My DM Review column from June 8, 2006, entitled "Making the Case for an Enterprise-Wide BI and DW Strategy" highlighted the need for organizations to get serious about business intelligence (BI) and to develop an enterprise BI and DW capability. When pursuing this capability it's important to take a holistic view of where you want to go, followed by disciplined investment and execution. To develop the future vision for this capability, there are seven interrelated areas that must be considered: strategy, people, process, metrics, applications, data and architecture. This column explores the key considerations of strategy.Think of BI as a Foundational Corporate Asset. Information must be readily available to employees to support their decision-making; forward-looking companies understand this is a requirement for doing business efficiently and effectively. In this respect, BI can be compared to email, telephones, air conditioning, etc. - things that are essential to conduct business - even though BI is much more valuable. If your company isn't thinking this way, it's a good bet that several of your competitors, suppliers and customers are and will be using their strategic information advantage at your expense.
Plan Ahead. The funding for a BI program is not a one-time consideration; instead, the BI program should be included as part of the recurring annual budget. A multiyear plan enables corporate leaders to have an understanding of the road ahead and what they are getting into. The multiyear plan for the BI program would include a definition of and rough timeline for activities, high-level resource estimates for these activities, plus the costs for resources and any necessary hardware and software purchases.
Align with the Business. When deciding what activities to include, start by looking at the top business priorities and determine how improved reporting and analysis capabilities could enable these priorities to be achieved or better measured. Often companies define annual objectives and initiatives which can be a good starting point for determining these priorities. In the ideal case, corporate objectives and initiatives have been developed via a formal performance management process that defines the corporate objectives in actionable terms and the individual accountability for the results of these initiatives. The measurement and reporting capabilities needed to enable this individual accountability will also drive the need for some of the BI solutions on your plan.
Align with Other IT Groups. Many of the activities on your plan will likely require cooperation with other teams within IT. For example, most of the data sources needed by the BI solutions will typically be owned and managed by other IT teams. Additionally, other groups in IT are usually working on new source systems to replace existing systems and collecting data or automating business processes never addressed before. You'll need to coordinate timelines with these groups to ensure the BI plan is in sync with them.
Pool Your Money. Once you know what you want to do, you will need to figure out funding. A best practice is to have all funding come from one pool for the overall program, as opposed to funding individual projects or activities. This can require a significant mind-set change in some companies, but I'd argue that siloed funding is the single biggest contributor to the dysfunctional, siloed BI situation, which was discussed in the first column in this series. This funding pool could be established most simply by dedicating money from the IT budget for BI purposes, or possibly having several business functions provide funds to the pool at the direction of the C-level executives.
Manage the Mix. Once the money is pooled together, it allows for the most effective allocation of the funds. For example, the money can be allocated:
- To the top priority strategic objectives and initiatives of the whole company - not just for any one specific function or department.
- Across the right mix of activities - baseline, strategic and tactical. Baseline activities are those you need to keep existing BI solutions running smoothly and support end users. You'll want to keep baseline costs from rising dramatically over time as more and more solutions are delivered. Strategic activities you should make progress on are the strategic objectives of the company and help make the BI future vision a reality. Over time, this should be your largest investment area. Tactical activities allow quick response to the time-sensitive needs of the business. You'll want to minimize investment in tactical activities because these won't have a significant business impact in the long run.
- To the most appropriate combination of resource types, such as internal employees, external consultants or contractors and offshore developers.
- To the optimal purchases of software licenses and hardware across the enterprise user groups. Once software licenses are pooled, it is common to find many of the same people identified as users of the various BI solutions, allowing you to save on end-user licenses.
Enroll and Revise the BI Vision. To effectively execute this plan, you must continue to communicate and enroll the various stakeholder groups in the plan and revise the plan as the business and IT environment changes.
Robert Farris is vice president and Business Intelligence Capability Practice Leader for Hitachi Consulting. He may be contacted at email@example.com.
This article originally appeared on DMReview.com.
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