CATEGORY: Business Intelligence

REVIEWER: Sharon Reason, procurement performance manager for HBOS.

BACKGROUND: HBOS plc was formed in September 2001 as a result of the merger of Halifax and Bank of Scotland. Our merged organization has assets of more than £320 billion (UK pounds sterling) and 20 million customers, making it one of the largest financial institutions in the world.

PLATFORMS: Operating system: Windows 2000. Database server: Compaq 8500 quad processor. Repository server: Compaq DL380 single processor. Web server: Compaq DL580 dual processor. Broadcast agent server: Compaq ML370.

PROBLEM SOLVED: Following the merger, the group wanted to leverage the synergy between the two companies to generate significant savings in procurement. We needed a business intelligence platform for a single view of data held across the merged companies, but we were hampered by the inconsistent data structures and systems used by the banks. A pressing need was to identify who was spending what, with which suppliers and for what commodities. HBOS has 32,000 suppliers and sees 700,000 invoice transactions each year. These challenges required a solution that provided detailed, accurate business intelligence in the midst of change.

PRODUCT FUNCTIONALITY: The KALIDO Dynamic Information Warehouse (DIW) is an intelligent data warehouse application that integrates data from diverse systems for consolidated, detailed reporting of management information. Its architecture supports changing business circumstances, a feature of life in the newly merged company. It has produced a central repository for procurement data, allowing consistent group-wide management information to be generated for the first time. This enables us to analyze and manage supplier performance across the complex organizational structure.

STRENGTHS: KALIDO DIW provides HBOS with a single, real-world view of management information throughout business change. It provides power to the procurement professional team, which makes daily decisions about the consolidation and hiring of suppliers. The software integrates information across diverse IT and operational systems to provide multidimensional views of management information from multiple perspectives. It is also designed as an end-user application that highly complements our BI tools; therefore, procurement professionals can generate reports that they need and simply update codes. This provides our procurement department with the tools necessary for better-informed and rapid business decision making. The KALIDO application maintains historical transactions as well as past business and data models alongside current ones, enabling HBOS to measure and compare performance at any point in time. Finally, KALIDO provides the flexibility of a custom-built data warehouse with the lower cost, faster implementation and ease of use offered by prepackaged software.

WEAKNESSES: KALIDO DIW utilizes a hyper-normalized schema because its core assumption is that every aspect of a business will change. While standard database views are provided to access this schema directly, this type of approach does not lend itself to straightforward ad hoc querying without first having to understand a bit more about how KALIDO DIW is storing the data. KALIDO DIW's approach for dealing with this is automatically generating and maintaining industry-standard star schemas and relational result sets for use directly by third-party reporting tools.

SELECTION CRITERIA: KALIDO DIW was the only solution that could provide the ability to integrate data from diverse systems for consolidated, detailed BI reporting. Also, its architecture supports a constantly changing business model.

DELIVERABLES: The KALIDO solution provides detailed BI reports on supplier spend data. It provides fact-based decision support, not just for procurement but also as a means of influencing internal customers. The KALIDO DIW supports HBOS e-Procurement, which is now used by approximately 7,000 users across the company to request the items they need in their daily roles. Group procurement can access demand and cost information on transactions processed through the e- procurement application, enabling better planning of logistics and demand management. KALIDO also helped users to de-duplicate the supplier list on the HBOS accounts-payable system and was the primary source of vendor data for the implementation of a single-group finance system.

VENDOR SUPPORT: The KALIDO software was installed by information management specialist, Acuma, who supplied documentation at every stage to meet ISO 9000 standards. The company also ran a successful skills transfer program to enable us to maintain the new supplier relationship management system ourselves. We have been well supported by both Acuma and Kalido since the system went live.

DOCUMENTATION: We received product documentation and training manuals which proved easy to understand and use.

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