Staying ahead with Business Intelligence and ERP

Companies that operate globally are under pressure to deliver results. Despite the economic downturn, companies view Business Intelligence as a strategic weapon that can help them gain a competitive advantage, differentiate themselves and ultimately get a decent RoI, says Sanjay Deshmukh

Business Intelligence (BI) is a tool that lets organisations make better decisions by organising, analysing and reporting data they generate. In other words, BI solutions transform an organisation’s operational data into an accessible store of high-value information.

BI is a valuable addition to a business manager’s toolkit. With the help of BI processes, raw business data is transformed into valuable information, presented in a variety of reports and summaries that help managers grasp business fundamentals and apply the same to critical business needs in a jiffy. This helps in putting procedures in place to consistently deliver accurate and timely information to people who need it, on time.

Going beyond ERP

Organisations that have deployed an ERP solution have other data sources that store valuable information. Business Intelligence in conjunction with ERP lets manufacturers answer questions such as, “How much revenue do we lose due to unfulfilled orders?” or “Are we producing products in areas where there is no demand?” or “What is our service level to our top ten customers?”

Take the example of telcos that build data warehouses to consolidate their transactional data in a central repository. They use BI software to analyse the information stored. They also use BI tools for ad hoc reporting on production data that is not captured in the data warehouse. This drastically cuts the time required to generate reports. One can comfortably deduce that organisations have realised that investing in BI is the best way to leverage existing enterprise data in order to improve performance and cut costs.

When BI meets ERP

Rapid deployment templates exist to connect multiple ERP modules and allow easy extraction of data from an ERP system. At this point, the user builds queries using the BI software that transforms the extracted data and generates reports letting users analyse data in great depth.

In many organisations, the ERP implementation is aimed at making data available centrally. By implementing ERP applications, companies have gathered a lot of data that is available only in the ERP database and once BI is integrated with ERP an organisation gets unprecedented insights into its own performance. Gaining the maximum benefit from an ERP solution requires Business Intelligence and involves three phases.

The first stage of the BI life cycle addresses IT and end-user needs. The aim is to quickly implement a BI solution; certain BI products are compliant with popular ERP systems. For simple reports, such as a vendor list or inventory level report, this method works well.

Building a data warehouse

The second stage involves building a data warehouse. This becomes necessary to ensure optimal performance. The primary advantage is that this results in the end user’s query workload moving off the ERP system to the data warehouse thereby improving transaction processing. By completing this stage, an organisation gains a scalable infrastructure for the transition from operational data to data warehouse. A single enterprise application lets employees easily access, analyse and share all customer information found in ERP and other enterprise applications.

The final phase makes it possible for users throughout a company’s supply chain to access and analyse information stored within corporate databases. The benefits of this stage include a rise in customer satisfaction, reduced support costs and additional competitive differentiation.

Companies can achieve a significant return on investment (RoI) by leveraging their existing applications and data environment. To do this they need to invest in BI solutions that integrate existing data sources and provide a better view of enterprise operations and performance. It is possible to manually generate reports from ERP applications on a case-by-case basis, but the time and effort involved in their creation dilutes the impact.

The benefits of BI and ERP solutions are similar to networking infrastructure where business intelligence is an enabler among other things. It is increasingly becoming something that you must have. Businesses can take prompt action based on instant results, improving response time and become more competitive in the process.

As the pace of business quickens, companies must eliminate information lag and make timely and effective decisions. The use of IT to enable businesses to act intelligently and in real time has become the need of the hour. That’s where BI matters.

The author is the business development director, Business Objects. He can be reached on sanjay.deshmukh@businessobjects.com