The terminology in the business intelligence (BI) space can be quite confusing. There’s business performance management (BPM), business activity monitoring (BAM), enterprise performance management (EPM) and more. What do each of these solutions offer? Which one will solve my business needs? Why choose one over the other?
BI refers to technologies, applications and practices for the collection, integration, analysis and presentation of business information and also sometimes to the information itself. The purpose of BI is to support better business decision-making.
BI systems provide historical, current and predictive views of business operations, most often using data that has been gathered into a data warehouse or a data mart and, at times, from operational data. In today’s highly competitive business environment, corporations are generating enormous amounts of data to meet compliance standards, from automation, and from technology solutions such as customer resource management (CRM). BI systems sort through this data, extract useful information and turn it into actionable knowledge.
Traditional BI software consists of reporting/trending, query/analysis, online analytical processing (OLAP) and data mining. Basically, BI is reporting on data you gathered and generating a report from this data.
BPM and BAM are applications based on BI that give businesses a better picture of how the business is performing, such as historical sales forecast versus actual. The act of monitoring key performance indicators (KPIs) in real time is known as BAM.
EPM in short represents the strategic deployment of business intelligence solutions.
EPM is the next generation of BI that allows companies to take the decisions they made through the BI system and strategically align these decisions with their corporate goals. Where BI covered the decision process, starting at monitoring, then analysis and finally actions based on KPIs, EPM aligns or integrates these KPIs into short-, medium- or long-term goals. EPM defines the way an organization should operate based on a clear, corporate business strategy containing actions and processes that align to the strategy with identification of KPIs and progress tracking.
EPM involves consolidation of data from various sources, querying and analysis of the data, and putting the results into practice. EPM enhances processes by creating better feedback loops. Continuous and real-time reviews help to identify and eliminate problems before they grow.
Built on a foundation of BI, EPM marries BI to the planning and control cycle of the enterprise - with enterprise planning, strategic analysis and modeling or what-if capabilities. Fundamentally, EPM is being able to manage the operations of the organization on a holistic scale by managing all the information of the organization, and strategically using this information to meet the business’ mission and vision.
Companies with an EPM system in place can look across the entire organization and know the effect each discipline or business process within the organization has on the other processes of the organization.
How Does an EPM System Work?
An EPM system looks globally across an organization to gather and consolidate data from numerous sources. The data can be real-time manufacturing data, customer information, operational information, sales, financial data and more.
