For many large organizations, success with business intelligence (BI) and information applications such as enterprise reporting requires a coordinated effort across the dimensions of people, processes, technology and, of course, data. The complexity of real-world BI continues to grow with the increasing demand for information at all levels of business, new data formats and presentation requirements, and expertise to develop and maintain these new wide-scale BI applications. Fortunately, best practices and techniques have been developed to achieve the mission of BI while overcoming these key implementation challenges. This article examines some of these methods and the state of BI from the implementation perspective, introducing the BI center of excellence (CoE) delivery approach that not only offers a model for addressing key BI deployment, integration and adoption challenges, but also can be used to drive self-service initiatives. Given their potential scope, we also propose a new framework for building a business case for a CoE and other enterprise-level BI projects, and then provide a case study that illustrates real-world BI concepts and a CoE in action.
The BI Implementation Challenge
The field of BI has seen dramatic success in recent years, despite the challenges of the post-dot-com bubble era and growing scrutiny around new enterprise software investments. We believe this success stems from the fact that these technologies provide tangible business value across a number of functional and industry segments. BI or information applications and services are also increasingly in demand from business users as they adapt to the demands of the real-time enterprise and decision making in this new age of accountability.
At the same time, as outlined in the April 2002 Allen Bonde Group study of BI and enterprise reporting trends, there have been significant changes occurring in the marketplace as Internet adoption and applications such as Microsoft Excel and Web-based analysis tools cause an increasing number of organizations to rethink the meaning of BI and enterprise reporting.1 As explored in this study, these innovations and new models have resulted in a fundamental shift of many BI solutions, with the OLAP-centric view being replaced by a broader Web-enabled information delivery model. There is also a growing focus for IT on enabling true enterprise-wide BI on a robust yet flexible platform by developing numerous information applications such as business performance management (BPM) dashboards, information portals and business analytics, enterprise reporting and spreadsheet reporting applications that empower all consumers of information, both inside and outside the firewall.
Defining a Center of Excellence Delivery Model
Changing the role of the IT staff as well as business users to support and leverage emerging self-service BI models and new enterprise-wide information applications requires a coordinated effort. That's why we have seen a growing number of large organizations create a center of excellence for their BI, enterprise reporting and information application initiatives (see Figure 1). While still typically the domain of large, multidivisional or multinational organizations, a CoE approach can also be valuable as a delivery model for other types of companies looking to drive the change necessary to ensure the success of their BI efforts.
Figure 1: BI CoE (Source: Actuate and Allen Bonde Group Inc., 2003
At a high level, the mission for a BI CoE is to better align the people, processes, technology and data for BI - to deliver the needed information to each class of users at the lowest cost to the enterprise.2 CoEs can also be the hub for knowledge sharing around the development/promotion of standard frameworks, models and best practices. In several cases, organizations have also worked with vendors to create a focal point for driving technology transfer, application rollout and training efforts. In the example in Figure 1, the CoE is really a joint effort of the vendor and the organization, facilitating much more of a high-value partnership as well as knowledge transfer of industry best practices from the vendor's experiences with customers and partners.
While a BI CoE may have various drivers and starting points, most operate within the IT organization and employ a number of common techniques to overcome the implementation challenge:
- Employ a self-service model that is appropriate to the user base and application.
- Provide a pool of trained business analysts and specialists who understand business needs and benefits behind user requests.
- Create and promote standard processes and frameworks for developing BI and information applications, and a methodology for choosing the right platform.
- Offer flexible staff resources, including full-time employees as well as contractors and offshore resources, depending on their scale.
- Drive definition and adoption of standard performance metrics - and deliver CoE services according to defined service level agreements (e.g., response time for requests from business customers).
These activities encompass both centralized and distributed functions, which may include a steering group to represent business unit needs and direction, help desk and training staff, program and project managers, architects, business analysts and other development staff. However, regardless of the specific roles and functions, the key benefit of using a CoE model is "simplification and leverage."3 In other words, providing a common set of resources, models and tools that meet the broadest set of business needs while taking advantage of existing organizational expertise, standards and infrastructure.
Creating a Business Case
Closely aligning technology investments with specific business needs is critical before, during and after a deployment. That's why we believe the CoE model is a practical way to not only deliver on the mission of BI, but also to drive ongoing organizational change and technology investments. Developing an enterprise-scale technology initiative such as a BI CoE typically starts with a ROI analysis. However, as BI solutions become more broadly focused and potentially impact multiple classes of users both within and outside of the organization, traditional ROI approaches are increasingly limited in their ability to show the scope of tangible and intangible benefits of both a CoE and the applications it supports.
Begin by identifying the key business drivers for the BI initiatives that are going to be supported by a CoE. For example:
- Lowering infrastructure costs via platform and tools standardization and self-service support.
- Lowering operational costs via new self-service information applications (e.g., call reduction, paper/fax/mail cost savings) and error-rate reduction in existing self-service information applications.
- Improving business process efficiency, such as decision-maker productivity and the quality of information available to those executives.
- Offering greater visibility into key operating metrics or risk factors.
- Increasing revenue opportunities, such as selling information-based products that can be charged to customers.
Linking the leading business drivers or objectives to technology is a critical step in justifying a new project and defining success metrics. A top-down approach that starts with a common vision, business goals and aligned objectives also creates clear, more credible ROI data, a key factor in obtaining executive buy-in and sponsorship. In practice, our model decomposes generalized business objectives into increasingly specific strategies, tactics and related metrics. From this structure, a team can determine both the solution fit as well as provide the context for ROI calculations and scenarios. Specifically, the model captures:
- Objectives: Why is the solution being implemented from a business perspective?
- Strategies: What is going to be done to achieve the objectives?
- Tactics: How is the strategy going to be implemented?
- Metrics: What is the return and how can it be measured?
For each objective, we can break out specific strategies, such as "self-service report development" and "centralized tool and platform support" under an objective of "operational cost savings." Likewise, we can list specific tactics enabled by our BI and reporting solution, such as "Web delivery" and "end-user tools" as well as other tactics such as "user education" and link these to our first strategy.
By looking at the impact of specific tactics and agreeing on ways to quantify them, we can identify the key performance metrics that provide the basis for ROI calculations. For example, there are a number of metrics that we can associate with our "operational cost savings" objective, including: a decrease in the number of calls and the cost to produce and deliver each report; increases in adoption of Web solutions; and a reduced number of errors made possible by the elimination of middlemen in report configuration, data entry and production.
By rolling up benefits by objective, we can also get a feeling for the overall projected improvement from deploying BI and information applications via a CoE - and in effect provide context for additional "bottom-up" ROI analysis and scenarios. The following section highlights a real-world example that illustrates the new face of BI, approaches to fostering self-service adoption and an example of CoE models in action.
A Real-World Example
In practice, successful enterprise-wide BI is as much about people and process as it is about technology. That's why a growing number of organizations have looked to a CoE delivery model as a way to not only gain economies of scale when deploying and supporting a large number of information consumers, but also to drive adoption of new self-service models, best practices and standard tools. At a large financial services company, the CoE has become the hub for architectural direction and centralized knowledge management as well as administration for its standard enterprise reporting platform. Along with keeping multiple versions of the common environment up and running, the CoE services the needs of 40 different business units and helps to coordinate each unit's contracts with systems integrators and offshore firms.
Keeping with the mission of "simplifying and leveraging" existing assets and knowledge, a core mission of the bank's CoE is capturing and providing report libraries and code snippets to individual business units. While development is currently done at the business unit level, the plan is to shift more of it to the CoE over time. The CoE's three full-time resources also identify and coordinate other experts within various business units and promote supported applications and success stories via an internal Web site to drive further awareness and use of the group's services.
In practice, we have seen various approaches to funding a CoE. The bank's CoE is a directly funded effort today, but will move to a charge-back model in the near future, based on use of both staff and system time. As for benefits, an initial driver for creating the BI CoE was the significant downtime being experienced by business units in the existing reporting environment, which was as high as 40 percent. No structure was in place to identify the right tool for each information application, or even share key learnings and best practices from one project to the next. Within five months of starting the CoE, tremendous strides were made in knowledge sharing and coordination. Moreover, uptime has improved to 98 percent, resulting in a dramatic reduction in complaints - and the costs to handle them.
Figure 2: Self-Service via a BI CoE Supports the Objective of Operational Cost Savings While Requiring User Education, Web Delivery and End-User Tools
(Source: Allen Bonde Group Inc., 2003)
The Bottom Line
The BI and enterprise reporting market continues to evolve, with the emergence of new classes of information applications reaching a much greater number of potential users, more open frameworks and interoperability, and corporate initiatives to standardize on a smaller number of BI tools and platforms. Yet, the move toward enterprise-wide business intelligence has generated some key implementation challenges, including supporting the unique needs of different types of users, the frequent lack of consistent BI processes and standards at a company level, and the growing burden on internal IT staff. These trends have driven interest in self-service models, both to empower users to be able to access, create and deliver information on their own terms and to allow IT to offload tasks, such as routine report development, technical support and even training, to users themselves.
Changing the role of IT staff as well as business users to embrace new self-service BI models and enterprise-wide information applications requires a coordinated effort. A center of excellence approach can help and is a structure that is being applied at a growing number of large organizations to allow centralized IT resources to better support emerging BI user needs, best practices and platforms. Building a business case for this type of CoE or enterprise-wide BI in general is critical in today's business environment; however, given the scope and range of potential benefits for such an initiative, traditional ROI approaches tell only part of the story. For this reason, we have presented an alternative, top-down business case framework approach that aims to put technology benefits into business context and extend cost-centric ROI models to capture both qualitative and quantitative metrics. With these metrics, organizations can then provide specific ROI scenarios and examples to reflect business priorities, environments and strategies. In practice, we believe this approach not only allows decision-makers to describe a common vision for enterprise-wide BI, but also allows IT to prioritize its efforts to provide more efficient and high-value implementation services.
1. "Real-World Business Intelligence and Enterprise Reporting: Key Trends and Best Practices," Allen Bonde Group Study, April 2002.
2. McMillan, Greg. "Still Building Houses of Cards? Part 1" BI Report. June 2002. http://www.dmreview.com/article_sub.cfm?articleId=5399.
3. Light, Brian. "Success Based on Leveraging IT." InformationWeek 500. Sept 11, 2000. www.informationweek.com/803/light.htm.
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