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The Shortcut Guide To

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Achieving Business Intelligence in Midsize Companies


Don Jones

The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

IntroductiontoRealtimePublishers
by Don Jones, Series Editor

Forseveralyearsnow,Realtimehasproduceddozensanddozensofhighqualitybooks thatjusthappentobedeliveredinelectronicformatatnocosttoyou,thereader.Weve madethisuniquepublishingmodelworkthroughthegeneroussupportandcooperationof oursponsors,whoagreetobeareachbooksproductionexpensesforthebenefitofour readers. Althoughwevealwaysofferedourpublicationstoyouforfree,dontthinkforamoment thatqualityisanythinglessthanourtoppriority.Myjobistomakesurethatourbooksare asgoodasandinmostcasesbetterthananyprintedbookthatwouldcostyou$40or more.Ourelectronicpublishingmodeloffersseveraladvantagesoverprintedbooks:You receivechaptersliterallyasfastasourauthorsproducethem(hencetherealtimeaspect ofourmodel),andwecanupdatechapterstoreflectthelatestchangesintechnology. Iwanttopointoutthatourbooksarebynomeanspaidadvertisementsorwhitepapers. Wereanindependentpublishingcompany,andanimportantaspectofmyjobistomake surethatourauthorsarefreetovoicetheirexpertiseandopinionswithoutreservationor restriction.Wemaintaincompleteeditorialcontrolofourpublications,andImproudthat weveproducedsomanyqualitybooksoverthepastyears. Iwanttoextendaninvitationtovisitusathttp://nexus.realtimepublishers.com,especially ifyouvereceivedthispublicationfromafriendorcolleague.Wehaveawidevarietyof additionalbooksonarangeoftopics,andyouresuretofindsomethingthatsofinterestto youanditwontcostyouathing.WehopeyoullcontinuetocometoRealtimeforyour educationalneedsfarintothefuture. Untilthen,enjoy. DonJones

The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

IntroductiontoRealtimePublishers.................................................................................................................i Chapter1:WhatIsBusinessIntelligence,Anyway?..................................................................................1 BusinessGoalsforBI..........................................................................................................................................3 BI:NotJustforBigCompanies.......................................................................................................................3 BITerminology.....................................................................................................................................................4 DataWarehousesandDataMarts...........................................................................................................4 DataMining.......................................................................................................................................................6 Reporting,Dashboards,andScorecards...............................................................................................6 PredictiveAnalytics.......................................................................................................................................9 BusinessPerformanceManagement......................................................................................................9 ABriefTechnicalOverviewofBI...............................................................................................................10 DataMartsandDataWarehouses........................................................................................................10 OLTPvs.OLAP..........................................................................................................................................10 Normalizedvs.DimensionalData....................................................................................................11 DataModeling..........................................................................................................................................12 DataTransformationandLoading.......................................................................................................13 InMemoryAnalytics..................................................................................................................................13 Reporting,Analysis,andVisualization...............................................................................................13 BI:Analysis+Planning...................................................................................................................................16 AnalyzingandReportingonInformation.........................................................................................16 MakingDecisions.........................................................................................................................................17 Implementing................................................................................................................................................17 OneSizeDoesNotFitAll...............................................................................................................................17 BIinLargeEnterprises.............................................................................................................................18 . BIinMidsizeCompanies...........................................................................................................................18 ComingUpNext.............................................................................................................................................19 Chapter2:HowBusinessIntelligenceHappens......................................................................................20 ii

The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

AssemblingYourBusinessData.................................................................................................................20 DirectDataMapping...................................................................................................................................21 DataLoading..................................................................................................................................................22 DataMartsandDataWarehouses........................................................................................................23 InMemoryAnalytics..................................................................................................................................24 CreatinganInformationDrivenBusinessCulture............................................................................25 Reporting........................................................................................................................................................26 . Dashboards.....................................................................................................................................................28 Scorecards......................................................................................................................................................28 . AnalyzingBusinessInformation................................................................................................................30 AnalysisandVisualization.......................................................................................................................31 UncoveringRootCausesBehindData.................................................................................................35 TheImportanceofModelingtheBusiness.......................................................................................36 MakingDecisionsandTakingActionThePlanningConnection..............................................36 Planning:AligningResourcestoOpportunities.............................................................................37 ComingUpNext.............................................................................................................................................40 Chapter3:DebunkingtheTopThreeMythsofBusinessIntelligenceforMidsizeCompanies .......................................................................................................................................................................................41 Myth1:BICanBeDisruptive.......................................................................................................................41 SpecializedToolsandTrainingRequired.........................................................................................42 LongImplementationTimes...................................................................................................................44 ImpactonOtherBusinessProcesses..................................................................................................44 Myth2:BIRequiresSpecializedExpertise............................................................................................45 ComplicatedDeploymentandImplementation.............................................................................46 SpecializedTechnologyManagementSkills....................................................................................46 . LargeCompanySkillsDontScaleDown...........................................................................................47 SpecializedEndUserSkills.....................................................................................................................48

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

Myth3:BIIsExpensive..................................................................................................................................51 ExpensiveAcquisitionCosts...................................................................................................................51 ExpensiveConsultingServices...............................................................................................................52 DontLikeNegotiatingwithVendors?................................................................................................52 UniqueAdvantagesofMidsizeBusinessBI...........................................................................................53 InMemoryAnalytics..................................................................................................................................53 Consistency....................................................................................................................................................54 . WhatsGoodforBigBusinessIsKindofGoodforYouToo...........................................................54 BusinessModelFlexibility.......................................................................................................................55 AdvancedReporting...................................................................................................................................55 DataEverywhereAccessibility..............................................................................................................55 ComingUpNext.............................................................................................................................................57 Chapter4:SuccessfullyAddingBusinessIntelligencetoaMidsizeCompany............................58 ReviewingtheProblemswithBI...............................................................................................................58 . TooComplex..................................................................................................................................................58 TooExpensive...............................................................................................................................................59 TooDisruptive..............................................................................................................................................60 AddingBIWithoutBreakingtheBank....................................................................................................61 NotJustReporting!.....................................................................................................................................61 . ThinkBig,StartSmall.................................................................................................................................62 StartwiththeBiggestPain......................................................................................................................63 AddCapabilitiesasNeeded.....................................................................................................................64 EnsurethatYouHaveaGrowthPath..................................................................................................66 SeekOutFixedPriceSolutions..............................................................................................................66 AddingBIwithYourCurrentITTeam....................................................................................................67 SoftwareAppliances...................................................................................................................................67 ModularAppliances....................................................................................................................................68 iv

The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

EnsurethatYouHaveaGrowthPath..................................................................................................68 MidsizeManageability...............................................................................................................................69 AddingBIwithoutDisruptingBusiness.................................................................................................70 LowStartupCost..........................................................................................................................................70 MinimalSpecializedExpertise...............................................................................................................71 SelfServiceviaWebConsoles...............................................................................................................71 . IntuitiveUserInterfaces...........................................................................................................................72 KeepYourExistingTools.........................................................................................................................74 WhatsGoodforBigBusinessIsntNecessarilyGoodforYou...................................................74

The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

Copyright Statement
2010 Realtime Publishers, Inc. All rights reserved. This site contains materials that have been created, developed, or commissioned by, and published with the permission of, Realtime Publishers, Inc. (the Materials) and this site and any such Materials are protected by international copyright and trademark laws. THE MATERIALS ARE PROVIDED AS IS WITHOUT WARRANTY OF ANY KIND, EITHER EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE AND NON-INFRINGEMENT. The Materials are subject to change without notice and do not represent a commitment on the part of Realtime Publishers, Inc or its web site sponsors. In no event shall Realtime Publishers, Inc. or its web site sponsors be held liable for technical or editorial errors or omissions contained in the Materials, including without limitation, for any direct, indirect, incidental, special, exemplary or consequential damages whatsoever resulting from the use of any information contained in the Materials. The Materials (including but not limited to the text, images, audio, and/or video) may not be copied, reproduced, republished, uploaded, posted, transmitted, or distributed in any way, in whole or in part, except that one copy may be downloaded for your personal, noncommercial use on a single computer. In connection with such use, you may not modify or obscure any copyright or other proprietary notice. The Materials may contain trademarks, services marks and logos that are the property of third parties. You are not permitted to use these trademarks, services marks or logos without prior written consent of such third parties. Realtime Publishers and the Realtime Publishers logo are registered in the US Patent & Trademark Office. All other product or service names are the property of their respective owners. If you have any questions about these terms, or if you would like information about licensing materials from Realtime Publishers, please contact us via e-mail at info@realtimepublishers.com.

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

Chapter1:WhatIsBusinessIntelligence, Anyway?
Forafewyearsnow,businessintelligencehavebeenbuzzwordsoftheITindustry.Unlikea lotofITbuzzwordslikeWeb2.0businessintelligenceactuallycarriessomeweight, hasadefinitemeaning,andbringsrealvaluetobusinesses.BusinessintelligenceorBI,as insidersliketocallitreferstothepracticeofhelpingabusinessacquireabetter understandingofitself.Morebroadly,BIalsoreferstotheskills,technologies,applications, andpracticesinvolvedinbringingthatunderstandingtolight. Thetermbusinessintelligencewasfirstusedina1958articlebyIBMresearcherHansPeter Luhn,whodefineditastheabilitytoapprehendtheinterrelationshipsofpresentedfactsin suchawayastoguideactiontowardsadesiredgoal.Inotherwords,BIisntjustabout technologycentricconceptssuchasdatawarehousingorbusinessanalytics;BIisreally aboutunderstandingtherelationshipsbetweendifferentaspectsofyourcompanysothat youcanguidethecompanytowardspecificgoals,likeincreasingmarketshareand improvingcustomersatisfaction. TheITindustrybeingtechnologycentric,ofcourseusesthetermBIasasortof umbrellaphrasethatcoversallthetechnologiesandcapabilitiesusedtogatherfactsabout thebusiness,presentthosefactsinawaythatmakesrelationshipsclearer,andallow manipulationofthosefactstoprojectwhatifscenariosallintendedtohelpguidebetter decisionmaking. LetsconsiderasimpleexampleofhowBIcanhelpabusiness.

The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

ImprovingCustomerSatisfaction Widgets,Inc.hasbeenstrugglingtoimprovetheircustomerservicelevels. Thecompanygenerallygetsgoodcustomersatisfactionscoresonthe surveysitconducts,butitgoesthroughperiodswheresatisfactiondropsby morethan30%.Thecompanysexecutivesalreadyknowthatthedropscome duringperiodswhenthecompanyisextremelybusy,fieldingfarmoreorders thanusual.Thecompanyhasalreadyspenttensofthousandsofdollars improvingtheirdistributioncenteroperationstoreducethetimeittakesto shipcustomerorders,butithasntseemedtomakeanydifference. ThecompanyinvestsinaBIsystem.Thesystemgathersinformationfroma numberofinternalsources,includingthemainorderprocessingdatabase. Thesystemalsocollectsdatafromsomeexternalsources,includingbilling datafromthecompanysshippingvendors,thecompanyspayrollsystem, andotherplaces. AfterusingtheBIsystemforafewmonths,companymanagersnotice somethingunexpected.Duringperiodsofdecreasedcustomersatisfaction, theirdistributioncenterisactuallylessbusytheycanseetheincreasein customerorderscorrelatewithadecreaseinpayrollforthedistribution center.Diggingabitfurther,theyrealizethattheincreasedcustomerorders aremainlyforproductsthatarebeingdropshippeddirectlyfromacoupleof specificvendorstocustomers.Managementrealizesthatitsthosevendors thatareslowtofulfillorders,causingthedropincustomersatisfaction.They nowknowtofocustheireffortsonimprovingthosevendorsperformance, findingnewvendorsforthoseproducts,orstockingthoseproductsintheir owndistributioncenter,wheretheyllhavebettercontrolovershipping times. ThedrivingforcebehindBIisthatcompaniesaredrowninginunrelatedfactsthatcome fromsilos:payrolldata,financialdata,customerdata,vendordata,andsoon.BIpullsall thatdatatogetherandcorrelatesit.Thedatamayseemunrelated,butinfacteverythingin thebusinessisrelatedsomehowifsomedataistrulyunrelated,thenwhyisitinthe businessinthefirstplace?BIdoesntgeneratenewdataitsimplymakesiteasierto exploreoverlookedrelationshipsbetweendata.

The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

BusinessGoalsforBI
Mostcompaniesevenmidsizeoneshaveanincredibleamountofdatalivingin transactionbased,distributedsystemsanddatabases.Thepayrollsystemhasone database,theorderprocessingsystemhasanother,andsoon.Thesedatabasesare typicallyfinetunedforindividualtransactions,suchasretrievingasinglecustomerorder, orforspecificbatchoperations,suchasprocessingpayrollattheendofeachmonth.What thesedatabasesarenotdesignedtodoiscommunicatewithoneanother,toallowusersto exploredatainunusualways,ortoprovidehighlevelsummariesofthedatainaninstant. ThemaingoalforBI,then,istoprovideexactlythosethings: Theabilitytoviewdatafrommultiplesourcesinasingleview,suchasseeingsales informationcorrelatedwithshippingexpensesandfacilityutilitybills Theabilitytoquicklyseesummariesofdatafromdifferentplacessuchasthetotal payrollspent,alongwiththetotalsales,foragiventimeperiod Theabilitytoseedataovertime,comparingdatafromyesterday,lastmonth,the pastthreequartersofthepast5years,toseehowthingshavechangedovertime Theabilitytoaskwhatifquestionsandhaveanswersgeneratedbasedon historicaldata;forexample,youmightwanttoknowifraisingsalesby10%fora sustainedperiodoftimewillnecessitatearaiseinutilitycostsorpayrollexpenses

Ideally,theanswerstothesequestionscanfeeddirectlyintothecompanysplanning systems,helpingdefinebudgets,salesgoals,andotherplanningelements.Doingsoallows historicaltrendstodrivebusinessdecisions,andthosedecisionsautomaticallydrive businessplanning. OneofthereasonsBIhasbecomesopopularaterminthepastfewyearsisthatitisan incrementalITinvestment.Youdonthavetotearapartyourexistingsystemsinanyway infact,thosesystemswontknowthattheyreparticipatinginaBIsolution.ThefactthatBI doesntimpactyourproductionsystemsmeansimplementingBIisrelativelylowrisk yourenotlikelytodisruptdailyoperationswhileimplementingaBIsolution.Bestyet,a properlydesignedandimplementedBIsolutioncanquicklydeliverahighreturnon investment(ROI),somethingexecutivesreallyappreciate.

BI:NotJustforBigCompanies
TheresaperceptionthatBIisjustformajorenterprises,anditscertainlytruethatmajor enterpriseshavealottogainfromimplementingBIandthatthosebigcompanieshavethe extracashneededtoimplementaBIsolution.Implementationinmajorenterprisescan takemonths,anditsrarelyaninexpensiveundertaking.

The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

ButthatdoesntmeanmidsizecompaniescantbenefitfromBI,anditdoesntmeanmidsize companieshavetospendasmuchtimeormoneyashugecompaniesdo.Afterall,midsize companiesoftenuselessexpensive,easiertoimplementsolutionsforthingslikepayroll, corporatebookkeeping,andcustomerrelationshipmanagement;BIdoesntneedtobeany different. Buttheresanimportantcorollarytothatstatement:Justasmidsizebusinessesdontuse thesamebookkeepingsoftwarethatamajorenterprisedoes,amidsizebusinesswontuse thesameBIsolutionthatagiganticcompanyuses.BringingalargescaleBIsolutionintoa midsizecompanyisntanysmarterthanbringingagiganticfacilitiesmanagementpackage intoamidsizecompany.WhatmidsizecompaniesneedisamidsizeBIpackage.Huge companiesaregenerallyaccustomedtolengthyimplementationtimesforanynewsolution packagewhetheritsEnterpriseResourcePlanning(ERP),CustomerRelationship Management(CRM),payroll,orwhatever.Midsizecompaniestypicallytakeadvantageof moreprepackagedsolutionsthatarelessexpensiveandmucheasiertoimplement.The sameapproachcanworkforBI. Infact,youcanmakeanargumentthatmidsizecompaniescanseeaquicker,betterreturn onaBIinvestmentthanlargecompanies.Afterall,largecompaniescanbeslowtochange, evenwhentheyvegotgoodintelligence,smartdecisions,andagoodplan.Evenwitha fullyimplementedBIsystem,largecompaniesoftentakelongertoimplementthedecisions thattheirBIleadsthemto.Midsizecompanies,incontrast,areknownforbeingsomewhat simplerinstructureandcanoftenreactmorequicklytochange.WiththerightBIsolution, amidsizecompanycouldeasilydevelopsolidBI,makesmartdecisionsaboutthe companysfuture,andactonthosedecisionsmorerapidlymeaningafasterROIfromthat BIsolution.

BITerminology
LetsbrieflystepbackfromthebusinessaspectsofBIandlookatsomeofthemajor elementsthatgointoaBIsolution.Wellstartwiththenextfivesections,whereIlloutline themajoraspectsofaBIsolutionatahighlevel.

DataWarehousesandDataMarts
CentraltomostBIeffortsisadatamartoradatawarehouse.Theyrebothbasicallythe samethingunderthehood:aspecializedkindofdatabasethatsdesignedtosupport businessanalyticsandtocontaindatafromoneormanydifferentsources.Thedifference betweenamartandawarehouseistheirscope:Adatamartonlyseekstoservetheneeds ofaportionofthecompany,suchasthemarketingdepartmentorfinancedepartment.A datawarehouseseekstoservetheentirecompany.

The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

Therearetwodesignapproachesthatcomeintoplaywhenyouretalkingaboutmartsand warehouses.Thetopdownapproachdirectsustobuildthedatawarehousefirst, consideringtheneedsoftheentirecompanywhendesigningit.Thatsobviouslyacomplex task,asyoureallyneedtolookathowtheentirecompanyworksandhowitsvarious piecesfittogether.Withthewarehouseinplace,youcancreatedatamartsthatextracta portionofthewarehousetomeettheneedsofspecificaudiences,suchasfinanceor marketing. Thebottomupapproachdirectstheopposite,havingusbuilddatamartsforeachaudience withinthecompany,thencombiningthosetoformacompanywidedatawarehouse.Thisis ofteneasiertoimplement,simplybecauseitseasiertowrapyourbrainaroundtheneeds ofaspecificdepartmentsuchasmarketingthantograspthecompanywideviewof things.However,thisapproachisnotwithoutitsdetractors.Ina2000article,DataMart DoesNotEqualDataWarehouse,authorWilliamInmonofferedthisanalogy:Youcan catchalltheminnowsintheoceanandstackthemtogetherandtheystilldonotmakea whale.Whathessayingisthatthesilospecificdatamartswillhavegapsbetweenthem, andtheyllnever,insum,providetherealcompanywideviewyouneed. ThesesortsofdesignissuesarewhatmakeBIimplementationinlargecompaniesso complex.Inmidsizecompanies,however,theresanadvantage:Prepackagedsolutionscan takemuchofthiscontroversyoutofyourhandsbyprovidingapremadedatawarehouse. RalphKimball,anothernoteddatawarehousedesignexpert,favorswhatmanydescribeas abottomupapproach.Hesuggeststhat,firstandforemost,youneedtofocusonyour business.Buildingsmallerdatamartsthateachfocusonaparticularsubjectwithinyour businesshelpsconstrainthetasktosomethingmoremanageable,andhelpsyoukeepthe businessnottheultimatedatawarehousemorefirmlyinmind.Herecommends buildingdatamartsnotaroundbusinessunitsbutaroundbusinessprocesses,suchas orders,shipments,payments,andsoforth.Kimballrefutestheuseofthebottomuplabel forhisapproach,pointingoutthathisapproachdoesntfollowthetraditionalbottomup approachofdesigningaroundorganizationalunitswithinthebusinessbutinsteadaround howthebusinessworksandwhatitdoes. Resource AfulldiscussionofRalphKimballsapproachisbeyondthescopeofthis book,butyoucanlearnmoreathttp://www.ralphkimball.com/.Especially informativeishisFablesandFactspageat http://www.ralphkimball.com/html/controversies.html. Sowhatisadatawarehouse?Illgetintothetechnicaldetailsabitlaterinthischapter,but fornow,thinkofadatawarehouseasaplacewhereallyourcompanysdataiscopiedto andthenrearrangedsothatrelationshipsareeasiertoperceiveandsummariesareeasier togenerate.

The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

DataMining
DataminingissimplytheprocessofextractingpatternsfromdatainBIterms,froma datawarehouse.Wanttofindoutwhythedistributioncenterprocessesordersmore slowlyatcertaintimesofthemonth?Mineyourdatawarehouselookingforpatterns perhapsyoullfindthatthingsslowdownasthesupplyofcardboardboxesdwindles becausetheboxvendorisntfulfillingtheirordersquicklyenough. Itsimportanttorealize,however,thatdataminingcantrevealpatternsindatathatarent presentinthedatabeingmined.Thatsoundsobvious,butitcanbedeceptivebecausedata miningcanoftenseemtorevealpatternsthatarentreallythere.Whatyoucanfindyourself lookingatisapatterncomprisedofsymptomsratherthancauses,whenthecausaldataisnt presentinthedatawarehouse.Thisisnttosaythatdataminingisntusefulitsatthe heartofBI,infact.Rather,youjustneedtobeawareofwhatsinthedata,andwhatisnt, andtakecommonsenseapproachestoverifyingandvalidatingtheconclusionstowhich yourdataminingleadsyou.

Reporting,Dashboards,andScorecards
Withallthedatathatadatawarehousecancontain,mostuserswillneedsimplifiedmeans oflookingatcommonlyexaminedinformation.Reportsareoneobviousproductofadata warehouse,andtheycanrangefromhighlevelsummariestoextremelydetailedanalyses. Anotheroptionisadashboard,whichprovidesasummaryofcommonmetricspossibly frommultiplesources,andoftencontainsplanningandactualcomparisons,often visualizedinaslick,simplifieduserinterface(UI)suchastheexampleFigure1.1shows.

Figure1.1:Anexampledashboard. 6

The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

Dashboardsdontoftendrivedirectdecisions;rather,theyletindividualusersgetafeelfor generalperformance,suchassales,inventoryturn,customercomplaints,andsoforth. Dashboardsletyouknowifeverythingisallrightoriffurtherinvestigationiswarranted. Dashboardsmayalsoincludetrendssuchasdaybydaysalesfigurescomparedwith goalsorplans.Again,thedashboardisntgoingtoletyouknowwhysalesarewherethey arebutiftheyresignificantlyoffplan,youllbeabletotellataglanceandinitiatefurther investigation. Dashboardsareusefulbecausetheycanhelpnewandlessexperiencedusersquicklystart takingadvantageofthedatainadatawarehouseoreventhedatainatransactional processingsystem,suchasanorderentryapplication.Thelearningcurveforadashboard isusuallyprettyshortandshallow,somoreusersarelikelytousethemmoreeffectively. Anotherusefulvisualizationisascorecard.ThiscustomUIlinksinternalandexternaldata totheorganizationsgoals.Basically,ittellsyouhowfaralongyouareintermsofachieving yourgoals.Figure1.2offersanexample,showinghowfarvariousdepartmentsarein achievingaspecificcompanygoal.

Figure1.2:Anexamplescorecard.

The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

Scorecardsareusefulpreciselybecausetheyshowyouwhereyouareinrelationtoyour goals.Inthisexample,theSalesdepartmentisdoingwell;theHumanResources departmentmayneedsomeinvestigationandassistance.Scorecardshelpyoufocusyour efforts,spotproblemareas,andmanagetoyourgoalsonadailybasis. Dashboardsandscorecardsserveasimilarpurpose,andsomeBIsolutionspresentthemin suchawaythattheresnopracticaldifference.Ifyouneedtomakeadistinctionbetween them,adashboardusuallyjustshowsyouwhereyouareinabsoluteterms;ascorecard showsyouwhereyouarerelativetoyourgoals.Bothareuseful,andbothmaybe presentedinadashboardstyleUI. EmptyBeds?!?! Considerthisexampleofhowdashboardscanhelpmanagementfocusonthe rightareasfortheirattention.NiceHotels,Inc.traditionallymanageditself likemosthotelsdotheirprimarymetricwasroomoccupancy.100% occupancywasalwaysthegoal,althoughmostoftheirpropertiesrarely achievedthatonaconsistentbasis. AfterimplementingaBIsystem,managersweregivenanewdashboardthat showedthemtotaloccupancyaswellasoccupancyonaperbedbasis.The dashboardalsoshowedthenumberofgueststurnedawayinanovacancy situation.Theyfoundthattheirfrontdeskagentswereassigningsingle gueststoroomswithdoublebeds;laterintheevening,theywouldturnaway familiessimplybecausetheonlyroomsleftatthatpointcontainedsingle beds. Managersstartedmanagingtoperbedoccupancyinsteadofperroom occupancy.Theyscheduledroomcleaningssothatanequalnumberof doublesandsingleswouldbecleanedatroughlythesametime,ensuringthat thefrontdeskwouldhavethebestchanceofhavingtherightsizeroomfor whateverguestwascheckingin.Theytrainedthefrontdesktonotuse doubleroomsforsingleguests. Overtime,somepropertieswerestillseeinghigherthandesiredquantities ofemptybedseachnight,sotheybeganplanningtoconvertsomedouble roomstosinglesduringrefurbishments.Singleroomsrequirelesstimeto clean,arelessexpensivebecausetheycontainlessfurnitureandsoftgoods suchassheets,andthosepropertiesclearlyhadasurplusofdoublerooms. Bybeingabletoseeperbedoccupancyataglance,managersbeganto managemoreaggressivelyandintelligently,customizingeachpropertytoits historicalclienteleandrealizingadditionalrevenueandsavingsovertime.

The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

PredictiveAnalytics
Predictiveanalyticsisexactlywhatitsoundslike:miningdata,lookingforpatterns,and makingpredictionsaboutfutureeventsbasedonhistoricalfacts.Creditscoringisoneof themostwellknownformsofpredictiveanalysis,andcreditreportingcompaniesmake useofsomeoftheworldslargestdatawarehouses.Thereportingcompaniesproprietary scoringalgorithmsconsiderfactorssuchascredithistory,paymenthistory,loan applications,andothercustomerdatatoassignnumericscoresthatareapredictionofthe customersabilitytoproperlymanageandservicetheirdebt. Crosssellsuchastheyoumightalsolikeproductsuggestionsfrometailerslike Amazon.comisanotherexample.Byanalyzingthetotalpurchasesmadebyallofits customers,acompanycanpredict,withsomedegreeofaccuracy,whatproductsyouare likelytopurchasebaseduponthoseyouhavepurchasedorthoseyouareconsidering.By offeringyouthoseitemsratherthanmakingyougohuntforthem,thecompanycantake advantageofimpulsebuying,helpingtoincreaseoverallrevenue. Internally,manycompaniesusepredictiveanalyticswithouteventhinkingaboutit.For example,manyretailersknowthattheirholidaysaleswillbesomemultipleoftheirpre holidaysales;theyalsoknowthatacertainnumberofadditionalemployeeswillbeneeded tohandletheadditionalholidaysalesvolume.Bylookingathistoricaldataandplottinga trendintothefuture,thosecompaniescanmakeaninformedguessabouteachyears holidayhiringneeds.Mostcompaniesfacenumerousadhocdecisionseveryday; predictiveanalyticscantmakethosedecisions,butitcanhelpinformthemwithmore accuracythanagutdecision.

BusinessPerformanceManagement
BusinessPerformanceManagement(BPM),orCorporatePerformanceManagement(CPM), rollsupreporting,predictiveanalytics,andotherBIpracticestogetherwithplanning, budgeting,andforecasting.Itsdesignedtoprovideaframeworkthatorganizes information,deliversnewinsight,takesaction,andoptimizesperformance. InTheNextGenerationofBusinessIntelligence:OperationalBI,authorColinWhite describedthelinkbetweenBIandbusinessperformancemanagement: ThebiggestgrowthareainoperationalBIanalysisisintheareaofbusiness performancemanagement(BPM).OperationalBPMapplicationsnotonly analyzetheperformance...butalsocomparethemeasuredperformance againstbusinessgoalsandalertbusinessuserswhenactualperformanceis outoflinewithbusinessgoals. Aswithscorecards,goalistheoperativekeywordforBPM.BIisgreat;comparingthe informationfromBItoyourgoalsallowsyoutomanage.

The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

Althoughthefancynameisnew,BPMasaconceptisntallthatnew.Mostsalesmanagers, forexample,areinthehabitoflookingatthepriordayssaleswhentheysitdownforwork inthemorning.Theymightdrillintoeachsalespersonsindividualsalesaswell.They compareallthatdatawiththeirsalesgoals,andtypicallyknowhowmuchtheystillhave lefttosellinthemonthbeforetheymeettheirgoal.BPMandBIsimplytakethattoahigher level,automatingthecollectionofthedata,automaticallycomparingitwithgoals,andnot onlydisplayingtheresultinadashboardbutalsoalertingmanagementwhenperformance isoutoflinewithgoals. BPMmightevendriveautomateddecisions.Forexample,ifsalesaremarkedlyhigherthan planned,aBPMsystemmightacceleratethevelocityofproductsordersplacedwith vendorstoensuresufficientstockisonhandtomeetthegrowingdemandtrend. BPMisacontinualloop,meaningaBPMsystemupdatesitself.Asthecompanyrespondsto currentevents,theBPMsystemcontinuouslycollectsitsdataandchangesitsanalyses, helpingthecompanyimmediatelyseetheneartermandpredictedlongtermeffectsofits efforts.

ABriefTechnicalOverviewofBI
Now,letsspendsometimelookingatthetechnologythatlivesunderthehoodofaBI solution.Manyofthesetechnologiesarereallyjustcleverextensionsofproven,decades oldtechnologiesusedinnewwaystohelpachievegreaterresults.

DataMartsandDataWarehouses
Adatawarehouseoradatamartsubsetisreallyjustanormaldatabase.Typically,they liveinthesamerelationaldatabasemanagementsystemssuchasOracle,SQLServer, DB2,orwhateverthatnormaldatabaseslivein.However,datawarehousesanddata martsarestructuredquiteabitdifferently. OLTPvs.OLAP AnOnlineTransactionProcessing(OLTP)ortransactionaldatabasehasseveralkey features: Itcontainsdetailedinformation.Forexample,itcontainsnotonlysummary informationsuchasthetotalamountofanorderbutalsodetailedinformationsuch ashowmucheachitemcosts. Itisdesignedtoprocesstransactionsmeaningitstypicallydealingwithonepiece ofdataatatime:oneorder,oneproduct,onecustomer.Itmaybeusedtogenerate basicreportsfromthisdata,butitsstructureisoptimizedtosupportrapidaccess tosmallchunksofdata,thereforecontainingmanytables.

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

Theschemaisrigidandunchanging. Itcontainsuptodateinformationandisupdatedinrealtime.Itmaypurgedata onceitisnolongerneededorrelevant,thereforecontainingonlycurrentdata. Thequalityofinputdataisoftenveryhigh,meaningapplicationsandother elementsensurethatcorrectdatagoesintothedatabase.

AdatawarehouseisanOnlineAnalyticalProcessing(OLAP)database,andoftenincludes thesefeatures: Somedatamaybesummarized,meaningdetailisnotavailable.Youmaybeableto tellthetotalamountofagivenorderbutnotthecostofeachproductcontainedin theorder. Itspurposeistodriveanalysisanddecisions.Accessisoptimizedforexamining largequantitiesofdatainordertoseetrends. Theinformationishistoricalandisonlyasuptodateastheloadingschedule.The emphasisisonpastdataandtrends,moresothanimmediate,realtimedata.Historic datafrommonthsoryearsagowilloftenbestoredwithinthedatabase. Dataisoftencleansed,meaningerrantoredgedatamayberemovedtomake trendsclearer.Datawarehousestendtofocusonsetsofdataratherthanon individualelements.

Companieswithadatawarehousewillalwayshaveoneormorenormaldatabasesthat feedthedatawarehouse. Normalizedvs.DimensionalData OLTPsystemsrelyonnormalizeddata,meaningtheyseektoreducedataduplicationand relyondependenciesbetweensetsofdata.Customersplaceorders,forexample,andsoan OLTPdatabasemighthaveonetableforcustomerdataandanotherfororderdataand woulduserelationshipstoconnectcustomerstotheirorders.OLTPdatabasesworkwell becauseinmanysituationsonlysmallpiecesofdataarebeingmanipulatedenteringa newcustomerorretrievingoneorder,forexample.OLTPdatabasesaretunedtosupport thisbehavior. However,whenitcomestoBI,youdontalwaysneedthefinedetailslikewhich customersorderedwhatproducts.Instead,yourelookingatbiggertrendslikehowmany ofaparticularproductweresoldintheprecedingquarter.OLTPdatabasescanprovide thatinformation,buttheyreabitsloweratitbecausetheirdatabasestructureisntfine tunedtosummarizeandaggregatedatainthatfashion.Infact,askinganOLTPdatabaseto providethatinformationcanimpactperformanceofnormaldatabaseoperations meaningyourquestforBIwillactuallyslowdownbusiness. Adatawarehouseusesadifferentdatabasestructureentirely.Figure1.3showsasimple exampleofastarschema,oneofthesimplestdatawarehousingstructures.

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

Figure1.3:Anexamplestarschema. Here,allthepossibledatesarepulledintoonetablecalledadimensiontable.Allpossible productsareinaseconddimensiontable,andallthecompanysstoresareinathird dimension.Acentralfacttablelinksthethreedimensionssothatyoucandiscoverwhich productsweresoldinwhichstoreonwhatdate.Thisstructureisnotoptimizedtoreduce dataredundancyinfact,therewilllikelybealotofduplicateddata.Thatsokay;data warehousestradesizeforspeed,meaningtheyoftencontainagreatdealofredundant data,butthatredundancyhelpsthemproduceresultslikereportsmuchmorerapidly. Usingaschemalikethis,forexample,makesitmucheasiertoseethedaysonwhich televisionssoldmorequicklyorwhetherthereareanystoresthatselllaptopcomputers especiallywell. DataModeling Thetricktoaneffectivedatawarehouseisintheschemahowyoumodelthedata.You needtoknowinadvance,toadegree,whatquestionsyouwantansweredbythedata warehouse.Forexample,theexampleinFigure1.3wonthelpyoufigureoutwhethermore customersuseVisaorAmericanExpresstopurchaserefrigeratorsbecauseyoudidnt includepaymentinformationintheschema.Ifthatsthetypeofthingyouwanttoknow,it needstobeincludedinthedatamodel. Datamodelingiswherelargecompaniesspendalotoftimewhentheyreimplementinga datawarehouse.Fortunately,midsizecompaniesoftensharealotofcommondatasources andbusinessneeds.Justasanofftheshelfbookkeepingpackagetendstoworkwellwith justaboutanykindofmidsizebusiness,anofftheshelfBIsolutioncanalsoworkwell withoutallthetimeconsumingupfrontdatamodeling.

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

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DataTransformationandLoading
Withyourdatawarehouseschemaready,thenexttaskistogetdataintoit.Onereasona datawarehouseworkswellisthatitcopiesdatafromproductionsystemsintothe warehouse;thatmeansyoucanpullreportsfromthewarehousealldaylongwithout impactingyourproductionsystems.Italsomeansthatyourwarehousesdatawillalways beslightlyoutofdateexactlyhowmuchdependsonhowoftenyoucopynewdataintoit. However,mostBIworksfromlongtermtrends,sonothavinguptothemomentdataisnt usuallyanissue.ThereissuchathingasrealtimeBI,butitisbeyondthescopeofthisbook. Theactualprocessofcopyingdataisusuallyreferredtoasanextract,transform,andload process(ETL).Theextractstepconnectstothesourcedatabaseandpullstherequireddata fromit.AgoodBIsolutionwillhavethecapabilitytoconnecttomostcommondatabases; longstandingconnectivitystandards,adoptedbymostdatabasevendors,makesthis easier.Thetransformsteprearrangesthedataintotheschemausedbythedata warehouse.Thismayinvolvesummarizingcertainpiecesofdata,ifthedatawarehouse wontcontainlineitemdetails,anditusuallyinvolvesspreadingthedataoutintothe differenttablestructureusedbythedatawarehouse.Finally,theloadstepactuallyplaces thetransformeddataintothedatawarehouse.Thismaybeaseparatedatabaserunningon arelationaldatabasemanagementserveroraproprietarydatabasecontainedwithintheBI solutionitself. ETLisntanallornothingprocess.Youmayloaddatafromcertainsourcesonceanhour, oreverynight;othersourcessuchasaccountingsystemsmaybecomeinvolvedona monthlyorquarterlybasis.

InMemoryAnalytics
ArelativelynewdevelopmentinthefieldofBIisinmemoryanalytics.Ratherthancopying allyourdatatoadifferentlocationlikeadatawarehouseandperforminganalysis there,dataissimplyreadintoaserversmemoryandanalyzedrightthenandthere. Actually,theideaofinmemoryanalyticsisntnew,butitsonlyrecentlywiththe availabilityofmorepowerfulcomputingresourcesatlowerpricesthatitsbecome practical.Illdiscussitinmoredetailinthenextchapter.

Reporting,Analysis,andVisualization
Thelaststep,ofcourse,istousethedatainthewarehouse.ThisiswhereBIsystemsreally comeintoplay:Simplyhavingalotofdatasittinginadatabaseisntterriblyuseful;theBI systemcontainsthesmartstoturnthatdataintousefulreports,dashboards,scorecards, andotherformsofinformation. GoodBIsystemswillallowuserstoworkwiththetoolsthattheyrealreadycomfortable with.Ivedescribedhowdashboardsandscorecardsprovideintuitivesummariesofdata; someusersmaypreferstraightforwardreports,whileothersmightprefertoworkwith pivottablesinaspreadsheetapplicationsuchasMicrosoftExcel.Figure1.4showsan exampleofthese,andhowasingleBIsolutioncanprovidealltheseformsofoutput.

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

Figure1.4:Commonexamplesofdatawarehouseoutput. PivottablesthePivotTablefeatureinMicrosoftExcel,forexamplecanbeuseful analysistoolsforusersalreadycomfortableworkingwithspreadsheets.Welldiscussthem moreinlaterchapters,butfornow,keepinmindthatpivottablesallowuserstoconstruct customoutput,summarizekeydataondemand,andrearrangedatatoseedifferent relationships. BIsystemscanalsoprovidemorepowerfulvisualizationsfordata.Forexample,Figure1.5 showsarelationshipchart,whichhelpsvisualizepatternsindata.Inthisexample,the yellownodesrepresentindividualsinacommunitywhosmokecigarettes.Researchers usedthischarttostudytheeffectsofthesmokersrelationshipsontheirsmoking,and foundthatafteralmost30years,moststoppedsmoking.Theoneswhocontinuedsmoking hadfewcloserelationships.Thissuggestedapatternofquittingifyourfriendsquit,you willtoo.Itsatypeofrelationshipthatonlyadatawarehouse,andthisspecifickindof visualization,canunveil.

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

Figure1.5:Anexamplerelationshipchart. Reporting,analysis,andvisualizationcanallseemlikethesamethingandtheycertainly allservesimilargoals.Sowhataretherealdifferences? Reportscanaddressavarietyofbusinessneeds,canbepersonalizedandtargeted, andcanbeeasilydistributedviamanymeans.Theycanbeadaptedtorunfrom differentdatasourcesaswell,makingthemveryflexible. Dashboardstranslatecomplexinformationintohighimpact,ataglancedisplays. Theyremoreintuitivethanreports,andhelpkeepdecisionmakersalignedwith organizationalgoals.Dashboardshelpyouspotproblemsmorequickly,making themgooddailyusetools. 15

The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

Scorecardsalsodeliverataglanceinformationbutshowhowwellyouredoing comparedwithspecifictargets.Theyregoodforcommunicatingstrategyand progress,andcanhelpincreaseaccountability. Analysisletsyouexploreinformationfromacrossthebusiness,andhelpsyoudig deepertodiscoverthewhybehindwhatyoureseeingonareport,dashboard,or scorecard.Youcanmovethroughsummaryinformationtodeeperlevelinformation, andmodelwhatifscenariostohelpfindtherightactionforimprovement.

BI:Analysis+Planning
Allthebusinessintelligenceintheworldisuselessifyoudontuseittochangesomething aboutyourbusinessoratleasttovalidatethatwhatyourecurrentlydoingisthebest path.GoodBIsolutionsfacilitatethisgoalbynotonlyprovidingintelligencebutalsoby helpingyouanalyzethatintelligence,makedecisions,andactuallyimplementthose decisions.

AnalyzingandReportingonInformation
Analyzinginformationcanhappeninmanyways.Youmightusereportsor,more specifically,youmightuseaninteractivedrilldownordrillupreport.Thesereportsletyou clickanitemofdatatoseethedetailbehindthatitem,makingiteasiertodigtothesource ofsomethingthatisproblematic.Oryoumightlookatinformationbasedonadhoc queries,whichcanbepresentedinavarietyofformats.Youmightalsousedashboardsor othervisualizations,likethebreakdownshowninFigure1.6.

Figure1.6:Anexamplesalessummaryreport.

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

IfyourecomfortableinExcel,youmightcreateaPivotTable,oruseoneofthemanyBI addinsforExcel.Thesecanhelpyouanalyzewhatifscenarios,likeseeingtheeffectofa changeinproductsalesforagivenmonth.Allthisanalysiswillhelpyoudrawconclusions aboutwhythingsarethewaytheyarewithinyourcompany;youcanthenmakeinformed decisionsaboutwhichthingsneedtochangeinordertomeetyourgoals.

MakingDecisions
Makingdecisionscanbethetoughpart.Thetrickistomakesureyourelookingatallthe data.BIsolutionscanhelpbycorrelatingdatafrommanysources,makingiteasiertosee previouslysiloedinformationinasingle,cohesiveview.Seeproductsalesnextto manufacturingcostsalongsidepayrollandfacilitiesoverhead.Drilldownreportshelpyou seethenittygrittydetailseasilyandthendrilluptosummaryviewsthatshowyouthe bigpictureresultsofproposedchanges. WhatifiswhereBIreallycomesinhandy.Asyoulookatprojectionsandtrends,BI solutionsmakeiteasytoplugindifferentnumbers:Whatifweincreasedpayrollandhired newshippingclerks?Whatifweuseanadditionalvendortosourcecriticalcomponents? Whatifunitsalesgodown10%?Whatifweofferbiggerdiscountsforbulkorders?By punchinginproposals,youcanseealmostinstantlyhowthenumbersfallout,to determinewhetheryourproposalsmakeapositiveornegativeimpact.

Implementing
Implementingiswheretherubbermeetstheroad:Itswhereyoutakeyourbestproposals andputthemintoaction.Doingsomayrequireupdatingcorporatebudgets,financial outlooks,andotherplanningandsupportsystems;agoodBIsolutionwillprovidewrite backcapabilitiessothatyourwhatifproposalscanbeacceptedandlinkedbackto businessoptimizationandplanningtools.Inotherwords,justasaBIsolutioncanreaddata fromplanningsystems,itcanalsowritedatabackintothosesystemstoadjustassumptions andplans.ItsagreatwaytoclosetheloopinBI,makingyourwhatifproposalsa reality,sooner.

OneSizeDoesNotFitAll
BIlikemostbusinesstechnologiesisnotaonesizefitsallaffair.Iactuallygetalittle surprisedwhenIseemidsizebusinessesattemptingtoimplementorevenconsidering thesameBIsolutionsusedbyagiantcompanylikeFordMotorCompany,Aetna,orHome Depot.MostmidsizecompanieswouldneverevenlookattheERP,CRM,andother applicationssuitableforagiantcompany;mostsolutionvendorshavespecificproducts gearedtowardmidsizebusinesses.WhyshouldBIbeanydifferent?

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

BIinLargeEnterprises
Notwolargeenterprisesareexactlyalikeindeed,fewofthemareevenvaguelysimilar, evenwhentheyreinthesameindustry.Theymayhaveallstartedassmallcompanies,but theygrewupinverydifferentways.Theyhandlepayrolldifferently,structuretheir accountingdifferently,havedifferentmanufacturingmodelsandphilosophies,andsoon. Largeenterprisesareoftenorganizedintobusinessunitsanddivisionswhichthemselves operatealmostasindependententities.InsomelargeenterprisesGEisagoodexample therearedivisionsthathaveabsolutelynothingtodowithotherdivisions,suchasGEs medicalequipmentdivisionandtheirtelevisionbroadcastingdivision(althoughGEs medicalequipmentdoesgetsuspiciouslygoodplacementintheirnetworkstelevision shows). AllofthismeansthatBIinalargeenterpriseiscomplicated.Youredealingwiththousands ofdatasourcesintheETLprocessandmayhavehundredsofdifferentaudiencesthatneed differentreports,dashboards,andscorecards.EveryBIdeploymentinoneofthese enterprisesisacustomaffair,fromdesigningthedatawarehouseschematowritingthe ETLroutinestodevelopingthefinaloutput.ManyBIvendorswhoworkatthisleveldont sellproducts;theyselltoolkits,alongwithdeploymentandimplementationservices expertswhousethosetoolstobuildacustomBIsolutionforeachnewcustomer. Soundexpensive?Surebutdontforgetthatbigenterpriseshavealotofmoneyonthe line.IftheyspendacoupleofmilliondollarsimplementingaBIsolution,theymaybe lookingtosavetensofmillionsfromthatsolution.Butitdoesntscaledown.Followthat sameimplementationprocess,usingthesamevendorsandtoolkits,andyoullspendalot ofmoneyandmidsizecompaniesarentlookingtosaveasmuch,sotheBIinvestment doesntseemworthit.

BIinMidsizeCompanies
Midsizecompaniesareatotallydifferentanimal.Theyremorelikely,forexample,touse offtheshelforlightlycustomizedsolutionsforkeytaskssuchasbookkeeping,payroll, CRM,andsoforth.Midsizecompaniestendtofocusonsimilarbroadbusinessquestions: Wherearesales?Howsinventory?Whatdoespayrollandotheroverheadlooklike? Midsizecompaniestendtohavealotofbroadsimilaritieswithoneanother,inother words. Thus,BIvendorscanofferprepackagedBIsolutionsdesignedformidsizebusinesses. Thesesolutionsmayrequirelittleornooutsideexpertservicestoimplement,andtheyre designedinmuchthesamewaythatmidsizebookkeepingsoftwareisdesignedtomeeta commonsetofneeds,withenoughroomforcustomizationtoensureagoodfitonmost businesses.TheBIvendorisabletospreadthecostofdesigningthedatawarehouse, output,andETLroutinesacrossallofitscustomers,resultinginalowercost,offtheshelf product.ItwouldntbeatallsuitableforaFortune500companybutitcanworkgreatfor midsizebusinesses.

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

PrepackagedBIsolutionsoftenofferthemostcompellingfeaturesfromthefullsizedBI toolkits,suchasWebbaseddashboards,supportforpivottablesinspreadsheets, scorecards,andsoon.WellexploresomeofthesefeaturesandhelpbuildaBIsolution shoppinglistinanupcomingchapter.

ComingUpNext
SoexactlywhatisinvolvedinmakingBIhappeninsideyourorganization?Howdoyou introduceaBIsolution,andwhatsortofoutputswillyouneed?Howwillyouanalyzethat output,andwhatsortsofdecisionscanyouexpecttomake?Inthenextchapter,Illattempt toanswerallofthesequestionsbyexplainingthebasicprocessbywhichBIisintroduced intoanenvironment.Welldigalittledeeper,technically,thaninthischapter,butIllalso focusonlayingoutthestepsyoullbetaking.IlllookatwhyBIistraditionallycomplicated andexpensive,andoutlinesomewaysinwhichmidsizecompaniescanleveragecertain economiesofscaleandsimilaritytosavebothtimeandmoney.

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

Chapter2:HowBusinessIntelligence Happens
How,exactly,doyougetabusinessintelligence(BI)systemintoyourorganization?BI hasnttraditionallybeensomethingyoujustinstallontoaserverorclientcomputer,soits importanttounderstandtheprocess,tools,andtechniquesthatareinvolvedin implementingandcreatingit.Someofthesemay,infact,bemajorreasonswhyyour midsizecompanyhasavoidedBIinthepastmakingitevenmoreimportantto understandnotonlythetechnologies,tools,andtechniquesbutalsohowtheyveevolvedin recentyearstomeettheneedsofcompaniesotherthangiantenterprises. Inthischapter,IllexplainthebasicprocessesbywhichBIisintroducedintoan environment.IllalsolookatsomeofthereasonsBIistraditionallyatimeconsumingand expensivepropositionformostcompanies,andsetupsomeofthewaysinwhichyoucan implementBImoreeasilyandforlessmoney.ThinkofthischapterastheBIlifecyclea lookintowhatBIactuallylookslikeinsideanorganizationlikeyours.

AssemblingYourBusinessData
BIis,firstandforemost,allaboutdata.TheultimatepurposeofBIistobringtogetherdata frommanydifferentsourcessothatyoucanstartmakingconnections,findingpatterns, andspottingtrendsthatwouldntbeapparentotherwise.Thatmeansthefirststepin implementingBIisdecidingwhatbusinessdatayoullneedtoassemble,andfiguringout howtogetitallintooneplace.Theactualtechnologiesfordoingsoarelessimportantright now;wereconcernedwiththedifferentkindsofdatathatdriveyourbusinessandthe waysinwhichthatdataiscurrentlystoredandused.Thatinformationwillhelpusdecide whichtechniquesyoushouldusetopullthatdataintoaBIplatform. Note Imdeliberatelyavoidingthetermdatawarehouseforacoupleofpages; althoughitslikelythatyourBIeffortwillinvolvesomekindofdata warehouseordatamart,thatsnotimportantatthemoment.Rightnow, weretakingastepbackfromthedeeperlevelsofBItechnologyandthinking aboutwhatyourdatacurrentlylookslike,andwhatyouneedyourdatato looklikeinordertouseitwithinaBIimplementation.

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

Rightnow,themajorityofthedatainyourorganizationprobablylivesinsidetransactional databases.Thatis,yourdatalivesinthesystemsthathandleyourbusinessdaytoday operationscustomerorderingsystems,invoicingsystems,financialsystems,andsoon. ThatinformationmightphysicallyliveinsomethinglikeMicrosoftSQLServer,orOracle,or IBMDB2,orsomeotherrelationaldatabasemanagementsystem.Youmaywellhavedata livinginsmallerdatabasessuchasMicrosoftAccessorevenMicrosoftExcelspreadsheets. Someofyourdatamaybeinproprietarydatabases,likeaQuickBooksfile,orinadatabase usedbymidsizebusinesssoftwarelikeMicrosoftDynamicsERP.Thesearecalledsource systemsorsystemsofrecord. BIdoesntchangethat.Yourdaytodaydatawillcontinuetolivewhereveritlivesnow, drivingbusinessapplications,lineofbusinesssoftware,andtheothersystemsthatmake yourbusinesswork.WhatBIwantstodoislookatthatdata,possiblycopythatdatato differentlocationsandindifferentforms,andtoanalyzethatdata.

DirectDataMapping
DirectdatamappingallowsaBIsystemtoconnecttoyourbusinessdatainitscurrent location.Thatis,ratherthancopyingyourdatasomewhereelse(likeintoadata warehouse),theBIsystemsimplyconnectstothedatawheneveritneedstouseit.The advantageofdoingsoisthatyourminutetominutechangescanbeimmediatelyviewed andusedwithintheBIsystem;adisadvantageisthatdependinguponhowyourBI systemisbuiltandusedyoucanplaceasignificantperformanceburdenonyourlive productionsystems,somethingthatyoulltypicallywanttoavoid. ThemappingpartofthisreferstothefactthatBIsystemsasdiscussedintheprevious chaptertypicallyorganizedatadifferentlythanatransactionalsystemdoes.BIsystems usedatastructuresthatareoptimizedforfastqueryingofdata,whereastransactional systemsoftentrytostrikeabalancebetweenqueryingdataandaddingnewdata.In addition,transactionalsystemsrarelyexecutethekindofcomplex,interrelatedqueries thataBIsystemuses. Interestingly,datamappingalmostalwayscomesintoplaywithaBIsystemevenifyou dontwanttoallowyourBIsystemtoquerydatadirectlyondemandfromtransactional systems.Sometimes,youmightprefertocopyrelevantdatafromyourtransactional systemsintoadedicatedBIdatastore;whenyoudoso,youllstillneedadatamapthat helpstheBIsystemproperlyqueryandreorganizethedataforusewithintheBIsolution. Simplified Datamappingistheprocessofdesignatingthedatathatwillbeutilizedin theBIsystem,whetherthatdataisaccesseddirectlywhereitsitsorcopied intoadifferentdatastoreforBIpurposes.Datamappingdesignatesnotonly thatdatathatwillbeusedbutalsotoadegreehowthedatawillbere structuredintotheformusedbytheBIsystem.

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

DataLoading
DataloadingisusedwhenyoudontwantaBIsystemtodirectlyaccessproductiondata whileusersaretryingtoenterorders,findinventory,andbalanceaccounts.Utilizingadata mapthatiseithermanuallycreatedor,insomecases,generatedautomaticallybysoftware tools,dataloadingutilitiescopydataoutofyourtransactionalsystems,transformor rearrangethedataintothestructurerequiredbytheBIsystem,andaddthedatatotheBI system. IntheBIworld,dataloadingisoftenreferredtoasExtract,Transform,andLoad,orETL, whichnicelydescribesexactlywhathappens:Dataisextractedfromonedatabase, transformedintoadifferentstructure,andloadedintotheBIsystem.SomeBIsystemsmay bepreprogrammedwithdatamapsforcommonlyusedbusinesssoftware,including EnterpriseResourcePlanning(ERP)solutionsorotherfinancialsoftware;mostBIsystems alsoallowcustomdataloadingfromwhateverdatabasesyouhappentohaveinyour environment. ThetransformaspectofETLiswhathelpsmakeBIsouseful.Becausedifferentdatabases allusedifferentstructuresandconventions,connectingdatafromdifferentplacescanbe verydifficult.Transformingthedatahelpsstandardizeit.Forexample,atransformprocess might: Translateabbreviations,likethenamesofstates,intotheirfullnames SelectonlycertainpiecesofdatathatwillberelevanttotheBIsystem Cleansedata,suchasrunningcustomeraddressesthroughanaddressverification systemorformattingallproductIDnumberstoastandardizedformat Aggregatedata,suchascalculatingthetotalforcustomerorders,eventhoughyour transactionalsystemonlystoreslineitemamounts Filterdata,eliminatingredundanciesorunwanteddata Joiningdatafrommultiplesources,suchaslookingupproductnamesratherthan storinglesshumanfriendlyproductIDnumbers Validatingdata,ensuringthatthedatausedforBIpurposesiscorrect,valid,orupto date Correlatingdatafromdifferentsystemsmatchingthedatafromyourorderentry systemtothedatainyourinventorysystemtothedatainyourshippingsystemto thedatainyourcustomerrelationshipmanagement(CRM)system

Dataloadingisoftenaccomplishedduringoffhours,whenanyburdenitplacesonyour productionsystemswillbelessnoticeabletoyourusers.ThismeansthatyourBIsystem wonthaveuptotheminutedatabutinmostsituations,thatsokay;BIsystemsareall aboutworkingwithlongertermtrendsandpatterns,andlessaboutworkingwithupto theseconddata.However,ifyoursituationrequiresthatyourBIsystemworkwithsome kindsofrealtimedata,directdatamappingcanbeusedinconjunctionwithdataloadingto provideahybridmodelthatgetsyouwhatyouneed,whenyouneedit.

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

DataMartsandDataWarehouses
Asdiscussedinthepreviouschapter,datawarehousesaretypicallywhereaBIsystem storesitsdataafterloadingthatdatafromyourproduction,transactionalsystems.To quicklyreview,adatamartcommonlyholdsdatarelatedtoaportionofyourbusiness,such asdepartmentaldata.Adatamartcanthelpmakebroaddecisionsthataffecttheentire company,butitcanbeusedtohelpmakedecisionswithintheportionofthecompanythat itserves.Adatawarehousecontainsstandardized,consistent,cleanseddatafromtheentire company(orfrommostofit,atleast),andisusedtoanalyzepatternsandtrendsfrom acrossthecompany. Forexample,adatamartmighthelpyourCFOunderstandtherelationshipbetweensalary costsandproductsales,andmakewhatifdecisionstohelppredictfuturesalaryexpenses invarioussalesscenarios.Alargerdatawarehouse,incontrast,mighthelptiein informationonyourmarketingandadvertisingefforts,helpingtheCFOpredictchangesin salarycostsbasedondifferentadvertisingeffortsormarketingcampaignsasthosethings presumablyaffectproductsales. Somedatawarehousesarebuiltfromacollectionofdatamarts(calledabottomup approach);otherexpertsprefertobuildthelargerdatawarehousefirst,thenbreakitdown intodepartmentaldatamartsasneeded(thetopdownapproach).Therearestrong opinionsheldbydifferentexpertsforbothtechniques,andwhichapproachtotakeisoften oneofthefirsttoughdecisionsthatlargecompaniesfacewhencontemplatingaBI implementation. TopDown,BottomUpHelp! Pickupagoodbookondatawarehousedesignandyoumayquicklycometo thedecisionthatBIisntrightforyourmidsizecompany.Designphilosophies arejustthebeginningofthedifficultdecisionsitseemsyoullhaveto somehowmake. Butthatsituationisactuallytrueformostbusinessdecisions.Willyour companyoperateoncashbasisoraccrual?Howwillyoustructureyour financialledgersandaccounts?Howwillyoubuildandmonitorasales pipeline? Giantcompaniesareoftenforcedtoconfrontthesedecisions,spendtime educatingthemselves,andmakeadecision.Thetechnologysolutionssoldto largecompaniesmustoftenbecustomizedtofitthecompanysdecisions, whichcanbeexpensiveandtimeconsuming. Midsizebusinesses,however,oftentakeacommonlyacceptedapproach. Theypurchaseanofftheshelfaccounting,ERP,orCRMsystem,thenuseit howeveritwasdesignedtobeused.Inaway,theyletthetechnologymake thedecisionforthem,because,inmostcases,thetechnologywaswrittento modelthemostcommon,bestpractices,andgenerallyacceptedwayof doingthings.Inthisway,midsizebusinessessavethemselvestimeand money.

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

BIshouldbenodifferent.Althoughgiantcompanieswillstillneedtospenda greatdealoftimeondesigndecisionsandotherupfrontquestions,midsize businessescanoftenselectaBIsolutionthatwasdesignedformidsize companies,lettingthesolutionsdesignersselectthemostcommon, generallyacceptedwayofdoingthings,thensimplyworkingwithinthat frameworkratherthanhavingtomakeeverysingledesigndecision themselves.

InMemoryAnalytics
OneofthehotnewtrendsforBIinthepastfewyearshasbeeninmemoryanalytics.The ideahereisthatratherthanloadingallyourdataintoadatawarehouse(whichisreally justanotherkindofdatabasethatstoresdataondisk),youloadyourdataintoa computersmemoryandworkwithitthereinteractingwithdiskbasedstorageverylittle ifatall.Inmemoryanalyticsisntactuallyanewconceptbuttherecent(andmassive)drop inpriceofcomputerprocessorsandmemoryhasfinallystartedtomakeinmemory analyticsmorepractical. Inmemoryanalyticscanhelpreduceoreliminatetheneedtotransformandloaddatainto adatawarehousesomethingthatisoftentimeconsumingbeforeanalyzingthedata. Instead,datacanbequeriedfromproductionsources,transformedinmemory,and analyzeddirectly.Thisisespeciallyusefulforobtainingmoreuptotheminuteanalyses andforanalyzingdatainanewwaythatisntprovidedforinatraditionaldatamartordata warehouse. Theinmemorytechniqueisimportantforafewreasons: Buildingadatawarehouserequirestechnicalexpertise,whichisalsorequiredto helptunetheperformanceofthedatawarehouse.Becauseinmemoryanalysisis adhoc,lesstechnicalexpertiseisneeded,allowingbusinessanalystsandlineof businessmanagerstobuildtheirownreportsanddashboards. Inmemoryanalysisisfasterthananalysisthatrequiresdiskaccesssimplybecause disksaremuchslowerthancomputermemory. Inmemoryanalyticscanallowmoreflexibleanalysisofthedata.Datacanberapidly restructuredinmemorytoanswerdifferentquestionswithouthavingateamre designthedatastoreandrebuildthedatabasetablestosupportit.

Inmemoryanalysisisntaperfectsolution,though,becausecomputermemorystillisnt unlimitedorfree.Someestimatessuggestthatcomputersbeingusedforinmemory analysisneedtohavemultiplefastprocessorsandmustbeabletodedicatealargeportion ofmemorytotheanalysisenoughmemorytoholdasmuchas100%oftheamountof databeinganalyzed,dependingontheexactcircumstances.Inmemorycompressionand otherdatahandlingtechniquescanreducethatmemoryrequirementinsomecases;some vendorscitea1to10datavolumeratio,meaningyoudonlyneedenoughmemorytohold about10%ofthedatayouplantoanalyze.Midsizebusinesseswhichoftendealwithless sheervolumeofdatathanhugeenterprisesmayfindthatinmemoryanalyticsisan affordableandpracticaltechniquefortheirBIneeds.

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

InMemoryAdvantages Businessusershatewaitingforanswers.Tellamanagerthathisreportswill onlycomeonceaweekorthathellhavetowaitafewhourstogetresponses toanalysisqueries,andthatmanagerwillprobablygiveuponBI.Infact, manyorganizationsstillrelegateBIsystemusetoafewtrained,patient businessanalysts.Butthepowerandflexibilitygainedfromgivingfrontline managersaccesstofastBItoolscantbeignored. Withinmemoryanalytics,querytimemightdropfrom30minutestoafew secondsprovidedyoucanemploythehardwareneededtomakeithappen. Onceusersbecomeaccustomedtosuchrapidperformance,theystartasking theBIsystemmorequestions,gettingmoreanswers,andrunningthe businessbasedonfactsandtrendsratherthanongutinstinct. Inmemoryanalysiscanworkwithoutadatawarehouse,meaningyouwont needasmuchonstafftechnicalexpertisetogetupandrunningwithBI.That makesinmemoryanalysisespeciallyattractivetomidsizecompanieswhose ITstaffmightnothaveBIexpertiseorwhosimplymightnothavethe bandwidthforamorecomplexBIproject. Inmemoryanalysishasstartedbecomingpopularnotbecauseofitsadvantagesafterall, whowouldntwantfasteranswers?butbecauseofitsfeasibility.Justafewyearsago, 1GBofcomputermemorycostover$150;todayitcostslessthan$35orso.Apowerful analyticsserverwith64GBofmemorymighthavecost$64,000,andtodaycostsonly $13,000muchmoreaffordable.Theincreasedpowerandlowercostof64bit,multi corecomputerprocessorshashelpedtoo,asthoseprocessorscanphysicallyconnecttothe largeamountsofmemoryneededtomakeinmemoryanalyticspossible. Resource Ifyoudliketoreadmoreaboutinmemoryanalysis,visit http://www.tagonline.org/articles.php?id=298.Youllfindagreat,clear articleonthesubject.

CreatinganInformationDrivenBusinessCulture
Everytimeweraisethepriceoftheproduct,wesellmorecopies.Thatswhatone businessexecutivetoldme,andthatsimplecorrelationdrovemanyofthecompanys businessdecisions.Ofcourse,correlationisnotcausation;thecompanywasalsoadding significantnewfeaturestotheproduct,exhibitingatmoretradeshows,andspendingmore onmarketingandadvertising.Butthatonesimplefactorproductpriceiswhatdrove thatexecutivesgutdecisions.

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Managingbyinstinctisespeciallycommoninmidsizecompanies,particularlybecause manyexecutivesandmanagershavebeenwiththecompanyforalongtimeandstillfeel theyhaveacompleteviewintoallofthecompanysdata.Butastinycompaniesgrowtobe midsizeones,itbecomesmoreandmoredifficultforasinglehumanbeingtokeeptheir fingersoneveryoneofthecompanyspulses;managersstopmanagingbasedon informationsimplybecausetheydontactuallyhavealltheavailableinformation. Eventually,theysimplystartmanagingoninstinctsomethingthatisunreliable,not repeatable,andgenerallydoesntservemidsizecompanieswellinthelongrun. AfteryougetyourdataintoaBIsystem,youhavetostartteachingyourselfandyour colleaguestousethatinformationandtotrustit.Createaninformationdrivenculture ratherthananinstinctdrivencultureinyourmidsizecompany.BIsystemsoffera numberofefficientand,frankly,sometimescoolwaysofdoingso. SkillInstinct Notmanagingbyinstinctisnotthesamethingasnotneedingmanagerial skills.Goodmanagerscanstillrelyontheirexperienceandtheirintimate knowledgeofhowthecompanyworksthatexperienceandknowledgecan simplybemoreinformed.Providingfactsandinformation,filteredand temperedbyexperienceandskill,isthewayBIcanmakemanagers decisionsbetter. Ofcourse,Ihavetoacknowledgethatcreatinganinformationdrivenculturedoesnot meanthatexperienceandhandsonmanagementarentuseful.Iveknownandinsome casesworkedfortoomanymanagersthatspentalldaystaringatspreadsheetsandnever temperedallthatinformationwithahandsonrealitycheck.Theywerent,toputitkindly, allthateffectiveatmanaging.Informationshouldcontributetothemanagementprocess, notdominateit.

Reporting
Goodmanagerslovereports.Reportsofferinformationdatapointsthatcanhelpdirect managementdecisions.ABIsystemsimplyproducesbroader,moreinsightfulreportsthan thoseofferedbyasingletransactionalsystem.Anorderentrysystem,forexample,might tellamanagertheaveragevalueofalltheordersenteredforatypicalbusinessday.ABI system,however,canalsotellthatmanagertheaveragecosttoenterthoseordersbecause theBIsystemcandrawfrommanyothersourcesofdataincludingsourcesthatoffer salaryamounts,utilitybills,andmuchmore.ABIsystemcanalsohelpthatmanagersee trendsinordervolumebasedonadvertising;askilledmanagerbackedbyagoodBIsystem willknowexactlyhowmanyadditionalstaffwillbeneededtohandletheonslaughtof customerordersthatwillaccompanythenewestupcomingtelevisionad. ReportsfromaBIsystemcanbehighlyflexible,andevendynamic,allowingmanagersto useareporttoaskwhatifquestions,andmakedecisionsbasedontheresults.Figure2.1 showsatypicalBIreport,displayingaggregatesales,salesbyproductcategory,andtop sellingproducts.Thiskindofsummarylevelreporthelpsmanagersfocustheirefforts, makeproductstockingdecisions,andsoon.Adynamicversionofthisreportmightbe clickable,lettingmanagersdrilldownintomoredetailedinformationasneeded. 26

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Figure2.1:AcommonBIreport. SomemanagersareskilledinusingMicrosoftExcel,whichoffersbuiltinpivottable functionalityandcanuseaddinstoprovideevenmoreBIanalyticalfunctionality.By connectingExceltoadatawarehouseoraninmemoryanalyticsserver,asFigure2.2 shows,managerscanpivotdata,buildcustomanalyses,drillthroughdata,andpropose whatifscenariostoseetheresults.Thishelpsmanagersseethepotentialoutcomeof decisions,helpingdrivethedecisionthatmostbenefitsthecompany.Figure2.2actually showsanExceladdin,whichissomethingthatmanyBIsolutionsincludeoroffer.

Figure2.2:ConnectingExceltoadatawarehouseorinmemoryanalyticsserver.

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ThebiggestchallengewithaBIimplementationisgettingmanagerstousethesepowerful tools.Onceexposedtothemandshownhowtoutilizethem,mostexperiencedmanagers willneverturnback.

Dashboards
ThereportinFigure2.1mightbemoreaccuratelycalledadashboard,whichisacommon featureofmostBIsystems.Dashboardsarespecializedkindsofreportsthatutilize graphicaldisplaystosummarizekeyinformationforataglanceconsumption. Dashboardslikethedashboardinyourcarhelpmanagerkeeptrackofcritical,high levelmetrics.Figure2.3isanotherdashboardexample.

Figure2.3:BIdashboard. Thisdashboardmightbeidealforexecutivesortoplevelmanagers,asithelpsthemsee thecompanyscurrentbalancesheet,theprojectedbalancesheetinoneyear,earningsat riskbylineofbusinessandbyrisktype,andotherhighlevelmetrics.Dashboardsarent designedtodriveimmediatedecisions;likeyourcarscheckenginelight,adashboard indicatorisintendedtodrivefurtherinvestigationifsomethinglooksamiss.

Scorecards
Scorecards,likedashboards,areintendedtogiveahighleveloverviewofkeymetrics.The bigdifferencewithascorecardisthatliketheonesyouremembersofondlyfrom schoolascorecardappliesanabsolutegradebasedonrelativethresholds.Inother words,foreachmetric,thescorecardtellsyouifthecompanyisdoinggood,okay,or bad.Figure2.4showsanexample,wherecolorcodedmetricshelpdrawmanagers attentiontoproblematicareaslikesalesgrowth,Websitevisitors,andimprovement suggestions,whichareallredinthisgraphic.

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Figure2.4:Examplescorecard. Theideaofascorecardissimple:IfeverythingisanAorB,thenyourebasicallydoing well.ItemswithaCorDdeserveadditionalattentionandmanagerialeffort;itemswith anFareinneedofimmediateandsignificantattention.Aswithadashboard,theideais nottodriveimmediatedecisionsbutrathertohelpfocuseffortandfurtherinvestigation wheretheyareneededmosturgently. Graphics=Engaging Humansarevisualcreatures.Fewmanagersrelishthethoughtofstaringat rowsandcolumnsofnumbers,tryingtopickoutareasthattheyneedto focuson.Informationalgraphicslikethoseindashboardsandscorecards engageourvisualsensesandhelpusquicklysortoutpriorities. Atypicalcorporateprofitandloss(P&L)statementisanexampleofhow rowsandcolumnsofnumbersarentalwaysgoodatdrivingmanagerial attention.Expensesareat10%?Okayisthatgoodorbad?Wespent $23,000onshipping?Greatornot? Adashboard,however,canshowachartcomparingcurrentperformance withlastyears;anybarinthechartthatissignificantlyoutofwhackisan immediatecallforattention.Ascorecardcanbedesignedtocolorcode anythingthatismorethan10%outofline,helpingdrawattentionwhereits neededmost. Althoughtraditionaltextualreportswillalwayshavetheirplace,oneofthe biggestandmostimmediatevaluesaBIsystemcandeliverisdashboardsand scorecardsthathelpmanagersfocustheirtimewhereitisreallyneeded.

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AnalyzingBusinessInformation
LetsbrieflypauseandexaminewhereweareintheBIlifecycle.Figure2.5illustrateswhat wevealreadyaccomplished.

Figure2.5:Ourprogresssofar. Wevemappeddatafromlivedatasourcesthroughouttheorganization.Insomecases,our BIsystemwillusethatdatadirectly,whileinothers,itwillextract,transform,andloadthat dataintotheBIsystemeitherintoadatawarehouseorperhapsintoaninmemory analyticalstructure.Fromthere,theBIsystemwillproducethereports,dashboards,and scorecardsthatwellbeusingtocheckonourorganizationshealthandprogress,askwhat ifquestions,andsoforth. Thenextstepistogetthisinformationintothebrainsofmanagers,analysts,andothers whowillusethatinformationtohelpdrivebusinessdecisions.ShouldIdrawanarrow leadingfromtheinformationtoaperson?Probablynot:Onethingwehavetoacknowledge isthatyoucantpushinformationtopeople;peoplehavetovoluntarilypullthat information,activelyexaminingitandusingittohelpinformtheirdecisions.Thats ultimatelywhatmakesaBIimplementationsucceedorfail:Isitusedbytheright individualstoinformtherightdecisions?Ofcourse,youcanhelpspeedBIadoptionby ensuringthatyourBIsystemprovidesaccurate,timelyinformationtotherightpeople withinyourorganizationandensuringthatitdoessoquickly. OncethatBIinformationisintherighthands,orratherheads,andtheyrepreparedtouse it,theactofanalysisanddecisiondrivingtrulybegins.

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AnalysisandVisualization
OneofthemostdifficultaspectsofaBIsystemisteachingitsusershowtoanalyzedata. Simplystaringatareportordashboardisntsufficient;BIusersneedtoknowhowtoslice anddicedatatofindtheanswerstospecificbusinessquestions,seepatterns,spottrends, anddrivedecisions.Thishelpstouncoveropportunitiesfornewmarketsorefficiencies,or toexplainwhyaparticularareaofbusinessperformanceisgoodorbad(andyesyou definitelywanttofocusongoodperformanceaswellasbad,becausethecausesofgood performancecanoftenbeutilizedelsewheretoimprovetheoverallbusiness). Mostmanagersareactuallyfamiliarwithacertaintypeofbusinessmodelingandanalysis: spreadsheets.Theseareatwodimensionalformofbusinessmodeling,oftendisplaying metricsovertime,breakingdownperformancebybusinesscategories,orsomethingelse. Thatstwodimensions:metricsandtime,performanceandcategory,andsoforth.Figure 2.6showsacommonspreadsheet,displayingactualbusinessmetricsagainstplanned metrics.Again,thatstwodimensions:actualandplanned.

Figure2.6:Analysisviaspreadsheet. Theproblemwithtwodimensionalanalysisisthatitsfartoolimited.Twodimensions arentnearlysufficienttorepresentthecomplexitiesofevenaverysmallbusiness,let aloneatypicalmidsizebusiness.Althoughspreadsheetslikethisareusefulforquick overviews,theydontprovideaneasywaytodrilldownintothedatatouncoverhidden detailsandrootcauses. Bycontrast,BIisbuiltaroundtheconceptofmultidimensionalanalysis.Itcanbetrickyto explainandillustrate,simplybecausecomputersareinherentlytwodimensionalwhenit comestodisplayinginformation. Todisplaymultidimensionalinformationrequiresdisplaytricksandconventionstomimic multipledimensions;aspreadsheetpivottableisonesuchconvention.Figure2.7showsan examplepivottable.

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Figure2.7:Anexamplepivottable. Note MicrosoftsbrandnameforpivottablefunctionalitywithinMicrosoftExcelis PivotTable;themoregenericpivottabledescribesthisfunctionalityin anyproductthatoffersit. Pivottablestypicallyconsistofmultiplefacts,whichareaddedbytheuser.Here,thefacts areUnits,Price,andCostnumericdimensions.Thecolumnsandrowscanbeanykindof dimension:Rowdimensionscreatearowforeveryuniquevalue,whileColumnscreatea columnforeverycombinationofcolumnfieldsandfacts.Asimplepivottableliketheone inFigure2.7canhelpspotcriticalbusinessproblems,suchaspoorunitsalesinagiven regionorhigherunitcostsinagivencategoryinagivenregion.Itsthosemultiple dimensionsregions,categories,andstylesthathelpbringmoreinformationintoplay. Butpivottablescanrevealmuchmore.InFigure2.8,Iveaddedatotalrowshowninlight yellowtohelprevealaggregateinformation.

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Figure2.8:Addingaggregatestopivottables. Theabilitytodynamicallyaddtotalsandotheraggregateshelpsusersrollupinformation toseetheresultsfromagivendimensionorsetofdimensions.Here,bothboysandgirls categoriesaresubtotaled,andeachregionistotaledaswell.Pivottablesaredesignedto workdynamically,allowingtheusertoexploreandvisualizedatainwhateverwaythey want.Forexample,IcanremovetheCategorydimension,andthepivottablere calculates,asshowninFigure2.9.

Figure2.9:Rollingupdatainpivottables.

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Ivesimplifiedmyviewofthedatatoseeonlystyles,regardlessofcategory.Imayhave decidedthatcategorieswerentafactorinwhateverIwasanalyzing,andbyeliminatingit,I canviewmydataandaggregationsbasedonotherfactorssimplystyleandregion,inthis case.ThisviewrevealsthattheEastregionsellssignificantlyfewerunitsthantheNorth region,afactthatwasavailabletomebeforebutmayhavebeenlessobviousbecauseit wasburiedinwithsomanyothernumbers. Butherestheproblem:Althoughpivottablescanbeusefulforuserswhoarealready comfortableinExcel,youshouldntlimitthistypeofBItojustthoseusers.Also,diggingin anddiscoveringfactsandinformationsolelyusingspreadsheetscanbecomepretty overwhelming.ThatswhyanygoodmidsizeBIsolutionmaysupportpivottable functionality,butitwilldefinitelysupportmorepowerfulinmemoryanalytics,andoffer muchfriendlierandmoreintuitiveuserinterfaces.TheseUIsareoftenpresentedinaWeb browserapplication,forexample.Figure2.10showshowaWebinterface,poweredbya backendanalyticsengine,canpresentdatainsimplerforms,likeabarchart.

Figure2.10:Displayingdatainchartform. Thischartwouldbebasedonliveorrecentlycollecteddatathatwasanalyzedinmemory, meaningitsuptodate.Butthepowerfulpartaboutthiskindofbusinessintelligenceisthat thischartisntstatic.Wonderingwhygolfequipmentsmarginsarethewaytheyare?Just clickonthatportionofthechart.Theanalyticsenginegoestowork,pullingtogetherthe supportingdatathatresultedinthefirstchartanddisplayingaseconddrilldownchart, showninFigure2.11,thatshowsmoredetail.

Figure2.11:Drilldownchart.

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Nowwecanseethatputters,asacategory,isdraggingdownmarginsongolfequipmenta bit.Furtherclickswoulddrilldownevendeeper,revealingindividualproducts, manufacturers,andsoon,lettingusquicklyfindtheanswerwewerelookingfor. Butaninmemoryanalyticsenginecandomuchmore.Supposethefirstchart,which breaksdownsalesbyproductcategory,isntansweringyourquestions.Instead,youwant toseeproductsalesgroupedbystorelocation,orbyproductvendor,orsomeother grouping.Noproblem:Becausetheanalyticsarebeingperformedinmemory,youcan rearrangeandregrouphoweveryoulike,lettingyoulookatyourdatainwaysthatmake sensetoyou,andhelpingyoudiscoverimportantnewrelationshipsandfacts. Asyoubecomemoreaggressiveaboutanalyzingyourbusinessdata,youllfindthatthe bestsuiteoftoolsincludesfeatureslikepivottablesinaspreadsheet,analyticaladdinsto applicationslikeExcel,andWebbasedfrontendstopowerfulinmemoryanalytics engines.Withthiscombinationoftools,moreusersandmanagerswillhaveaccesstobetter datamorequickly.Theyllbeabletodynamicallychangewhattheyrelookingattoanswer exactlytherightquestions.

UncoveringRootCausesBehindData
Youglanceatadashboarddisplayandseethatsalesarentwheretheyshouldbewhatdo youdo?AsIvedescribedearlier,adashboardandotherBIsummarydisplaysshould driveinvestigation,notimmediatedecision;yourresponsetosomethingalarmingor,for thatmatter,gratifyinginadashboarddisplayshouldbetodigintotherootcause,looking eitherforaproblemthatneedstobesolvedorsomethingbeneficialthatmayneedtobe examinedandexploited. BecauseBIsystemscombinedatafromallovertheorganization,theyexcelatprovidingthe detailsbehindthedashboardforuserswhoknowwhattoaskandhowtoaskit.IntheBI world,askingaquestionofthesystemiscalledaquery,andtheresultsaretypicallya report,graph,orotherdatavisualization.ThebenefitofaBIsystemisthat,unlikemore traditionalreportingsystemsbuiltatoptransactionaldatabases,BIsystemscanrespond quicklywithanswersgivingusersmoreopportunitytorefine,revise,andresubmittheir querytofindtherealanswerstotheirquestions. BIsystemstypicallyofferusersavarietyofwaystosubmitqueriesandreceiveresults. Queryoptionsmayinclude: Naturallanguagequeries.ThesesystemsallowuserstoaskplainEnglishquestions like,HowdosalesintheEastandNorthregionscompareforlastquarter?The systemparsesthequestionandmatcheskeywordstodatafacts,andproducesthe appropriatereport. Graphicalquerybuilders.Thesesystemsuseadraganddropinterfacetopresent userswithavailabledatafacts,allowinguserstoselectthefactsthatinterestthem, indicatefiltercriteria,andsoforth. Querylanguages.Thesesystemsacceptquerieswritteninaspecificquerylanguage, whichisoftenavariantoftheindustrystandardSQLlanguage.Althoughthisoption requiresamoretechnicallyproficientuser,itdoesofferahighlevelofflexibility. 35

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BIsystemscommonlyallowuserstosavetheirqueries;thismakesthemavailablenotonly foreasierqueryinginthefuturebutalsotoother,lessskilledusers. AndbecauseagoodBIsystemwillalsomakedataavailablethroughintuitiveWeb interfaces,yourusersmightnotneedanyparticularqueryingskillsinordertodrilldown, rearrange,andregroupdata,andfindtheanswerstheyneed.

TheImportanceofModelingtheBusiness
Ofcourse,aBIsystemcanreallyonlyworkeffectivelyifitaccuratelymodelsyourbusiness. Forexample,ifyourbusinesssuccessfocusesondeliveringservicesinaspecificperiodof time,butyourBIsystemsmodelsarefocusedonfactssuchasrevenueandcosts,yourBI systemwontbeaseffectiveinhelpingyouuncoverrootcausesandfindnewefficiencies andopportunities.ModelingoneofthefirststepsinaBIimplementation,andclosely relatedtodatamappingensuresthatyourBIsystemunderstandswhatyourbusiness lookslike,howitworks,andhowyourvariouspiecesofdatafittogether.

MakingDecisionsandTakingActionThePlanningConnection
LetssayyouvegotagreatBIsystem.Itcontainsdatafromalloveryourorganization,and youvebecomeskilledinsubmittingquestionsandreviewingtheresults.Yourdecisions arebeingdrivenmoreandmorebytheinformationyouuncoverthroughyourBIsystem. Whatnext? ThelastconnectioninaBIsystemismakingthosedecisionsareality.TakealookatFigure 2.12,whichillustratesthetruepurposeofaBIsystem.

Figure2.12:ThepurposeofBI.

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ThegoalofBIistodrawdatafromyourbusinessanduseittoinformmanagers.Those managersdecisionstheninfluencethebusiness,hopefullychangingitforthebetterin somefashion.Thatchangeaffectsthedatacomingoutofthebusiness,whichgoesintothe BIsystemtoinfluencethenextroundofdecisions. Sothemissingpiecehereisthis:Howdomanagersdecisionsgetintothebusiness?Inmost midsizecompanies,itsnotassimpleasmanagersdecidingtorunanewadcampaignto boostsales;decisionshaveconsequencessuchascostsandmanpowerthathavetobe accountedfor.Thatmeansmanagersdecisionscantalwaysbeimplementedinstantly; instead,theyhavetoimpactthecompanysplanningprocess.

Planning:AligningResourcestoOpportunities
Mostcompanieshavesomekindofplanningsystemandprocessinplace.Inmanymidsize companies,itssimplyacollectionofspreadsheetssalesforecasts,budgets,capital planning,andsoforth.Businessmanagersareconstantlylookingforbetterdata:What drivesthebusiness?Whereisthebusinesstrending?Inmanysituations,thosemanagers turntospreadsheetsoftenhundredsofthem,oftenindividuallymanagedbydifferent peoplethroughoutthecompany. Theproblemwithgettinginformationthatwayisthatittakesatremendousmanualeffort tokeepitallupdated.Inaddition,learninganythingthatrequiresaggregatingseparate spreadsheetsisreallydifficult.Whatsniceaboutthosespreadsheets,however,isthatyou canchangethem:plugdifferentvaluesintodifferentcells,thenseewhathappens.Whatif weassumeahighersalesvolumewillweneedmorestaffingbudget? Todaysbusinessesarealsobecomingmoredynamic,andthatdemandsamore interconnected,dynamicplanningandforecastingsystem.ThatswhereyourBIsystemcan stepin.Figure2.13illustrateshowthemanyportionsofyourcompanyareconnected; shouldntyourplanningdatabejustasinterconnected?

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ENTERPRISE PLANNING
Sales Marketing Customer Service Finance Product Operations Developme nt IT/Systems Human Resources

UnitVolume Incentive

FinancialStatements Revenue Expenses PipelineCoverage CampaignPlanning CapitalExpenditures

CapacityPlanning ProductionPlanning InventoryPlanning

InitiativePlanning ServiceLevel& Capacity Planning

InvestmentFunnel NewProduct Introduction

WorkforcePlanning Compensation

Staffing InitiativePlanning

Figure2.13:Enterpriseplanningunderstandstheinterconnectednessofyour companyspieces. AsimpleBIsystemconsistingofadatawarehousecanprovidefacts,butitsessentially readonly.Sure,youcanpullsomeofthatdataintoaspreadsheetperhapsusingapivot tableoranaddinofsomekindbutthenyourerightbacktodealingwithindividual spreadsheets.Bymostdefinitions,adatawarehouseisalwaysreadonly:Itsaspecial purposecopyofyourdata. MorepowerfulBIsystemsoffertrueOnlineAnalyticalProcessing,orOLAP,includingwrite backcapabilities.Withwriteback,youreactuallyabletoplugnewnumbersandfactsinto theanalysisengine.Yourenotmodifyinganyofyourhistoricaldata,butyouaremodifying thewaythenumbersconnecttooneanother.Youremodifyingassumptions,andasking whatif,withthepoweroftheentireanalyticsenginebehindyou. Thinkabouthowthisworks.ABIsystemcanconnectallofthedatainyourcompany.You candynamicallyregroupandrearrangeinformationtoanswerdifferentquestions,allon thefly.Thatsgreatforansweringquestionsaboutthepastwhathasalreadyhappened. Bybeingabletoreachintotheanalyticssystemandmakechanges,youcanstartfiguring outwhatmighthappeninthefuture.Youcanseesalestrendschange,seehowbudgets mightbeaffected,seehowyoumightchangeyourhiringpatterns,andsoon.Youtakethe latestbeliefs,forecasts,andcommitmentsfrombusinessmanagers,andseehowtheyll affectthingslikeinventoryacquisitionorcustomerservicevolumeorproductioncapacity. Thatletsyoumakeplanningchanges.Suddenlyyourenolongerreactingtoyour businessyouredrivingit.

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WhatifyouwritenumbersintotheOLAPsystemthatpredictadownwarddriftin revenuesomethingmanycompanieshavebeenfacinginrecentyears?Ratherthanbeing caughtoffguardandhavingtomerelyreacttochangingmarkets,youcanbeinfrontofthe problem,recalibratingexpensesandotherexpendituressothatyourcompanycanremain agileandprofitableevenduringadownwardswing.Itsallbasedonthecapabilityofyour BIanalysisenginetotakenewassumptions,crunchthemintoyourcompanywidedata,and showyouwhattheresultlookslike. OneoftheworsttimesatmostanycompanyisBudgetTime,withQuarterlyForecastTime cominginaclosesecondworst.Sometimesitfeelslikeeveryoneisjustpullingnumbers outofthinair,stickingtheminspreadsheets,andthenhopingforthebest.Partofthe problemisthateveryonestryingtopulldatafromadozendifferentplaces.Theyretrying torollupthatdatatoaprofitandloss(P&L)statementlevel,tocreateprojectionson thingslikecashflowandexpenses.Becauseofthedifficultyindoingthismanually,alotof companiesdontdoitveryoftenmeaningtheyrerunningwithoutforecasts,withoutreal plans.WithawritebackOLAPsystem,however,allthatchanges.Yourenolongerworking withdecoupledhighlevelgoalsandlowlevelcapabilities.Wanttoseewhatitwouldtake todoubleyourrevenue?Plugthenumberin,andlettheOLAPsystemshowyouwhatit wouldtaketoreachthatnumber.Wanttoseewhateffectadownsizingwouldhaveonthe bottomline?Plugthenumberin,andlookatthegraphs,charts,andreports. AsFigure2.14shows,thisiswhereBIreallyclosestheloopforacompany.BIismorethan justadatawarehousethatquicklyservesupfactsaboutwhathashappened;agood analysissystemcanalsotellyouwhatwillhappen,whenyoupluginestimates,forecasts, andwhatifscenarios.

Figure2.14:ClosingtheBIloop.

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Note WritebackisntacapabilitysupportedbyallBIsystems;ifyoufeelthisisan importantfeatureforyourbusiness,besureyoutakeitintoaccountwhen evaluatingdifferentBIsolutions. ClosingtheloopinthisfashionhelpscreateamoreautomatedlinkbetweenBI, management,andthecompanysdaytodayoperations.

ComingUpNext
TheresarealproblemwithBI,especiallyasitrelatestomidsizecompanies.Thatproblem ismisinformation.Thereareatremendousnumberofmythsouttherethattellyouwhat youcanandcantdowithBIinamidsizecompany,andmostofthosemythsareatbest basedonoutdatedinformation.Inthenextchapter,Illoutlinethethreebiggestmythsthat drivemidsizebusinessesawayfromBI,orleadthemdownanimplementationpaththatis unnecessarilyexpensiveandtimeconsuming.Welldebunkthosemythsandsettherecord straight.

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Chapter3:DebunkingtheTopThreeMyths ofBusinessIntelligenceforMidsize Companies


Thereisdefinitelyapervasivebeliefthatmidsizecompaniessimplycantafford,cant handle,orcantappreciatebusinessintelligence(BI).Ievenrunintoexecutivesatmidsize companieswhoabsolutelybelievethatcompaniesthesizeoftheirsdontneedBIandcant benefitfromit.Itsimplyisnttrue,andinthischapter,ImgoingtoplayMythbustersand addressthemostcommonmisinformationregardingBIasitrelatestothesecompanies. BeforeIdoso,however,Iwanttogetoneofthemostharmfulpiecesofmisinformationout oftheway,whichisthis:MidsizecompaniescantbenefitfromBI.Thatspatentlyfalse;its likesayingthatmidsizecompaniescantbenefitfromcustomerrelationshipmanagement (CRM),accountingsoftware,payrollsoftware,oranyothercommonbusinesstool. Althoughitstruethatmanyofthesetechnologysolutionsbeganinextremelylarge companies,thefactisthatanycompanycanrunitselfmoreeffectivelyandefficientlywhen thesetoolsareavailable.ItsalsotruethattheCRMsolutions(totakeonetoolasan example)usedbygiantenterprisesarebuiltdifferentlythanthoseusedbymidsize companies,butthatdoesntmeanmidsizecompaniesdontbenefitfromtheirparticular versions. Infact,thatsoneofthecommonthemesyoullfindinthischapter:Midsizecompaniescan anddobenefitfromthesamebusinesstoolsandcapabilitiesasgiantenterprises;those toolsaresimplybuiltspecificallyforthemidsizemarket,andareofteneasier,less expensive,andfastertoadoptandusethantheonesdesignedforgiantenterprises.Onto themyths.

Myth1:BICanBeDisruptive
IfindthattheresdefinitelyabeliefthatBIcanbedisruptivetothebusiness,oratleastthat theprocessofimplementingBIcanbedisruptive.Ivecertainlyworkedwithcustomers whohavehaddedicatedprojectteamsworkformany,manymonthsatbringingaBI projecttolight,andtheentireprocesscertainlywasdisruptivetothebusinessinmany ways.Butthoseweregiganticcompanies,andmanyoftheproblemstheydealtwithwere onesyoudonlyrunintoinsideareallylargeenterprise.Letsfocusonsomeofthemajor aspectsofthedisruptivemyth.

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Don Jones

SpecializedToolsandTrainingRequired
OneobjectionIhearfrommidsizecompaniesisthattheyfeartheyllneedtopurchase expensivetools,andundergoextensivetraining,inordertobeginplanninganddeployinga BIsolution.ItseasytoseewherethismythcomesfrombecauseIcanconfirmthatit reallydoeshappeninsidehugeenterprises. ButthisishardlytrueonlywithBIprojects.Lookatnearlyanymajor,enterprisewide projectinamassivecompanyandyoulltypicallyseetheneedforspecializedtools, extensivetraining,andsoon.Howmanymajorcompanieshaventbeenthroughan exhaustingimplementationforaccountingsoftware?Irememberwhenonepast employera22,000employeetelecommunicationsdivisionimplementednewfinancial softwareandspecializedtoolsandtrainingwasanunderstatement.Horrorstories aboundforCRMandEnterpriseResourcePlanning(ERP)solutions,aswell,andIveseen thoseprojects(inonecaseIgotropedintoone).Therewasatonofspecializedtoolsand trainingfloatingaround.Butagain,thatwasinaverylargecompany. Hereswhy:Largecompaniestendtobeextremelydiversified.Theyhavealotofthings goingon,andtheyhavedepartmentsanddivisionsthatoperatealmostasautonomous businesses.SimplyfiguringoutwhatanaccountingsystemneedstolooklikeorhowaCRM solutionneedstoworkrequiressomeveryspecializedexperience.BIisprobablyan extremeexampleofthis:AtrulyenterprisewideBIsystemwantstotoucheverypieceof datathecompanyhassothatallthatdatacanplayaroleindashboards,reporting,analysis, whatifscenarios,andsoon.Figuringoutwhereallthatdatalives,whoownsit,howit works,andhowitwillbeloadedintoadatamartordatawarehousearecomplicatedtasks. Thetoolsusedtodesigntheresultingdatawarehousearecomplicatedandcanbe expensive;thetoolsusedtogatherinformationandrequirementsareequallyspecialized. Butthatsinaverylargecompany. Soifspecializedtoolsandtrainingareatruthforlargeenterprises,whyarethingsany differentforamidsizecompany?Idontwanttocomeacrossassuggestingthatmidsize companiesaresomehowmoregenericthanlargerenterprises,becausethatisnttrue.But thefactisthatmostmidsizecompaniesdooperatebyamorecommonsetofrulesand practicesthanlargecompaniesdo.Thatisntadownsideofbeingamidsizecompany;itsa benefitthatmostlargeenterprisesoftenwishtheystillhad.Bearwithmeforamoment whileIexplain. Startbyconsideringpayroll.Mostmidsizecompanieshavefairlybasicandcommonpayroll needs:Youpayemployees,youkeeptrackofpaidtimeoff,youaccountfortax withholdings,andyoulikelyextractsomemoneyforbenefits.Nomatterwhatlineof businessyourein,payrolltendstolookthesamesomuchsothatmidsizecompanies oftenoutsourcetheirpayrollentirelyoruseofftheshelfsoftwarepackagesthatallwork thesameway.MidsizecompaniesdontoftenhaveamassivecadreofHRfolks,andso thosecompaniestendtokeeptheirpayrollwithintherealmthatcanbehandledby outsourcedcompaniesorbyofftheshelfpayrollpackages.Whenyougettobeahuge company,however,andyoubuildupahugeHRdepartment,itstartstobeeasiertodo differentthingswithpayroll,andsopayrollbecomesalmostasidebusinesswithinthe enterprisespecializedtotheenterprisesneeds. 42

The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

Whataboutaccounting?MidsizecompaniestendtofollowGenerallyAcceptable AccountingPractices(GAAP),andtherearenumerousofftheshelfsoftwarepackagesthat provideperfectlyacceptableaccountingcapabilities.Midsizecompaniesdoaccounting becausetheyhaveto,notbecausetheyespeciallyenjoyit;therefore,theytendtokeeptheir accountingpracticeswithinthedomainthatanofftheshelf(orlightlycustomized) accountingpackagecanhandle.Sure,midsizecompaniescouldstartdoingcomplicated thingswithaccounting,andtheydsavesomemoneybuttheywouldntsaveenoughto makeitworththeextracomplication.Largecompanies,however,canseebiggersavings frommorecomplicatedanddetailedaccountingpractices,andsothoselargecompanies investinspecializedsoftware,specializedprocesses,andsoon. Thissametrendcontinuesthroughjustabouteverybusinesstool:Midsizecompaniescould havethesamelevelofcomplexityasagiantbusiness,buttheresnotahugereturnindoing so.Therefore,midsizecompaniestendtohavebackendsystemsthatalllookandworkina verysimilarway.Thosesystems,toadegree,drive(oratleastinfluence)thecompanys businessprocessesandworkflows,meaningthatmostmidsizecompanieslookfroma backendperspectiveifnotidentical,thenatleastverysimilar.Theresanimportant truthherethatIwanttoemphasize:Midsizecompaniesoftensteerclearofverycustomized toolsandprocessesbecausethosecustomizationsaddcomplexitythatisnotjustifiedtoa midsizecompanyintermsofitsaddedvalue. SohowdoesthisaffectBIimplementationsinamidsizecompany?Thereasonamassive enterpriseneedsspecializedBItools,skills,andtrainingisbecauseeverysinglemassive enterpriselooksentirelydifferentfromtheothers.Theyvealladoptedtheirown customizedaccounting,payroll,ERP,CRM,andotherpractices.DesigningaBI infrastructurethatutilizesallthosedatasourceswill,obviously,beacustomized undertakingandwillrequirespecializedskills,tools,andtraining. ABIsolutiondesignedspecificallyformidsizecompaniesstillrequiresspecializedtoolsand training,butbecausemidsizecompanieslooksosimilaronthebackend,thosespecialized toolsandtrainingcomeintoplayonce,whentheBIsolutionisinitiallycreatedbyits vendor.Afterthat,thesamepremadeBIsolutionwillwithperhapssomelight customizationbesuitableformostmidsizecompaniessimplybecausemostmidsize companiesareusingthebusinesspracticesandpatternsthatweretakenasassumptions whentheBIsolutionwascreatedinthefirstplace.Inotherwords,amidsizecompanycan dowithoutthespecializedtoolsandtrainingsimplybecauseamidsizecompanywilltendto steerclearofthecustomizationsthatmakethetoolsandtrainingnecessaryforan individualBIdeployment. ThisisanimportantconceptfordebunkingmanyoftheBImythsinthischapter,soI appreciateyoubearingwithmethroughthisexplanation.Letmetryandwrapitupwitha nonbusinessanalogy,justtomakesureIvemadethisimportantpoint.

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

ConsideraNASCARcar.Thatcarrequiressomeexpensive,specializedtools,anditsdriver requiresextensive,specializedtraining.Why?Thosetoolsandtrainingcanbringthe hundredthsofasecondadvantagethatmeansawin.Mostnormaldriverslikeyouand medontneedahundredthsofasecondadvantage,sowemakedowithcarsthatdont needhighlyspecializedtools.Thatmeanswecanveryfeasiblypurchaseandownacar withouthavinganyspecializedtoolsortraining.Thecarswebuyaredesignedtoworkina standardizedfashion,eventhoughthecarsavailabletousvarywidelyinspecificfeatures andcapabilities. ThatsbasicallywhymidsizecompaniesdontneedspecializedtoolsandtrainingtodoaBI implementation:Prepackagedsolutionsthataredesignedforthewaymostmidsize companiesalreadyworkhavethespecializedtoolsandtrainingbuiltrightin.

LongImplementationTimes
IwasonaBIprojectina40,000employeecompanythattook2yearstocomplete.No kidding.Wespentthefirst9monthsonrequirementsgathering,somethinglike3months designingreportsanddatawarehousesandsuch,andayearontheactualproduction implementationandtheinevitable,oh,canitalsodothis?requestsfromthesystems users.Whysolong?Well,itwasahugecompany.Datawaseverywhere,andwehadto reverseengineerhowthecompanyworkedinordertobuildaneffectivedatawarehouse. Thatskindofaworstcaseexample,butitservestoillustratethepointthatBIcantakea verylongtime.Inbigcompanies. IwontbelaborthepointImadeintheprevioussectionanyfurther,excepttosaythat becausemostmidsizecompaniesusesimilarbackendtoolsandprocesses,itdoesnthave totakenearlyaslongtoimplementausable,effectiveBIsolutioninthosecompanies.Sure, thisstillisntacasewhereyoudoubleclickSetupandaredonebutitsclosertothatthan theimplementationthatgiantcompaniesundertake. Inmanycases,prepackagedmidsizeBIsolutionsareallinonepackages.Youinstalla singlepieceofsoftwareandyougetaplaceforadatawarehouse,Webserver,dataloading components,inmemoryanalytics,reporting,dashboarding,andeverythingelseaBI systemneeds.Youjustpointitatyourexistingbusinessdataandletitgotowork.Iveseen implementationtimesofafewweeksorso,usingtheexistingITstaff.Somecompanies mightbeabletogetaBIsolutionupandrunninginevenlesstime,especiallyifthesolution isinitiallyonlyaddressingasingledivisionordepartmentwithinthecompany,simply becausethatmeansfewerdataconnectionsthathavetobemade.

ImpactonOtherBusinessProcesses
Ithinkthefirsttwopiecesofthismythprettymuchhandlethisthirdone.Ifmidsize companiescanimplementaprepackagedBIsolutioninafewweeks,usingtheirexistingIT staff,andwithouthavingtoofferextensivetrainingtohalfthecompanyemployees,well, thentheBIimplementationisntgoingtobeverydisruptive.

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

MostofthedisruptioninalargescaleBIdeploymentcomesfromthediscoveryand requirementsgatheringphases,whereBIprojectteammembersinvadeeverycornerof thecompanytryingtofigureoutwhatdataliveswhere,howeverythingfitstogether,and soon.TheITstaffgetsdistractedwithnewhardware,complicatednewsoftware,complex dataconnections,andsoforth.WithaprepackagedBIsolution,theressimplyno opportunityforanyofthattooccur:Youdonthaveamonthslongdiscoveryand requirementsgatheringphase,andtheITstaffisusuallydealingwithasingle,simpler pieceofintegratedsoftwarethatsmuchmorewithinthescopeofwhattheyreusedto dealingwith.

Myth2:BIRequiresSpecializedExpertise
WhenItalktoexecutivesinmidsizecompanies,IthinkthefirstandloudestobjectiontoBI isthebeliefthatthecompanyisgoingtohavetohireacadreofspecialized(andexpensive) consultantstomakeBIhappen. ThatscertainlybeentrueinmanylargecompaniesIveworkedwith,mainlybecausetheir ITstafflackedthespecializedskillsittakestoplanandimplementadatawarehouseand otherBIelements.Evenafterthemainimplementationisover,consultantsandtrainers usuallystayaroundforseveralmonthsteachingthecompanysexecutives,managers,and otherusershowtooperatetheBIsolutionandinsomecases,Iveseensomeconsultants turnintofulltimeemployees,specializinginBIandinhelpingthecompanysuserstake advantageofthesystem.Butmidsizecompaniesdontneedtodealwiththat. Heresanotheranalogy:Considertwocompaniesthatbuildhomesforaliving.One companyonlybuildscustomhomesthatcostmillionsofdollars;theotherbuildshomesin masterplannedcommunitiesandchargesafewhundredthousanddollars.Bothcompanies buildgreatlookinghomes,andtheyusemanyofthesamerawmaterials.Theyrealsoheld tothesamebuildingcodesandotherpractices,andtheybothbelieveincreatingahigh qualityproduct. Whenthefirstcompanybeginsarchitectinganewhome,alotofspecializedtoolsare required.Architectshavetodraweveryaspectofthenewhome,andengineershaveto figureouttheroofstructure,loadbearingcapacities,andsoon.Becausetheircustomers arepayinghugesumsofmoney,everyjobiscompletelycustomized,andsothearchitects andengineersgetinvolvedeverytime.Thecompanyscustomersallleadwildlydifferent lifestyles:Somewantinhomerecordingstudios,otherswantmassivemulticargarages, andsoon,soallthatcustomizationisreallyabigpartofthebusiness.

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

Thesecondcompanyscustomersdontwanttospendmillionsonahome,though.Sothe secondcompanyoffersafewpredesignedfloorplans,allofwhichhavebeenarchitected andengineeredinadvance.Thesearentcookiecutterhomes;thebuilderunderstands whichwallsareloadbearing,forexample,andcandominorcustomizationsthatdont affectthepreengineeredstructuralintegrity.Thiscompanyscustomersdontdemanda highlevelofcustomizationforexample,theysimplywanttopickouttheircabinetsand countertops.Becausethesecustomersdontwantorneeddesignedfromscratchhomes, theysavethemselvestheexpenseofanarchitectandengineer.Itsnotthatthose specializedskillswereneverneeded;theyweresimplyonlyneededonce,andtheresultsof theirworkwillbeusedmanytimes,bymanydifferentcustomers. Thisonetimeengagementofspecializedexpertiseiswhatdebunksthismythformidsize businesses.Letslookatsomespecifics.

ComplicatedDeploymentandImplementation
AlthoughapreengineeredmidsizebusinessBIsolutionisntexactlyassimpleasdouble clickSetup,itis,asIvealreadymentioned,notalotmorecomplicatedthanthat.Atleast, itscertainlynotascomplicatedasdesigningawholenewBIsolutionentirelyfromscratch. DeploymentandimplementationdoesstartwithdoubleclickingSetup,ofteninstallinga completelyintegrated,onepiece(orfewpiece)solutionthatcontainsprebuiltBI componentssuchasadatawarehouse,reports,andsoon.Deploymentandimplementation isaboutthesamecomplexitylevelasdeployingandimplementinganyotherserver software,suchasadatabaseserverormessagingserver. ThemostcomplexpartoftheimplementationisoftenthepartwhereyouconnecttheBI systemtoyourotherbusinesssystems.Typically,prepackagedBIsolutionsofferwizards andothertoolstohelpmakethisprocesseasier.Prepackagedsolutionsmayevencome withbuiltinconnectorsforcommonmidsizebusinessbackendsystems,suchas accountingsoftware,ERPsystems,CRMsystems,andsoforth.Soalthoughthisisntano brainerpartoftheBIsolutiondeployment,itscertainlysomethingthattheaverageIT staffcanhandlewithouthighlyspecializedskills.

SpecializedTechnologyManagementSkills
Theresalsoaconcernthatmidsizecompaniesdonthavethenecessaryskillsintheir existingITstafftomanageaBIsolutiononanongoingbasis.Fortunately,thatsnot generallyaconcern.Infact,evensomeextremelylargeenterprisesgetawaywithverylittle inthewayofspecializedtechnologymanagementskills. TherearetwoaspectsofmanagingadeployedBIsolution.Thefirstisthesimple,basic, daytodayoperationalstuff:keepingdatabasestunedforperformance,backingupservers, keepingserversproperlypatchedandupdated,andsoforth.Thiskindofmaintenanceis somethinganynormalITstaffershouldbeabletohandle;themostcomplicated maintenancetaskdatabasetuningisfranklysomethingthatcanbemoreorlesssetup onceandthenscheduledtorunautomatically;prepackagedBIsolutionstypicallyhavethis builtinandareadvertisedasselfmaintaining.

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

TheotheraspectofBIsolutionmanagementisongoingcustomization.Bigcompanies changetheirpatternsandpracticesovertime,evolvingtheirbusiness.Somelarge enterprisesmakesweepingchangesfairlyoftenandfeeltheoperationalpainwhenall theirsystems,includingaccounting,ERP,CRM,andsoon,needtobeupdatedtoreflectthe changesinthebusinessmodel.Forthosecompanies,havingspecializedITskillsonstaffis acostofdoingbusiness.Plentyofhugecompanies,though,makerelativelyfewchangesto theirbasicpatternsandpractices.Theydontwanttorearchitecttheiraccountingrecords, redesigntheirCRMsolutions,orredesigntheirBIsolution.Sothosecompanies,even thoughtheyrequitelarge,oftendowithoutspecializedBIskillsonstaff.Midsize companiesalsotendtoavoidthekindofcomplexchangesthatrequiresweepingchanges totheirbackendsystems.Remember,midsizecompaniesoftensteerclearofvery customizedtoolsandprocessesbecausethosecustomizationsaddcomplexitythatisnot justifiedtoamidsizecompanyintermsofitsaddedvalue.

LargeCompanySkillsDontScaleDown
SomemidsizecompaniesarefortunateenoughtohaveBIexperienceonstaff.Typically,its intheformofanITstafferwhoperhapsworkedonaBIprojectinapreviousjoboften withalargecompany.OritmightbeanexecutiveormanagerwhousedBIsolutionsinpast jobs.Thefear,however,isthatthoselargecompanyskillswontscaledowntothemidsize business,meaningthoseexistingskillsareatbestuseless,andareatworstdangerous,as theywilldrivebigcompanydecisionsthatarentappropriateforamidsizebusiness. Inmyexperience,nothingcouldbefurtherfromthetruth.Ivespentalotoftimewriting aboutprepackagedBIsolutionsformidsizecompanies;itwouldbeveryeasytoassume thatprepackagedsomehowmeansdifferentorlesscapable.Notso.PrepackagedBI solutionsareBIsolutions;theyworkinmuchthesamewaythatbigcompaniesBI solutionswork,andpastexperiencewithanyBIsystemwillmakesomeonemore comfortablewithanyotherBIsystem.Prepackagedsimplymeansassembledforyou ratherthanbuildityourself;custombuiltBIsolutionsarecustom,notnecessarilybetter. Solargecompanyskillsdontneedtoscaledowntomidsizebusinesses;thoseskillsare valuableexactlyastheyare.

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

SpecializedEndUserSkills
DoBIsystemsrequirespecializedenduserskills?Wellyesandno.Thisisntacasewhere Imgoingtotellyouagainthatmidsizecompaniessimplydontneedthesameskillsas bigcompanies.AsIoutlinedintheprevioussection,bigcompanyBIskillsworkwellina midsizeenvironment;thatsuggeststhatanyBIimplementationwillneedthesameskills, sosomeonewhodoesnthavethoseskillswillneedtraining.Right? Again,yesandno.Letmefallbacktotheexampleofaccountingsystems.Inthevery earliestdaysofcomputerizedaccountingsystems,computerizedaccountingwasonlydone bybigbusinesses.Alotofspecializedskillswereinvolved;midsizebusinessesstuckwith pencilandpaperledgers.Asmoreandmorebigbusinessesusedthoseaccountingsystems, however,thefolkswhocreatedthosesystemsfoundwaystomakethemeasiertouse. Eventually,thatresultedinprepackagedaccountingsystemsliketodaysQuickBooksfor smallbusinesses,orMicrosoftDynamicsformidsizebusinessesthatwereeasiertouse andreallydidntrequirealotofskillsspecifictothesoftware.Anycompetentaccountant, accompaniedbyagoodinstructionalbook,couldfigureoutthesoftwareanduseit effectively. Inotherwords,theinvestmentbybigcompaniesmadethingsmoreaccessibletosmaller companies.WeseethatagainandagainintheITindustry:Bigcompanieswerethefirstto investinlarge,mainframecomputersinthesixties;today,everycompanyhasseveralPCs. ThesamehasheldtrueforBI:Theinvestmentbybigcompaniesintrainingtheirend users,inimplementingBI,andsoonhasmadethingsmuchmoreaccessibletoendusers. ThefirstBIimplementationsreliedoncomplexreports,proprietaryanalysisinterfaces, andsoon;today,Webbaseddashboardsandscorecardsareaccessibletomoreusers.Add instofamiliarapplicationssuchasMicrosoftExcelputBIanalysisinthehandsofmore people,withlesstraining.Bigcompaniesstartedwithsimple,informationdensecharts, liketheoneshowninFigure3.1.

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

Figure3.1:DetailedBIchart. Althoughthistypeofchartisstillusefultoday,ittookthefirstBIusersagooddealoftime andeffortusingspecializedskillstopullthisinformationtogetherintothisdisplay. Today,BIsolutionsforbothenterprisesandmidsizecompaniescanautomaticallyproduce richerdisplays,likethesalesdashboardshowninFigure3.2andthescorecardshownin Figure3.3.

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

Figure3.2:SalesdashboardfromaBIsystem.

Figure3.3:ExamplescorecardfromaBIsystem.

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

Again,theanswertothismythisntthesamemidsizecompaniesarentthesameasbig companiesanswerIveprovideduptothispoint;inthiscase,specializedenduserskills arelessneededbyanyBIsystemlargeorsmallsimplybecauseBIsolutiondevelopers havemadeconsiderableefforttomakethingsmoreintuitive,automatic,andapproachable. Weresimplyseeingtheculminationofmorethanadecadeofcontinuedprogressand evolution. Now,thatsnottosaythatbigcompaniesdonthaveenduserswhohavespecializedskills. IfyouretryingtoanswerentirelynewquestionsusingaBIsystem,thenthingswill certainlygofasterifyoureexperiencedusingyourtoolset.Butinlargepart,Ithinkthe operativewordthereisexperience.Anyintelligentbusinesspersoncangainspecialized skillssimplybyusingtheirBItoolsetforevermorecomplextasks.Andtrainingfor theseendusersisalsomorewidelyavailable:TypeBIdataanalysisintoanonline bookstoressearchengine,andyoullfindhundredsofresults.

Myth3:BIIsExpensive
WhenIveworkedwithbigcompanies,therewasnoquestionthatBIwasapricey proposition.Butisnteverythinginabigcompanyexpensive?Thatspartofthedealof beingbig.ButyoucantusebigcompanypricingtodrawaccurateconclusionsaboutBI costsformidsizecompanies.Yourmidsizecompanydidntspendasmuchon,say,aCRM solutionasagiganticenterprisewhywouldBIbeanydifferent?

ExpensiveAcquisitionCosts
TherearetwomaincostsassociatedwithaBIimplementation,andoneofthemis obviouslythecostoftheBIsoftware.Thatiswhatitis,butamidsizecompanyshouldnt expecttopayanythinglikewhatahugeenterprisewouldinvest.Thevendorsthatproduce thesesolutionsarentstupid;theyknowperfectlywellthattheyneedtoofferdifferent pricepointsfordifferentsizedbusinesses. Manyofthesevendorsdosobyofferingdifferentpackagesoreditionsoftheirsolutions andtoolsets.JustasMicrosoftoffersanUltimateeditionoftheirOfficeproductivitysuite, theyassumeonlypoweruserswouldpurchasethatedition.OthereditionsHome& Student,Professional,andsoforthallprovidedifferentpricepoints,andfunctionality packages,foruserswithdifferentneeds.Today,BIsolutionsarentreallythatdifferent: Yourmidsizecompanycangetthefunctionalityyouneedinaneditionthatsmuchless expensivethanwhatabigenterprisewouldneedandbewillingtopayfor.

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

ExpensiveConsultingServices
TheothermaincostassociatedwithaBIimplementationisthehordesofconsultantswho willspendmonthsandmonthsresearching,planning,implementing,andtrainingbefore yourBIsolutionisofficiallyonlineinabigcompany,atleast;asIvealreadydiscussed. Midsizecompaniescanbenefitfromprepackagedsolutionsthatrequirelittleorno consultingservices.Sure,youllprobablyspendsometimespeakingwithasalespersonand atechnicalexpert,selectingtherightfeaturesetforyourneeds,andmakingsurethatthe solutionyoueventuallypurchasewilldowhatyouexpectitto.Butinmanycases,these prepackagedsolutionsareprepackagedineverysenseoftheword:Youdontneedtohave abunchofoutsiderscomeinandinstallitforyou. NoticeIsaidneed.YoucertainlycanhaveconsultantshandleyourBIimplementation,and therearesomevalidbusinessreasonsfordoingso,suchasanITstaffthatsimplydoesnt havetimefortheprojectregardlessofwhethertheyhavetherightskills.ButwithBI solutionstargetedspecificallyatthemidsizemarket,youllfindthateventheconsulting expensesshouldyouchoosetouseconsultantsforyourimplementationaremuch lowerthanwhatabigcompanywouldexpecttopay.Yourelookingatweeksof implementation,notmonths;youredealingwithaBIsolutionthatsintendedtobe installedusingfewerspecializedskills(meaninglessexpensiveconsultants),inlesstime, andwithlesseffort.

DontLikeNegotiatingwithVendors?
TheresanotherthingIfindaboutmidsizecompanieswhoareexploringBIoptions:They hatedickeringwithsalespeople.Theresthisfeeling,nowadays,thateverybusiness softwarepurchaseisgoingtobelikebuyingacar.Youhavetohaggleoverthebasiclicense pricing,thenhaggleoverthemaintenancefees.Thesalespersonistryingtofigureout exactlyhowmuchhecansqueezebeforeyoukickhimoutoftheconferenceroom,while youretryingtofigureouthowlowyoucandrivethepricebeforethesalespersongivesup andwalksaway. Somebusinesspeoplelovenegotiating,andtherewillalwaysbesalespeoplewillingtodo so.ButsomeBIvendorsespeciallythosetargetingthemidsizemarketrealizethatalot ofmidsizebusinesspeopledonthavethetimeorinclinationforprotractednegotiations. Theyrebuyingaprepackagedsolution,afterall;whycanttheypayaprepackagedprice? YoullfindthatmanyBIvendorsagain,especiallythosetargetingthemidsizemarket providesimple,fixedpricingontheirmidsizebusinessBIsolutions.Yourejustbuyinga pieceofsoftware,notapieceofrealestate,sotheytrytomakethingseasyaswellas affordable.

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

LookforaTrialVersion SomeBIvendorsmaketheirmidsizebusinesssolutionsavailableasafree trialdownload.Tome,thatsaysanawfullotaboutthemythsweveexplored inthischapter. Afreedownloadmeansthevendorisprettysureyoullbeabletosetthe softwareupanduseitquickly(beforethetrialexpires),andthatyouwont needspecializedconsultingservicesorskillsinordertohaveatleastbasic successwiththesoftware. Afreedownloadmeansyourenotexpectedtohaveanyspecializedplanning ordesigntools,either.Afreedownloadisalsoasignofsoftwarethatis,oris onitswaytobecoming,somewhatcommoditized.Thatsnottosaythat differentvendorsdonthavecompetitiveadvantages,butrathertosaythat theyvereallygottenthesoftwareprepackaged,andthatobtainingitand usingitshouldntbeanymorecomplicatedthatobtainingandusingany otherpieceofserversoftware. Plus,afreetrialmeansyoucanofteninstallandexplorethesoftwareentirely onyourown,atyourownpace,andunderyourownconditionsyoudont havetoengageinalengthysalesrelationshipjusttoseewhatthesoftware lookslike,whatitdoes,andhowitworks.Ifindthatmidsizecompanies especiallytheirITdepartmentsreallylovebeingabletotestsomethingon theirown,thenengagethevendorssalesorganizationwhentheyrereadyto proceed.

UniqueAdvantagesofMidsizeBusinessBI
ThereareafewthingsthatmidsizecompaniescantypicallydowithBIthatisactuallya distinctadvantage,givingmidsizecompaniesarealbenefitthatismoredifficultforlarger companiestoachieve.

InMemoryAnalytics
Oneexampleisinmemoryanalysis.AsIdescribedinthepreviouschapter,itsagrowing trendtouseinmemoryanalyticsbecausetheyrefast,canoftenaccessmoreuptodate(or evenrealtime)datamorereadily,andultimatelybecausetheyprovidefasteranswersto questions.Theyallowmorerapidexplorationofwhatifscenariosbecauseyoudonthave towaitforreportsorotheroutputtobegenerated.

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

Bigcompaniescancertainlyuseinmemoryanalytics,butitcanoftenbeexpensivefor them(remember,everythingabigcompanydoesseemstobeexpensive).Becausetheir businessmodelsdealwithsomuchdata,theyneedalotofcomputingpowerespecially memorytomakeinmemoryanalyticspossible.Somebigcompanieschoosetolive withoutit,whileothersmaketheinvestment.Midsizecompaniesoftendealwithasmaller volumeofdata,meaninginmemoryanalyticsismoreimmediatelyapproachable. Computerhardwarecoststhesamenomatterhowbigyourcompanyis,andamidsize companywilloftenneedmuchlessofittoenableinmemoryanalyticsadistinct advantagegiventhebenefitinmemoryanalyticscanhaveonbusinessdecisions.

Consistency
Bigcompaniesarewell,theyrebig.Theyhavelotsofdivisionswithdifferentneeds,and thatcanmakeBIdifficult.Peoplewinduplookingatdifferent,customizedreports,and drawingdifferentconclusionsfromwhattheysee.Anotheradvantageofmidsize companiesisthateveryonetendstobealittleclosertotheactuallineofbusiness,so everyonetendstobealittlemoreconsistentintheirneeds.PrepackagedBIsolutions capitalizeonthisbymakingconsistentBIoutputavailableacrossthebusiness,intheform ofreports,dashboards,andsoforth.Bygettingeveryoneliterallyonthesamepage somethingamidsizecompanycanhaveaneasiertimedoingyoucanmakemore consistentbusinessdecisionsandgeteveryonemovinginthesamedirectionmoreeasily.

WhatsGoodforBigBusinessIsKindofGoodforYouToo
Hopefully,IveconvincedyouthatBIisntjustforbigbusinesses,andthatmanyofthe commonperceptionsaboutBIareinfactmisperceptions.BIdoesnthavetobeexpensive, doesnthavetoinvolveanarmyofconsultants,anddoesntrequireyourbusinesstoslam onthebrakesanddisruptitself. Butinusingtermslikeprepackaged,Imayhavegivenyoutheimpressionthatmidsize businessBIofferingsaresomehowlesscapableorflexible,andIneedtoaddressthat. AlthoughBIsolutionstargetedatmidsizecompaniesoftendoincludeasubsetofthe featuresfoundinabigcompanyBIsolution,thatstypicallybecausemanyofthebig companyBIfeaturesarespecifictoamajorenterpriseenvironmentandthosefeatures oftendorequirethespecializedskillsandtrainingmidsizebusinessesarelesslikelyto haveorwanttoacquire. Thatdoesnotmeanthatprepackaged,midsizebusinessBIsolutionsareinflexible,one sizefitsallprogramsthatwillforceyoutochangethewayyoudobusinessinordertofit thesolutionspreconceivedmodel.Modernsoftwareis,fortunately,muchmoreflexible thanthat.

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

BusinessModelFlexibility
EveryBIvendorknowsthattheycantforceyoutoremodelyourbusinesstofitthe vendorsnotionsofhowyourbusinessworks.Iftheytried,youdsimplyneverbytheir product,andtheydfail.ThevalueofBIcanonlyberealizedwhentheBIsolutionmaps itselftoyourbusinessmodel,nottheotherwayaround;thatswhylargebusinesses typicallyhavecustomizedBIsolutionsbuiltforthem. ItsthesimilarityofmidsizebusinessesthatmakeprepackagedBIsolutionsfeasible; nobodyexpectsmidsizebusinessestobeidentical.BIsolutionstargetedatthemidsize marketcanbeincrediblyflexible,andexploringasolutionsabilitytomaptoyourbusiness modelisoneofthefirstthingsyoushoulddowhenevaluatingsolutionsforyourbusiness.

AdvancedReporting
Midsizedoesntmeandumbeddown.MidsizebusinessBIsolutionstypicallyinclude powerful,customizablereportingcapabilities.Adifference,however,isthatthese capabilitiesaretypicallyexposedinamuchfriendlier,moreintuitiveway.BIdataisoften storedusingacommonmetadatamodelthatusesstandardbusinessterminologyrather thantechgeekspeak,makingtheBIsystemmoreunderstandabletobusinessusers. MidsizeBIsolutionstypicallyincludelotsofbuiltinreportsforthemostcommonbusiness needs,andthesereportscanserveasthebasisforadditional,customizedreportsthatare sharedthroughacentralrepositoryacrosstheentirebusiness.Asusersgain experience,theycanusuallybeginwritingtheirowncustomreports,againsharingthese throughtheBIsolutionwiththeotherusersinthecompany.

DataEverywhereAccessibility
Bigbusinesseswereamongthefirsttoinvestheavilyinmobileworkforcetechnologies, andthatinvestmentlikealltheothersbigbusinesseshavemadeinIToverthedecades paysoffformidsizecompanies.Havingcreateddataeverywherecapabilitiesfortheirbig companyBIsolutions,BIvendorsmovedquicklytobringthefunctionalitytotheirmidsize businessofferingsaswell. Andanybusinesscancertainlybenefitfromdataeverywhere.Thepopularityofmobile devicessuchasBlackberriesandiPhonesprovesthatbusinesspeoplelovetobeconnected totheirbusinessesallthetimeandbeingconnectedtoyourBIsolutionisnodifferent. MidsizebusinessBIsolutionscanproviderobustmobilesupport,includingtheabilityto accessreports,dashboards,andscorecardsfrommobileWebbrowsers,dedicatedmobile applications,andeventhroughmobileemail(seeFigure3.4). Note ThecontinuingimprovementtomobiledeviceWebbrowserscanmakeeven moreBIdataavailableremotely,becauseasIlldiscussnextmanyBI systemsarerelyingmoreandmoreonWebbasedinterfaces.

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Figure3.4:BIsolutionbeingusedfromamobiledevice. MobiledevicesarenttheonlypartofdataeverywherethatyoushouldlookforinaBI solution.Simplybeingabletoaccessreports,dashboards,andanalysistoolsfromahome office,fromahotelroomwhiletraveling,orintheconferenceroomofabusinesspartner areallvaluableusagescenarios.MostmidsizebusinessITsolutionsaccommodatethese scenariosbystandardizingonpowerful,modernWebbasedinterfacesformuchoftheir reportingandanalysisfunctionality.Figure3.5showsanexampleofaWebbased analysis/reportinginterfacesomethingthatuserscouldaccessusinganyWebbrowser fromanycomputerintheworld.

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Figure3.5:Webbasedinterfacesareaccessiblefromanywhere.

ComingUpNext
ThenextandfinalchapterinthisbookwilloutlinearoadmapforsuccessfullyaddingBIto amidsizecompany.NowthatyouvelearnedwhatBIis,howitworks,andwhatisnttrue aboutit,yourereadytoseehowtobringitintoyourcompany.Illstartbyreviewingsome ofthemainchallengespresentedbyBI,andsomewaysinwhichyoucanaddressthose challengesinauniquelymidsizecompanyfashion.IlllookatwaystobringBIintothe companywithoutturningitintoagiant,neverendingimplementationandwithout breakingthebank.IllshowyouhowBIcanbemadetoworkwithinthescopeofyour currentITresources,withoutneedingexpensiveconsultantscampedoutforthenext18 months.Finally,IlllookathowtodoBIinawaythatcomplements,ratherthandisrupts, yourbusinessenvironment.Illwrapupthisbookbyexplainingafewofthethingsthatbig businessesdealwithwhenitcomestoBIandhowsomeofthosethingsarentgoodfor midsizecompanies;Illthenshowyouhowtoavoidthem.

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Chapter4:SuccessfullyAddingBusiness IntelligencetoaMidsizeCompany
Atthispoint,youshouldbeatleastreadytoconsiderabusinessintelligence(BI)solution foryourmidsizecompanyandyoumayevenbeoutrightconvincedthatitstherighttool foryourbusiness.SohowdoyougoaboutsuccessfullyaddingaBIsolutionwithout disruptingyourcompany?Withoutbreakingthebank?Withouthavingtoaddstaff memberswithspecialtiesyouveneverevenheardofbefore?Mygoalinthischapteristo helpanswerexactlythosequestions,withpracticaladviceforbringingBIintoyourmidsize company.

ReviewingtheProblemswithBI
Beforewecontinue,Iwanttojustbrieflyreviewandsummarizesomeofthehurdlesthat BIhastraditionallyfaced.Keepinmindthatthesehurdlesarepotentiallyaproblemforany sizecompany;asIgo,Illoutlinewhybigcompanieschoosetoacceptthesedownsides,and howmidsizecompaniescanavoidthementirely.

TooComplex
BIsystemsaretypicallyseenasincrediblycomplex.Thatsbecause,toalargepart,the underlyingbusinesssystemsandprocessesthataBIsolutionmustmodelarealsocomplex. Inotherwords,ifyouhaveahuge,complexcompany,thenyourBIsystemislikelytobe hugeandcomplexalso. Bigcompaniesacceptthisasafactoflifesimplybecauseeverythinginabigcompanyisbig andcomplex.Payrollsystems.Accountingsystems.Customerrelationshipmanagement (CRM)systems.Enterpriseresourceplanning(ERP)systems.Assettrackingsystems.Heck, justfilinganexpensereportinabigcompanycanbeliketryingtopassabillinCongress everythingiscomplicated.Toalargedegree,bigcompaniescantavoidthatcomplexity. Theyresubjecttoalotoflegalscrutiny,foronething.Microsoft,forexample,hastobevery cautiousabouthowitsvariousbusinessunitsinteract,simplybecausetheyrealmost continuallysuedovertheresultsofthoseinteractions.

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Midsizecompanies,however,canoftenavoidsomeofthatcomplexityandtypicallytry veryhardtodoso.Midsizecompaniesdontoftenhaveinternationaldivisions,multiple linesofbusiness,andmergersandacquisitionstodealwith.Midsizecompaniesoftenuse offtheshelfsoftwareorservicesforthingslikeaccounting,customermanagement,stock management,andsoon.Thatmakesmidsizecompaniesinherentlylesscomplicated,anda lesscomplicatedcompanywillhavelesscomplicatedoptionsforBI. TheanalogyIveusedbeforeisthatofahouse:BuildingagiantcompanysBIsolutionisa lotlikebuildinganentirecity.Noothercityisgoingtobeexactlylikeit,soyouwindup withalotofcomplexarchitecturalanddesignelements.Youhavemanydifferentbuildings, eachofwhichhaveadifferentpurposeandmustbebuiltforthatpurpose.Youcantuse offtheshelfengineeringnumbers;youhavetoworkallthemathfromscratch.Nothingis standardized;everythingwillbecompletelycustomandtherewillbealotofittodealwith. Allthatcustomizationandcomplexitymakesthebuildingprocesscomplex:Permitsare complicated(andtherearealotofthem)engineeringdrawings(tonsofthem)aremore complicated,eventhingslikegradingplansandlandscapingdesignswillnaturallybemore complicated.Theupsideisthatyougetanentirecityintheend;thedownsideisthatit takesalotoftime,money,andeffortandalotofwastedeffortbecausecustomalso meansalotofwrongturns,backingup,andredoingthings.Anotherdownsideisthat tryingtobuilditallinonegowillmeanalotofbacktrackingandwastedeffort,alotofre donework,andalotofprojectsthatstartbutsimplynevergetfinished. Forme,amidsizecompanysBIsolutionismorelikeanicehouseinamasterplanned community.Theresstillalotofqualityintheconstructioninfact,thequalitycanoftenbe higherthanthecustommansionbecausethetradesmenarebuildingseveralunitsthatare basicallythesame,andtheyworkoutalltheglitchesearlyon.Thehousecanstillhavealot ofsemicustomoptionsandelements,sotheyrenotcookiecutter(becausemidsize businessescertainlyarentcookiecutter),butmanyofthoseoptionsarepreengineered,so theyreeasiertobuildandlessexpensive,andtheycanbepluggedintothebasehome designwithoutalotofgriefandturmoil. SoareBIsystemscomplex?Yesiftheunderlyingcompanyiscomplex.Midsizecompanies tendtoavoidthatkindofcomplexityontheirown,however,soamidsizecompanyBI solutionislikewisemuchlesscomplicated.

TooExpensive
Complexityleadstoexpense,andbecauseBIsystemsaretypicallyseenascomplicated, theyrealsotypicallyseenasexpensive.Andtheycanbe.Bigbusinessestypicallyneed themtobeexpensivebecausethatexpenseiswhatpaysforaBIsystemthatcanmatchthe underlyingcomplexityofthegiantbusinessitself. MidsizebusinessesdontneedtoautomaticallyspendafortuneonaBIsolution.Theres justnoneed.PrepackagedBIsolutionswhatIllcallasoftwareappliancecanbe purchasedforamuchlower,fixedpricethanacustombuilt,massiveenterpriseBIproject. Softwareappliancesareentirelyselfcontainedyoumayjustinstallasinglesoftware applicationontoaserver,oryoumayevenpurchasethesolutionfromavalueadded resellerwhojustshowsupwithapreinstalledmachineandplugsitintoyournetwork. 59

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Withasoftwareapplianceorprepackagedapproach,yourcostsarealsoknownfully,up front,beforeyoumakeanacquisition.Youcandecidethenifitsexpensiveornot,and knowthatthepricetagisallyoullpaybecausetheBIsolutionisprepackagedandself contained,theresnochanceforscopecreep,forneverendingimplementationprojects,or forconsultantsthathavebeeninoneofyourofficesforlongerthanhalfyouremployees.

TooDisruptive
IvesavedmyworstcaseBIstoryforthislastchapter.Ionceworkedforacompanya largecreditcardissuingbankthatdecidedtoimplementamajorBIproject.Theywere stickingwithaspecificdivisionofthecompany,figuringthatwouldbeeasierandless disruptivethantryingtogowholehogwiththeentirecompanyallatonce.Thisparticular divisionemployedabout12,000people(althoughmanywereparttimers),andhad literallymillionsofcustomers. TheBIprojecttook2yearsbeforeitwasfinallycompleteandeveryconsultantwenthome. Inthemeantime,thedivisionhadtobringonanother1000employeestooffsetthe resourcesthatwoundupbeingtiedupalmostfulltimeontheBIproject.Theyspent foreverfiguringoutwhatreportstheywouldneed,whatdashboardswouldlooklike,where datawascomingfrom,wheredataneededtogo,whatspreadsheetswouldcontributeand needtobeupdateditwasnuts.Thereweresevendifferentdatawarehousedesignsinall, becauseeverytimetheydcompleteonedesign,theydrealizethatitwasmissingafew thingsandenduphavingtostartover. TwentyITpeopleincludingmyself,unfortunatelywereonthisprojectalmostfulltime for2years.Weemergedfromitcompletelyunawareofwhatelsewashappeninginthe company.MostofusoccupiedfairlyseniorpositionsinIT,yetwewereessentiallyclueless aboutthestateofourowndepartmentbecausewedbeenentirelyfocusedonthisBI projectforsolong. Disruptive?Youbet.BIcanbedisruptive.Now,ourprojectwasnotashiningexampleof BIeveninaverylargecompany,butthepointisthatBIcangetawayfromyou,andthats whenitstartsbeingdisruptive.CanyouimagineatenthofyourITstaffoccupiedfor severalmonthsonnothingbutaBIproject? Thegoodnewsisthat,withprepackagedBIsoftwaredesignedforamidsizecompany, youllneverhavetoimaginethat.Theresnodiscoveryofbusinessrequirementstobe done.Manyreportsanddashboardswillcomeprebuilt,soyouwonthavetocreate everythingfromscratchyoullbeabletostartusingthesolutionmuchmorequickly. Therearenodatawarehousestodesign,redesign,discard,anddesignagaininsome cases,thesolutionmayevenrelymoreoninmemoryanalyticsthanadatawarehouse. Muchofthedesignworkisdoneforyouallyouhavetodoisinstallitandconfiguredata connections.Itdoesnthavetobeanymoredisruptivethaninstallinganewmessaging serverintoyourinfrastructure.Yes,someonewillhavetospendsometimeonitbutthat timewillbemeasuredindays,notmonthsoryears.

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AddingBIWithoutBreakingtheBank
ThereareafewwaysyoucanchoosetoapproachBI,evenasamidsizecompanythatplans touseaprepackagedsoftwareappliance.Youcould,forexample,goforacompanywideBI solutionthatencompasseseverythingyoudo;youcouldchoosetoinsteadfocusona smallerinitialproject.Yourchoicesinthismatterwillhelpdefineyourcosts,sowhat choicescanyoumakethatwillminimizeacquisitionandimplementationcosts,while deliveringreal,tangiblevalue?

NotJustReporting!
BeforeIdivein,IwanttoreemphasizeonepointIvetriedtomakethroughoutthisbook: BIisnotjustreporting.ItseasytoseewheresomeonemightthinkBIwasjustfancy reportingbecauseBItendstofocusondynamicreports,staticreports,scorecards, dashboardsallofwhichare,really,akindofreport.TrueBI,however,shouldbethe whole,integratedreporting+analysis+planning.CallitCorporatePerformance Managementifyoulike(somefolksdo).Gatherdata.Analyzeitinvariousways.Make tentativedecisions,andseehowtheyaffectthedataoutcome.Makefinaldecisions,and havethemmodifyyourplanningsystemsdynamicallytomakeimplementingthose decisionsseamlessandeasier.Repeat,asshowninFigure4.1.

Figure4.1:TheCorporatePerformanceManagementlifecycle. ThisiswhattrueBIisallabout.Notjustdeliveringdatainvisuallystunningdashboards, butgivingyourealtoolstospottrendsandunderlyingcauses,tomakedecisions,andto makethosedecisionshappen.

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ThinkBig,StartSmall
Inpreviouschapters,Ivementionedacoupleofapproachestodatawarehousedesign. Thesearebothveryhighlevelphilosophies,bothespousedbyveryhighlevelexpertsin thefield.Thefirstisthetopdownapproach,whichsaysthatyouhavetostartbycreatinga datawarehousefortheentirecompany,thenbreakthatdownintosmallerdatamartsfor differentdepartmentsandpurposes.Thesecondisthebottomupapproach,whichmoreor lessstatestheopposite:Thatyoustartwithsmallerdatamartsthatareverytaskspecific, thengraduallyaggregatethemintoacompanywidedatawarehouse. Proponentsonbothsidesofthedebatehaveveryscathingandwittythingstosayabout theiropponents,andIdontproposetohaveafinalansweronthesubjectinthisshort book.However,whatIwillsayisthis:Philosophyanddebateisallverywellandgood,but thepracticalrealitiesofthebusinessworldsometimesmeanyoumakeacompromise.For me,bottomupisthatcompromise. Yes,youhavetothinkaboutyourentirecompany.ButimplementingacompanywideBI solutionisobviouslymorecomplexthanonethatjustservesaspecificdepartment.As wevealreadyseen,complexity=time=expense;acompanywidesystemisdesirablebutit isntalwaysthemostpracticalstartingpointforamidsizecompany.Whatsoftenmore practicalandapproachableistoimplementaprepackagedBIsoftwareapplianceforone partofthecompany.Learnhowtouseit.Gainsomeexperiencewithit.Then,gradually, addinanotherpartofthecompany.Andanother.Andanother. WillaBIsolutionbuiltinpiecesbeasgoodasonethatwasbuiltfromthetopdown approach?Well,thatdepends.Mynormalanswerwouldbemaybe,maybenot,which isntverydefinitivebecauseitdependsalotonhowwellthepiecesweredesigned. Dependingontheexactsolutionyouchoose,youmightwindupwithseparate, independentBIsystemsfordifferentdivisionswhichcanbeunitedintoacompanywide system.OtherBIsolutionvendorsmayofferasinglesystemthatcanstartoutsmalland growtoincludeotherdepartments,andeventuallytheentirecompany.Thisisapointto investigateasyoubeginresearchingandevaluatingspecificsolutions;neitherapproachis wrong,butunderstandingtheapproachthatavendorhaschoseniscertainlyimportant.

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StartwiththeBiggestPain
Ionceworkedforaninternationalretailer.Weshippedproductstohundredsofstores fromthreedistributioncentersworldwide;wealsomanagedasmalldirectmailbusiness forcustomerswhodidnthaveastoreintheirimmediatearea.Oneofthecompanys biggestfrustrationswasourshippingcosts.Wednegotiatethebestdealswecouldwith variouscarriers,buttherewasalwaysthissensethatshippingwasavast,blackpitinto whichwejustpouredmoney.Ourexecutiveteamwasnotoriouslydetailorientedtheyd reengineeredanumberofourbusinessprocessesandhadsavedhundredsofthousandsof dollarsinsodoing.Butshippingjustfeltlikethisuntouchablecomponentitcostwhatit cost,andallyoucoulddowasnegotiatelowerrates.Theywerealsofrustratedwithwhat theyperceivedasinconsistentdeliverytimesandotherdetailstheycouldntmakesense ofexactlywhattheirmoneywasgettingforthem. ItwasthefirstareathecompanychoseforaBIsolution.Infact,itwastheuntouchable, unknowablenatureofshippingthatmadeourexecutivesevenconsideraBIsolution. Everythingelsetheydtriedhadntgiventhemanyinsightintoshipping;maybeBIcould proveitselfbydoingwhattheycouldntaccomplishontheirown. Acoupleofmonthslater,wehadaprettybasicBIsolutioninplaceandourexecutiveswere alreadygettinganswerssurprisingones.Theirstrategyhadbeentoofferexclusivitytoa givencarrierinreturnfordeeperdiscounts,andtosendpackagesthatwereascloseas possibletothecarriersmaximumsizeandweight.SomewhatifscenariosintheBIsystem suggestedthatevenwithmodestdiscounts,wedsavemoneyandgetbetterdelivery timeswithsomewhatsmallerpackages,andifweusedseveralcarriers,selectingthem basedontheproximityoftheirhubstoourstores.Withinayear,theBIsystemhadpaidfor itselfinshippingsavings. Notlongafter,westartedpluggingtheBIsystemintomoreareasofthecompany.Wecould punchinproposedsalesfiguresforagivenmonthandseeexactlywhatwedprobablybe spendingonshipping,seeifthedistributioncenterstaffwouldneedmoreorfewerpart timerstohandletherestockingworkload,andevenpredicthowlongthelossprevention departmentwouldneedtoauditthesales.AsIwaspreparingtoleavethecompany,a singledashboardcouldeventellyouhowmuchlosstoexpectforagivensalesamount(it wassurprisinglynonlinearwesawgreaterlossesatverylowandveryhighsales amounts,butlesslossforaveragesales),leadingtoawholenewsetofinitiativestocombat thatloss.Itwasexciting.

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Thelessonistofocusonwhereyouhavethemostpain.StartyourBIeffortthere.Thereare afewreasonsfordoingso: Youhavethemosttogain.RelativelyfewandminorinsightsfromaBIsolutioncan providemaximaleffectinyourmostpainfulareaofbusiness. Youreprobablyalreadyfocusingonthisareaofyourbusiness,sotheBIsystem wontbeseenasadistraction,itwillbeseenasatooltoassistyouralreadyheavy focus. Itoffersthehighestincentive.Peopleinawellrunareaofyourbusinessareless likelytowelcomeaBIinitiativewithenthusiasmbecausetheyllfeeltheyalready haveeverythingundercontrol.Byshowingthemhowanotherpartofthebusiness benefits,youllhaveaneasiertimesellingthemonBIlater.

Sohowdoyouquantifypaininanareaofyourbusiness? Lookforareaswheremajordecisionsarebeingmadeprimarilyfrominstitutional knowledgethatis,bygutinstinctfromexperiencedmanagers. Lookforareasthatareawashinrawdatabuthaverelativelylittlerefineddata. Lookforareaswheremanagersarealreadyaccustomedtousingspreadsheetsto crunchnumbersandmakedecisionsthosearethefolkswhowillbenefitfirstfrom aBIsolution. Lookforareaswhereyousensethattrendsandpatternsmustexistbutwherethose trendsandpatternsneverseemtomaterialize. LookforareaswhereoldassumptionsarestilldrivingcriticaldecisionsaBI systemcanhelprevisethoseassumptionsusingrealworlddata.

Selecttheareaofyourbusinessthathasthemostofthesefactors,andyoullbegivingaBI solutionthebestopportunitytohelpyouimprovethebusiness.

AddCapabilitiesasNeeded
Likemostappliances,softwareappliancesareoftenmodularinnature.Needanicemaker foryourfreezer?Wanttoaddtheicecreammakerattachmenttoyourkitchenstandmixer? WanttoaddanewreportingmoduletoyourBIsolution?Noproblem:Extensible appliancesarenothingnew,andtheygiveyoutheabilitytobuyjustwhatyouneed,just whenyouneedit,soyouresavingmoneyandeffort.

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EveryBIsolutionvendorwillobviouslyfollowdifferentpatternsfortheirtoolset,butin general,thecapabilitiesbreakintotwohalves: Analysisandvisualization.Thisincludestheabilitytopullinrawdataand generateanalysesandvisualrepresentations.Inmemoryanalyticsmaybeoffered, whichhelpsyougeneratefasteranalysisresultsfromrealtime,operationaldata stores.Thisiswhereyoulloftengetvisualizationslikethedashboardshownin Figure4.2.

Figure4.2:UsingadashboardfromaBIanalysispackage. Reportingandadhocquerying.Thisoftenincludesselfservicereporting interfaces,givingyoutheabilitytocreatecustomreports.Thebenefithereisthat thereportsarealldrawnfromasingledatasourcethedatawarehouseandso everyuserwillbeworkingwithconsistentdata.Reportsareoftencolumnar, althoughyoullalsobeabletodesignmorecomplexones.Figure4.3showsasample BIreport.ThebenefithereisthattheBIsolutionprovidesatoolsetthatletsusers createtheirownreportsratherthanjustusingprepackagedones.Thisfeaturehelps eachusergettheexactanswerstheyneedatthatexactmoment.

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Figure4.3:AnexampleBIreport. Youmayfindothermodules,too,suchasmodulesthatsupportMicrosoftExcel connectivity,whichcanbeaboonforspreadsheetjockeysinyourcompanywhoare comfortableusingExcelfordataanalysis.

EnsurethatYouHaveaGrowthPath
Whateveryoudo,makesureyouhaveaplaninthebackofyourheadtoextendyourBI solutiontootherareasofyourcompany.DiscussthosepossibilitieswitheachBIsolution vendorthatyouspeakwithandletthemhelpguideyoutowardasolutionthatcan accommodatethosegrowthplans.Yourplansmightchange,buthavingasolutioninplace withtherightflexibilitywillhelpensurethatyoucangetwhereyouwanttogo.

SeekOutFixedPriceSolutions
Ivebeeninvolvedinanumberofhighpricedsoftwareacquisitions,andIhatenegotiating withsalespeople.Frankly,Imnotverygoodatit.Ineverknowiftheirfirstpriceisreally thepriceoriftheyexpectmetohagglethemdown.Iftheydo,Idonteverunderstandwhy theyjustcouldntbringmethatpriceinthefirstplace. Whenitcomestoprepackagedsoftwaresolutions,however,yourerarelygoingtofind yourselfhavingtonegotiateandyoushouldnthavetowithamidsizecompanyBI solution.Solutionslikethisareaknownquantityforthevendor;inservingamidsize businessaudience,goodvendorswillfocusonstandardizedpricing.

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Whileonthesubjectofprice,however,Idohaveacautiontooffer:Dontseekoutadoit yourselfsolution.EvenifyouvegottheworldsbestdatawarehousingandBIexperton yourstaff,arollyourownBIsolutionisnearlyalwaysgoingtocostyoumoretimeand moneyinthelongrunthanapackagedsolution.Iveseenjustacoupleofmidsize companiesgothebuildourownroute,andafteracoupleofyearsofsustainedeffort,they finallygaveupandjustboughtsomething.Whentheydid,theygotasystemthatdidmore thantheirhomegrownsystem,haditupandrunninginafewdays,andspentlesson softwaremaintenancethantheydbeenpayingthetwostafferswhohaddevelopedand weremaintaining,theirinhousesolution.Oneofthosecompaniesdecisionwasdriven purelybystaffingtheirBIexpertquit,leavingthemwithoutanyonewhounderstoodhow theBIsystemhadbeenbuiltorhowitworkedunderthehood.Theyhadnochoicebutto eitherhiresomeoneelseandsalariesinthatspecializationhadgonewayupatthat timeorbuyaprepackagedsolution.

AddingBIwithYourCurrentITTeam
IvesaidbeforethatmidsizebusinessescanandshouldimplementarightsizedBIsolution withoutneedingexpensiveconsultingservicesorspecializednewhires.Herearesometips fordoingso.

SoftwareAppliances
LookforaBIsolutionthatcouldaccuratelybedescribedasasoftwareappliance.Iveused thattermbefore,asasynonymforprepackaged;whatexactlydoesitmean?Consideryour corporatefirewall.Thereareacoupleofwaysyoucangowhenchoosingafirewalla dedicatedfirewallsoftwarepackage,whichoftenrunsonanOSsuchasWindowsorLinux, orapowerfulhardwarefirewall,likethosefromCisco.Theseallinvolveafairlycomplex levelofconfiguration,andyoullprobablyneedanexperttoatleastsetthethingup initially,ifnottohelpmaintainitonanongoingbasis.Configurationoftenrequires somethingakintoprogramming,whichdefinitelyrequiresspecializedexpertise.Insome cases,youmayneedotherprerequisitesinordertomakethefirewallsolutionwork,such asanauthenticationserver,loggingserver,andotherelements. Thepointhereisthatyouhavetobuythesoftwareand/orcomponents,hookitintoyour infrastructure,redesignyourinfrastructuretoaccommodateit,thenfullyprogramthe thingwithallthesettingsitneedstooperateandthatyouneedtofityourbusinessneeds. Alternatively,youbuyafirewallappliance.ThisisaboxthatplugsintoACpowerandinto yournetwork.Configurationisoftenmuchsimpler,typicallyWebbased,andusually wizarddriven.Youhavefeweroptionstoworryabout,fewerthingsyoucouldpotentially dowrong,andyoulikelywontneedanexperttogetthethingworkingproperly.Manycan evenselfdiscovercertaininformationaboutyournetworksothatyoudonthaveto configurethosethingsmanually.

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Imusingfirewallsasanexamplebecausetheyreacommonnetworkelementthatcanbe hadbothasacomplexsolutionandasaprepackaged,preconfiguredappliance.For midsizecompanies,IrecommendthelatterapproachforaBIsolution:Findanappliance. Itmightnotbealiteralboxyouplugin,butitshouldntbefarfromthat.Itshould: Comelargelyprebuiltandpreconfigured Comewithwhateverprerequisitesitneedsyoushouldnthavetobuyorinstall anythingelsetomakeitwork Requireminimalconfigurationtoadapttoyourenvironment,andthatconfiguration shouldbedrivenbywizardsandothertoolstohelpmaketheconfigurationeasier andmoreorderly

ThatshowyougetaBIsolutionthatyourcurrentITteamcandeploy.Infact,lookforaBI solutionthatsavailableasafreetrial.Ifthevendorissoconfidentoftheireaseof deploymentthattheyfeeltheycanofferadoityourselftrialwithperhapsashortPDF evaluatorsguidetowalkyouthroughsetupthenyouveprobablyfoundsomethingthat canaccuratelybedescribedasasoftwareappliance.

ModularAppliances
AsIvewrittenearlierinthischapter,youridealBIsolutionwilloftencomebrokeninto modulessothatyoucanbuyjustthebitsyouwant.Anotherapproachistooffereditions, wheresuccessivelyhighereditionsoffergreaterandgreaterfunctionality.Ipreferthe modularapproachbecausewithityoucanbuyjustwhatyouneed;witheditionsIalways findmyselfstuckwiththenexthighereditionthanIreallywantjustbecauseofoneortwo musthavefeatures. Spendsometimeworkingwithtrialversions,and/orspeakingwiththesolutionvendor,to understandexactlywhatcapabilitieseachmoduleoreditionoffers.Evenifyourefocused onsavingmoney,dontforgocriticalfunctionalitydoingsocouldspellfailureforyourBI project,andmanycompaniesdontliketogivesomethingasecondchanceifthefirst attemptfails.Inotherwords,dontbuymorethanyouneed,butcertainlydontbuyless, either.

EnsurethatYouHaveaGrowthPath
AsIvewrittenbefore,youneedtomakesureyourebuyingasolutionthatcangrowwith youandyouneedtounderstandhowthatgrowthwillphysicallyhappen.Heresan example:Yearsago,backwhenMicrosoftExchangeServerwasstillnew,Microsoftreleased aStandardeditionandanEnterpriseedition.Theprimarydifferencebetweenthetwo wastheirstoragecapacity:TheStandardeditionhadanarbitrarylimitonhowmuchit couldstore,whiletheEnterpriseeditionsupportedthemaximumWindowsdisksizeatthe time. TheproblemoccurredwhenpeopleontheStandardeditionranoutofroomanddecidedto upgrade.Therebasicallywasnoupgradepath;youhadtobuyEnterprise,installit,and thenmigrateallofyourmailboxestoitandthendecommissiontheoldserver,typically withoutreceivinganycreditorrefundforthecostofitslicense.

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MakesureyourBIsolutiondoesntstickyouinthesameboat.Withamodularproduct,you shouldbeabletojustaddonnewmodulesasneeded.Ifyoureusingaproductthatsbuilt aroundfeatureeditions,makesureyouhaveawaytogrowtothenexteditionwithout havingtostartformscratch.Thatmightinvolvepayinganupgradefeeandenteringanew licensecode,forexample,ratherthaninstallingawholenewproductandmigratingyour data,reports,configuration,andotherwork.

MidsizeManageability
HowwillyourexistingITteammanageyournewBIsolution?ABIsolutionevenonethat isprepackagedasasoftwareappliancestillhasmaintenanceandmonitoring requirements.Someoneneedstomakesureitsupandrunning,andthatitsrunningina healthycondition.Ifsomethinggoeswronglikeitgetslowondiskspaceyoullwantto knowbeforethatbecomesarealproblem.WilltheBIsolutionneedperiodicdatabase maintenance?Whowillperformthat?Howhardisittodo? Themoreprepackagedandappliancelikeasolutionis,themoreIwouldexpectittodo thesethingslargelyonitsown.Sure,youllstillhavetodoOSlevelmaintenancepatches andsoforthbutyourITstaffiswellequippedtodothatkindofbasicupkeep.The solutionmightmaintainitsowndatabase,andmighteventakecareofitsownmonitoring, perhapsbysendingsomeoneanemailifaproblemconditionisdetected.Somesolutions mightofferoptionsforsendingnotificationstoanoperationsmonitoringconsole,although themoreprepackagedthesolutionis,thelessImightexpectthatoption.Iwouldcertainly expectanappliancestylesolutiontoprovideitsownmonitoring,oftenthroughan administrativeconsole. Ideally,theentireproductshouldbeeasytoadminister,perhapsthroughaWebbased console.Figure4.4showsanexampleofhoweasyitshouldbetoaddnewdataconnections tothedatawarehouse,forexample:Anice,welllaidoutWebconsolecanmakeotherwise complicatedtaskseasierforyourexistingITstafftounderstandandaccomplish.

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Figure4.4:AdministrationthroughasimpleWebbasedconsole. IfaBIsolutionusesanexternaldatabasemaybeitrequiresyoutoprovideaMicrosoft SQLServer,orOracleserver,forexampleImightexpecttohandlethemaintenanceof thatdatabasemyself.However,suchasolutionwouldnotbeanapplianceinmyopinion; appliancesdontrequireyoutoBringYourOwnDatabase.

AddingBIwithoutDisruptingBusiness
SoyoucandeployamidsizeBIsolutionwithyourexistingITstaff;canyoudosowithout distractinganddisruptingyourdaytodaybusiness?Thetrickindoingsoistorequirea minimumofcost,specializedexpertise,andspecializedsoftware,aswellasaminimumof training.LetsseehowaproperlydesignedmidsizeBIsystemmightaccomplishthat.

LowStartupCost
IvealreadyexplainedhowafixedpriceBIsolutionisdesirable,andhowamodular solutiondesignletsyoubuyjustthepiecesyouneed.Thosefactors,combinedwiththe abilityofyourexistingITstafftodeployandmaintaintheBIsolution,leadstoalower startupcost.AlowstartupcosthelpscontributetoalessdisruptiveBIimplementation project;fewereyeswillbenervouslywatchingeverystep,givingtheprojectanopportunity tobecompletedandputintousewithoutanyonepanickingaboutthemountingexpenses.

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

Besides,highpricedsystemsinmidsizecompaniesalmostalwaysleadtoagonizing, sometimesantagonisticbattlesaboutwhetherthecompanyshouldevenpursuethe solution.Thatsortofthingputseveryoneofftrack,disruptingmanagerialrelationships anddistractingpeoplefromdaytodaybusiness.Alowerstartupcostletseveryonehavea betterdiscussionabouttheprojectsmeritswithoutquiteasmanyeyesbuggingoutover anexorbitantpricetag. Finally,afixedpricesolutionmakeseveryoneinvolvedwiththecompanysfinancialsfeel better.Starttalkingaboutconsultantsandservicesandfees,andeveryonegetsnervous becausetheyjustknowthebillwillkeepgoingupandupandup.Anappliancestyle solutionwithafixed,knownupfrontcostisaknownquantitythatcanbeconsideredand accepted;knowingthatthepricewontcontinuetoclimbisanotherwaytoprevent disruption.

MinimalSpecializedExpertise
Aprepackaged,appliancestylesolutionavoidsthatbysimplynotrequiringverymuchin thewayofspecializedexpertise.Theexpertiseisbuiltintotheproduct,readytobeused; youdontneedmuchmoretogetitinstalledandworking.

SelfServiceviaWebConsoles
UsersshouldbeabletoaccessmuchoftheBIsolutionsanalysisfunctionalitythrough simpletouse,selfserviceconsoles.Webconsolesaremoreeasilyaccessiblefromavariety ofdevicesandOSs,andgiveyourusersasingle,consistentknowledgeportalthrough whichtheycanaccessarangeofinformation.Webconsolescanofferrichfunctionality, tooFigure4.5showsanexampleofacomplexanalysisthatausercanconductthrougha Webinterface.

Figure4.5:EasytouseWebinterfacesminimizedisruption. Webinterfacesalsomeanyoudonthavetodeploysoftwaretoeveryonesdesktop.Thatsa hugething,givenhowdisruptivesoftwaredeploymentscanbecombinedwiththe trainingandpainalmostalwaysassociatedwithnewsoftware. 71

The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

IntuitiveUserInterfaces
Speakingoftraining,youcanminimizethelearningcurveforyourusersbyselecting softwarethatsintelligentlyandintuitivelydesigned.Forexample,Figure4.6showsan excerptfromaWebdashboard.Someonelookingatthismightwonder,Whyaremargins ingolfequipmentthewaytheyare?Awelldesigneduserinterfacewillallowuserstodrill downandanswerthatquestionbydoingwhattheuserwilltendtodonaturally:Clickon theGolfEquipmentitem.

Figure4.6:Startingwithawelldesigneduserinterface

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

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Ifclickingleadstheusertoanotherlayerofdata,theyllcontinuetoexplore.Figure4.7 showswherethefirstclicktookthemtoabreakdownofdifferenttypesofgolf equipmentanintelligentnextstepinalineoffreeforminvestigation.Usersdontneedto knowanydatabasequerylanguages,orevenunderstandthattheyreusingaBIsystemora datawarehouse.Theyrejustexploringcompanydatatolookforpatterns,trends,and underlyingreasons.

Figure4.7:allowsuserstodrilleverdeeperintothedata Bycontinuingtosupportadditionallayersofdrilldown,thisuserinterfaceallowsauserto continuelookingfortherootcauseoftheproblem.Here,itappearsthatputtersarethe lowestmarginitem.Shouldthecompanyjustdiscontinueputters?Anotherclickand anotherdrilldowniswarranted.

Figure4.8:untiltheyfindtherootcause. AsshowninFigure4.8,itsonebrandofputtersthatsactuallydraggingdownthecategory. Now,thisusercanmakeabusinessdecisionbasedonfacts,notongutinstinctorbad assumptions.Ittooklongerformetowritethisnarrativethanitwouldhavetakenareal usertoactuallyreachthisconclusionallwithoutanyformalbusinessanalyticstraining. Thatsthevalueofawelldesigneduserinterface:immediateresults,lessdisruptiontothe business.

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

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KeepYourExistingTools
Userswhoarecomfortablewithanexistingtoolsetshouldbeabletousethem,ifpossible. AsIvementionedbefore,manymidsizebusinessusersareincrediblyproficientwithExcel spreadsheetssowhynotletthemcontinueusingatoolthattheyreskilledwith? Ifyouhavesomeofthesespreadsheetjockeysinyourcompany,havingaBIsystemthat supportsthembydeliveringBIdatatoExcel,andallowingthemtoworkwithitthereis amusthavefeature.AlthoughExcelisntforeveryone,itcanbeincrediblypowerfuland empoweringforsomeonewhohasinvestedthetimetouseit,andbecausetheyreworking inacomfortable,familiarenvironment,youllfindthatthesespreadsheetjockeyswillbe amongstthefirsttograspthepowerofBI,andtostartmakingareturnonyourBI investment.

WhatsGoodforBigBusinessIsntNecessarilyGoodforYou
Bigbusinessescanoftenaffordabigsacrificeiftheyseeabigbenefit.Midsizecompanies, however,havetobealotmorecareful.Disruptingadozenemployeesfor3monthsis hardlyevennoticeableforagiantcompany;foramidsizecompany,however,itcandistract vitalassetsforanunforgivablylongtime. ThatswhyBIisntonesizefitsall.Whatworksforanenormousenterprisemonthsof factfinding,specializedconsultantstobuilddatawarehousedesigns,lengthy implementationsandevenlengthiertrainingjustdoesntfitamidsizebusinessmodel. Whatcanworkforamidsizebusiness,however,aresmallersizedBIsolutionsthat althoughtheywouldneverworkforahugecompanyfitnicelyintoamidsizecompanys needs,availableresources,andavailabletime. Iveusedthewordprepackagedalotinthisbook,andinthebeginningIworriedabout usingthatexactterm.Prepackaged,tomanypeople,seemslikeitmightmeanlower quality,likeaprepackaged,frozendinner.ThatsnotwhatImeanatall.Inthetechnology industry,prepackagedsoftwareproductspowermostaspectsofmostmidsizecompanies, fromfinancialmanagementtocustomerrelationshipmanagement.Eventheoffice productivitysuiteyoureusingawordprocessor,aspreadsheet,andperhapsasmall databaseapplicationareprepackaged.Prepackageddoesnotmeanlowerqualityorless powerful.Forme,prepackagedmeansaneasytoinstall,easytolearnpieceofsoftware thathandles90%ormoreofthefunctionsthat90%ofbusinessusersrequire.Itmeansno lengthy,expensivecustomizationsrequired.IntheworldofBIsolutions,prepackaged solutionsdesignedtofitamidsizecompanyarethebestwaytoimplementBI.Frankly,even hugeenterpriseswoulduseprepackagedBIsolutionsiftheyhadtheoptiontheydsavea fortuneandalotoftime.Thisisanadvantagethatmidsizecompaniescancapitalizeon: TheabilitytouseaprepackagedBIsolutionbringsyoubigcompanypowerwithoutthe bigcompanypriceortimecommitment.

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The Shortcut Guide to Achieving Business Intelligence in Midsize Companies

Don Jones

Wevecoveredalotofgroundinashortspace.Inthefirstchapter,Iexplainedwhat businessintelligencereallyis,andwhyyoumightwantitinyourcompany.Inthesecond chapter,IexplainedthewaysinwhichBIbecomesarealitystartingwithhowyou assembledataandanalyzeittomakebetterdecisionsforyourcompany.Thethirdchapter wasachancetoplaymythbusters,debunkingconceptslikethefactthatBIcandisrupt yourbusinessorthatBIisonlyforlargecompanies.Inthischapter,Iofferedsometipsand practicesforbringingBIintoyourcompanyinaproductive,practicalmanner. Ihopeyouvefoundthisinformationtobeuseful,andIhopethatBIisonyourradarnot onlyasausefulsetoftechnologiesbutasanobtainable,practicalideaforhelpingyouand yourcompanymakebetterdecisionsaboutyourfuture.Thanksforreading.

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