Description
Business Intelligence is defined as "knowledge ained about a business through the use of various hardware/software technologies which enable organizations to turn data into information”.
®
IBM Software Group
© 2007 IBM Corporation
Introduction to Business Intelligence
Vince Leat
ASEAN SW Group
IBM Software Group
2
Discussion
What is Business Intelligence
BI Vision Evolution
Business Intelligence Environment
Characteristics of Successful Business Intelligence
IBM Software Group
3
What is Business Intelligence?
Business Intelligence (BI) is:
“The processes, technologies and tools needed to turn data into
information and information into knowledge and knowledge into plans
that drive profitable business action. BI encompasses data
warehousing, business analytics and knowledge management.”
The Data Warehouse Institute, Q4/2002
Business Intelligence is defined as "knowledge gained about a business
through the use of various hardware/software technologies which
enable organizations to turn data into information”.
Data Management Review
IBM Software Group
4
According to a recent CEO survey, responding
efficiently to market conditions & differentiated
products are their key priorities.
0% 20% 40% 60% 80% 100%
Disaster Management
Sourcing
Strategic Partners
Employee Needs
IT Performance
Organization
New Products / Services
Operational Efficiency
Business Model
Differentiated Products
Rapid Response
Source: IBM Business Consulting Services, The Global CEO Study 2004
0% 25% 50% 75%
Other
Implement/leverage CRM processes and applications
Empower front-line employees
Track competitor trends and actions
Create adaptable processes that allow real time response
Vehicles to capture customers / consumers
needs/preferences
Capture and utilize customer information for swift
decisions
Key CEO Priorities
…with strategic usage of customer
information & processes as the key enabler…
…with strategic usage of customer
information & processes as the key enabler…
IBM Software Group
5
Another recent survey by “The Asian Banker” rates
customer knowledge as key capabilities for
competitive advantage.
What are the key capabilities to achieve a competitive advantange in over the next 5
years?
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A
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“Survey on strategic information challenges faced by the best retail banks in Asia”, May 2005
If you could only have one competitive advantage what would it be?
0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%
A Low Cost Base Innovative Products Service CustomisationCRM / Customer
Knowledge
IBM Software Group
6
Business Intelligence (BI) allows us to use data
strategically in responses to challenges and drive
profitable business actions.
Efficiency
“minimize the cost of selling/servicing the
customer …”
Effectiveness
“real-time access to customer information
across every point of contact… at the line-of-
business…”
Differentiation
“ability to proactively manage opportunity
and risk at every point of customer contact…
at the enterprise… at the affinity partner...”
Business Intelligence (BI)
“The processes, technologies and tools needed to turn data into
information and information into knowledge and knowledge into
plans that drive profitable business action. BI encompasses data
warehousing, business analytics and knowledge management.”
The Data Warehouse Institute, Q4/2002
Business Drivers
Business Strategies Business Initiatives
IBM Software Group
7
The Business Intelligence :
Revitalizing Value Growth
Creating a single customer view business
intelligence platform to enable analysis of customer
needs
Develop a series of customer analytical applications
to understand and identify customer needs
Use the insights derived from the analytical applications
to create new or customized products, services and
tactical campaigns that meets customer needs to
drive revenue growth and cost optimization objectives
Revitalized value growth with improved customer
experience
Operationalize the strategic usage of data as part of
business as usual
Cost Optimization
Revenue Creation
Understand Customer
Needs
Technology
Transformation
Business
Imperatives
Enterprise
Transformation
IBM Software Group
8
BI can be thought of as a data refinery that turns
data into actions and business value.
operational systems
information
data
knowledge
insights
value
actions
experience
rules & model
analytical tools
data warehouse
review, measure, refine
The Data Refinery The Data Refinery
investment
IBM Software Group
9
BI requires cross functional data
Business Information Needs
Supplier/
Supply Chain
Information
Financial and
Business
Performance
Information
Customer
Information
Employee
Information
· How tightly is customer satisfaction related to
business unit performance and profitability?
· Are the most satisfied customers the most
profitable?
· Are incentive systems achieving the desired results?
· How effective is the company’s strategy?
· Which parts of the business are creating value and
what parts are destroying value?
· Regional compensation differences may be driving
some of the business unit performance variances
· What is the ratio of customer profitability to
employee incentives, by business unit, by region?
Effective decision making requires information that crosses organizational and
functional boundaries.
IBM Software Group
10
LEVEL 5: LEADING
Differentiates based on
business intelligence capabilities.
LEVEL 5: LEADING
Differentiates based on
business intelligence capabilities.
LEVEL 4: OPTIMIZING
Integrates business intelligence
practices into daily operations.
LEVEL 4: OPTIMIZING
Integrates business intelligence
practices into daily operations.
LEVEL 3: PRACTICING
Implements basic business intelligence
capabilities.
LEVEL 3: PRACTICING
Implements basic business intelligence
capabilities.
LEVEL 2: DEVELOPING
Basic, non-integrated
business intelligence capabilities in place.
LEVEL 2: DEVELOPING
Basic, non-integrated
business intelligence capabilities in place.
LEVEL 1: AWARE
Shows few business intelligence
capabilities.
LEVEL 1: AWARE
Shows few business intelligence
capabilities.
Level 1 Level 2 Level 3
Level 4 Level 5
Segmentation
confined to
marketing
organization.
Simple lifestyle
or profitability
segments
Segmentation
based on
profitability and
behavioral data,
some predictive
modeling.
• Multiple
segmentations
• Closed-loop
campaign
management
Recognize,
anticipate and
response using 1
to 1 multi-step
marketing initial.
Segmentation drives:
• pricing and service levels
of all touchpoints.
• Direct marketing content
and workflow
• Preemptive retention
Full integration of
organization with
customer functions.
• Single, corporate data
warehouse with solid
data management
practices
• Access of all customer
touchpoints
• Basic report & ad-hoc
analysis
• Numerous data
sources
• Data access limited to
IT and marketing
• Dynamic analysis
• Numerous data marts with
“clean data”
• Some touchpoint access
Partial organizational
alignment, but
conflicts with
traditional silos.
No
organizational
alignment.
Ability to Actualize Vision
Real time event
triggers
Integrated data
collection and
enhanced predictive
modeling.
B
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Evolutionary steps to achieving the BI vision.
IBM Software Group
11
Evolutionary steps in adoption of BI analytical
techniques.
LEVEL 5: LEADING
Differentiates based on
business intelligence capabilities.
LEVEL 5: LEADING
Differentiates based on
business intelligence capabilities.
LEVEL 4: OPTIMIZING
Integrates business intelligence
practices into daily operations.
LEVEL 4: OPTIMIZING
Integrates business intelligence
practices into daily operations.
LEVEL 3: PRACTICING
Implements basic business intelligence
capabilities.
LEVEL 3: PRACTICING
Implements basic business intelligence
capabilities.
LEVEL 2: DEVELOPING
Basic, non-integrated
business intelligence capabilities in place.
LEVEL 2: DEVELOPING
Basic, non-integrated
business intelligence capabilities in place.
LEVEL 1: AWARE
Shows few business intelligence
capabilities.
LEVEL 1: AWARE
Shows few business intelligence
capabilities.
batched reports OLAP
predictive modeling
& data mining
event-based triggering
Primarily batched reports
Increase in ad-hoc queries and start analytical data mining
Analytical and predictive modeling and mining grows
Adopts event-based analysis and triggering
Integrated modeling and event-based environment
0% 100% 50%
IBM Software Group
12
ROI $ returns starts negative but grows
exponentially with constant evolution of data and
business capabilities.
The World of
Reporting
R
O
I
(
$
)
Time
Information
Access
Enterprise
Information
Performance
Management
The Intelligent,
Agile
Enterprise
data quality
reports
manual
spreadsheets
data
marts
KPIs
enterprise data
warehouse
financial
management
profitability
segmentation
propensity
modeling
risk
management
enterprise
dashboard
events
detection
OLAP
relationship
optimization
IBM Software Group
13
A typical enterprise BI environment consists of a
warehouse and an analytical environment.
Enterprise
Data Warehouse
Extract
Clean
Model
Transform
Transfer
Load
Query
Report
Analyze
Mine
Visualize
Act
Data Warehousing Environment Analytical Environment
Enterprise BI Environment
Technical Team Business Users
enterprise-wide
single view of
the customer
ERP
CRM
Legacy
Others
IBM Software Group
14
There are key differences in transaction vs. BI data
warehousing environment.
Data Warehousing
Environment
Transaction vs. BI Systems
Transaction vs. BI Data
IBM Software Group
15
Building and managing a data warehouse is a
continuous iterative process…
DW Physical
DB Design
Data Warehouse
Design & Implementation
Data Warehouse Usage,
Support, and Enhancement
Data
Warehouse
Solution
Readiness
C/S Application
Dev. (Full Cycle)
DW Data
Transformation
DW Logical Data
Model Review
DW
Audit
Data
Warehouse
Solution
Integration
Data Warehouse Management
( Process and Operations )
DW Physical
DB Design Rev.
DW Tuning
DW Capacity
Planning
Data Warehouse
Workshop
DW Logical
Data Modeling
DW Architecture
Design
Data Warehouse
Planning
Data
Warehouse
Information
Discovery
Business
Discovery
Services
Knowledge
Discovery
Model Dev.
Data Mining
Analytical
Application
Enterprise
System
Support
Data Warehousing
Environment
IBM Software Group
16
…with new data sources or applications added
incrementally with new or changing business
requirements.
Data Warehousing
Environment
PLAN
D&I use
Time X+Y
PLAN
D&I use
Time X
PLAN
D&I use
Time X+Y+Z
PLAN
D&I use
……
ERP CRM Legacy Others
IBM Software Group
17
New data or applications for the EDW should be
prioritized and approved by a central governance
committee.
Data Warehousing
Environment
Identify
Projects w
DSS
Rqrmnts
Identify
Projects w
DSS
Rqrmnts
Prioritize
Projects by
Business
Benefit
Prioritize
Projects by
Business
Benefit
Complete
Business
Case
Complete
Business
Case
Prioritize
Projects w
Approved
Business
Case
Prioritize
Projects w
Approved
Business
Case
Plan &
Schedule
Approved
EDW
Projects
Plan &
Schedule
Approved
EDW
Projects
IT
Develop &
Implement
EDW
Projects
IT
Develop &
Implement
EDW
Projects
Projects
Sent to
CIO for
Exception
Projects
Sent to
CIO for
Exception
If business case is not approved or EDW
resources are not available & business unit
wants to fund & develop project outside IT
External
Vendor
Develops &
Implements
External
Vendor
Develops &
Implements
Approved
Project on
EDW or
Other
Approved
Project on
EDW or
Other
Business Units
EDW Steering
Committee
Business case includes
strategic objectives for
business & IT architectures
IBM Software Group
18
The landscape for analytical tools.
Analytical
Environment
REPORTING ANALYZING PREDICTING OPERATIONAL
What happened? Why did it happen? What will happen? What is happening?
Operational Reports
Web Reports
Exception Reports
Scorecards
OLAPs
Planning
Forecasting
Statistical models
Affinity Analysis
Optimization
Simulation
Dashboards
Alerts
Decision Engines
Events detection
Strategic & Tactical Analysis Operational Analysis
75% of usage 20% of usage 5% of usage 75% of usage
Historical Data (Data Warehouse/Marts) Real-Time Data (OS/EAI)
Business Performance
Management
Data Mining &
Predictive Modeling
Business Process
Monitoring
analytical & operational sophistication
IBM Software Group
19
Continuous Update/Short Queries Event-Based Triggering Batch Ad Hoc Analytics
STAGE 1
REPORTING
WHAT happened?
Primarily Batch
with Pre-defined
Queries and reports
STAGE 2
ANALYZING
WHY did it happen?
Increase in
Ad Hoc Queries
Early Data Mining
STAGE 3
PREDICTING
WHAT will happen?
Data Mining &
Analytical Modeling
Capability Grows
STAGE 4
OPERATIONALIZING
What IS happening?
Continuous Update &
Time Sensitive Queries
Gain Importance
STAGE 5
ACTIVE WAREHOUSING
What do I WANT to happen?
Event Based Triggering
takes hold
The adoption of analytical tools typically also follows
an evolution process of increasing complexity.
Analytical
Environment
IBM Software Group
20
Needs Tools
Decision
Makers
Analysts &
Specialists
Operational
Users
BU managers and leaders
Fast access to KPI scores and
click and point reports based on
their subject area of interest
Support decision makers
Detailed data across full
spectrum of enterprise – the
freedom to ask any question to
find the root causes and
breakthrough insights
Predefined scorecards
Reporting Tools
10s users
Specialist applications eg. risk
Statistical Modelling
Ad Hoc query tools
100s users
Look up access screens
Web or operational system based
1000s Users
Frontline and processing staff
Fast access to profiles of
customers in order to make the
right service, sales, approval
decisions
Different user types exist, that require different
analytical tools and access.
Analytical
Environment
IBM Software Group
21
What do the best BI solution and system looks like?
TDWI Report Series: “Smart Companies in the 21st Century: The Secrets of Creating Successful Business Intelligence Solutions”
The systems that support BI solutions are very different from other
systems in the company. Well-designed BI systems are adaptive by
nature; they continually change to answer new and different business
questions.
And the best way to adapt effectively is to start small and grow
organically. Each new increment refines and extends the solution,
adjusting to user feedback and new requirements.
Like a sprawling redwood forest, the best BI solutions take years to
mature, expanding in breadth and depth over time. It is no
coincidence that the value of a BI solution grows exponentially with the
number of users and applications it supports.
IBM Software Group
22
Characteristics of successful BI
Business sponsors are highly committed and actively
involved in the project.
Business users and the BI technical team work
together closely.
The BI system is viewed as an enterprise resource
and given adequate funding and guidance to ensure
long-term growth and viability.
Organization provide users both static and
interactive online views of data.
The BI team has prior experience with BI and is
assisted by vendor and independent consultants in a
partnership arrangement.
The company’s organizational culture reinforces the
BI solution.
IBM Software Group
23
Guidelines for successful BI
Step 1: Establish a BI Vision and Evangelize it
Step 2: Develop a BI Roadmap to Prioritize Initiatives
Step 3: Establish BI Governance & Funding Process
Step 4: Establish BI Competency Centre (BICC)
Step 5: Align Business and IT for the Long Haul
Step 6: Measure and Track ROI/Benefits from BI
Step 7: Build Trust in the System
IBM Software Group
24
Guidelines for successful BI
Determine the overall role that BI will
play in driving business strategy,
which drives the base vision
technology state and configuration
Determine the vision and key
business drivers, which drives the
scope (business units) breadth (data
subject areas)
Determine the business initiatives,
which will drive the applications and
knowledge assets required
Step 1: Establish a BI Vision and Evangelize it
IBM Software Group
25
Guidelines for successful BI
Prioritize business initiatives by ROI,
strategic value and ease of execution
Overlay the cost savings from data
mart consolidation and centralization
Develop a roadmap for integration
with minimum costs (funded through
centralization benefits) and maximum
benefits generation (through enabling
business initiatives)
Step 2: Develop a BI Roadmap to Prioritize BI Initiatives
IBM Software Group
26
Guidelines for successful BI
Establish governance structures,
executives, data governance board
and teams
Establish business intelligence
communities and support structures
Business sponsors need to secure
initial funding to launch the project.
More important, they need to sustain
funding over the life of the BI portfolio
and allocate funds to build and
maintain an enterprise BI
infrastructure.
Step 3: Establish BI Governance & Funding Process
IBM Software Group
27
Guidelines for successful BI
The enterprise wide data warehouse
creates a need for new skills in data
analysis. A BICC is a central pool of skilled
resources and specialists which can be
shared by all business units.
The BICC acts as a champion driving the
EDW initiatives & awareness
The BICC is full-time team dedicated to
the data warehouse, and develops full
knowledge and expertise in the data,
analysis techniques and models
Step 4: Establish BI Competency Centre (BICC)
IBM Software Group
28
Guidelines for successful BI
Extraordinarily successful BI projects all
have an enterprise scope that took years to
implement. The journey requires by a close-
knit team of developers and business people
who work hand in hand to deliver actionable
information to the users who need it.
Ensure alignment between the business and
technical development teams by use joint
application development sessions to bring
the two groups together to gain a common
understanding.
Step 5: Align Business and IT for the Long Haul
IBM Software Group
29
Guidelines for successful BI
BI is a journey and not a short term project.
Many a times, organizations loose sight and
confidence of the original objectives.
The way to overcome this is to start small
and expand with this baseline.
At the same time, make conscious effort to
measure and track any ROI/benefits that is
derived from BI (tangible or intangible)
The clear demonstration of success brings
confidence to progress while the loses
indicates opportunities for improvements.
Step 6: Measure and Track ROI/Benefits from BI
IBM Software Group
30
Guidelines for successful BI
There are very few ways to directly increase
the credibility of a system, but hundreds of
ways to undermine it.
The only way to build trust in a new BI
solution is to have the business team own
the solution and make all the decisions within
predefined technical boundaries (design,
data model, sourcing & validation).
Business sponsors need to make sure that,
in their eagerness to build the BI solution,
they don’t set arbitrary deadlines.
The technical team needs to provide a bullet-
proof technical environment that adapts
rapidly to changes in business requirements.
Step 7: Build Trust in the System
IBM Software Group
31
In short, BI can help us become more intelligent
about the way we do business.
Smart companies in the 21st century use business
intelligence (BI) solutions to gain a clearer picture
of their internal operations, customers, supply
chain, and financial performance. They also derive
significant ROI by using BI to devise better tactics
and plans, respond more effectively to
emergencies, and capitalize more quickly on new
opportunities. In short, they are using BI to become
intelligent about the way they do business.
TDWI Report Series: “Smart Companies in the 21st Century:
The Secrets of Creating Successful Business Intelligence Solutions”
Organisation
Business Units /
Departments
Employee
Interpretation
Analysis Planning
Decision
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Info. Action
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Customer
doc_503702505.pdf
Business Intelligence is defined as "knowledge ained about a business through the use of various hardware/software technologies which enable organizations to turn data into information”.
®
IBM Software Group
© 2007 IBM Corporation
Introduction to Business Intelligence
Vince Leat
ASEAN SW Group
IBM Software Group
2
Discussion
What is Business Intelligence
BI Vision Evolution
Business Intelligence Environment
Characteristics of Successful Business Intelligence
IBM Software Group
3
What is Business Intelligence?
Business Intelligence (BI) is:
“The processes, technologies and tools needed to turn data into
information and information into knowledge and knowledge into plans
that drive profitable business action. BI encompasses data
warehousing, business analytics and knowledge management.”
The Data Warehouse Institute, Q4/2002
Business Intelligence is defined as "knowledge gained about a business
through the use of various hardware/software technologies which
enable organizations to turn data into information”.
Data Management Review
IBM Software Group
4
According to a recent CEO survey, responding
efficiently to market conditions & differentiated
products are their key priorities.
0% 20% 40% 60% 80% 100%
Disaster Management
Sourcing
Strategic Partners
Employee Needs
IT Performance
Organization
New Products / Services
Operational Efficiency
Business Model
Differentiated Products
Rapid Response
Source: IBM Business Consulting Services, The Global CEO Study 2004
0% 25% 50% 75%
Other
Implement/leverage CRM processes and applications
Empower front-line employees
Track competitor trends and actions
Create adaptable processes that allow real time response
Vehicles to capture customers / consumers
needs/preferences
Capture and utilize customer information for swift
decisions
Key CEO Priorities
…with strategic usage of customer
information & processes as the key enabler…
…with strategic usage of customer
information & processes as the key enabler…
IBM Software Group
5
Another recent survey by “The Asian Banker” rates
customer knowledge as key capabilities for
competitive advantage.
What are the key capabilities to achieve a competitive advantange in over the next 5
years?
D
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s
t
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I
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“Survey on strategic information challenges faced by the best retail banks in Asia”, May 2005
If you could only have one competitive advantage what would it be?
0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%
A Low Cost Base Innovative Products Service CustomisationCRM / Customer
Knowledge
IBM Software Group
6
Business Intelligence (BI) allows us to use data
strategically in responses to challenges and drive
profitable business actions.
Efficiency
“minimize the cost of selling/servicing the
customer …”
Effectiveness
“real-time access to customer information
across every point of contact… at the line-of-
business…”
Differentiation
“ability to proactively manage opportunity
and risk at every point of customer contact…
at the enterprise… at the affinity partner...”
Business Intelligence (BI)
“The processes, technologies and tools needed to turn data into
information and information into knowledge and knowledge into
plans that drive profitable business action. BI encompasses data
warehousing, business analytics and knowledge management.”
The Data Warehouse Institute, Q4/2002
Business Drivers
Business Strategies Business Initiatives
IBM Software Group
7
The Business Intelligence :
Revitalizing Value Growth
Creating a single customer view business
intelligence platform to enable analysis of customer
needs
Develop a series of customer analytical applications
to understand and identify customer needs
Use the insights derived from the analytical applications
to create new or customized products, services and
tactical campaigns that meets customer needs to
drive revenue growth and cost optimization objectives
Revitalized value growth with improved customer
experience
Operationalize the strategic usage of data as part of
business as usual
Cost Optimization
Revenue Creation
Understand Customer
Needs
Technology
Transformation
Business
Imperatives
Enterprise
Transformation
IBM Software Group
8
BI can be thought of as a data refinery that turns
data into actions and business value.
operational systems
information
data
knowledge
insights
value
actions
experience
rules & model
analytical tools
data warehouse
review, measure, refine
The Data Refinery The Data Refinery
investment
IBM Software Group
9
BI requires cross functional data
Business Information Needs
Supplier/
Supply Chain
Information
Financial and
Business
Performance
Information
Customer
Information
Employee
Information
· How tightly is customer satisfaction related to
business unit performance and profitability?
· Are the most satisfied customers the most
profitable?
· Are incentive systems achieving the desired results?
· How effective is the company’s strategy?
· Which parts of the business are creating value and
what parts are destroying value?
· Regional compensation differences may be driving
some of the business unit performance variances
· What is the ratio of customer profitability to
employee incentives, by business unit, by region?
Effective decision making requires information that crosses organizational and
functional boundaries.
IBM Software Group
10
LEVEL 5: LEADING
Differentiates based on
business intelligence capabilities.
LEVEL 5: LEADING
Differentiates based on
business intelligence capabilities.
LEVEL 4: OPTIMIZING
Integrates business intelligence
practices into daily operations.
LEVEL 4: OPTIMIZING
Integrates business intelligence
practices into daily operations.
LEVEL 3: PRACTICING
Implements basic business intelligence
capabilities.
LEVEL 3: PRACTICING
Implements basic business intelligence
capabilities.
LEVEL 2: DEVELOPING
Basic, non-integrated
business intelligence capabilities in place.
LEVEL 2: DEVELOPING
Basic, non-integrated
business intelligence capabilities in place.
LEVEL 1: AWARE
Shows few business intelligence
capabilities.
LEVEL 1: AWARE
Shows few business intelligence
capabilities.
Level 1 Level 2 Level 3
Level 4 Level 5
Segmentation
confined to
marketing
organization.
Simple lifestyle
or profitability
segments
Segmentation
based on
profitability and
behavioral data,
some predictive
modeling.
• Multiple
segmentations
• Closed-loop
campaign
management
Recognize,
anticipate and
response using 1
to 1 multi-step
marketing initial.
Segmentation drives:
• pricing and service levels
of all touchpoints.
• Direct marketing content
and workflow
• Preemptive retention
Full integration of
organization with
customer functions.
• Single, corporate data
warehouse with solid
data management
practices
• Access of all customer
touchpoints
• Basic report & ad-hoc
analysis
• Numerous data
sources
• Data access limited to
IT and marketing
• Dynamic analysis
• Numerous data marts with
“clean data”
• Some touchpoint access
Partial organizational
alignment, but
conflicts with
traditional silos.
No
organizational
alignment.
Ability to Actualize Vision
Real time event
triggers
Integrated data
collection and
enhanced predictive
modeling.
B
u
s
i
n
e
s
s
I
n
t
e
l
l
i
g
e
n
c
e
V
i
s
i
o
n
D
e
v
e
l
o
p
m
e
n
t
Evolutionary steps to achieving the BI vision.
IBM Software Group
11
Evolutionary steps in adoption of BI analytical
techniques.
LEVEL 5: LEADING
Differentiates based on
business intelligence capabilities.
LEVEL 5: LEADING
Differentiates based on
business intelligence capabilities.
LEVEL 4: OPTIMIZING
Integrates business intelligence
practices into daily operations.
LEVEL 4: OPTIMIZING
Integrates business intelligence
practices into daily operations.
LEVEL 3: PRACTICING
Implements basic business intelligence
capabilities.
LEVEL 3: PRACTICING
Implements basic business intelligence
capabilities.
LEVEL 2: DEVELOPING
Basic, non-integrated
business intelligence capabilities in place.
LEVEL 2: DEVELOPING
Basic, non-integrated
business intelligence capabilities in place.
LEVEL 1: AWARE
Shows few business intelligence
capabilities.
LEVEL 1: AWARE
Shows few business intelligence
capabilities.
batched reports OLAP
predictive modeling
& data mining
event-based triggering
Primarily batched reports
Increase in ad-hoc queries and start analytical data mining
Analytical and predictive modeling and mining grows
Adopts event-based analysis and triggering
Integrated modeling and event-based environment
0% 100% 50%
IBM Software Group
12
ROI $ returns starts negative but grows
exponentially with constant evolution of data and
business capabilities.
The World of
Reporting
R
O
I
(
$
)
Time
Information
Access
Enterprise
Information
Performance
Management
The Intelligent,
Agile
Enterprise
data quality
reports
manual
spreadsheets
data
marts
KPIs
enterprise data
warehouse
financial
management
profitability
segmentation
propensity
modeling
risk
management
enterprise
dashboard
events
detection
OLAP
relationship
optimization
IBM Software Group
13
A typical enterprise BI environment consists of a
warehouse and an analytical environment.
Enterprise
Data Warehouse
Extract
Clean
Model
Transform
Transfer
Load
Query
Report
Analyze
Mine
Visualize
Act
Data Warehousing Environment Analytical Environment
Enterprise BI Environment
Technical Team Business Users
enterprise-wide
single view of
the customer
ERP
CRM
Legacy
Others
IBM Software Group
14
There are key differences in transaction vs. BI data
warehousing environment.
Data Warehousing
Environment
Transaction vs. BI Systems
Transaction vs. BI Data
IBM Software Group
15
Building and managing a data warehouse is a
continuous iterative process…
DW Physical
DB Design
Data Warehouse
Design & Implementation
Data Warehouse Usage,
Support, and Enhancement
Data
Warehouse
Solution
Readiness
C/S Application
Dev. (Full Cycle)
DW Data
Transformation
DW Logical Data
Model Review
DW
Audit
Data
Warehouse
Solution
Integration
Data Warehouse Management
( Process and Operations )
DW Physical
DB Design Rev.
DW Tuning
DW Capacity
Planning
Data Warehouse
Workshop
DW Logical
Data Modeling
DW Architecture
Design
Data Warehouse
Planning
Data
Warehouse
Information
Discovery
Business
Discovery
Services
Knowledge
Discovery
Model Dev.
Data Mining
Analytical
Application
Enterprise
System
Support
Data Warehousing
Environment
IBM Software Group
16
…with new data sources or applications added
incrementally with new or changing business
requirements.
Data Warehousing
Environment
PLAN
D&I use
Time X+Y
PLAN
D&I use
Time X
PLAN
D&I use
Time X+Y+Z
PLAN
D&I use
……
ERP CRM Legacy Others
IBM Software Group
17
New data or applications for the EDW should be
prioritized and approved by a central governance
committee.
Data Warehousing
Environment
Identify
Projects w
DSS
Rqrmnts
Identify
Projects w
DSS
Rqrmnts
Prioritize
Projects by
Business
Benefit
Prioritize
Projects by
Business
Benefit
Complete
Business
Case
Complete
Business
Case
Prioritize
Projects w
Approved
Business
Case
Prioritize
Projects w
Approved
Business
Case
Plan &
Schedule
Approved
EDW
Projects
Plan &
Schedule
Approved
EDW
Projects
IT
Develop &
Implement
EDW
Projects
IT
Develop &
Implement
EDW
Projects
Projects
Sent to
CIO for
Exception
Projects
Sent to
CIO for
Exception
If business case is not approved or EDW
resources are not available & business unit
wants to fund & develop project outside IT
External
Vendor
Develops &
Implements
External
Vendor
Develops &
Implements
Approved
Project on
EDW or
Other
Approved
Project on
EDW or
Other
Business Units
EDW Steering
Committee
Business case includes
strategic objectives for
business & IT architectures
IBM Software Group
18
The landscape for analytical tools.
Analytical
Environment
REPORTING ANALYZING PREDICTING OPERATIONAL
What happened? Why did it happen? What will happen? What is happening?
Operational Reports
Web Reports
Exception Reports
Scorecards
OLAPs
Planning
Forecasting
Statistical models
Affinity Analysis
Optimization
Simulation
Dashboards
Alerts
Decision Engines
Events detection
Strategic & Tactical Analysis Operational Analysis
75% of usage 20% of usage 5% of usage 75% of usage
Historical Data (Data Warehouse/Marts) Real-Time Data (OS/EAI)
Business Performance
Management
Data Mining &
Predictive Modeling
Business Process
Monitoring
analytical & operational sophistication
IBM Software Group
19
Continuous Update/Short Queries Event-Based Triggering Batch Ad Hoc Analytics
STAGE 1
REPORTING
WHAT happened?
Primarily Batch
with Pre-defined
Queries and reports
STAGE 2
ANALYZING
WHY did it happen?
Increase in
Ad Hoc Queries
Early Data Mining
STAGE 3
PREDICTING
WHAT will happen?
Data Mining &
Analytical Modeling
Capability Grows
STAGE 4
OPERATIONALIZING
What IS happening?
Continuous Update &
Time Sensitive Queries
Gain Importance
STAGE 5
ACTIVE WAREHOUSING
What do I WANT to happen?
Event Based Triggering
takes hold
The adoption of analytical tools typically also follows
an evolution process of increasing complexity.
Analytical
Environment
IBM Software Group
20
Needs Tools
Decision
Makers
Analysts &
Specialists
Operational
Users
BU managers and leaders
Fast access to KPI scores and
click and point reports based on
their subject area of interest
Support decision makers
Detailed data across full
spectrum of enterprise – the
freedom to ask any question to
find the root causes and
breakthrough insights
Predefined scorecards
Reporting Tools
10s users
Specialist applications eg. risk
Statistical Modelling
Ad Hoc query tools
100s users
Look up access screens
Web or operational system based
1000s Users
Frontline and processing staff
Fast access to profiles of
customers in order to make the
right service, sales, approval
decisions
Different user types exist, that require different
analytical tools and access.
Analytical
Environment
IBM Software Group
21
What do the best BI solution and system looks like?
TDWI Report Series: “Smart Companies in the 21st Century: The Secrets of Creating Successful Business Intelligence Solutions”
The systems that support BI solutions are very different from other
systems in the company. Well-designed BI systems are adaptive by
nature; they continually change to answer new and different business
questions.
And the best way to adapt effectively is to start small and grow
organically. Each new increment refines and extends the solution,
adjusting to user feedback and new requirements.
Like a sprawling redwood forest, the best BI solutions take years to
mature, expanding in breadth and depth over time. It is no
coincidence that the value of a BI solution grows exponentially with the
number of users and applications it supports.
IBM Software Group
22
Characteristics of successful BI
Business sponsors are highly committed and actively
involved in the project.
Business users and the BI technical team work
together closely.
The BI system is viewed as an enterprise resource
and given adequate funding and guidance to ensure
long-term growth and viability.
Organization provide users both static and
interactive online views of data.
The BI team has prior experience with BI and is
assisted by vendor and independent consultants in a
partnership arrangement.
The company’s organizational culture reinforces the
BI solution.
IBM Software Group
23
Guidelines for successful BI
Step 1: Establish a BI Vision and Evangelize it
Step 2: Develop a BI Roadmap to Prioritize Initiatives
Step 3: Establish BI Governance & Funding Process
Step 4: Establish BI Competency Centre (BICC)
Step 5: Align Business and IT for the Long Haul
Step 6: Measure and Track ROI/Benefits from BI
Step 7: Build Trust in the System
IBM Software Group
24
Guidelines for successful BI
Determine the overall role that BI will
play in driving business strategy,
which drives the base vision
technology state and configuration
Determine the vision and key
business drivers, which drives the
scope (business units) breadth (data
subject areas)
Determine the business initiatives,
which will drive the applications and
knowledge assets required
Step 1: Establish a BI Vision and Evangelize it
IBM Software Group
25
Guidelines for successful BI
Prioritize business initiatives by ROI,
strategic value and ease of execution
Overlay the cost savings from data
mart consolidation and centralization
Develop a roadmap for integration
with minimum costs (funded through
centralization benefits) and maximum
benefits generation (through enabling
business initiatives)
Step 2: Develop a BI Roadmap to Prioritize BI Initiatives
IBM Software Group
26
Guidelines for successful BI
Establish governance structures,
executives, data governance board
and teams
Establish business intelligence
communities and support structures
Business sponsors need to secure
initial funding to launch the project.
More important, they need to sustain
funding over the life of the BI portfolio
and allocate funds to build and
maintain an enterprise BI
infrastructure.
Step 3: Establish BI Governance & Funding Process
IBM Software Group
27
Guidelines for successful BI
The enterprise wide data warehouse
creates a need for new skills in data
analysis. A BICC is a central pool of skilled
resources and specialists which can be
shared by all business units.
The BICC acts as a champion driving the
EDW initiatives & awareness
The BICC is full-time team dedicated to
the data warehouse, and develops full
knowledge and expertise in the data,
analysis techniques and models
Step 4: Establish BI Competency Centre (BICC)
IBM Software Group
28
Guidelines for successful BI
Extraordinarily successful BI projects all
have an enterprise scope that took years to
implement. The journey requires by a close-
knit team of developers and business people
who work hand in hand to deliver actionable
information to the users who need it.
Ensure alignment between the business and
technical development teams by use joint
application development sessions to bring
the two groups together to gain a common
understanding.
Step 5: Align Business and IT for the Long Haul
IBM Software Group
29
Guidelines for successful BI
BI is a journey and not a short term project.
Many a times, organizations loose sight and
confidence of the original objectives.
The way to overcome this is to start small
and expand with this baseline.
At the same time, make conscious effort to
measure and track any ROI/benefits that is
derived from BI (tangible or intangible)
The clear demonstration of success brings
confidence to progress while the loses
indicates opportunities for improvements.
Step 6: Measure and Track ROI/Benefits from BI
IBM Software Group
30
Guidelines for successful BI
There are very few ways to directly increase
the credibility of a system, but hundreds of
ways to undermine it.
The only way to build trust in a new BI
solution is to have the business team own
the solution and make all the decisions within
predefined technical boundaries (design,
data model, sourcing & validation).
Business sponsors need to make sure that,
in their eagerness to build the BI solution,
they don’t set arbitrary deadlines.
The technical team needs to provide a bullet-
proof technical environment that adapts
rapidly to changes in business requirements.
Step 7: Build Trust in the System
IBM Software Group
31
In short, BI can help us become more intelligent
about the way we do business.
Smart companies in the 21st century use business
intelligence (BI) solutions to gain a clearer picture
of their internal operations, customers, supply
chain, and financial performance. They also derive
significant ROI by using BI to devise better tactics
and plans, respond more effectively to
emergencies, and capitalize more quickly on new
opportunities. In short, they are using BI to become
intelligent about the way they do business.
TDWI Report Series: “Smart Companies in the 21st Century:
The Secrets of Creating Successful Business Intelligence Solutions”
Organisation
Business Units /
Departments
Employee
Interpretation
Analysis Planning
Decision
D
e
c
i
s
i
o
n
P
r
o
c
e
s
s
Info. Action
I
n
f
o
.
F
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w
Customer
doc_503702505.pdf