In focus

Mark Smith, Ventana Research’s CEO and SVP of Research on the significant role business intelligence plays in collecting and managing an organisation’s data.

Those who want to survive and thrive have to move fast to keep up with customer demands, changing regulations and the risks of everyday business. It’s a challenging environment, but success is certainly possible for those companies that can make sense of the vast quantities of data at their disposal – which is where better business intelligence comes in. Advanced analytics solutions are providing the means to deliver the increased insight needed to prosper, and are proving invaluable at unearthing previously hidden information treasures that are making the difference between success and failure.

Here CXO speaks to Mark Smith, CEO and SVP of Research at industry research firm Ventana, about business intelligence and the significant role it plays in collecting and managing an organisation’s data.

CXO. This year Gartner ranked business intelligence as the highest technology priority amongst CIOs. Why do you think BI has become so essential?

MS. Yes, BI overall has become a top priority. However, I think it is important to keep things in perspective –so when people respond to our surveys, and put business intelligence at number one on their priority list it doesn’t necessarily mean it ranks number one with regards to the amount of money they have spent or people they have assigned to the project. We have over 450 CIO’s in our community and we have asked them about this matter. It’s important for them because in both finance and operations people are asking for more information, more quickly and accurately. Business intelligence and analytics is a category of technology that is focused on providing information.

CXO. In your opinion, do you think companies are getting the full potential from their data? Why is it important that companies realise the importance of good quality information?

MS. The information that companies generate is what helps them manage their business. Unfortunately, most companies have not spent enough time or money managing their data to provide better information for business management to make better decisions. It has become even more important with a lot of regulatory compliance issues. As part of the regulatory compliance review, companies have found that a lot of their information is not necessarily the most accurate – it has been manipulated and changed inside spreadsheets and other tools that allow individuals to change numbers or make calculations. Unfortunately, these aren’t stored in enterprise repositories. So this whole issue is becoming a hot button and a critical item for reassessing how companies manage their business with information.

CXO. How can business intelligence help a company address compliance issues?

MS. Compliance is multi-faceted and obviously there are different regulatory compliance regulations. Each of these has different needs for providing visibility of information in the business. A lot of compliance areas need documented processes. A lot of companies don’t have these that they can actually audit, so business intelligence provides information about processes and the health of a company. It’s really the primary manner that companies can actually report either their results or the health of their company to either external shareholders or internally to management.

CXO. Can you outline some of the major reasons why BI projects fail, and suggest possible routes to avoid these pitfalls?

MS. Unfortunately, a lot of BI implementations do fail – and it’s not just BI, but also systems such as CRM. The reason that they fail is because there isn’t enough business and IT involvement. There isn’t the right kind of project and programme definition to ensure that everything is well defined and agreed upon. Of course, executive leadership is only one piece of the puzzle. It requires follow-through, so most companies aren’t well set up because they don’t have the right business and IT involvement. They also don’t have the right sponsorship and in many cases they don’t have the right expectations of what is going to be delivered and in what timeframe. Most failures are a binary issue – in reality their projects work, they just don’t deliver as much of the benefit or the value that companies would like. They expect to get a 100 percent improvement, but they only get 70 percent. Some companies would say that was a failure, but in reality that 70 percent is really valuable. They would have liked to have more and so trying to make improvement is really what it is all about. When we look at these kinds of projects, we make sure that they have the right kind of buy-in and definition to ensure they don’t reap these kinds of shortfalls.

CXO. Would you agree that search capabilities are an increasingly important aspect for business intelligence applications?

MS. Yes, I would. The reason is that searching for information is the simplest thing that business users want to do. They want to be able to ask business questions and get answers – they don’t want to use complicated tools and interfaces, they want to be able to go into Yahoo! or Google, ask a question and get relevant results. Unfortunately, search engines don’t always get relevant results and portals such as Yahoo and Google give you far too much information that is not relevant, so there is a lot of new advancements in search to make it simpler for business users to get access to information.

CXO. What does the future hold for business intelligence as far as business opportunities and challenges faced?

MS. The business intelligence marketplace has a great potential for growth. We’ve completed a lot of research in this area and frankly, most organisation have only just scratched the surface in terms of supplying the right kinds of information and tools for their business users.

The challenge BI faces is making the technology simple enough for broader sets of users. Also, making sure that the information is timely, relevant and accurate. This isn’t easy. It is something that requires a lot of work. Technology is only one piece of the puzzle. Business intelligence is an important concept and technology, but if you don’t apply it to the business and drive better results, or as we call it – better performance, then what is the point? Managing performance is what it is all about. Business intelligence can provide the information to tell you how well you are managing performance. If you don’t necessarily apply BI to help the company improve then there is no point doing it in the first place. A lot of the time people use technology for technology sake without having clarity in what they are trying to achieve. So the market has huge opportunity for growth.