E-Book

Key trends in business intelligence

Business intelligence has come a long way from its reporting roots.
Today’s BI systems offer sophisticated decision-support capabilities on
top of high-performance data management infrastructures. In this e-
book, get up to speed on some of the hottest trends currently affecting
BI users and the BI market – from approaches such as agile BI,
pervasive BI and the development of multilayered enterprise BI and
corporate performance management strategies to the emergence of
technologies such as open source BI, analytic databases and cloud-
based BI tools.

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E-Book
Key trends in business intelligence
Table of Contents
Agile BI advice at TDWI welcomed by attendees, but confusion remains

Gartner: Enterprise BI strategy rarely a one-size-fits-all approach

Broader business intelligence strategy may require eased data controls

Gartner BI Summit: Effective BI needs performance management metrics

Resources from IBM

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Agile BI advice at TDWI welcomed by attendees,

but confusion remains
By Hannah Smalltree, SearchBusinessAnalytics.com Editorial Director

SAN DIEGO – Change is inevitable, so plan for it. That was the prevailing message of the
summer 2010 TDWI conference here, which was focused on agile business intelligence (BI).

While attendees lauded the conference’s content, some remained confused over agile BI,
even two days into the event. Some thought it referred to applying agile development
principles to their BI environment. A few saw it as yet another industry buzzword. Others
thought it meant the ability of BI to help an organization be more adaptable, nimble and
quick.

They’re all partially right, explained Wayne Eckerson, research director for The Data
Warehousing Institute (TDWI), a Renton, Wash.-based analyst firm.

“When TDWI uses the term [agile BI], it’s in the broadest context possible," Eckerson said.
"It refers to any of the organizational processes, technology and infrastructure required to
make the business go as fast as possible.”

Practically speaking, he said, that means agile BI spans many areas and is more mentality
than methodology. It means initiatives like revamping an organization’s BI team and
program structure for better business alignment and improving how information is
disseminated and used. It means developing powerful BI and data management
infrastructures that are flexible enough to handle change. And it means applying agile
development techniques to BI projects, Eckerson explained. But given that many of these
goals are not new, why is the agile BI concept gaining traction now?

Eckerson pointed first to the recent uptick in executive interest in using BI and analytics to
be more agile and competitive. Technology innovations in data warehousing appliances,
analytic databases, cloud computing and open source are “changing the game,” he said,
enabling organizations to ask and answer analytical questions that historically weren’t
possible as a result of storage, processing and cost constraints. And there’s a genuine move

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toward using agile development concepts to help overcome the stigma (and, often, the
reality) that IT organizations are too slow to respond to business needs.

“There’s a growing momentum toward failing fast and not trying to be perfect. If something
breaks and you make a mistake, the cost of fixing the mistake is often outweighed by the
advantage of going fast,” Eckerson said. “So fail. Make a mistake. Build your architecture
and fix things after the fact. Let your developers go out, build these solutions quickly and
reconcile the models afterwards. It’s OK, as long as you’re all developing to certain core
principles. Not hard-and-fast rules, but core principles.”

That may be a tough pill for some BI and data management professionals to swallow, he
acknowledged. After years of requirements templates, careful modeling and attempts to get
the data perfect, the new directives are to develop quickly, iterate often and be OK with
delivering 80%. Granted, this approach might not be ideal for an executive’s financial
reporting, but the average business user will probably be OK with getting some data sooner,
rather than waiting for the perfect solution.

Eckerson offered even more advice in a keynote speech, sharing his “Five Secrets to
Building an Agile, Adaptable BI Environment”:

• Align with the business. Evaluate BI program structures, he recommended, and

consider agile development tactics, such as “embedding” BI developers in a business
department and cross-training staff in all facets of BI. He referenced a Netflix case
study that involved disbanding formal requirements and QA teams in favor of a
cross-trained BI staff, where a single developer may build out an entire solution.

• Slow down to speed up. Eckerson cautioned that the emphasis on fast delivery
should not mean ignoring the business user or getting seduced by attractive
technology before knowing what’s really needed.

• Anticipate the business. The more that BI professionals know the business side
“inside and out,” the better position they will be in to develop applications and
infrastructures that can handle future business requests. Given that businesses often

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don’t want to fund architecture development – instead focusing on projects –

Eckerson recommended building out BI architectures incrementally.

• Manage expectations. “The harsh reality of BI is that we’ll never, ever move as
fast as the business wants – but we can move as fast as they need,” Eckerson said.
BI teams with a good business rapport can help requestors step back to consider
what will do the job. Other helpful tactics are developing a visual BI portfolio (a
concept pioneered by Baseline Consulting) and having a solid governance structure
to manage incoming requests.

• Cede control back to the business. BI organizations need to educate business

users and develop standards and governance that enable BI without sacrificing the
user’s desire for data. It’s akin to raising teenagers, Eckerson joked. When you can
no longer control their actions, you hope that the standards and values you’ve
espoused will help them make good decisions.

These messages seemed to resonate with many of the attendees at the event. Roger
Barker, enterprise data warehouse manager with El Segundo, Calif.-based semiconductor
maker International Rectifier, came to the event partly to get advice on developing the
executive sponsorship required for him to grow his BI organization beyond his current one-
man show. His goal is to evolve International Rectifier’s three-year-old data warehouse into
a full-fledged BI program. Barker said applying agile development methodologies to BI is an
intriguing idea, but “we have other things to do first.”

Another attendee, Russell Brown, a BI analyst with Jacksonville, Fla.-based financial

services provider FIS, was at the event to present, take a CBIP exam and bring back new
ideas.

“The focus for us in the next couple of years is scalability,” Brown said. “How do we take
these complicated statistical analyses and put those into our clients’ hands so they make
sense of [them] – without our end users needing to have a Ph.D. in statistics?”

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Gartner: Enterprise BI strategy rarely a one-size-

fits-all approach
By Jeff Kelly, SearchBusinessAnalytics.com News Editor

When it comes to business intelligence (BI) strategy in the enterprise, one size rarely fits
all.
In large organizations, different divisions and business units play very different roles and
have very different objectives. As a result, their approaches to BI should also be different,
according to Patrick Meehan, an analyst with Stamford, Conn.-based Gartner Inc.

Meehan identified three approaches to BI that business unit CIOs should consider, noting
that a combination of approaches will most often be necessary in large, multi-unit
enterprises. “All three approaches could exist in different places in the enterprise depending
on what the persistent or burning business questions were,” Meehan said.

The first approach to BI is the “past-tense approach.” Here, business units focus on making
better business decisions by analyzing historical data. This approach is best suited for
business units “that seek to recast their business plans on a quarterly or annual basis,”
Meehan wrote in a recent report.

The second approach is the “present-tense approach,” in which business units harness BI
tools and technology to push real-time data to workers to make better business decisions in
the moment. This method often requires integrating data from key business applications like
CRM and ERP applications.

The third, “future-tense approach,” involves using advanced analytics and data modeling to
predict likely future events so business units can plan their behavior accordingly.

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BI methodologies not just seen as steps along an evolutionary path

“I went into this thinking [the approaches] would be additive,” Meehan said, meaning he
thought it likely that organizations would adopt the first approach, then move on to the
second and third approaches as their BI capabilities and culture matured. “But the cases
didn’t prove that,” he said.

In some business units, Meehan’s research found, the past-tense approach proved to be the
best choice. Finance divisions, Meehan found, are often best served by the past-tense
approach to BI – relying, for example, on historical data to determine if the company met
its earnings per share goals.

Supply chain organizations, on the other hand, are better suited to the present-tense BI
approach in order to keep order fulfillment and inventory levels in line. Marketing
organizations, meanwhile, likely benefit most from the future-tense approach, using BI to
predict future consumer behavior.

Eric Williams, CIO at Catalina Marketing Corp., said he agreed with Gartner’s advice.
Catalina, based in St. Petersburg, Fla., helps its consumer products and pharmaceutical
customers collect and analyze point-of-sale (POS) data.

“I agree with the assessment and, in fact, that is why I set up a center of excellence within
my BI team … to help pick the right product for each BI need in the business,” Williams
said. “We found that each group has different needs and desires, and the key is to help
uncover the specific need or unmet desire.”

The company’s operational departments, for example, use predictive analytics to help
Catalina customers forecast consumer behavior based on POS data. Other divisions within
Catalina, like its finance and HR departments, use more traditional BI tools, Williams said.

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Successful BI projects require different enterprise BI strategies

Just like Catalina, in most large enterprises – which have multiple divisions including
finance, supply chain and marketing – successful BI projects require the various business
units to employ different approaches to BI.

That doesn’t mean that companies should invest in multiple BI tools from multiple vendors.
In fact, BI platform consolidation can lead to significant cost savings. But mega-vendors like
Oracle, SAP, IBM and Microsoft offer a wide range of tools, and companies can in some
cases find the various BI tools needed to meet their departments’ diverse analytic needs at
one or two of those vendors.

The key for business unit CIOs trying to decide which BI approach is right for their unit is
not to identify a technology, but to identify the hottest of the burning questions that need
answers to run the department effectively, according to Meehan. “The BU CIO needs to
determine the top three or so pieces of information that could revolutionize the method of
doing business or that could at least contribute to [its] success,” he wrote in a recent
report.

For a finance unit, the burning questions might revolve around determining if certain
quarterly targets were met. For a marketing department, detecting shifts in consumer
demographics might prove to be the hottest questions.

“The idea here is to make practical use of the Pareto principle – identifying the 20% of
burning questions that drive 80% of the value (the critical few), as opposed to being
distracted by the 80% of burning questions that drive 20% of the value (the less impactful
many),” Meehan concluded.

Once the hottest of the burning questions are identified, business unit CIOs should use them
as conversation starters with the CEO and other business-side executives. From there, the
objectives of any BI deployment can be better specified – thereby improving the chances of
success – and the right approach to BI identified.

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“If you don’t sit down and formulate the questions, how could you possibly come up with
the answers, let alone make impactful business decisions?” Meehan said.

Ultimately, he said, BI is as much a cultural and business issue as a technical one, and
business unit CIOs should view it as such. They need to see themselves as “educators,” he
advised – not just technology implementers.

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Broader business intelligence strategy may require

eased data controls
By Craig Stedman, SearchBusinessAnalytics.com Site Editor

LAS VEGAS – Think that standardizing your corporate data in an enterprise data warehouse
is all you need to do to create a successful business intelligence (BI) process for your
organization? Think again.

Many companies have worked for years and spent millions of dollars to build big, monolithic
data warehouses, only to find now that doing so was just the beginning of the BI
development cycle. They also are learning that they may have to give up some of their
centralized data controls to enable end users to take full advantage of BI tools.

“A lot of times, BI is relegated to a data warehouse with ancillary reports,” Baseline

Consulting’s Jill Dyche said in a keynote speech at the BI Executive Summit, held here as
part of a TDWI World Conference. And indeed, when Dyche asked for a show of hands on
where attendees stood with their BI programs, many indicated that their BI teams were
seen primarily as report writers.

Dyche, a partner and co-founder of Baseline in Sherman Oaks, Calif., recommended that IT
and business units work together to develop a structured BI strategy, first by agreeing on a
set of guiding principles for their BI deployments and then by using a portfolio management
approach to prioritizing the rollout of different BI applications for separate groups of users.
“[That way] it’s no longer about the tool set,” she said. “It’s about BI’s ability to support
corporate strategies and objectives.”

Creating a prioritized BI application portfolio also gets companies out of the practice of
loading data into their data warehouses in an organizational vacuum, Dyche said. “The
ideal,” she noted, “is to pair up applications with the specific data they need.”

Mark Madsen, a consultant at Third Nature Inc. in Rogue River, Ore., went even further
during a pair of keynotes at the BI Executive Summit and the general conference. Madsen
advocated establishing different “zones of control” over data within an organization, saying

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that the focus on standardizing information in data warehouses and associated data marts is
“disempowering” business users and leading to the perpetuation of “the kingdom of Excel”
as an alternative to corporate BI tools.

Fixed data models may cause business intelligence problems

“Data warehouse has become a bad word for a lot of people,” Madsen said. “The concept of
fixed [data] models needs to change. Data doesn’t have to be identical; you have to relax
the constraints.” Otherwise, he added in an interview, data warehouses risk becoming
“legacy systems cranking out static reports” that don’t let organizations tap the full value of
BI technologies and processes.

Jason Beard, director of global BI at John Wiley & Sons Inc., said Madsen’s advice maps to
where he’d like to take the Hoboken, N.J.-based publishing company’s BI program. “We
want to take our BI game up a little,” Beard said. “A lot of what we’re asked to do now is
kind of routine stuff that answers questions but doesn’t go into this unstructured analysis
realm.”

Generating reports out of Wiley’s data warehouse will continue to be an important part of
the company’s BI strategy, Beard said, noting that many of the users in the company’s
finance department just want to get data “in a repeatable and consistent way” for tracking
key performance indicators. But he added that he’s looking to use BI tools to enable, say,
marketing workers to do data analysis in a “more speed-of-thought” manner.

Madsen’s description of centralized data warehouses as often being too rigid “is exactly our
story,” said Suresh Karu’Pakula, an IT principal and director of BI strategy and architecture
at ConAgra Foods Inc. in Omaha, Neb. ConAgra has spent five years building and operating
a single data warehouse, Karu’Pakula said. But now, he added, the BI team is looking to “go
from being the purveyor of a complete BI stack to being the purveyor of enterprise
information and to let go of some of the control.”

Data analysis needs to be faster, more iterative and more flexible than it is now,
Karu’Pakula said. And in order to achieve that, he wants ConAgra to be in a position where

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it can provide “the right tool for the right user group,” instead of forcing them all to rely on
the same BI technology.

Wayne Eckerson, director of research and services at conference sponsor TDWI, said the
issue of control over data is becoming a “pain point” for mature data warehousing
organizations.

“We build these things up over time and start to standardize the data and the BI platform,
and then IT or the BI team starts to control stuff for very valid reasons,” Eckerson said. “But
after a while, that becomes the problem. And if we’re not careful, we start to affect the
ability of users to get the useful information that was the whole reason to do BI in the first
place.”

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Gartner BI Summit: Effective BI needs performance

management metrics
By Craig Stedman, SearchBusinessAnalytics.com Site Editor

LAS VEGAS – When Gartner Inc. held its annual Business Intelligence Summit here,
analysts from the consulting firm spent much of the conference’s first day reiterating a
common theme at these events: Just deploying business intelligence (BI) systems and
executive dashboards isn’t enough for companies looking to improve their business
performance and gain a competitive edge on rivals.

In session after session, Gartner talked up the need to add performance management
metrics and tools, all ideally orchestrated by a business intelligence competency center
(BICC) working off a formal corporate BI strategy document. Conventional BI systems often
don’t provide the analytics and performance measurement capabilities that business
executives need to more effectively manage operations, according to Gartner.

“BI in too many companies is just a case of building a data warehouse and some reports
that support performance monitoring,” Gartner analyst Nigel Rayner said. “It’s not adding
real value. It’s not actionable information.” Effective performance management “is not just
about giving [business users] scorecards and dashboards,” he counseled attendees during
one session.

This is not exactly a revelation from the analyst firm. For years at these events, Gartner has
been reiterating the idea of integrating BI and performance management. But it’s a goal
that seems to continue to elude many of the attendees, for a variety of reasons.

Some BI professionals at the conference said that adopting and acting on the
recommendations to create what Gartner describes as an “enterprise metrics framework”
won’t be easy for their organizations. And Rayner and other Gartner representatives openly
acknowledged that it isn’t a simple process.

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Creating a performance metrics framework ‘takes some work’

“This isn’t something you solve by going to a Gartner conference and suddenly you have a
metrics framework,” analyst John Van Decker said in the opening keynote session. “Ideally,
all of this can be linked together. But that takes some work.”

For starters, organizations need to create “a performance-driven culture,” Gartner analyst

Kurt Schlegel said in a third session. Doing so, he noted, is likely to require the direct
involvement of senior corporate executives to identify key performance indicators (KPIs)
and business metrics. That will give business unit managers and department heads a vested
interest in finding ways to track those metrics, Schlegel said.

He also thinks it’s important to set up a BICC that can take the lead on BI and performance
management initiatives – and to include both IT and business representatives in order to
instill a team mentality “where everyone wins or loses together.” Even that would be a big
change for many organizations: Only a handful of people in Schlegel’s session raised their
hands to indicate that they have a team relationship between IT and the business side in
place now, let alone an actual BICC.

Nevertheless, Schlegel laid out an aggressive action plan for attendees, saying they should
start right away on creating a documented BI strategy for their organizations. Recruiting
corporate executives to lead the development of performance management metrics should
be done over the next 90 days, he said, and that should be followed within the next year by
the establishment of a BICC.

Things won’t happen quite so quickly at CooperVision Inc., a maker of contact lenses in
Fairport, N.Y. Varahan Ganesan, CooperVision’s director of applications, said the company is
looking at pursuing a metrics-driven corporate performance management (CPM) strategy to
expand beyond its current BI reporting capabilities. “There’s a lot of interest at the
executive level, that they want to see this,” Ganesan said.

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Better data consistency comes before performance management

metrics

But first, CooperVision needs to make sure its data is more consistent on an enterprise-wide
basis, Ganesan noted. To that end, he said, the company is launching a data
standardization and master data management (MDM) project that is expected to be finished
by the end of this year. Ganesan hopes that a system for tracking KPIs and operational
metrics can be in place within 18 to 24 months.

Jabir Patel, associate director of BI at Chicago-based CME Group, said his IT-only team is
working to define a formal BI strategy after being asked to do so by the company’s CIO.
Patel also hopes to create a BICC with business members in addition to workers from within
IT. And he said that CME, which operates the Chicago Mercantile Exchange and other
derivatives marketplaces, is interested in expanding performance management capabilities
beyond what is supported by its current BI system.

But, Patel added, “I think everyone realizes it’s not an easy thing to do.” Defining metrics is
just one part of the performance management puzzle. The cost of building a CPM system to
actually track the metrics is “pretty significant,” he said. “For our organization, we really
haven’t come up with the [financial] value it would provide.”

In addition, Patel said, if a BICC does eventually get management buy-in, it would probably
be set up as “a loosely defined, dotted-line organization” instead of as a standalone unit.

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Resources from IBM

The right architecture for business intelligence: The foundation for effective
enterprise BI

About IBM
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most advanced information technologies, including computer systems, software, networking
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into value for our customers through our professional solutions and services businesses
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