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Building A Bi Strategy


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PDF outlining key considerations for designing a business intelligence strategy

Building A Bi Strategy

  1. 1. Our Experience. Your Advantage. Building a Business Intelligence Strategy
  2. 2. Agenda • What is a BI Strategy? • Elements of a BI Strategy • Support Corporate Goals and Metrics • BI Maturity Model • Activity Based Business Intelligence • BICC • ROI – Build vs. Buy • Executing on the Vision MiPro Consulting Proprietary & Confidential 2
  3. 3. What is a Business Intelligence Strategy? • A business intelligence strategy begins with a comprehensive view of the entire organization from both a technical and business standpoint. A true business intelligence strategy cannot be effective if it does not support both. The strategy should consist of long term and short term goals but ensure the short term supports the long term. A comprehensive view includes data readiness, organizational readiness, build and buy components, ensuring metrics across the organization are fully understood and accounted for in the strategy. MiPro Consulting Proprietary & Confidential 3
  4. 4. What are the elements of a BI strategy? • Alignment to key corporate objectives • Understanding where your organization fits on the BI Maturity Model – Data structure and readiness – Data Quality – Data integration – Organizational readiness • Identifying the “true” BI needs of the organization. Activity Based Business Intelligence (ABBI) • Alignment of metrics across the organization • Business Intelligence Competency Center • Build or buy? • A BI strategy to support short term and long term objectives MiPro Consulting Proprietary & Confidential 4
  5. 5. Our Experience. Your Advantage. Support Corporate Goals and Metrics
  6. 6. Support Corporate Goals and Metrics Target Area Reports KPI’s Analytics Reports KPI’s Alignment of metrics and goals Business Area Finance Corporate Business Unit Alignment of metrics and goals Marketing Operational Reports KPI’s Operational Objectives Objectives
  7. 7. Our Experience. Your Advantage. BI Maturity Model
  8. 8. BI Maturity Model Business Intelligence Pervasiveness Predictive Analytics Organizational Readiness Analytic Applications BICC Dashboarding Executive Data Readiness Sponsorship Ad Hoc Disparate Data Data Mart Data Warehouse Analysis Infrastructure Query and Skills Data Quality Reporting
  9. 9. The BI Maturity Model – Data Readiness  The first layer for the foundation for a successful Business Intelligence deployment is the data layer or data readiness.  Without a strong data structure in place that is designed to answer business questions, it will be much more of a significant challenge to have a widely successful BI deployment.  Disparate data sources that are transformed, combined and manually manipulated will prove a challenge to secure information that is trusted throughout the organization  As organizations progress in their need for information, there may be a tendency to build subject specific data marts  Better than disparate data sources  Still challenges with combining data across subject areas or subject marts  Less efficient data marts as BI needs increase and data marts are modified MiPro Consulting Proprietary & Confidential 9
  10. 10. The BI Maturity Model – Data Readiness  Ultimately successful organizations, for a wide variety of technical and business reasons deploy a data warehouse.  The key is that the data warehouse must not solely be designed from a technical perspective of size, performance and structure but must first be designed from a business perspective.  It must be understood what business questions must the data warehouse support now and in the future and not just from a siloed, sales, finance, HR etc. perspective but designed to allow these metrics to link across operations and support corporate objectives. MiPro Consulting Proprietary & Confidential 10
  11. 11. Execute Data Quality  Data is the backbone that allows for a sound BI deployment.  A sound Data Quality strategy and execution is a significant part of that backbone and overall BI strategy  Data Quality is important because:  Trusted Data. The ability to trust the data and know that facts and figures are correct is extremely important, especially in financial reporting and today’s SOX requirements.  Accurate Information. In order to get accurate reporting, you must have clean data.  Example of sales reporting based upon customer ids.  If there is not a master data management system in place or stringent rules on customer master entry, it is highly likely that there are duplicate customer entries.  A data quality tool can identify duplicates, cleanse and consolidate them resulting in more accurate information.  A data quality tool can cleanse the data interactively as the information is entered resulting in ongoing clean data from the point of entry. MiPro Consulting Proprietary & Confidential 11
  12. 12. Execute Data Quality  Data Quality is important because:  Compliance. SOX, HIPPA are just a couple of examples of required compliance.  Individual person example  Suppose you have individual data in your system for Michael Andrew Jones. This individual may have entries as Mike Jones, Mike A. Jones, Michael Jones, Michael A. Jones, Michael Andrew Jones, Mike Andrew Jones etc.  It becomes a severe challenge to data privacy if this data is not cleansed and accurate. Are these versions of the same individual or different people?  Security. The security of data from keeping secret company strategic differentiators to ensuring employees only see certain types of data is critical to most organizations.  A sound data quality program can help ensure that data is secure by consolidating data, moving data appropriately and make sure employee information is clean and accurate as employees are allowed access to only certain types of data.  Data quality should be an enterprise wide program, not just from an IT perspective but most importantly from a business perspective.  When developing your BI strategy, be sure to include a data quality strategy MiPro Consulting Proprietary & Confidential 12
  13. 13. BI Maturity Model Business Intelligence Pervasiveness Predictive Analytics Organizational Readiness Analytic Applications BICC Dashboarding Executive Data Readiness Sponsorship Ad Hoc Disparate Data Data Mart Data Warehouse Analysis Infrastructure Query and Skills Data Quality Reporting
  14. 14. The BI Maturity Model – Organizational Readiness  Organizational readiness is really about having the right skills in place and the right organizational structure to support those skills.  Business intelligence skills may require  Specific BI tools knowledge,  Business knowledge ,  Skills on dashboard best practices and visual effectiveness  Very specialized data mining and predictive analysis skills.  What in house and external skill sets an organization has access to will drive what BI they are ready to deploy.  Executive exposure and sponsorship  What skills are required now and in the future? What skills can we utilize now? What skills can we cross train? Hire? MiPro Consulting Proprietary & Confidential 14
  15. 15. The BI Maturity Model – Organizational Readiness  Understand the readiness and capabilities of the various organizations across the enterprise  Understand  Audience  Deliver mechanisms  Frequency  Self service or developed reports  Training requirements MiPro Consulting Proprietary & Confidential 15
  16. 16. BI Maturity Model Business Intelligence Pervasiveness Predictive Analytics Organizational Readiness Analytic Applications BICC Dashboarding Executive Data Readiness Sponsorship Ad Hoc Disparate Data Data Mart Data Warehouse Analysis Infrastructure Query and Skills Data Quality Reporting
  17. 17. The BI Maturity Model – BI Pervasiveness  Tool complexity is not just from a technical perspective but is measured by the number of users, the training required, the business expertise and technical expertise required to deploy these tools.  An organization can generally deploy developer reporting tools to a small population of users in a relatively easy manner.  As more ad hoc query and analysis is deployed, a meta data infrastructure may be required along with more significant training for the end users.  Once Meta Data is in place and users understand how to secure data and understand what metrics can be measured and how, then dashboards can be deployed.  Finally advanced analytics and predictive analytics can be deployed.  Walk before you run MiPro Consulting Proprietary & Confidential 17
  18. 18. Our Experience. Your Advantage. Activity Based Business Intelligence
  19. 19. Activity Based Business Intelligence  Execute requirements gathering by understanding the daily work requirements at the audience level  Purchasing Buyer for Raw materials for Manufacturing process  Report for overdue purchase orders with materials overdue by 10 days  Peel back the onion  Buyers uses the report and then queries deeper to review the materials on each PO  Based upon materials, buyer reviews the production schedule and determines if production may be impacted by late deliveries  If production is negatively impacted, buyer works with production scheduler to re- schedule or expedite materials from vendor  Buyer’s real value is a dashboard that shows production line impact due to overdue materials  Dashboard should drill back to overdue po’s detailed reports  Embeds BI into the business work flow  Identifies the impact of BI to other business areas MiPro Consulting Proprietary & Confidential 19
  20. 20. Activity Based Business Intelligence  Flow of dashboard to drill down reports MiPro Consulting Proprietary & Confidential 20
  21. 21. Our Experience. Your Advantage. Align Metrics from Top to Bottom
  22. 22. Align Metrics From Top to Bottom  In order to truly provide value to the organization from top to bottom, the metrics must align from top to bottom across information and eliminate silos.  Aligning metrics can prove to be a powerful tool to help both the top and bottom lines of an organization.  Line leaders to middle managers to executives must have metrics and dashboards that are in alignment and support one another.  Business Scenario  Construction Company  Corporate Objective to increase margin by 1%  Operations contributes by utilizing a machine 25% more efficient  Specialized skills required  HR aligns their metrics with Operations to retain, cross train and hire these skills MiPro Consulting Proprietary & Confidential 22
  23. 23. Align Metrics From Top to Bottom  Understanding the “links” between functional areas can help define conformed dimensions and ensure the ability to measure across business units/areas  If the data structure is present and objectives are in alignment, all aspects of an organization can be strategic and contribute to the overall success of the company. MiPro Consulting Proprietary & Confidential 23
  24. 24. Our Experience. Your Advantage. Business Intelligence Competency Center
  25. 25. Plan For A Business Intelligence Competency Center  A Business Intelligence Competency Center is a permanent organization within a company with a formal structure designed to most effectively promote business intelligence within an organization by putting together the right skills and knowledge which results in increased user adoption.  A BICC does not have to start out with every role and every skill that is defined in the end solution.  A BICC should and can evolve as your organization evolves adding the necessary skills as your BI deployment grows and more business units and users adopt the chosen BI tools.  Initially it may not require much of a significant BICC if you have a single data source and are deploying developer level reports to a single business unit. As you deploy end user reporting solutions and dashboards to additional business units your BICC must grow and adapt in order to keep user adoption of your BI solution high. MiPro Consulting Proprietary & Confidential 25
  26. 26. Plan For A Business Intelligence Competency Center MiPro Consulting Proprietary & Confidential 26
  27. 27. Plan For A Business Intelligence Competency Center  It is important to understand the types of resources and skills required for a BICC so it can be determined what specific skills your organization needs as BI becomes more pervasive and evolves.  The chart below depicts some resources/skills required for a BICC. Not every role is absolutely required and some roles can be combined for each organization is different. MiPro Consulting Proprietary & Confidential 27
  28. 28. Our Experience. Your Advantage. Build or Buy
  29. 29. Contents • Pro’s and Con’s – Build from Scratch • Pro’s and Cons’ – BI Apps • Timeline and Activities • Simple Calculations and Comparisons • General ROI statements • Soft ROI • Hard ROI • Choosing which BI App to deploy MiPro Consulting Proprietary & Confidential 29
  30. 30. Build or Buy components of the solution • Based upon all of the factors discussed to this point, should you build or buy a solution • Packaged solutions that are a hybrid – Oracle BI Applications – Rapid Marts – Significant cost and time savings MiPro Consulting Proprietary & Confidential
  31. 31. ROI – Build from Scratch • Build from scratch disadvantages – Thousands of tables, fields, views and all must be analyzed and determined which are appropriate – Status driven transactions, status must be analyzed and understood for appropriate metric use – Appropriate denormalized data structure must be designed to support reporting and metrics – ETL scripts must be designed and developed to move data from PeopleSoft to data warehouse (if a data warehouse is utilized) – If no data warehouse is utilized, then potential performance hit on PeopleSoft transaction system MiPro Consulting Proprietary & Confidential 31
  32. 32. ROI – Build from Scratch • Build from scratch disadvantages (continued) – Extensive requirements gathering – No industry standard KPI measurements (unless industry standards are understood) – More extensive skills required to build a complete solution • Data modeler • Data quality • Data architect • Data warehouse administrator – Higher costs – Longer time frame • Higher failure percentage* *(According to a 2003 Gartner report, more than 50 percent of data warehouse projects failed, and the ones that survived were delivered very late with extremely high costs.) Embarcadero Technologies MiPro Consulting Proprietary & Confidential 32
  33. 33. ROI – Build from Scratch • Build from scratch advantages – Build it specific to the organization requirements – If utilize only BI against the transaction table, report development can be more swift as a data warehouse is not required (Note: some issues result from reporting against the transaction system) – No additional cost for the BI application MiPro Consulting Proprietary & Confidential 33
  34. 34. ROI – Buy BI apps • Buy (BI Apps) Advantages – Time to value – faster implementation (typically 3-4 months per application) – Industry standard KPI’s and measurements – Higher percentage of success – Pre-built data warehouse structure (using a data warehouse reduces performance concerns against the PeopleSoft transaction system) – Pre-built dashboards – Pre-built reports – BI application is embedded in the PeopleSoft transaction processes/menu. Do not have to leave the PeopleSoft application to generate BI MiPro Consulting Proprietary & Confidential 34
  35. 35. ROI – Buy BI Apps • Buy (BI Apps) Advantage – Upgrades and maintenance. The BI apps are upgraded and maintained with the PeopleSoft transaction system – All appropriate tables, fields, views, status’ are already analyzed and determined – Data warehouse foundation is already in place to add additional data content from outside of PeopleSoft MiPro Consulting Proprietary & Confidential 35
  36. 36. ROI – Timeline/Activity Comparison Months to years - Build Design and Requirements Analyze Design a Data Design and Create ETL develop reports, Test & Train Gathering PeopleSoft Model deploy security dashboards, kpi’s Much of this work, delivered as part of BI Apps Weeks to Months – BI Applications Refine Install and Execute ETL Test dashboards, Train configure processes reports, kpi’s MiPro Consulting Proprietary & Confidential 36
  37. 37. Simple calculations and comparisons • Perform some simple calculations based upon some assumptions • The Procurement and Spend Analytics contain: – 2 dashboards, 14 dashboard pages, 103 reports, 161 metrics • Assume that each report is of simple complexity. Simple is defined as simple formatting and groupings, standard calculations such as totals, sums, averages etc. Standard graphs and charts. 8 hours to design, develop and unit test. (Note: Most likely there will be a mix of low, medium and high complex reports) • If each report is 8 hours then 103 X 8 = 824 hours of work or 20.6 weeks of effort. This does not include dashboards and dashboard pages. • This also does not include any data structure or ETL work or metrics analysis MiPro Consulting Proprietary & Confidential 37
  38. 38. Simple calculations and comparisons • Perform some simple calculations based upon some assumptions • The Supply Chain and Order Management Analytics contain: – 2 dashboards, 18 dashboard pages, 157 reports, 388 metrics • Assume that each report is of simple complexity. Simple is defined as simple formatting and groupings, standard calculations such as totals, sums, averages etc. Standard graphs and charts. 8 hours to design, develop and unit test. (Note: Most likely there will be a mix of low, medium, high complex reports) • If each report is 8 hours then 157 X 8 = 1256 hours of work or 31.4 weeks of effort. This does not include dashboards and dashboard pages • This also does not include any data structure or ETL work or metrics analysis MiPro Consulting Proprietary & Confidential 38
  39. 39. General ROI statements • According to TDWI Research, the average data warehousing project costs $1.1 million and takes 10 months to deliver, while a data mart project costs $544,000 and takes six months to deliver. * • One leading BI implementer has estimated that the cost of deploying a custom solution is typically 2.5 to 3.5 times greater than the cost estimate of deploying prebuilt applications.** • When you add everything up, we estimate about a 7X effort increment to deliver a similar piece of functionality as the BI Apps.*** *From In Search of a Single Version of Truth: Strategies for Consolidating Analytic Silos by Wayne Eckerson, TDWI Best Practices Report, 2004 ( Technically, the numbers are for consolidating data warehouses, but the common approach for consolidation was starting from scratch ** The Business Intelligence Consulting Group, “The Great Debate: Buy Versus Build,” 2007 *** Jeff McQuigg – Independent consultant. IT Toolbox Blog 3/17/2008 MiPro Consulting Proprietary & Confidential 39
  40. 40. Soft ROI • More timely access to information • Improved decision making • Improved performance (no reports against the transaction system) • BI embedded into the business process. With BI apps, users appear to stay within the PeopleSoft application • Total Cost of Ownership (BI apps are supported) • Baseline data warehouse in place, providing a foundation to add additional data sources • Industry standard measurements MiPro Consulting Proprietary & Confidential 40
  41. 41. Soft ROI • Oracle Development Takes care of the following activities: – Requirements Gathering – Naming Standards & Industry KPI’s – Source System Analysis – Change Data Capture Design – ETL design and coding and execution – Metadata – Alerts and triggers – Reports and dashboards – Supportability and upgrades – Enabling BI within PeopleSoft (Big ROI) MiPro Consulting Proprietary & Confidential 41
  42. 42. Hard ROI • In order to determine the Hard ROI, you must have measurable value • Start with these two questions: – What will you be able to do with the BI apps that you could not do prior to implementing them? – What problems will be resolved through the use of the BI apps that were unsolvable before the project was started? • Example: Based upon BI information, it is estimated inventory values can be reduced by 10% or $1,000,000 resulting in a better control of cash. • Example: Based upon BI information, it is estimated to reduce purchasing costs by 5% or $200,000. • See attached document on ROI MiPro Consulting Proprietary & Confidential 42
  43. 43. Our Experience. Your Advantage. Executing on the Vision
  44. 44. Long term and short term strategy • Understand what can be deployed in the short term to meet key goals • Design the short term solution to support the long term vision • Examples – Deploy developer based BI tools first – Work towards a comprehensive Data Warehouse – Create interim data marts (design for the integration to the long term data warehouse) – Deploy a rapid mart or BI application – Deploy BI self service MiPro Consulting Proprietary & Confidential
  45. 45. Executing on the Vision • All of the elements described within this presentation must be understood in order to develop a successful BI strategy • Categorize and classify the findings • Prioritize the elements based upon feasibility and benefit • Based upon the findings create a short term and long term business intelligence strategy MiPro Consulting Proprietary & Confidential
  46. 46. Business Benefit and Feasibility • Map the benefit and feasibility to help prioritize strategy elements High Purchase BI Build data apps warehouse Busi BI Self ness service Valu e Deploy developer based tools Low Feasibility or Ability to Execute High MiPro Consulting Proprietary & Confidential
  47. 47. BI Strategy Requirements Workshop • Understand High Level Key measurements and objectives of top management • Understand key measurements and objectives of upper and middle management along with operations • Ensure BI strategy aligns top to bottom • Gather report information consisting of: – Metrics – what gets measured and what is the measurement criteria – Medium – What is the preferred medium for the presentation of the report/metrics MiPro Consulting Proprietary & Confidential
  48. 48. BI Strategy Requirements Workshop • Gather report information consisting of: – Frequency – How often is the metric measured and presented? Self service, scheduled? – Audience – Who is the intended audience for the report? – Delivery mechanism • Gather BI Maturity information consisting of: – What are the data sources • What type of data is stored in each source? • What is the data structure type? – What are the current BI skill levels? – What is the organizational alignment for BI? MiPro Consulting Proprietary & Confidential
  49. 49. Decision Elements • Capture information related to each report/metric • Specifics for each report will drive the solution for each report Data Strategic Report Description Frequency Audience Mechanism KPI's Sources Data Type Ad-Hoc Scheduled Benefit Feasibility /Tactical MiPro Consulting Proprietary & Confidential