This is our blog about designing and implementing Intelligent organizations. Within this area of expertise we write often about the following subjects BI, analytics, the tools, decision management, data visualization, BI success, Business Intelligence concepts, data management, continuous improvement, and the organization of BI & Analytics.
Of course you can order our book here too.
Many companies are looking for ideas to increase employee productivity and reduce the cost of business operations to increase their competitiveness. As information in society becomes increasingly and more digitized, the moment has come to get more of a grip on the huge mountain of data, and to implement smart solutions for managing this data from the cradle to the grave.
It is a business problem that sometimes even gets the better of the IT department and needs attention from top management to set the course.
In order to prepare an organization Cockpit, it is sufficient that the organization has a strategy at a certain point in time. However, writing a book on strategic performance management without ‘coming clean’ is not possible. Because, in strategy formulation, content, tools like Cognos and BusinessObjects, and process influence each other. That is also the reason that the leadership of an intelligent organization tries to make content and process reinforce each other.
Twelve months ago, Walraven, an international wholesaler dealing in construction and installation materials, was named as the smartest organization in the Netherlands. In an interview with Tino Hartsink, IT manager of Walraven, we look back at the successful 2010 Business Intelligence Award contest.
The existence of the Business Intelligence Award was pointed out to Walraven by their own customers and suppliers. “It was not obvious to us that we should enter for the BI Award”, IT manager Tino Hartsink told us. “Customers drew our attention to the prize and at the same time indicated that they felt Walraven would have a good chance of winning the Award because Walraven has such well organized business processes”.
Strategy formulation can take place in completely different ways. There is apparently no ‘one best way’. The strategy schools with their four quadrants urge managers to make a choice themselves depending on their own situation. Despite the differences, I think that conclusions can also be drawn that are applicable to almost all situations. With these conclusions, I indicate how strategy formulation in an organization can be carried out more effectively.
How can you get a better grip on business processes and transform your company into an organization where the customer comes first? The idea of role-based portals can provide new thinking and give you a fresh perspective on your organization.
Nowadays it is important for every company to put the customer first. It is all about companies listening carefully to the customer, understanding what the customer needs and ensuring that the customer’s needs are met quickly. All companies, both profit and non-profit, wish to excel in this and thus distinguish themselves from the competition.
A well designed Performance Management system has striking similarities with a well-designed game. I will describe below how to achieve cross fertilization between performance management and the game world.
First, some definitions.
We see two approaches within the gaming world that might be interesting for Performance Management: ‘Serious Gaming’ and ‘Gamification’.
The term Serious Gaming is used when games are deployed outside the game environments that are traditionally meant for entertainment. Examples of this are management games, simulation games and board games that are used in a business context. We therefore temporarily step out of the work environment in order to be able to undergo awareness training and/or learning objectives in a safe way.
The Amsterdam-Amstelland Fire Brigade emerged as the big winner at the presentation of the Dutch BI Awards in 2013. They were able to take home not only the audience prize, but also the jury prize. The ability to predict potential fire locations and subsequently conduct targeted awareness campaigns specifically at those locations and therefore prevent fires, made a huge impression on both the jury and the audience.
In the National Business Intelligence (BI) Survey, the public sector achieves the lowest score of all the sectors. It is interesting then to know what the business sector is really doing differently from the public sector. Where are the opportunities for improvement within the context of government, education and health care? And how much room for improvement is there actually, given the legal frameworks and regulations? Or are these not really an obstacle?
Possible objections to performance management that are often mentioned include:
The introduction of performance management evokes resistance because it reduces existing freedom of action. This observation is correct: freedom of action is indeed reduced. However, in the context of the methodology, this is seen as desirable. Managers cannot confine themselves to flashy activities, but must manage the everyday practicalities.
We have been searching for the holy grail of Business Intelligence for many years, or what makes an organization really smart and able to achieve good results. How can we find the grail, use it and incorporate it into Business Intelligence projects? The last point is not unimportant. The objectives and deliverables of a project can drastically change because of this.
Instead of aiming at a working reporting environment that draws on multiple sources, we choose a different ambition level where we try to ensure that relevant information is or can be used for performance improvement. However, the way the Business Intelligence is organized will also need to be at a different level of operation. It’s nice to find and keep the Holy Grail, but being able to do something with it is the important thing. Below is a summary of the article in the latest Business Intelligence and Performance Management research. Do you want to know exactly what the situation is with the holy grail of Business Intelligence? Then order the research paper ‘Business Intelligence Pitfalls & Success factors’ now.
In a recent poll, we asked visitors to this website to vote on the statement “If Business Intelligence is successful it turns the organization upside down”. The outcome of this poll has surprised us positively; the majority of voters believe that with a successful implementation of Business Intelligence the organization is turned upside down. In other words, the organization is going to organize itself differently or regroup.
Daan van Beek and Wouter Huisman of Passionned Group have been supporting a project group of the Municipality of The Hague for some time. The goal is to achieve a municipality-wide Business Intelligence Roadmap. “In terms of business intelligence we are really still learning to walk,” says Ling Po-Shih, Group Advisor / Project Manager Business Intelligence (BI) at the Municipality. “In 2009 internal research showed that we were not at all ready for BI at the time. We did that research again in 2013. Now we are at the point where we want to draw up a BI Roadmap. We do, however, need some help with that.”
Business Intelligence (BI) is described, both appropriately and inappropriately, as a way to ‘bring the right information in the right form at the right time to the right person’. That is right four times, but formulated very abstractly. By applying the aforementioned combination, information becomes meaningful and relevant for the end user. The practical translation shows just how complex the implementation of the combination is: the number of possible variations is in fact very large!
Passionned Group assisted accounting and consulting firm PricewaterhouseCoopers in the design and implementation of a powerful Business Intelligence system. Until recently this office managed on the basis of figures that lay hidden in collections of spreadsheets, stunning presentations and all kinds of downloads, in particular on financial indicators.
However, these only relate to a small part of the process. “We should not only look back, but also look forward in the process. That was one of our main objectives in creating our Business Intelligence system”, says Jan Maarten van der Meulen, member of the Advisory board and client.
I am Daan van Beek of the Passionned Group. Our job is helping people to work smarter. It starts with people, with the human side of Business Intelligence and organizational renewal. To put it better, it means that the organization must have a certain ambition, you must want to go somewhere and creating that is perhaps the most difficult thing in our profession, you have to start things going and teach people to start things going.
Since early 2014, the BI team of the Carante Group in the Netherlands has been working on the redesign of their 12-year-old BI environment. “On the one hand, it is about developing a new vision and a strategy, on the other hand we want to organize BI better and give it more body.” They are doing this with the help of Marc Wijnberg, senior BI consultant at Passionned Group.
The Carante Group is a consortium of twelve autonomous, regional foundations that are active in the care sector. These organizations work together through their 20,000 employees to provide care, guidance and support, tailored to the needs of their 25,000 clients. The Carante Group is active in the care sector and provides services to people with a physical and/or mental disability, psychiatry, care of the elderly, welfare and youth assistance, in other words care in the widest sense.
In response to the news stories about the National BI Survey in various trade journals including the one in Computable of Friday, the 30th of January this year headlined – “BI almost never pays off” – we can at least conclude that the subject is alive.
We also understand that you, like us, warmly support the profession. However, we must not lose sight of the reality, which corresponds with the perceptions of many BI and Business Managers, CIOs and CFOs. This is why we have been conducting thorough research into the effect of BI and performance management within the Dutch business community and the public sector since 2004. Our goal was to identify the critical success factors for BI. We now have them in front of us! So let us learn from them. Do not try to ignore or deny the facts, but try to understand them. This is precisely what creates the possibility of making BI more frequently successful, as in the case of Ahold, winner of the last BI Awards.
When people talk about agile business intelligence, then they are often talking about the software development framework Scrum: the project management perspective. Or is it about the idea that BI can make the business more agile: the business perspective. There is still little attention given to making the BI process itself more agile, faster and cheaper. Nowadays this is quite simple. Then you need to keep out the traditional builders of report factories and dashboard collections (for now), because they often have little interest in minimising reports and dashboards. Business Intelligence frameworks can help you here.
Nico de Jonge is a Business Consultant at ABN AMRO Lease. At the end of 2013, he attended the two-day Passionned Business Intelligence training course. “In my job I have to work with financial data a lot,” he says. “I wanted to know for myself what is currently happening in the world of Business Intelligence and what is for sale. I was looking for some theoretical basis, but with a practical approach. Moreover, attending a two-day training course offers the opportunity to exchange ideas with colleagues from other companies.”
Much has been spoken and written about cloud computing, as well as about Business Intelligence (BI). You can expect a specialized BI research company and consultancy to follow developments closely and to share clear and stimulating views on various topics with you. In this way, we can help you to separate the wheat from the chaff and to make a good choice. In this article, we look at the ‘BI in the cloud’ phenomenon.
Last year TIAS, a separate division for executive teaching of Tilburg University, started an executive programme for IT Consulting. Of the 10 modules, one is dedicated to Business Intelligence. Prof. Piet Ribbers asked Passionned to take on the lion’s share of the BI sessions. “A wonderful challenge and a great honor” according to Daan van Beek.
TIAS offers a number of programmes that are IT-related. The students are typically in their thirties with about 5 years of work experience who want to gain an extra MSc degree or another diploma valued in practice. The IT Consulting programme is aimed at those who want to become proficient in this area. The programme was created in addition to the existing IT Auditing programme. There is a joint intake for IT Auditing and IT Consulting, after about a year both groups split.
Many organizations are increasing their focus on the key performance indicator (KPI). That’s not surprising, because it’s a very powerful management tool and KPIs are at the heart of every business, including yours. The trick is defining the right ones.
However, KPIs and SMART goals are very specific and you can make mistakes quickly. It’s easy to focus on the wrong indicators. Or to define so many (not) Key Performance Indicators that you can’t see the forest for the trees anymore. We’ve listed the 5 biggest KPI blunders for you, so that you can avoid them in the future.
A decade ago the vast majority of data warehouse systems were hand crafted, but the market for ETL software has steadily grown and the majority of practitioners now use ETL tools in place of hand-coded systems. Does it make sense to hand-code (SQL) a data warehouse today, or is an ETL tool a better choice?
What are the 7 biggest benefits of using an ETL tool?
We now generally recommend using an ETL tool, but a custom-built approach can still make sense, especially when it is model-driven. This publication summarizes the seven biggest benefits of ETL tools and offers guidance on making the right choice for your situation.
The Passionned Group has extended its Business Intelligence Tools Survey with a new element. The just-released 2014 edition now contains a Sentiment Analysis, in addition to the usual extensive analysis of functionalities of the tools and features of the Business Intelligence suppliers.
The reason for this additional research is that many BI-suppliers try to let you believe that Analytics would be the new BI. In many publications and presentations they promote to refer the term BI to the archive and to then only speak about Analytics.
Predictive analytics is a powerful instrument for many organizations. It helps them to create competitive advantage and make their business processes more effective. Insurance companies and credit card issuers for example use it to detect fraud, cops use it to catch criminals, sometimes even before they commit a crime, and car dealers apply analytics to predict the chance that someone responds to a campaign. From our experience we strongly believe that there is a lot of added value in predictive analytics. But, prediction is very difficult – especially if it’s about the future (Niels Bohr) – and making automated predictions is even more difficult. There are many pitfalls on the road to success. We think this are the five most important pitfalls:
Contrary to many studies that evaluate ETL tools based only on their current market share and functionality, our study (the ETL Tools & Data Integration Survey) also attempts to evaluate ETL tools based on their expected future performance. With the market changing as quickly as it is today, market share is about the past, and says little about the future. Many products, including WordPerfect, Lotus 123, and Harvard Graphics once had a huge market share, but proved to have very little future potential. The growth potential as defined within the confines of this ETL study looks at how frequently a vendor releases new, valuable features; an important indicator for innovation and the strategic importance of the product to the vendor.
The maximum number of points awarded in our ETL tools & Data Integration Survey to an ETL tool for its ease-of-use was eleven. A maximum of two points was awarded for each of the four attributes, indicated by one or more plus (+) signs, and points were allocated depending on the number of days of training suggested by the vendors (less training required – more points for Ease of Use).If the verdict was negative indicated by one or more minus (-) signs, points were deducted. If, for example, ease of use, WYSIWYG, and logical order earned a plus sign and screen design a minus sign, the tool was awarded two points (one point for each plus sign, minus one point for the minus sign). Since it can take considerable time to improve the usability of a product we have compared the product (where possible) over a three year period. The maximum number of points was 11.
Over more than a decade SAS Institute, a US-based vendor of BI solutions, is a top player in this field. SAS’ roots are at North-Carolina State University and since 1976 the company is managed by its inspiring chairman Dr James (Jim) Goodnight. Today SAS is still a privately held company with an annual turnover of more than 3 billion dollars.
A couple of years ago SAS started profiling itself as a vendor of Analytics solutions. Ever since its foundation the company had a strong preference for Data Mining and today it claims the Analytics market as its own. Although the main part of SAS’s turnover emanates from license sales of the SAS BI-platform – which includes ETL, data warehousing, data quality, reporting and analysis – the full focus is on Analytics.
Within the field of Business Intelligence and Analytics, the following developments will gradually take shape and gain momentum:
In recent years, Business Intelligence has proved to be highly technology-driven. It was all about snazzy reporting tools with all sorts of ‘bells and whistles’, performance, technical debates about the most suitable data modeling method and advanced drill-down possibilities. These ‘toys’ diverted our attention from the real purpose of Business Intelligence, namely creating a truly intelligent organization. Fortunately, today we see that Business Intelligence is increasingly driven by the business and that the attention shifts to the behavioural side. Many organisations today prepare a business case in advance in order to assess whether the payback period of data warehouses and Business Intelligence applications is in line with current economic and business standards. Business Intelligence becomes increasingly business-driven and permeates through the organisation more easily. Business Intelligence gradually matures and technology becomes secondary to the processes and applications.
Even though there are many standardized tools, specific solutions will always have a place. New challenges demand tailor-made solutions. A cotton manufacturer wanted to work more efficiently and reduce waste. Critical questions spurred that desire on. The production team wondered: why do we do things the way we do them? Why are we throwing away so much good material? Can we do better?
Most problems only become interesting once the money runs out. Or when the margins shrink, or revenue keeps decreasing. That’s when alarm bells start going off. In many cases, that’s too late to turn the tide. The solutions which were thought up under pressure are no longer executable. If only you’d taken action sooner. If only you’d listened to the data.
Automation is always about people. This is certainly true with regard to ‘automating’ decisions and transforming data into ‘actionable intelligence’.
The point is that people will use this information and start acting differently. In order to create a proper (well-designed) Intelligent organization, we will need people in certain roles, with specific (behavioral) competencies, experience and knowledge, first on a project basis and later in the daily operations. In this article, we describe the ideal Business Intelligence project organization. Note that, in practice, we do not always require all roles or we cannot always facilitate all roles, due for example to budgetary constraints.
Business Intelligence projects are characterized by an extremely high risk factor and many obstacles. These obstacles are mostly related to the fact that Business Intelligence projects typically go beyond the boundaries of departments, processes and even business units; contain a mix of strategy, business operations and technology and are often highly political.
Also, the BI systems are derived from the operational information systems. The obstacles refer to the ten most common and most important forces and risks that can make or break a Business Intelligence project, which are divided into three main categories:
If we do not predetermine what we test and how we test the Business Intelligence system, then this testing process can be very time consuming.
Precisely because Business Intelligence allows flexible reporting, we are initially tempted to test all possible combinations of indicators and dimensions. What we forget is that, even in small Business Intelligence systems with for example ten indicators that are linked to eight dimensions, the number of possible combinations can reach ten million!
When we have (too) low expectations of Business Intelligence and we operate in a highly political environment, this may result in a return on investment (of BI) that is far below its potential.
A year ago, a transport company with five thousand employees worldwide, implemented a well thought out and professional Business Intelligence system, which offered the possibility to not only monitor market share figures and revenues, but also to present various financial details and ratios.
It is important to determine whether and how Business Intelligence can be profitable within the organization and in which way we can achieve lasting success. In other words: what is the business case (for BI)?
The benefits of Business Intelligence can be split into four categories (Liautaud and Hammond, 2001):
not immediately apparent;