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Looking for New Ways to Cut Costs and Boost Revenues?

Published
  • April 04 2003, 1:00am EST

Belt tightening is the rule today. Companies are pulling their hair out looking for ways to reduce costs and increase or, at least, maintain profits to survive in this down market. For many, it means taking a microscope to all business processes looking for excess fat as well as cooking up new ways to wring every drop of profit from each sale. Sound familiar?

A lot of companies have discovered a simple, low-cost way to deliver a sizable boost in sales: give people real-time business intelligence. A recent survey revealed that 42 percent of companies said they expect to see revenues actually increase when end users are given access to timely data.

Each month, we at Appfluent Technology conduct a survey about business intelligence trends. Two hundred and seventy-five technology professionals, including almost half in technology management or C-level technology positions, completed our most recent online survey. More than 90 percent of respondents were from large or very large organizations (more than 1,000 employees).

We set out to discover how real-time business intelligence impacts various business processes. We wanted to assess which units are benefiting. We also wanted to see how widespread the trend toward real time is and what the payoffs are.

We found out that from corporate planning all the way to production floor management, access to real-time data is delivering sizable benefits across the enterprise. Demand for fresh data is strong among end users, and IT departments are working to roll out timely BI across all business units. Here are some specifics:

  • Half of survey respondents said their organizations would have better control over resources by giving end users access to timely data.
  • Forty-two percent said they expect to see revenues increase when end users run timely reports.
  • More than 70 percent of respondents indicated their end users make more intelligent decisions when given access to timely data. Of those, one in five indicated that sales is the activity that most benefits from intelligent decision making with boosted revenues being a direct result.
  • Production, finance and sales were the business units most often accessing fresh data.
  • Production was cited as the unit that most benefits, with improved effectiveness, tighter cost control and better use of resources, when users are giving access to real-time data.

This research confirms that, in today's business environment, companies must be agile if they are to succeed. And, that means they need timely information from critical business systems. More and more users are demanding real-time information, but is this getting too expensive and complex for most enterprises?
Our survey revealed almost one-third of companies are running 50 to 80 percent of all business intelligence reports off production databases to get the timeliest information. For most companies, these are the same systems that support business processes such as financial reporting, customer service and logistics. However, this causes costly deterioration in performance. As both reporting applications and enterprise applications contend for processing resources, each system becomes noticeably slower, precluding this as a viable long-term solution.

Our research revealed some of the strategies companies employ to address the issue:

  • To avoid system bottlenecks, 22 percent of companies allow reports to be run off production databases at off peak times only.
  • Another 17 percent allow only authorized personnel to run reports off production systems.
  • One-third of companies run real-time reports from a data warehouse or data mart instead of the production database.
  • Interestingly, 8.5 percent of respondents indicated that they have not yet addressed the problem and allow full query/report access from production databases by all users.

These workarounds get can get the job done, but at what cost? Given the bottom-line benefits our survey reveals and user demand for timely information, can companies really afford to restrict access or delay delivery of fresh data?
Another alternative is to set up an operational data store (ODS) to mirror production databases to ease all this real-time traffic. But, many companies think this comes with too high a price tag, especially in tough economic times. Others don’t have the necessary staff and skills to deploy, manage and administer an ODS. In fact, our survey revealed that of those deciding against it, 64 percent of companies found the cost and complexity of an ODS prohibitive.

That said, companies could now look to save in terms of budgets and resources with intelligent, self- managing dedicated reporting servers. These enable people to access timely information from production systems without compromising the performance of critical applications. Belts are tightened; no hair pulling required. Real-time business intelligence is realized.

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