business areas use the data to manage
inventory, improve margins, review market speci?city, and identify sales opportunities. Lowe’s
also uses BI to analyze demographic attribute data to better anticipate the products that its
customers will buy.
CUSTOMER VIGNETTES: IMPLEMENTING BI FOR
PRODUCT SALES
MicroStrategy: Best in Business Intelligence 61
62 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Product Sales
Key Performance
I ndi cators
% Change in # Orders
Top 10 Products in Sales
Profit per Unit
Top 3 Related Products
% Change in Sales
Bottom 10% of Products
by Sales
Cumulative Profit by Customer
Units per Transaction
Category performance analysis, also often referred to as category management, provides
insight into merchandise performance by product, category, geography, and vendor. Product,
store, and channel managers analyze sales performance to understand which products and
categories are selling well and which are selling poorly, in which geographies and stores, during
which time periods. Just this basic level of knowledge allows managers to optimize their product
mix, ensure inventory levels are appropriate, and offer speci?c product selections demanded
locally by consumers. Using more advanced features of business intelligence, marketers are
able to identify statistically signi?cant product relationships (which products sell well together,
which products sell well at the POS) and optimize merchandising strategies through “what if”
analysis and predictive modeling.
Sample Report: Geographic Product Trends
Category Performance Analysis/Category Management
COMMON BUSINESS QUESTIONS
• Which regions are experiencing the most growth in Product A sales?
• What are my top selling products?
• What other products are selling at the same time as my top seller?
• What is the contribution to sales of my top products?
• Which products have declining sales momentum?
• How have sales of Product A changed year over year?
• What items did Customer X buy in her last transaction?
• What is the annual sales trend of each product?
• What is the profit per unit for Product A?
Flavor Store Price
Tier
Average
Retail Price
Retail
Promotion
Quantity -
Previous
Quantity -
Current
Volume
Difference
Volume %
Change
Vanilla
Chocolate
Strawberry
Marketfresh
Fresh Fods
Corner Mart
Marketfresh
Fresh Foods
Corner Mart
Marketfresh
Fresh Foods
Corner Mart
Full
33% off
Full
Full
Full
10% off
25% off
Full
Full
$ 2.49
$ 1.74
$ 2.99
$ 2.49
$ 2.49
$ 2.71
$ 1.89
$ 2.49
$ 2.99
no
yes
yes
no
no
yes
yes
no
no
65,421
98,132
32,547
32,547
48,821
16,274
12,548
18,822
6,547
70,655
107,945
32,987
25,387
49,854
20,324
16,689
15,654
4,897
5,234
9,813
440
(7,160)
1,034
4,068
4,141
(3,168)
(1,650)
8%
10%
1%
-22%
2%
25%
33%
-17%
-25%
ICUP Ice Cream Company
Sales Geography: Metro Washington DC Sales Type: Retailer
Segment: Grocery Product Type: Print
Chain/Independent: Chain
This report shows overall changes in sales volume by region for an ice cream manufacturer. Sales, product,
merchandising, and marketing managers can see at-a-glance which territories require attention. By drilling
into the ?avor sales distribution for underperforming regions at the region, ?avor, or store level, managers
can identify factors contributing to under- or over-performance and correct or replicate tactics.
MicroStrategy: Best in Business Intelligence 63
The continuous analysis of product inventory helps an organization match supply to demand,
saving money in idle inventory and making money by preventing lost sales. Product, sales, and
logistics managers monitor important inventory indicators like consumption, turnover, returns,
and material movements in order to minimize inventory while still ensuring adequate product
supply exists to satisfy demand. First-order inventory analysis consists of reporting current
inventory status, analyzing inventory levels by location, and notifying managers of shortages via
alerts. Business intelligence can also quantify the monetary impact of inventory shortfalls on sales,
predict future inventory needs, and automate the reorder process based on demand forecasts.
Sample Report: Sales and Inventory Forecast
COMMON BUSINESS QUESTIONS
• How much is the inventory of Product XYZ worth?
• What products are in danger of stock out?
• What is the inventory capital effectiveness?
• What impact are my current sales having on my inventory plans?
• What is the trend for inventory turns by product type? Color? Size?
• What are the trends in returns and what impact will this have on inventory?
• What can I do to decrease inventory turns?
• What are my projected warehouse space requirements?
Key Performance
I ndi cators
Inventory Turn Rate
% Change to Sales Forecast
Returns Rate
Stock Out Rate
Inventory Carrying Cost
Days on Hand
Vendor Rating
Projected Inventory Surplus
Inventory Shortage as %
of Demand
Inventory Analysis
Sales Forecast and Inventory Levels for Full Suspension Mountain Bikes
Distribution
Center
Inventory as of
Today (BOH)
Sales
Last Month
Sales This
Month Last Yr
Projected Sales
for This Month
Inventory Surplus
(Projected EOH)
Northeast 100 66 35 51 50
Southeast 180 200 210 205 (25)
Northcentral 60 40 80 60 0
Southcentral 225 325 300 313 (88)
Rocky Mountain 175 155 215 185 (10)
Northwest 150 60 90 75 75
Southwest 320 315 425 370 (50)
This report links sales forecasts and inventory levels to ensure the right products are available in the
right distribution centers to support sales demand. Sales and Distribution Managers use this report to
reallocate existing stock, proactively route current orders to high-demand regions, and place new bike
orders. Beginning-on-hand (BOH) and end-on-hand (EOH) are common measures of inventory levels at
the beginning and end of a time period. A next step would analyze projected inventory surplus over
time, drill to another product to see if multiple products need to be rerouted, or create “what if” sales
and inventory scenarios.
64 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Product Sales
Key Performance
I ndi cators
Traffic Rate
% of Shelf Space Allotted
Top 10 SKUs by Location
within Store
Price Variance b/n Store
Placements
Bottom 3 Product Sizes
Cost per Package Type
% of Product Purchased
at Discount
Product Affinity Rate
Merchandising analysis allows a company to improve the planning, placement, and
presentation of products for identi?ed target markets, with the goal of optimizing the product
mix to drive traf?c and pro?tability. Sales, product, and store managers monitor the impact of
merchandising attributes like product placement, packaging, and shelf-space area on metrics
such as product sales and pro?tability. Additionally, understanding what, when, and where
speci?c segments that customers buy enables more effective store design, better product mix,
and better placement of products relative to each other. Business intelligence also provides
statistical tools to identify product af?nities (which products sell well together) and predictive
models that can be used to forecast sales quantities.
Sample Report: Merchandising Optimization
Merchandising Analysis
COMMON BUSINESS QUESTIONS
• How do I increase sales with the current product mix?
• How do I manage the increasing number of products (#’s of SKUs)?
• What are the sales trends and results with different product/service placements?
• What are the market trends by geography for identical products?
• What is the sales impact of packaging variations?
• How do I optimize my shelf space given the store configuration?
• How do I increase sales of my most profitable products?
• Which products need to be localized to suit international markets?
• How can I alter the store layout to increase traffic through the electronics department?
Products Most Commonly Sold Together Film Sales by Display Location within Store
3000
2500
2000
1500
1000
500
0
Jan Feb Mar
U
n
i
t
S
a
l
e
s
Product Category: Photography
Subcategory: Film and Storage Memory
Region: Southeast
Checkout Aisles Electronics Section
Month
35mm Film
ISO 200
ISO 400
APS Film
Bright Sun
B & W
Digital Memory
128 MB
256 MB
Most
Common
AA Batteries
Chewing Gum
Blue Sunglasses
Cubs Hat
Lithium Battery
Camera Case
2nd Most
Common
Diet Cola
ISO 200 Film
Sun Block - SPF 15
Newspaper
Tissues
Photo Magazine
This combination report illustrates the product category af?nity along with the sales trends for numerous
display locations in a store. By performing “Market Basket Analysis,” product sales, brand, and store
managers can determine optimal product placement across a retail environment. Next steps are to
investigate trends across regions, analyze sales of products where ?lm is complementary, and drill to SKUs
stocked at each location to determine which type of ?lm is selling best.
MicroStrategy: Best in Business Intelligence 65
Fraud and theft are major cost components in retail environments, where large numbers of
employees and customers have easy access to products and even the cash receipts of the business.
By understanding what is normal and what is anomalous in daily operations, regional, store, and
risk managers can identify and proactively address fraudulent behavior to minimize loss. Loss
prevention results in reduced operating costs, increased pro?ts, and better managerial controls
across the organization. Business intelligence allows real-time detection of pre-de?ned fraud
patterns and consequent noti?cation by e-mail, page, or wireless device to proper authorities.
Statistical and data mining functionality enables fraud patterns to be uncovered and intricate
pro?les created for future detection, as well as predictive analysis of loss.
Sample Report: Refund Fraud Analysis by Payment Category
COMMON BUSINESS QUESTIONS
• What types of sales have the most fraudulent returns?
• Where in my supply chain is most of the anomalous behavior occurring?
• Which products are subject to the most fraud?
• What is the total cost of the loss associated with cash refunds?
• Is most of my fraud risk from employees or customers?
• What are the details of the transaction immediately following a return?
• Which employees are associated with Fraud Pattern x?
Key Performance
I ndi cators
% Merchandise Returned
# of Cash Refunds
Rate of Credit Card Fraud
Total Loss per Product
Annual % Change in Loss
Top 10 Suspect Transactions
Suspect Transactions over
$10,000
Top 25 At-Risk Products
Top 50 Employees by # of
Returns
Fraud Analysis and Loss Prevention
Fraud Analysis and Loss Prevention
Store 1
Store 2
Store 3
Standard Deviation
(as % of sales) -3 -2 -1 1 2 3
Total Refunds
Cash Refunds
Credit Card Refunds
Merchandise Exchange
Total Refunds
Cash Refunds
Credit Card Refunds
Merchandise Exchange
Total Refunds
Cash Refunds
Credit Card Refunds
Merchandise Exchange
Fraud Analysis and Loss Prevention
Store 1
Store 2
Store 3
Standard Deviation
(as % of sales) -3 -2 -1 1 2 3
Total Refunds
Cash Refunds
Credit Card Refunds
Merchandise Exchange
Total Refunds
Cash Refunds
Credit Card Refunds
Merchandise Exchange
Total Refunds
Cash Refunds
Credit Card Refunds
Merchandise Exchange
This report compares refund rates of different stores with respect to the mean to show potential areas
of fraud. Here, Store 1 is signi?cantly above average in its cash refunds, signaling an employee or group
of employees is likely stealing cash from registers. Regional, store, and risk managers use this type of
report to spot unusual activity, and drill into suspect stores to show refunds by employees, time of day,
and register ID to narrow down the likely source of the fraud.
66 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Product Sales
Key Performance
I ndi cators
Product Sales by Region
Top 10 Products by
Profit Margin
% Change in Sales
Period-to-Period
% Change in Margin
Period-to-Period
ROI per Product
Top 10 Orders per Region
Cost per Campaign
Profit by Channel
Units Ordered
Total Delivery Time by
Shipping Point
% Delivery Late
Top Competitor by Category
Product scorecards provide “at-a-glance” insight into key product and service drivers. Brand
and product managers are able to track and analyze factors that in?uence product pro?tability
and optimize product mix across channels, lines, categories, and brands. Scorecards are comprised
of various quantitative and visual components, ranging from tables and graphs to more symbolic
performance indicators such as speedometers, gauges, traf?c lights, and color-coded ?ags.
Scheduled delivery of product scorecards allow managers to see up-to-date performance indicators
in highly visual formats, allowing instant identi?cation of risk areas. Business intelligence delivers
interactive scorecards through e-mail, Web, and Microsoft
®
Excel, with complete integration of
reporting, ad hoc analysis, data mining functions, and access to transactional systems to provide
the most ef?cient environment for detection, analysis, and action.
Sample Report: Weekly Product Scorecard
Product Scorecards
COMMON BUSINESS QUESTIONS
• What is the forecast versus plan unit demand for the next four weeks?
• Display the breakdown of fixed and variable product costs for the quarter as a bar chart with
percentage and currency.
• Show me product sales compared to the same period last year, with increases over 10% high-
lighted in green and decreases over 10% highlighted in red.
• Provide a stoplight on my scorecard if customer calls related to my product are above average
for the week.
Product Manager Weekly Scorecard: Week ending 9/5/07
Product: Widget XYZ
Weekly Sales Summary
Weekly Deliver Summary by Shipping Point - Week Ending 9/5/07
Products Owned
% Change from
Last Week
Sales Order Items
Net Sales Order Amount]
Cost Sales Orders
Net Margin Sales Orders
% Net Margin Sales Orders
Avg Net $ per Sales Order Item
Sales Order Quantity (Base Units)
(27%)
(29%)
(22%)
(39%)
(15%)
(2%)
(27%)
Week Ending
9/5/03
Last Week
$0K
$1K
$2K
$3K
$4K
Sales Actual vs. Plan
Quarter-to-Date (000)
$0K
$4K
$8K
$12K
$16K
Units Ordered
Quarter-to-Date (000)
40%
38%
36%
34%
32%
30% Month
1 2 3 4 5 6 7 8 9 10 11 12
Average Profit
Margin Trend
2,394
$ 299,250
$ 204,089
$ 95,162
31.8%
$ 125
1,017,450
3,285
$ 420,480
$ 263,220
$ 157,260
37.4%
$ 128
1,396,125
Q3
Quarter-to-Date
12,870
$ 1,535,391
$ 991,863
$ 543,528
35.4%
$ 119
5,469,750
Q2
Quarter-to-Date
14,622
$ 2,017,863
$ 1,255,094
$ 762,742
37.8%
$ 138
6,214,350
Average Quarter-
To-Date 2007
13,945
$ 1,729,180
$ 1,092,842
$ 636,338
36.8%
$ 124
5,926,625
Products Owned
Outbound Delivery Items
Delivered Quantity (Base Units) for Outbound Delivery
% Contribution to Material Outbound Delivery Quantities
Average Total Delivery Time for Outbound Deliveries (Days)
Average Transportation Time for Outbound Deliveries (Days)
Average Shipping Processing Time for Outbound Deliveries (Days)
Average Delay Confirmed to Actual Delivery for Outbound Deliveries (Days)
% Delivery Items Delivered Late vs. Total
San Diego, CA
63
328,000
32%
7.2
5.3
1.9
1
12%
Trenton, NJ
83
754,000
68%
6.4
3.2
3.2
1.3
8.20%
3K
2K
1K
0K
Month
1 2 3 4 5 6 7 8 9 10 11 12
Customer Service Calls
This product scorecard is delivered every Monday to a product manager. The scorecard contains the key
performance indicators pertaining to this particular product, and allows the product manager to see trends
in product sales, achievement of planned sales and margin targets, distribution metrics by geography, and
trends in customer call volumes. Each of these areas may highlight potential problems that the product
manager should address. The scorecard is the entry point for the product manager to dive into the
underlying details – in this case, to see cost of sales breakdown and distribution center points.
MicroStrategy: Best in Business Intelligence 67
Companies often use discounts and promotions to entice customers to buy goods or services
or increase the size of a sale by bundling items together. Discounts often drive sales but may
have a deleterious effect on pro?tability if price elasticity models have not been well-formed.
Unfortunately, increased sales often don’t offset promotion costs. Analyzing discounts and
promotions enables sales and marketing managers to identify the most relevant and successful
offers for any product or customer segment. Sales discount and promotion analysis starts with
trending of campaign success over time by product, channel, or offer, and then calculates the
return on investment for executed campaigns. More advanced analysis uses statistical techniques
to identify product af?nities (products that sell well together) for promotions, to pro?le customer
segments likely to be attracted by speci?c discounts, and to predict ROI for future campaigns.
Sample Report: Q1 2007 Promotional Effectiveness
COMMON BUSINESS QUESTIONS
• What marketing tactics are driving sales?
• How much discounting are we doing relative to last year?
• What discounts are most popular? Least popular?
• What promotions are most popular? Least popular?
• What are the geographic discount/promotional trends?
• What is the cost of the discount/promotion compared to the increase in sales?
• What promotions are resonating with different customer segments?
• Which sales people are more reliant on discounts/promotions?
• Which promotions most significantly impact sales for my most profitable products?
Key Performance
I ndi cators
% Discount Offered
Return on Investment
Campaign
Coupon Redemption Rate
Variance from List Price
Net Cost of Campaign
Forecast Sales from Promotion
Bottom 10% of Promotions
by Sales
Discounts and Promotions Analysis
J an Profit Feb Profit Mar P ro fit Quarterly Promotion Cost
$$$
10% of f of 1st W SJ Ad M ag. Ad W eb Site Dir ect Mai l
time customer code: pr omo code: sale 15% of f 20% of f
Promotion
ROI 42% 3% -41% 5% -31%
$1,400,000
$1,200,000
$1,000,000
$800,000
$600,000
$400,000
$200,000
Prom o
Cost
($000)
$876,876
$868,669
$900,000
$368,577
$400,000
Promotion
10% of f of 1st
time customer
W SJ Ad
code: pr om o
M ag. Ad
code: sale
W eb Site
15% of f
Dir ect M ail
20% of f
ROI
42%
3%
-41%
5%
-31%
Jan
Profit
$432,536
$435,423
$243,534
$76,867
$98,590
Feb
Profit
$432,536
$435,423
$243,534
$76,867
$98,590
Mar
Profit
$432,536
$435,423
$243,534
$76,867
$98,590
Related Product ($000)
This report analyzes pro?t attributable to promotions, the cost of the promotion, and promotion ROI.
Sales and marketing managers use this report to understand sales impact, determine the effectiveness
of promotional efforts, and make decisions on future campaign design. Further analysis would reveal
those products with statistically signi?cant changes in sales as a result of each promotion, sales increase
by customer segment by promotion, or pro?t optimization varying dollar spend by channel.
68 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Overview
The report distribution, visualization, and advanced analytical capabilities required for supply chain
analysis demand an integrated reporting, analysis, and information delivery platform to distill
relevant information and deliver it to every party involved in optimizing the supply chain. The
following pages show the more common types of analyses enabled by MicroStrategy technology.
Key Anal ysi s Areas
Supply and Demand Planning
Manufacturing Scheduling
and Production Planning
Regulatory Management
Order Fulfillment
Strategic Sourcing and
Vendor Scorecards
Quality Control
Network Optimization
Call Center
Customers i n thi s
Area I ncl ude:
The Advisory Board
Company
Avon Products
dm-drogerie markt
Esteé Lauder
Faith Shoes
GT Nexus
Gucci
Hallmark Cards
Hudson’s Bay Company
The Katz Group
KB Toys, Inc.
La Rinascente
Liquor Control Board
of Ontario
Lowe’s Companies, Inc.
METRO Group
Michelin North America
Oakwood Homes
Porsche Cars
North America
Raley’s
Republic National
Distributing Company
Samsung Life Insurance
Sennheiser electronic
GmbH & Co. KG
Transportation Security
Administration
U.S. Postal Service
The predictable, reliable, and ef?cient movement of materials, components, and ?nished
products is critical to the success of every manufacturer, supplier, distributor, and retailer. The
importance of optimizing this supply chain has made supply chain analysis one of the fastest
growing business intelligence application areas. The proliferation of automated tracking systems,
supply chain transaction systems, and electronic data interchange (EDI) systems has contributed
to the rapid increase of data related to supply chain management. Business intelligence solutions
are required to turn these rapidly growing data stores into actionable information, allowing
managers and analysts to understand inventory trends, track vendor performance, analyze
distribution network ef?ciency, and respond more quickly and accurately to demand feedback
from the marketplace.
BUSINESS CHALLENGES SOLVED WITH BUSINESS INTELLIGENCE
Deploying vendor scorecards to manage inventory. Executives and trading partners require a
summary view of vendor performance versus plan for key business metrics such as on-time
and complete shipments. Scorecards integrate data elements from multiple sources into visual
representations of performance, such as graphs and gauges, to provide a complete picture of
supply chain performance at-a-glance.
Develop strategies to detect and mitigate fraud. Statistical quality control, process capability
studies, and acceptance testing allow managers to assess the quality of supply inputs and select
the most reliable sources. Users require an easy way to investigate complex manufacturing and
distribution processes using a full range of analytical and data mining functions.
Proactive alerts of product and material shortages. Production, sales, and supplier managers
need to review inventory levels broken down by both in-transit and ?nished goods location
on a programmatic and alert basis. Information must be delivered according to user-de?ned
business rules to their device of choice (Web, e-mail, pager) through data-driven thresholds
and schedules.
Sharing information securely with a distributed user community. Supply chain and back
of?ce operations have a diverse reporting population spanning geographies and time zones.
Information assets must be tightly secured, while allowing access via the Web, e-mail, and
Microsoft
®
Excel so the proper individuals can see the data for which they have privileges.
Supply Chain and Operations
“ Our customer base is very diverse
and a one-size-fits-all approach to
reporting and analytics does not work
for us. By embedding MicroStrategy,
we give our customers the ability to
build their own unique reports and
analytics. We conducted a thorough
assessment of BI products and it
was apparent, early on, that
MicroStrategy’s technology was
ahead of the game in many key
areas. We were particularly impressed
with MicroStrategy’s full-featured
Web interface with drag-and-drop
interactivity to meet the needs of our
diverse user population. Scalability
to handle volumes of data and an
integrated architecture for a seamless
user experience were two other
important decision criteria for us.”
Andy Stinnes,
VP of Products and Corporate Strategy,
GT Nexus
“ We selected MicroStrategy because
of its scalability, user-friendly Web
interface, and robust reporting
features that help us to make fact-
based decisions which impact our
bottom line. MicroStrategy provides
the ability for hundreds of concurrent
users to quickly retrieve and analyze
large volumes of detailed data and
efficiently monitor performance of
key business metrics.”
Tim Armstrong,
Director of Analytical Business Solutions,
KB Toys
> GT NEXUS
Identifying Ways for Companies to Reduce Costs and Improve Operational Ef?ciencies
In 2006, GT Nexus selected MicroStrategy to power the customer-facing analytics and reporting
capabilities on its Global Trade and Logistics portal. The GT Nexus portal is an on-demand
technology platform that is used by importers, exporters, transportation carriers, suppliers,
banks, and other partners to manage goods that are moving around the world.
The GT Nexus system captures and stores hard-to-get data associated with global supply chains,
and then fuels a range of Web applications that can be used by constituents to lower supply
chain costs and improve control. MicroStrategy will help GT Nexus to deliver a wide range of
analytics and reporting capabilities to its customers, which include Home Depot, Kmart, Xerox,
Weyerhaeuser, and American Eagle Out?tters.
By embedding MicroStrategy’s business intelligence technology into its portal, GT Nexus
enables customers to analyze their global supply chains and the performance of their
partners. With this data, GT Nexus customers can identify weak spots in their supply chain
and make analytically-based decisions that can reduce costs, improve operational ef?ciencies,
and enhance business performance.
> KB TOYS, INC.
Adding to the Bottom Line at the Nation’s Largest Mall-Based Specialty Toy Retailer
In 2007, KB Toys, Inc. selected MicroStrategy as its business intelligence platform. KB Toys, Inc.
is the nation’s largest mall-based specialty toy retailer.
Initially, KB Toys plans to use MicroStrategy for reporting on key merchandising and supply chain
metrics to improve the management of inventory from its vendors to its stores. MicroStrategy
will be used to manage product life cycles, track customer demand, and monitor inventory
levels through dashboards and exception reporting, enabling KB Toys to enhance customer
service levels while improving return on inventory.
“We are evolving our approach to buying, planning, product allocation, and store operations,”
said Frank Andryauskas, Chief Information Of?cer at KB Toys. “MicroStrategy will enable us
to better understand inventory trends, track product demand, and analyze the ef?ciency of
store operations.”
CUSTOMER VIGNETTES: IMPLEMENTING BI FOR SUPPLY
CHAIN AND OPERATIONS
MicroStrategy: Best in Business Intelligence 69
70 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Supply Chain and Operations
Key Performance
I ndi cators
Predicted Demand
Required Materials
Supply on Hand
Geographic Trends
Pricing Analysis
Inventory Turn Rate
% Change to Sales Forecast
Days on Hand
Supply and demand planning is continuously performed during the manufacturing and
distribution process to ensure planned production will meet forecasted demand and the
appropriate amount of raw materials and goods are available for production runs. Beyond basic
analysis of current supply and past demand, supply and demand planning requires predictive
modeling, statistical forecasting, and the ability to drill into demand detail by region, customer
segment, or product category. Shortfalls in supply can be detected or predicted, with automatic
alerts sent to managers or triggering a reorder process.
Sample Report: Product Demand and Component Inventory
Supply and Demand Planning
COMMON BUSINESS QUESTIONS
• What materials are used in the production of each product?
• How many products by type did we sell over the last five years?
• What was the geographic demand for our products?
• How many suppliers do we rely on for our products?
• Does regional manufacturing capacity align with demand?
• How is demand impacted by seasons?
• Which material(s) have the most price volatility by vendor?
• What customers will demand which products? Are there customer segment patterns?
T itanium Driver: Product Demand and Component Inventor y
Pe riod: Q3 2007
Comp 4 Comp 5
Product A
Product B
Product C
2
2
15094
28999
Forecast Demand (units )
2835
4712
1372
Comp 3
6
28272
36899
Comp 2
1
2
5579
4892
reorder
Comp 1
4
1 1340
13688
5
3
4
33799
291 12
reorder
T otal Components Required
I nventory on Hand
This sample report tracks forecasted demand to required product components. Combining the forecasted
demand with actual inventory on hand, the report highlights areas where inventory shortfalls are present.
This type of report can be generated daily and e-mailed to a Production Manager or be part of a dashboard
as a starting point for planning production. HTML links in the report allow users to drill into components to
determine why there is a shortfall, identify the suppliers, and quote prices of the items required in order to
meet production schedules. Reorder links allow immediate action to ensure correct supply.
MicroStrategy: Best in Business Intelligence 71
Manufacturing planning encompasses the hourly/daily/weekly/monthly production and
machine schedules across multiple plants or production lines to meet orders or forecasted demand.
Success hinges on accurate materials planning. Manufacturing managers, product managers, and
purchasing analysts review metrics such as production capacity and current inventories to plan
appropriate production schedules, ensure raw material availability, and make plant reallocation
decisions when appropriate. Basic analysis includes real-time status of plant utilization and trends
in market demand versus planned production runs. Advanced analysis includes hedging analysis
on commodities used in production, forecasting of machine output, and linear programming to
optimize production resources.
Sample Report: Utilization and Capacity Analysis
COMMON BUSINESS QUESTIONS
• What are the current machine utilization rates?
• Which plants/lines are operating with excess capacity?
• What percent of forecast is represented by planned manufacturing capacity?
• How much product(s) do we need to produce to meet existing demand?
• How much product(s) do we need to produce to meet anticipated demand?
• What are the planned machine/line downtimes and how will they affect product supplies?
• Which products are scheduled to have a major update this year? Will we be able to meet the
new demand?
Key Performance
I ndi cators
Production Capacity Trends
Projected Inventory Surplus
Days on Hand
Production Shortage as %
of Demand
Inventory Turn
Production Cycle
Equipment Utilization %
Manufacturing Scheduling and Production Planning
Model Line XYZ Current Production and Plant Utilization
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Plant 1 Plant 2 Plant 3 Plant 4 Plant 5
U
t
i
l
i
z
a
t
i
o
n
Forecasted Demand 485,000
Plant 1
Plant 2
Plant 3
Plant 4
Plant 5
Capacity
125,000
120,000
100,000
140,000
100,000
Current Production
112,500
48,000
100,000
119,000
75,000
Model XYZ Summary
Total 585,000 454,500
Shortfall with Current Production 30,500
This report summarizes current production for Model XYZ and combines it with the product demand
forecast showing a potential shortfall at the current output levels. This type of report helps managers
optimize ?xed investments in plant and equipment by keeping them running near 100% of capacity and
working to meet market demand. A next level of analysis would be to drill into the production status
of Plant 2 to determine what other products are being produced there, the margins on these products
versus Model XYZ, and market demand for the products being produced at Plant 2.
72 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Supply Chain and Operations
Key Performance
I ndi cators
Variance to Expected Outcome
Top 10 Malfunctions
Top 10 Side Effects
Variance to Acceptable Levels
Average Result of All Tests
Predicted Outcome
Statistical Significance
of Results
Standard Deviation of Results
Many industries must operate in tightly regulated environments with government reporting
and substantiation of ?lings critical to product and service delivery. Manufacturers, transportation,
defense, consumer goods and food, pharmaceutical, telecommunications, ?nancial services,
insurance, and utilities are just a few of the industries that must furnish regulatory information.
Engineering, manufacturing, and legal professionals perform analyses on performance against
predetermined and internal standards. Business intelligence provides basic analyses such as
performance versus standard levels as well as statistical signi?cance of acceptance or failure rates.
Sample Report: Clinical Trial Results, HIPAA Compliant
Regulatory Management
COMMON BUSINESS QUESTIONS
• What is my product’s performance versus approval standards?
• What clinical trials are currently underway?
• What is the user acceptance rate of a new product?
• Are any products in noncompliance with government or industry standards?
• How do trial results vary from expectations?
• Can these results be extrapolated to the general user population?
• What are the countries of origin for all my production components?
• What countries have we sold products to? Where are service calls coming from?
Patient Code Gender Group
6 Mo.
Effectiveness Rate
Patient Reported
Side Effects
P1102 M Test 90% None
P1105 F Control N/A None
P1107 F Test 70% Nausea
P1110 F Test 95% Slight nausea on one occasion
P1117 M Test 50% Nausea, sleeplessness, cough
P1118 M Control N/A Cough
P1122 F Test 88% Sleeplessness
P1124 M Control N/A None
P1125 F Test 86% Occasional nausea
Clinical Trial: A2B3452 6
This reports shows a sample of the results of a clinical trial for a new drug compound, and is a good
example of a report containing mostly qualitative data. Due to HIPAA and con?dentiality requirements,
patient identities have been masked, but a Clinical Manager can see who received a trial drug versus
placebo, the patient’s gender, and reported side effects. A next level of analysis is drilling into the details
on the side effects for each patient during monthly visits -- the same as drilling into individual transactions
with other analyses. While this example addresses regulatory needs in the pharmaceutical industry, the
concept can easily be adapted to meet the needs of a manufacturer with regulatory requirements.
MicroStrategy: Best in Business Intelligence 73
Logistics and operations managers analyze total processing time from order to ful?llment, the
variances between the original order and the delivered goods, and the business impact of goods
that are returned, damaged, or delivered incorrectly. The customers’ ability to track the status
of orders adds to satisfaction and ensures orders are accurately and promptly ful?lled as placed.
Reporting on the status of orders, tracking the time to ful?llment across product categories and
geographies, and analyzing the variance in delivery costs versus standards are ?rst steps in order
ful?llment reporting applications. Advanced analyses include trending performance against
service levels, drilling into individual orders across ful?llment metrics, and performing time series
analyses on ful?llment steps to optimize results.
Sample Report: Order Ful?llment Performance by Region
COMMON BUSINESS QUESTIONS
• What is the average total order processing time?
• What percent of orders were delivered on time?
• What customers have the most delivery delays? The least?
• What are the trends in fulfillment across product line and geography?
• How many items are in the backlog?
• What is the average delivery time?
• Was there a variance between the quantity ordered and the quantity delivered?
• Which orders are in transit?
• Do we have delivery confirmation for all of today’s deliveries?
Key Performance
I ndi cators
Backlog Moving Average
Trend in Delivery Time
% Orders Returned
Trend in Delivery Method
% Delivered on Time
Variance in Delivery vs. Order
Order Ful?llment Analysis
Cases Ordered
(000)
% Delivered
on Time
# Cases
Damaged (000)
% Cases
Damaged (000)
Lost Sales Due to
Stockouts (000)
Trend in Performance
vs. Last Month
North America 4,587 98% 11.8 0.257% $ 97.74 ?
Latin America 5,645 97% 20.1 0.356% $169.35 Ú
Europe 6,587 96% 12.3 0.187% $263.48 Ò
Asia 4,198 92% 6.6 0.157% $335.84 Ú
Chicken Soup (12oz.) Ful?llment Analysis - May 2007
This report summarizes information on the ful?llment results across regions for a particular product,
highlighting anomalies, and providing a visual snapshot of performance trends. An operations analyst
will use this report to determine regional performance and determine if steps need to be taken to
mitigate lost sales and damaged goods. From the links embedded in the report, users may look at
regions to determine causes for lost sales, including supply shortages, impact of new packaging, or
variation in performance of delivery methods – rail, sea, air, or truck.
74 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Supply Chain and Operations
Key Performance
I ndi cators
Inventory Turnover Rate
Price Variance to Order
# Stockouts Prevented
Days Until Reorder
Vendor Quality Rating
Product Delivery Date Variance
Vendor Quality Ranking
Top 5 Stockout Suppliers
Manufacturers analyze vendor performance at all entry points in the supply chain. Vendor
scorecards allow both a customer and vendor to compare performance against agreed upon
accuracy and delivery time service levels. Logistics, supply, purchasing, ?nance, and manufacturing
analysts and managers use this information to analyze the customer-supplier relationship and
ensure that the correct products and materials get to the right place at the right time – saving time
and money. Standard analysis focuses on tracking inventory levels, ranking vendor performance,
and showing the status of orders. Optimization techniques include predicting vendor performance,
based on past behavior, proactive alerts of potential stockouts and delivery status, and optimizing
scenarios for different sourcing mixes.
Sample Report: Vendor Performance Scorecard
Strategic Sourcing Analysis and Vendor Scorecards
COMMON BUSINESS QUESTIONS
• How many times have orders been placed with this vendor in the last year?
• How many different employees ordered from this vendor?
• What is the total dollar value spent with this vendor year over year?
• What is this vendor’s on-time delivery percentage?
• What is a vendor’s performance against predetermined performance metrics?
• Has this vendor been late to deliver in the past?
• Who are the top three low-cost bidders for a particular product?
• What components have the most price volatility over the last two years?
• Who are the suppliers with the most price volatility?
Month
Numer of
Shipments in Period
%
Complete
%
On Time
% On Time and
Complete
Vendor
Performance Rating
TARGETS ? 95% ? 95% ? 90% ? B%
April 542 98% 95% 94% A-
May 654 96% 92% 91% B+
June 602 96% 85% 82% C
Vendor: Oceans Soda Company
Reporting Period: Q2 2007
This vendor scorecard highlights summary performance of a single vendor, Ocean Soda Company, for the
desired reporting period with thresholding (red) used to show where performance deviates from Service
Level Agreements (SLAs). Sales, purchasing, logistics, and ?nance professionals both internally and at the
vendor organization will use this scorecard to monitor performance.
MicroStrategy: Best in Business Intelligence 75
To ensure ?nished products adhere to an organization’s quality standards while minimizing
costs, companies use business intelligence to develop product and component sourcing
scenarios. Managers and analysts in manufacturing, procurement, and customer service rely on
quality reporting to determine if a production run needs to be halted, to determine if a vendor
is having increased quality problems, or to identify customers who need to be contacted for a
recall. Understanding which products need to be recalled by production time or run, trends in
quality, and the costs of defects are ?rst-order analyses in quality control. Statistical sampling and
analysis on defect rates, proactive alerts sent to production managers when quality thresholds are
exceeded, and the ability to track the location of any component in a product in real-time are the
functions enabling companies to achieve true competitive advantage.
Sample Report: Quality Control Metrics by Product and Supplier
COMMON BUSINESS QUESTIONS
• What percentage of product is defective?
• How many of each product had to be discarded for defects?
• What dollar value did the discarded inventory represent?
• What is the standard deviation of quality ratings?
• What suppliers are linked to defective products?
• What are my defect rates compared to this same period last year?
• What is the trend in product quality?
Key Performance
I ndi cators
Overall % Defective
$ Value of Defective Product
# of Defects that Reached
Customers
Top 5 Vendors with
Components in Recall
Potential Cost of Recall
% Change in Quality Year
over Year
Top 10 Vendors with Lowest
Defect Rate
Customer Ranking by #
Exchanges
Top 5 Facilities in Quality
Production
Quality Control
Product
Total 2006
Production
2006 #
Defects
Defect
Rate
Production
Cost/Item
Total $ Loss
on Defect
Production
Defective
Part ID
Defective Part
Vendor
ABC 1,254,648 25,094 2% $50.26 $1,261,208 456 Jones Corp.
DEF 45,789,633 1,373,689 3% $25.29 $34,740,595 123 Smith Corp.
GHI 3,246,323 162,316 5% $30.54 $4,942,527 789 Smith Corp.
TOTALS 50,290,640 1,561,099 3% $40,944,330
Product: DEF Quarterly Defect Summary Production Run Units Produced Defects Defect Rate
Supplier: Smith Corporation Run 1 15,263,211 346,578 2.27%
Run 2 14,195,120 472,598 3.33%
Run 3 13,582,487 326,798 2.41%
Totals: 43,040,818 1,145,974
Production Summary
This report demonstrates a simple quality analysis that highlights the material defect rates and costs to
the organization, with details of one of the production runs. With user-de?ned thresholds, a ?nancial,
operations, or supplier analyst can perform this type of analysis to see if there are immediate problems
that need to be addressed or in preparation for discussions with a vendor on the quality of product
supplied. A next level of analysis would be to drill into individual production runs to determine if a
particular product run had a statistically signi?cant defect rate, or drill into the details of all products
supplied by a particular organization that may be having quality problems.
76 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Supply Chain and Operations
Key Performance
I ndi cators
% of Capacity
Utilization Rate
Top 10 Assets Serviced the
Most? The Least?
Trend in Maintenance Costs
Predicted Network Downtime
Variance to Standard
Network Capacity
Top 5 Production Bottlenecks
Developing a robust manufacturing and supply distribution network requires a large capital
investment. Manufacturing managers monitor machine utilization rates, capacity versus
demand, and load versus defect rates to optimize production lines. In communications networks,
information technology managers continuously monitor switches, channels, and the overall
network to determine usage rates, balance load, and plan capacity investments. Metrics often
tracked include infrastructure availability, up-time, and utilization. Predictive analysis is used to
determine future infrastructure requirements, and “what-if” analysis shows the tradeoffs of
different con?guration and load scenarios.
Sample Report: Network Performance and Downtime
Network Optimization
COMMON BUSINESS QUESTIONS
• What is the network utilization versus downtime?
• What percent of capacity is this location operating at on average?
• What is the trend in volume over the past year?
• How much downtime do we experience per month?
• What is the maximum traffic our network can handle?
• What machines require maintenance today? This week? This month?
• What machines are nearing the end of their productive life?
• What will our required network investments be next year?
Number of Outages
J an F eb M ar Apr M ay Jun Jul Aug Sep O ct N ov D ec Jan F eb Ma r Apr
06 06 06 06 06 06 06 06 06 06 06 06 07 07 07 07
Duratio n
# of O utages
14:00
12:00
10:00
8:00
6:00
4:00
2:00
0:00
#
o
f
O
u
t
a
g
e
s
10
9
8
7
6
5
4
3
2
1
0
D
u
r
a
t
i
o
n
o
f
O
u
t
a
g
e
s
This report demonstrates the trend in the number and duration of plant/network outages over a 16-month
window. The positive trend can be the result of a number of factors including a completed modernization
effort, increased training, or more proactive maintenance. By viewing this report, an operations, information
systems, or production analyst can see the amount of time lost due to outages and drill into the months
where there were anomalies. Typical follow-on analysis includes comparing ROI of upgrade/training/
maintenance (costs versus increased product sales or productivity measures), drilling into the cause and
location of outages, or implementing a proactive noti?cation process whenever there is downtime.
MicroStrategy: Best in Business Intelligence 77
Because of their low cost per touch, call centers have become an increasingly important customer
touchpoint for many businesses. Changes in call volumes, response times, and satisfaction levels
are all key to understanding the ef?ciency and ef?cacy of call center operations. Customer service
and telecommunications managers analyze these metrics to determine staf?ng levels, plan for
infrastructure investments, and ensure proper customer satisfaction levels. Basic reporting delivers
scorecards on call volume, response times, and call duration. Advanced analysis involves individual
call detail access, predictive modeling on staf?ng and infrastructure requirements, and analysis of
call volume by geography, customer segment, or product ownership.
Sample Report: Call Duration Trend Report
COMMON BUSINESS QUESTIONS
• What is the trend in call volume this month?
• What is my blocked call rate?
• How does the average response time compare to this month last year?
• How much capacity will be required next year if we continue at this rate?
• What products/services are inbound callers most frequently requesting?
• Which employees take the most calls?
• Which employees spend the longest time on the phone per customer?
Key Performance
I ndi cators
Variance in Call Volume by
Customer Segment
Average Response Time
Forecasted Call Volume
Average Call Length
Call Type (Sales, Service) as %
of Total Inquiries
Top 10 Customer Service
Representatives
Top 100 Customers by #
Inbound Calls
Average Number of Outbound
Calls to Sell a Product
Change in Customer
Satisfaction Rating
Call Center Analysis
January Incoming Call Duration Analysis
5-14 min
15-29 min
30-44 min < 4 min
< 5 min
Call Type: > 45 min
Sales 24%
Service 66%
General Info 10%
This report shows the breakdown of incoming call volume for a user selected time period. By drilling
into any of the pie sections, an operations or customer service analyst can determine the types of calls
in the duration segment. Further analyses of interest might be departments to which calls were routed,
individual agent activity records, or call duration for different customer segments.
78 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Web Site Analysis
Overview
Key Anal ysi s Areas
Web Traffic
Web Visitors
Web Navigation
eCommerce
Customers i n thi s
Area I ncl ude:
AutoTrader.com
Barnesandnoble.com
Brickstream
Corporate Express
Cortal Consors
eBay
Edmunds.com
La Caixa
Monster.com
Netflix
Nygard International
Ohio Department
of Education
Priceline.com
Quixtar
Sprint
Telefónica
Vodafone
Yahoo!
Companies study Web site visitor activity to understand customer and prospective buyer
interests, improve Web site design and navigation, and increase the pro?tability of the online
sales process. By tracking and analyzing Web traf?c patterns, site navigation, page views, and
transactions, online marketers can design more compelling Web sites and give visitors better
incentive to buy and return. With the low switching costs present on the World Wide Web,
companies know that a visitor’s experience must offer enough value to induce repeat visits.
Companies rigorous in their analytical approach to online merchandising and/or sales are
realizing lower marketing costs, higher online revenue, and improved customer loyalty.
BUSINESS CHALLENGES SOLVED WITH BUSINESS INTELLIGENCE
Investigate online visitor behavior trends to optimize Web site design. Web site design must be
optimized to induce speci?c visitor actions, for example, completing checkout once items have
been added to a shopping cart. BI allows paths of interest to be de?ned and tracked, related
pages to be grouped into a single de?ned interest area, and customer data to be combined
with Web traf?c data to better understand the behavior of particular visitor segments.
Combine of?ine and online customer detail to uncover marketing opportunities. Combining
Web log information with customer information from other corporate systems provides
marketers a unique opportunity to connect customers to page views, allowing offers to include
items speci?cally known to have been viewed by the customer. Business intelligence not only
enables this identi?cation process, but automatically creates and delivers targeted offers through
the Web, e-mail, and wireless devices.
Understand marketing campaign effectiveness through tracking of online results. Marketing
campaigns with Web-based calls-to-action can be effectively tracked near-real-time through
Web data analysis. E-mail, Web site, and other banner ad campaigns tagged with campaign
identi?ers can be tracked from click-through to response to closed sale. Understanding the
relative effectiveness of list targets, creative design, and offer content allows marketers to
optimize their marketing spend.
Provide real-time alerting of Web traf?c performance indicators and anomalies. Web site managers
must be noti?ed immediately when a Web site goes down. Other traf?c pattern and transaction
changes can indicate navigation problems, merchandising errors, and personalization errors. BI
provides statistical measures of traf?c, conversions, and page views relative to average for a de?ned
time period, and automatically alerts managers of anomalies based on prede?ned thresholds.
MicroStrategy’s unique ability to handle the growing volumes of Web data and combine it with data
from across the enterprise have won the business of many of the world’s most prestigious online
companies, including Yahoo! and eBay. The following pages review some of the most common areas
of Web data analysis and the benefits BI offers when applied to Web log data.
“ eBay selected MicroStrategy
because of its exceptional user
scalability and its ability to support
advanced reporting and analysis.
MicroStrategy also provides
excellent query performance with
our rapidly growing multi-terabyte
data warehouse.”
Brad Peterson,
CIO,
eBay
“ We were looking for a business
intelligence product that provides
excellent query performance
against our rapidly growing multi-
terabyte data warehouse. With
MicroStrategy, our marketing team
will have the information they
need to make strategic, data-
driven decisions to help drive
business growth.”
Ron Rose,
CIO,
Priceline.com
> eBAY
Providing Excellent Query Performance for a Rapidly Growing Multi-Terabyte
Data Warehouse
eBay relies on the MicroStrategy platform to analyze the ongoing performance of the many
different categories of products and services for sale on its Web sites. On any given day, there
are more than 16 million items listed on eBay across 27,000 categories.
> PRICELINE.COM
Enhancing Marketing Campaigns to Help Drive Business Growth
Priceline.com has chosen MicroStrategy to anchor key marketing reporting capabilities.
Priceline.com is an Internet-based travel service that offers leisure airline tickets, hotel rooms,
rental cars, vacation packages, and cruises.
Priceline.com selected MicroStrategy to enhance its analytic and reporting capabilities and provide
greater insight into key operational data for search engine marketing. With the ability to obtain
and analyze granular data, Priceline.com marketing analysts will have actionable data that they
can use to improve the return-on-ad-spend of its search engine marketing campaigns.
MicroStrategy was selected by Priceline.com for its Web-based platform, data and user
scalability, advanced reporting and analytical capabilities, and integrated metadata for
automated maintainability.
> YAHOO! INC.
Providing a Complete Understanding of Online Interactions
Recently, MicroStrategy customer Yahoo! expanded its use of the MicroStrategy Business
Intelligence Platform. For these new applications, MicroStrategy was selected primarily because
of its powerful analytics.
Yahoo! uses MicroStrategy’s software for customer analysis, sales analysis, advertising assessments,
and transaction activity reviews. Yahoo! Inc. is a leading provider of comprehensive online products
and services to consumers and businesses worldwide. Yahoo! is the No. 1 Internet brand globally
and the most traf?cked Internet destination worldwide.
CUSTOMER VIGNETTES: IMPLEMENTING BI FOR
WEB SITE ANALYSIS
MicroStrategy: Best in Business Intelligence 79
80 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Web Site Analysis
Key Performance
I ndi cators
Page View Count
Session Count
Unique Visitor Count
Average Session Depth
Average Session Duration
Click-through Count
Page Ranks
The analysis of Web traf?c metrics such as page views, visitor count, visit duration, and click-
throughs provide the most basic understanding of the attractiveness of a corporate Web site.
Traf?c trends are often ?rst reviewed for the Web site homepage and then for various major Web
subsections, portals, and microsites. Time-based traf?c comparisons highlight cyclical, seasonal,
or day-of-the-week visitation variations that can in?uence when new Web content should be
posted. Generally, Web traf?c analysis provides a good ?rst order indication of the effectiveness of
a company’s marketing message, since increased market awareness tends to drive additional Web
visits. Business intelligence additionally provides an early warning system for Web site availability
or design problems, as it is able to alert Web administrators when traf?c is unusually light. Overall,
Web traf?c analysis provides a better understanding of the level of interest in a company and its
offerings, helping marketers tune their messages to increase prospect and customer visitation.
Sample Report: Web Traf?c Trends by Content Section
Web Traf?c Analysis
COMMON BUSINESS QUESTIONS
• What is the trend in the number of unique visitors across corporate Web sites over the past year
for a particular visitor segment?
• Are there any unusual, non-seasonal changes or trends that need further investigation?
• What are the peak hours for Web traffic each weekday versus the weekend?
• Is there a correlation between changes in Web site design and Web site visitor activity?
• Which landing page has been the most active over the past year?
• Is there a correlation between Web site performance and visitor retention and/or attrition?
• What is the online behavior of the most valuable segment of my offline customers?
400K
350K
300K
250K
200K
150K
100K
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Month
Product
Launch
Customer
Promotion
Homepage
Redesign
New
CEO
Sections of website
Product
Services
Customers
Company
This report shows the trend of Web site visitors for different sections of a corporate Web site, overlayed with
some major corporate and marketing events. Marketing managers can determine the impact of speci?c
events on overall market interest, the effectiveness of campaigns on driving behavior, and the impact
of Web design on navigation paths. This overall picture leads to detailed visitor analysis of competitor,
customer, prospect, and investor segments, conversion to leads, and page stickiness. Proactive alerting of
signi?cant out-of-trend session numbers can also notify Web system managers of potential service issues.
MicroStrategy: Best in Business Intelligence 81
In order to better understand the needs of prospects and customers, companies often pro?le
individual Web visitors and analyze their visitation patterns. This visitor analysis and segmentation
is used to drive marketing campaigns, such as targeted cross-sell or up-sell campaigns, as well
as Web site design optimization. Accurate visitor pro?ling requires a combination of input
variables, from length of stay to page views to paths, combined with customer characteristics
and transactional history from the Web site and other customer touchpoints. “Stickiness” is a
common term used to characterize the attractiveness of a site, section, or page, and is measured
by the average number of page views, session duration, and page depth. In addition, Web visitors
identi?able through login or cookies may be tied to customer data from other systems to create
personalized campaigns by customer segment or by individual customer. Business intelligence
applied to Web visitor analysis is being used to feed campaign management systems for these
highly personalized and automated campaigns.
Sample Report: Web Visitor Breakdown by Segment
COMMON BUSINESS QUESTIONS
• What is the success rate in converting “visitors” to “repeat visitors” to “customers”?
• Which ad banners and other referrals are attracting the most qualified visitors?
• Is my defined target audience actually the majority of visitors I’m attracting?
• How often do my online customers also purchase offline?
• How effectively am I driving my offline customers to transact through my Web site?
• What is the demographic profile of visitors who have viewed Product X?
• What products are being viewed by customers who have purchased Product Y?
Key Performance
I ndi cators
Page Views
Traffic Counts
Visitors
Frequency
Click-throughs
Stickiness
Conversions
Referrals
Banner
Keyword
Web Visitor Analysis
100%
80%
60%
40%
20%
0%
Total Visitors
%
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Q1 2007 Q2 2007
8,392 7,037
Strangers (%)
Friends (%)
One-time Customers (%)
Loyal Customers (%)
Former Customers (%)
In the above example, even though the number of total visitors to this corporate Web site has decreased
from Q1 to Q2, the number of repeat visitors, termed “friends,” is increasing. This segment, now
familiar with the corporate message, may be ready for a purchase solicitation. The fact that visits by
“strangers,” or new visitors, are decreasing suggests prospecting tactics are becoming less effective.
82 Applications of Industrial-Strength BUSINESS INTELLIGENCE
Web Site Analysis
Key Performance
I ndi cators
Page Views
Visits
Visitors
Click-throughs
Conversions
Ranks
Visit Type
Banner
Search Keyword
Domain
A corporate Web site typically consists of many navigation paths and hierarchies stemming
from the site’s homepage. Whether the primary goal of the Web site is information dissemination,
lead generation, or actual product purchase, the paths of a Web site may be monitored to
determine whether Web visitors are taking a desired course of action. Web navigation analysis
studies the relative attractiveness of a Web site’s navigation paths to optimize site navigation
structures and to determine customer interest in speci?c content. Navigation analysis combines
individual and aggregate visitor activity, key-word search results, banner ad clicks, purchase
transaction activity, and page view duration. Optimization of site navigation is having a direct
impact on conversion of “lookers to bookers,” increasing the number of visitors that either
complete a transaction or stay engaged long enough to receive a desired message.
Sample Report: Campaign Effectiveness on Product Views
Web Navigation Analysis
COMMON BUSINESS QUESTIONS
• How effective are each of my banners at attracting visitors to my Web site?
• How are first time visitors using my site versus repeat visitors?
• How can I optimize page sequences for best conversion rates?
• What pages cause visitors to drop out?
• Is my image placement creating enough click-throughs to justify the real estate use?
• What is the average download size and time of my pages?
Pr oduct s
Web Ser ver
Repor t Wr i t er
Dat a Agent
Dat a Mi ner
7, 416
2, 654
1, 547
2, 569
646
6, 671
1, 254
2, 187
3, 230
25, 417
8, 965
2, 541
1, 756
1, 285
3, 658
2, 266
2, 365
852
1, 258
541
123
443
Consul t i ng
Educat i on
Suppor t
Ret ai l
Fi nanci al Ser vi ces
Telecommunications
Manuf act ur i ng
Ent er t ai nment
Over vi ew
Car eer s
Event s
Locat i ons
Pr ess
Ser vi ces
HOMEPAGE
Cust omer s Company
Web Navigation Analysis Week Ending: August 17, 2007
This report shows the Web page navigation paths for a selected week. A Web marketer or editor can use
this information to determine the logic taken by visitors to their Web site and the popularity of Web pages.
Further analysis can determine the pages that are exited most often, most popular calls to action invoked
by page, and referring source to the page.
MicroStrategy: Best in Business Intelligence 83
Web site transaction analysis (also commonly referred to as eCommerce analysis) provides insight
into the effectiveness of the online sales transaction process. In industry parlance, companies try
to convert “lookers to bookers” and use business intelligence to identify points of customer
attrition in the online transaction process. Analysis of the abandonment rate of shopping carts
is the ?rst step in optimizing the checkout process to convert more sales to closure. “Market-
basket” analysis of products being bought together allows marketers to execute targeted follow-
up campaigns to customers or present in real-time banners offering products associated with
items in a shopper’s cart. Given the low switching costs of Web purchasing, a site must create
value for the visitor, provide him with relevant, personalized information, and make it easy to
move from browsing to buying.
Sample Report: Abandonment During Checkout Process
COMMON BUSINESS QUESTIONS
• How many people abandon their shopping cart before check-out?
• What was my gross conversion rate of lookers to bookers?
• Which are my best selling products online?
• Which are my most profitable products sold online?
• Which online products sell well together?
• What percentage of up-sell opportunities closed?
• What percentage of online products were bought as a result of an e-mail promotion or campaign?
• For a visitor viewing a certain item, which items should be merchandised on the page based on
past visitor buying behavior?
Key Performance
I ndi cators
Abandonment Rate
Avg. Session Time
# Repeat Visitors
# New Visitors
# Unique Visitors
Avg. # of Pages per Session
Conversion Rate
Lookers to Bookers
eCommerce Analysis
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Customer Detail > Abandoned Shopping Carts
Customer
Jesse Smith
John Johnson
Haley Wilson
Michelle Wright
Jim Patterson
Earl Greene
6,000
5,000
4,000
3,000
2,000
1,000
0
[email protected]
[email protected]
[email protected]
[email protected]
[email protected]
[email protected]
Product(s) Abandoned
Blue sandals
Red silk scarf, umbrella
Silver tie, cuff links
Leather boots
Socks, black slacks
White tennis shoes
Opt-in
Y
Y
N
Y
Y
N
Checkout Process
#
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The following report illustrates the number of people who abandoned the online shopping process at
various stages. Each stage can be de?ned by the user to include any number of pages and links in the
purchase process. Web marketers can analyze this information to make decisions about Web site design
based on abandonment rates. A next step would be to develop targeted campaigns (electronic and postal)
to individuals who abandoned the buying process, promoting items contained in their shopping carts.
INDEX
FINANCE, 28
Accounts Receivable and Payable Reporting
and Analysis, 33
Balance Sheet Reporting and Analysis, 30
Cash Flow Analysis, 32
Financial Budgeting and Forecasting, 34
Profit and Loss/Income Statement Analysis, 31
Risk Management, 35
HUMAN RESOURCES, 36
Benefits Administration Reporting, 42
Career Path Reporting and Analysis, 41
Compensation Reporting and Analysis, 39
Employee Expense Reporting, 40
Headcount Trend Analysis, 38
Time and Labor Management Reporting, 43
SALES FORECAST, 44
Channel Analysis, 47
Competitor Analysis, 48
Sales Force Performance Reporting, 49
Sales Pipeline Reporting and Analysis, 46
CUSTOMER RELATIONSHIP MANAGEMENT, 50
Campaign Analysis, 57
Customer Aquisition, Retention, and Attrition
Analysis, 55
Customer Cross-Sell Analysis, 54
Customer Profitability Analysis, 53
Customer Scorecards, 59
Customer Segmentation Analysis, 52
Customer Service Analysis, 58
Loyalty Analysis, 56
PRODUCT SALES, 60
Category Performance Analysis/Category
Management, 62
Discounts and Promotions Analysis, 67
Fraud Analysis and Loss Prevention, 65
Inventory Analysis, 63
Merchandising Analysis, 64
Product Scorecards, 66
SUPPLY CHAIN AND OPERATIONS, 68
Call Center Analysis, 77
Manufacturing Scheduling and Production
Planning, 71
Network Optimization, 76
Order Fulfillment Analysis, 73
Quality Control, 75
Regulatory Management, 72
Strategic Sourcing Analysis and Vendor
Scorecards, 74
Supply and Demand Planning, 70
WEB SITE ANALYSIS, 78
eCommerce Analysis, 83
Web Navigation Analysis, 82
Web Traffic Analysis, 80
Web Visitor Analysis, 81
CUSTOMER VIGNETTES
Boots The Chemists, 51
Charming Shoppes, Inc., 29
Corporate Express, 45
Darden Restaurants, Inc., 37
eBay, 79
GT Nexus, 69
Hallmark Cards, 61
KB Toys, Inc., 69
Lowe’s Companies, 61
Netflix, 51
Priceline.com, 79
State of Tennessee, 29
The University of Miami, 37
U.S. Borax, 45
Yahoo!, 79
84 Implementing Industrial-Strength BUSINESS INTELLIGENCE
The future of business intelligence is limitless.
” “
COLL-0738 0907
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PATENT INFORMATION
This product is patented. One or more of the following patents may apply to the product sold herein: U.S. Patent Nos. 6,154,766, 6,173,310, 6,260,050, 6,263,051, 6,269,393,
6,279,033, 6,501,832, 6,567,796, 6,587,547, 6,606,596, 6,658,093, 6,658,432, 6,662,195, 6,671,715, 6,691,100, 6,694,316, 6,697,808, 6,704,723, 6,707,889, 6,741,980,
6,765,997, 6,768,788, 6,772,137, 6,788,768, 6,792,086, 6,798,867, 6,801,910, 6,820,073, 6,829,334, 6,836,537, 6,850,603, 6,859,798, 6,873,693, 6,885,734, 6,888,929,
6,895,084, 6,940,953, 6,964,012, 6,977,992, 6,996,568, 6,996,569, 7,003,512, 7,010,518, 7,016,480, 7,020,251, 7,039,165, 7,082,422, 7,113,993, 7,127,403, 7,174,349,
7,194,457, 7,197,461, 7,228,303, 7,260,577, 7,266,181 and 7,272,212. Other patent applications are pending.
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