Nowadays a company should not even question whether it needs business intelligence (BI) or not. Those who do not have it yet should include it in their future strategies, while those who do have it should search for ways to make BI work at its full potential.
You Don’t Have It Yet?
Let’s first analyze and understand why a company may not have BI:
1. BI is too expensive
If this is what has been preventing you from acquiring BI, it’s not a valid reason. There are free BI tools, such as Jaspersoft, Pentaho, etc. They often come with limitations on the number of licences and reporting capabilities, but that doesn’t mean they can’t be efficient.
There is also BI on demand or SaaS (software as a service), where you pay a monthly fee to access an online interface that lets you create all the reports, dashboards, etc., that you need. In this case, no costly hardware is required, and no IT maintenance team is necessary, but you depend entirely on the vendor for any customization.
2. BI is too complicated
Initially, BI tools were mostly used by people who had extended IT knowledge, including database administration and programming. This has changed a lot in the past couple of years, but depending on the products, it still is more or less true. Unfortunately, some vendors may promise more than they can deliver, and when you buy the BI tool, you’ll realize that you have to do much of the work yourself.
During testing and the selection process, do your best to make sure that the product really is user-friendly and that the vendor can provide the support and training you need to make things simple.
3. I don’t need BI
Maybe you don’t need it now, but your company really has only two options for the future: grow or disappear. Strangely enough, the growth of a company can eventually make it disappear, if you lose control over it. And BI is what you will sooner or later need, so you’d better start thinking about it now. Later might be too late.
A BI tool can help you control growth by creating forecasting and patterns that give you valuable information about how your company is doing and about the major obstacles it might have to face in the future.
You Have It but You Don’t Really Know How to Use It Efficiently
I really wanted to talk about this because I have seen companies that had a BI tool but that were not very interested in using it, especially the management team. The owner, controller, production manager, etc., should be the first ones to use it and promote it in the company.
To fully take advantage of the capabilities of any BI product, you should start by finding the answers to the following questions:
Do you know what you want?
The main challenge of BI is to get the right information, from the right source, in the right format. No BI tool will give you this unless you have a very good idea of what you want. If you are a decision maker, consult the people directly involved in the activity or process you are monitoring through BI. They might have insights that you ignore or don’t pay enough attention to.
Business management methodologies such as Six Sigma can help you define indicators that will show you how successful your company is. You might want to use the “Pareto principle” of the 80-20 rule, which states that 80% of whatever happens in your company is the effect of 20% of the possible causes.
Who needs the information?
A misconception that limits the usefulness of BI is that managers are the only people who need it. The truth is that everyone in the company should have access to the information. If you worry about security and confidentiality, you can limit the access according to the position each person holds in the company.
On the other hand, having too much information is worse than not having enough. Granting unlimited access to too many users might create overload and reduce the efficiency of your BI product. As a response to that, vendors introduced the notion of BI applications, which helps administrators define a relevant work environment for each user.
How do you intend to use the information?
If you only use your BI product as a report generator, then you have missed the point: BI is not a reporting tool. It does generate all types of reports but it also allows you to create what-if scenarios, compare data from different sources and timeframes, and identify pain points in your processes, among other things.
A good BI product should allow you to accurately translate your business needs into technical requirements, which will later on generate the reports, statistics, and analytics that you need in order to make sound business decisions. The only thing BI cannot do is understand certain aspects specific to human logic. Two different people in your company may end up having different results when analysing the same information, especially when vague and numerous criteria are used.
For instance, the same sales report will generate different results depending on the exchange rate type that you decide to use: the current one or the exchange rate at the time when the invoices were created.
Is There a Miracle Solution for All These Problems?
Many BI vendors will probably answer: “yes—our product.” Still, according to a 2009 Gartner report, 35 percent of the top 5,000 companies will not make the right decisions when it comes to actions they need to take to adapt to a changing market. This is caused by the lack of proper information, processes, and tools, which in turn is the result of unsuccessful BI selection and implementation processes.
If you’re looking for a BI tool and to be part of the 65 percent who will not fail, use our online selection tool here.
i have also written an article which was published in april 2009. read it at the following link.