Dumb Business Intelligence Choices Smart CIOs Make

By Patricia Bramhall

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According to a BusinessWeek Research Services survey released in the fall of 2006, 62% of respondents said recent large-scale or strategic business intelligence (BI) initiatives returned the value they expected. What about the other one-third?

Vendors touting BI like Cognos, Oracle, SAP, Microsoft, IBM and Business Objects say it can deliver knowledge, efficiency, better decisions, and profit to almost any organization that uses it—when done wisely.

Even the smartest companies can make some dumb mistakes when it comes to business intelligence. Here are nine to avoid.

Dumb idea #1 – Not having BI. No surprise that Gartner's 2007 survey of 1400 CIOs found BI was again the most highly ranked technology priority. A Ventana Research study in the fall of 2006 of 488 companies indicates that 53% of companies plan to implement query and reporting software, while 40% plan to implement analytics and data mining applications.

Dumb idea #2 – Not having a BI roadmap and buy-in. "Just build it, they will come," is stinking thinking. Too many IT departments build a data warehouse based on the assumption that once it is built, users will automatically see the benefit. They don’t, unless you get the users on board.

Dumb idea #3 – Reliance on spreadsheets. Admit it, you know people who hide behind spreadsheets. They do it because they are comfortable with them and because they know how to manipulate the numbers to satisfy the politics of their organizations. Not smart in the long run.

Dumb idea #4: – Not worrying about data quality. Four-out-of-five organizations suffer from problems caused by poor master data, according to a report issued by The Data Warehousing Institute, a provider of research and training for data warehousing and business intelligence professionals worldwide.

The May 2006 survey of 741 IT and business professionals found that the top three data management problems are related to data warehousing and BI: inaccurate reporting (81%), arguments over which data is appropriate (78%), and bad decisions based on incorrect definitions (54%).

Dumb idea #5 – "We can outsource the whole thing.“ Gartner predicts that less than 10% of enterprises, where outsourcing could be a viable strategy, will be ready or able to outsource their BI applications and operations completely. Gartner said enterprises must define their BI key competencies and capabilities in order to determine what to in- or outsource.

Dumb idea #6 – "Just give me a dashboard!" A management dashboard should be seen as the finishing touch. First comes a solid and stable BI infrastructure. Next, create a networked approach where these new technologies are able to communicate with other BI technologies inside and outside the organization, as well as with other technologies such as business process management and application integration.

Dumb idea #7 – Let’s not centralize. If one BI tool is good, two must be better, right? Wrong. Beware of overkill and different parts of the organization buying different tools that don’t work with each other.

Dumb idea #8 – Not knowing how to define information requirements. Once you have a good grasp of the relationship between BI strategy and business strategy, it is key to fully understand the information requirements and how they relate back to supporting the business.

Because business users have been trained over the years by IT people like you and me to provide reporting specs for operational system reporting, these business users reasonably think that information requirements should be defined as reporting requirements.

Dumb idea #9 – Glorified reporting only. BI initiatives are often positioned organizationally as an improvement on “reporting” and are viewed as something done by IT. No wonder there is little, if any, advancement of strategic information usage in many companies.

When an organization appreciates that BI is far more than reporting and can serve as an important tool to advance their competitive position in the marketplace, then you know you are on the smart track.

In the not too distant future, will smart CIOs lead their companies to the BI promised land? Some analysts predict a world of wise business decisions based on real time business information. In this future IT will not waste time crunching special reports. Instead needed data will be available in just one or two clicks, in much the same fashion as people come to expect to get information on the Internet.

Yes, BI can be the new strategic tool that lives up to its potential, but if and only if it is applied wisely.

Patricia Bramhall, founder of Tydak Consulting Services, LLC, is a thought leader in the field of IT and strategic solutions. She has an enviable record of achieving project objectives and deliverables on time and below cost, with budgets of up to $120 million under her management.