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How should I consider the integration of business intelligence systems and business performance management and what are the best ways to analyze these types of systems?

By
  • Joe Oates, Clay Rehm, Scott Howard
Published
  • October 09 2003, 1:00am EDT

Q:

How should I consider the integration of business intelligence systems and business performance management and what are the best ways to analyze these types of systems?

A:

Scott Howard’s Answer: I describe business performance management (BPM) systems as a continuum of business intelligence. The goal of a business intelligence system is to provide the right information to the strategic decision- maker to enable him or her to better guide the business. However, many consider the BI system finished once they provide what they believe to be quality information. Is it truly quality and beneficial information? Are the BI systems truly enhancing the decision-making process?

Well that’s where business performance management comes in. Let’s capture history about business performance and, among other things including the obvious measures of operational success, feed that information back into our systems to close the loop on BI. The results of BPM can help us validate or improve our total BI solution. If business performance benefits, your BI solution is effective. If you can not measure a performance positive change or that change is inconsistent, that itself is valuable input to the BI systems indicating the need for improvement or rework. BI and BPM when implemented in concert become self-correcting mechanisms for one another. Some people simply describe BPM as a subset of BI with which I agree, but I also feel that the successful BI solution with a proper focus on BPM truly completes the business intelligence continuum.

Joe Oates’ Answer: Business performance management (BPM) is often thought of as being a set of balanced scorecards. While balanced scorecards are one way to measure business performance, they are at the end of a very long chain of information integration.

What is BPM? According to vendors of software and consulting services, BPM includes:

Financial and non-financial key performance indicators (KPIs) or metrics; scorecards, dashboards and alerts; data exploration; complex queries that include drill down; profitability analysis of customers, channels and business units; integration of data from all operational systems, CRM systems and ERP systems; cause-and-effect relationships that span business units, business lines and subsidiary companies; a set of methodologies.

This sounds suspiciously like what an enterprise data warehouse is supposed to provide. In my opinion, BPM is just another buzzword for what Bill Inmon and other visionaries have been talking about for years. In order to properly implement BPM, an organization must have the enterprise data warehouse infrastructure in order to provide the integrated information needed to feed the balanced scorecards, dashboards and other tools that present the data in a way that allows management to get an indication that something is wrong, find out what it is and fix it.

Clay Rehm’s Answer: I assume that when your business intelligence systems were built in the first place, they were not designed from an enterprise-wide perspective. If that is indeed your problem, then you have disparate BI systems as well as disparate operational systems.

If each business intelligence system is indeed a standalone system and your desire is to integrate these systems, then there must be an initiative to create an "enterprise" business intelligence solution. This would include getting agreement on common terminology, common and shared dimensions and common and shared transformations.

This will not be easy and you really have to consider what the benefit will be. Have you prepared any kind of cost/benefit analysis to see if this is worth doing?

Additional analysis would include interviewing of end users around the organization regarding satisfaction of the systems, how much the systems are being used, and quite possibly what kind of cost savings or benefits these systems are currently providing.

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