Process-Oriented BI: Navigating the Road of Continuous Improvement
Imagine, for a moment, what successful process-oriented business intelligence would look like in your business.
In this dream, the company’s business processes are integrated and no longer hampered by organizational silos. Next generation BI platforms are finally realizing the returns outlined in the business case. In addition, you have successfully spread the benefits of BI to a wider audience of users and business operations owners. Decision-makers have access to actionable information and are able to perform real-time diagnostics of why key performance indicators are met or missed. Executives are no longer waiting for senior analysts to explain problems noted in last month’s performance dashboards. Instead, line managers now have access to the intelligence needed to identify problems in real time, as well as the information needed to act on the problems.
In your dream, contemplate the success of your BI program and the benefits gained by empowering process owners to be accountable and understand the information their business processes generate. Process owners have been able to drive costs down while also adding more value to the information management function. You have successfully achieved the benefits and the promise of process-oriented BI!
Then you wake up.
You are wondering if you will develop the business process management and BI capabilities needed to make process-oriented BI a reality. You also wake up to the reality of delivering on the promises made when the initial BI platform was implemented. The goal was to expand upon the value of the company’s information. Significant investments were made in the existing BI platform, but you have not seen a measurable return. Business process owners are frustrated at the pace and quality of BI delivery. There has been success in delivering solutions and applications to support strategic BI and analytical BI capabilities, but operational BI initiatives are still lagging. In addition, the ability to extract real-time, actionable information from business processes is lacking.
The Journey to Process-Oriented BI
Process-oriented BI is the marrying of BPM and BI capabilities to provide full transparency into business processes. Process-oriented BI provides the business context for measures, metrics and information to optimize business processes proactively based on near real-time, actionable information. It provides the insight needed to streamline processes and reduce costs, as well as the business context for variances on the executive dashboard.
Defining process-oriented BI is simple. Providing the roadmap for how to achieve process-oriented BI is more complex and requires careful planning and continuous navigation while en route. The journey to process-oriented BI has no clear road signs and no GPS to assist with the trip. To achieve and maintain successful execution of process-oriented BI, several key factors must be considered:
- End-to-end business process knowledge;
- Continuous improvement mindset;
- BI capabilities of operations;
- Data governance discipline; and
- Data latency reduction.
These factors should be treated as directional signals along the road. Depending on where you are on your journey, these factors will tell you where you need to go next.
End-to-End Business Process Knowledge
End-to-end business process knowledge is critical. Without a detailed understanding of the end-to-end process, it is impossible to define the appropriate measures that govern the process and link the operational measures to the strategic KPIs they impact. You cannot measure what you do not know. Knowing what, how, why and who is essential, as is having knowledge of the data, the event and the workflow that drive business processes. It is also critical to intricately understand the handoffs between upstream and downstream processes. This should be obvious, but experience has shown that documentation of operational processes typically falls short, provides inadequate detail or is outdated. Knowledge of processes is power. The better you identify the measures that should govern your processes, the faster you will achieve process-oriented BI.
Continuous Improvement Mindset
Process-oriented BI enables ongoing performance improvement. In standard business process re-engineering projects, one of the culminating tasks is typically “Establish a continuous improvement program.” Process-oriented BI finally brings that task to completion. To achieve continuous improvement, it is necessary to drive analytics to the operational level and push accountability of analytics to the business owners. The individuals responsible for performing operational processes must own the responsibility of measuring their tasks and interpreting their analytics. A culture of continuous improvement must be established to encourage individuals at the operational level to own their operational analytics and drive the changes needed to achieve expected efficiencies.
BI Capabilities of Operations
To truly embed BI in business processes and provide transparency and actionable information, BI programs must cater to operational users and provide user-friendly BI capabilities. Operational users are not analysts, but they understand the data better than outside analysts do. They just require different types of tools to facilitate navigation of their information. Operational owners need user-friendly reporting and analysis tools that can guide them through their information in an orderly manner so they can assess problems and issues without getting lost in the data. They also need the ability to easily create their own reports so they can replicate the questions, queries and searches they want to standardize. In addition to providing a more user-friendly tool, integrating operational analysts into operations is another way to build the necessary BI skills of operational owners.
On the journey to achieving process-oriented BI, common challenges include the limitations of traditional BI platforms and the organizational positioning of the analytical function. Traditional BI platforms focus on the requirements of a small population of BI users: typically analysts and executives. BI platforms should be expanded to include the functional and informational requirements of process owners. Organizationally, analytical functions need to be integrated into the business processes – not just serving as monitoring capabilities, but also helping to interpret, identify and translate process-driven data.
Data Governance Discipline
You will take a wrong turn if the quality of data is lacking. Without an effective data governance program, there is no assurance of the quality of an organization’s data. Organizations need to ensure that data is accurate before it can be made actionable. Otherwise, decision-makers will be armed with off-target and potentially incorrect information. If you have effectively provided business functions with local data governance capabilities and pushed accountability of managing data quality to the business function, you are on the way to process-oriented BI.
Data Latency Reduction
How quickly you achieve process-oriented BI depends on the company’s ability to reduce data latency. Simply put, data latency refers to the aging of reported data. In other words, it describes how quickly the data is produced and how relevant it is to the current business situation by the time it is used. Data latency is not just a detour, it is a roadblock. The faster you obtain information, the faster you can act on it. To extract the most value out of process-oriented BI, actionable information must be delivered at the right time. Reducing data latency is not a small feat. It requires additional investment in technology and evaluation of how much latency is acceptable. Weighing these requirements against the demands of the business and the strategic value associated with the information needed will help to articulate options to key decision-makers.
Are We There Yet?
Like any journey, there are signals that will act as a guide but, inevitably, the question will be asked, “Are we there yet?” To truly achieve process-oriented BI, a company must reach a certain level of maturity for its existing BPM and BI capabilities. In typical maturity models for BPM and BI, there is a convergence point where optimizing an organization’s capabilities is dependent upon embedding BI into business processes, hence achieving process-oriented BI. The IT infrastructure and the maturity of the BI platform will play a significant role in achieving the full capabilities of process-oriented BI. To establish a baseline and chart a course to obtain the required capabilities, you must evaluate where your BI and BPM capabilities are at the moment.
Establishing an iterative approach to achieve required capabilities is ideal, regardless of the company’s maturity in acquiring process-oriented BI capabilities. Before making additional investments in an existing BI platform or BPM tools, evaluate using tactical BI solutions built in SharePoint, Access or Excel. These lower-cost solutions may offer a quick bridge solution for a brief period and support the assessment of your true needs. Implementing tactical BI solutions can be the first step to making a significant investment in advanced analytical tools to help expose process-driven information.
Whose Turn is it to Drive?
There is a historical debate about who should drive any BI initiatives: IT (CIO) or the business (CFO)? The key is to remember that it is called business intelligence. Process-oriented BI cannot happen without the business leading efforts to define requirements and provide knowledge of the business. IT is the backbone to ensure that the right technology options are executed, but the business needs to be involved with the selection of technology options. IT empowers business operations by delivering actionable information, but the business and IT need to collaborate via open lines of communication. Technology should act as a partner and provide the business with the tools it needs to be self-sufficient.
Assuming that you follow all of the signs and signals along the way, you will arrive at process-oriented BI. It will no longer be a dream destination. You will have the information you need to understand your organization better than ever. You will also have the ability to translate business events into performance indicators that will drive business rules (i.e., actionable information) into business actions.
Remember though that the journey never ends. Do not plan to stay at this destination very long — keep going. Having the right information and infrastructure in place will help contribute to efforts to define competitive advantage. With access to the information that will drive continuous improvement, the continuous improvement program will become a reality and it will be ignited by the process owners. Now the organization will have the information to prove it.
Reaching process-oriented BI requires a strong, self-disciplined, collaborative culture that breaks down silos and brings an enterprise-wide perspective of business processes and drivers. It requires bringing financial, business, functional and system analysts together in a more cooperative and action-oriented fashion. Depending on where your organization is, the trip could be long or short. The key point is to get in the car and drive. Have a safe journey.