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Between the Bytes
What’s your BI quotient?
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| Val Souza |
Is Business Intelligence (BI) relevant to organisations
in India? Now that’s a moot question, especially when you consider
that so many of them are still struggling to get their basic enterprise
IT infrastructure in place. Meanwhile, CIOs of many large corporations
tell of shrinking or static IT budgets; those that are more fortunate
can at best hope for a 3-5 percent annual budget increase. BI thus
seems like a ludicrous luxury for most of corporate India.
Logical as the above argument against BI sounds, it misses
the point completely. For, it has been categorically shown that the best way
to unlock the business value buried deep within existing IT investments and
enterprise systems is through effective implementation of business intelligence
solutions. Indeed, with BI, that elusive “aligning IT with the business”
Holy Grail is within grasp.
I recently moderated a panel discussion on the relevance
and importance of BI to Indian enterprises. The panel consisted of CIOs and
industry representatives, while the audience comprised CIOs and IT heads from
a wide range of Indian enterprises. We attempted to ascertain how far India
Inc has moved up the BI curve. From the deliberations, my overall impression
is that corporate India’s implementation and understanding of business
intelligence and its potential is rather sketchy. Even those who have taken
the plunge seem to be stuck in the query-and-reporting mode that was so characteristic
of decision support systems and management information systems of old. The big
step from analysing the past to predicting the future has only been partially
taken.
Business Intelligence software has made astounding progress
in recent times. BI that is based on an enterprise view of the data (through
data warehousing) can provide predictive analytics that surface unseen patterns
in structured as well as unstructured data. This potentially provides new insights
into the business and throws up new opportunities for differentiation and expansion.
Few Indian enterprises have caught on to this potential. But that the indifferent
attitude is changing is evident from statistics that indicate BI spending is
now at a compounded annual growth rate level of over 30 percent, in comparison
to the 18 percent CAGR for overall IT spends in corporate India.
A successful BI implementation results in more efficient
and cost-effective processes and more enlightened decisions that are based on
concrete data and facts. This is rather contradictory to the preferred decision-making
style prevalent in many Indian organisations, where “gut feel” and
conjecture take precedence over fact and verity. Further, organisations have
been used to taking up BI projects at a departmental level, implementing it
for very specific requirements where the returns are obvious and immediate.
There is no doubt that the above silo approach will produce
some results, but the benefits fall far short of what’s possible when an
enterprise-level approach to BI is taken. When so much investment has gone into
enterprise applications like ERP, SCM and CRM, the next logical step is to extract
maximum value from these deployments through an enterprise-level BI platform
that takes an integrated and holistic view of the data as its input. Of course,
one would need a collaborative culture of the highest level right across the
organisation for this to work, and this can happen only with complete and continuous
top management support and commitment.
The data quality that goes into a BI system is of supreme
importance, especially when one enters the realm of modelling and predictive
analytics (else business intelligence can quickly turn into business stupidity).
CIOs will find that a large percentage of the time allocated for BI implementation
is actually consumed by data integration and cleansing activities.
The trend of information democracy, wherein the intelligence
derived from patterns in the data is placed in the hands of employees lower
down in the hierarchy, who are most likely to be able to act upon it, is an
irrevocable one. Despite the security risks and risks of misinterpretation and
resultant inappropriate action, it’s generally agreed that the true value
of BI can only be realised when it’s pushed down into the organisation,
surfacing specific information to specific users with their individual usage
and access patterns taken care of. This puts additional pressure on the CIO
to ensure that security is not breached and that risk mitigation policies and
procedures are in place. Also, information democracy necessitates proper training
of all those end-users empowered with the BI output—fortunately, managers
coming out of business schools today are far more clued in on BI and its potential
benefits and risks than their counterparts of just a few years ago.
How far evolved is your organisation when it comes to business
intelligence? The road to fully integrated enterprise-level BI is a long and
winding one. But it’s a road worth taking, for it’s the best way to
make your IT investments work to your competitive advantage. And that’s
when IT in your organisation will become truly strategic.
Val Souza, Consulting Editor
valsouza@expresscomputeronline.com
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