byMike Ferguson
White Paper :EII for Improving Operational Performance
Enterprise Information Integration (EII) has emerged as an information technology category within the Integration Management market. This adaptive technology can provide dynamic access to disparate information in the enterprise, leveraging a metadata and heterogeneous query infrastructure to dynamically access data from underlying systems including ERP, CRM, data warehouses, legacy systems and other XML, ODBC based data sources.
Business Intelligence processing today involves business executives and line of business managers making decisions that feed into operational systems. Data is then extracted from those operational systems, integrated and loaded into data warehouses where reporting and analyses are produced using Business Intelligence tools to measure business performance. Some would call that classic Business Intelligence. However it is really not enough. It is just business measurement. It is not business performance management.
Today business intelligence is being generated by information producers who often do not know how to leverage Business Intelligence in core business processes. In addition most business intelligence is static, i.e., it is not directly used to manage business operations or drive new business initiatives. What is needed is to deliver personalised Business Intelligence into the hands of people who can leverage it for maximum business benefit.
Managing a business involves three main things:
- Strategic planning
- Tactical analysis
- Operational decisions
However what is needed is objectives driven business management using scorecards and dashboards at the strategic level that are integrated with Business Intelligence tools and analytic applications that support business measurement at tactical and real-time operational levels.
Integrated business intelligence links CPM to traditional Business Intelligence processing such that analytics at the operational and tactical levels are ‘rolled up’ into KPIs that can be viewed in dashboards and attached to specific strategic objectives in scorecards at the strategic level. Figure 1 shows how intelligence needs to be integrated while Figure 2 shows an example of how objectives and integrated intelligence can work together.
Figure 1 - intelligence needs to be integrated
Figure 2 - how objectives and integrated intelligence can work together
Scorecard Versus Dashboards in CPM
It is often the case that scorecards and dashboards get confused in CPM discussions and so perhaps as an aside at this point it is worth explaining the difference. Scorecards are used for strategic performance management to manage business performance so as to understand, optimize and align organizational units, business processes, and individuals. They usually employ a formal or informal methodology such as Baldridge, Six Sigma or Balanced Scorecard and should be capable of being integrated into the Business Intelligence environment – not all products are capable of being integrated, especially if they require a separate database. What is important is that a scorecard product is methodology independent.
Dashboards on the other hand are used to monitor and measure business processes. They may support rules-driven business alerts and intelligence delivery and are used for providing a graphical view of Business Intelligence for tactical analysis – rules support may enable tactical performance management. In general, dashboards tend to encourage bottom-up development, whereas scorecards require top-down development and executive sponsorship.
It is important to note that scorecards and dashboards need to be drillable to integrate strategic performance management CPM applications with enterprise analytics.
Achieving CPM and Business Intelligence Integration
To achieve integrated intelligence requires two main components:
- An integrated set of packaged or custom built business intelligence applications
- An intelligent business suite
I pointed out earlier in this article that near-real time operational analytics are essential to managing a business. Strategic performance management on its own is not enough. KPIs at the strategic level are often judged as the ‘CPM’ element. However near real-time analytics, automatic analysis and automated action is also needed because people ‘on the ground’ working in day-to-day operations are not exposed to strategic KPIs. They need to be guided by alerts, live recommendations and automated application messages that are issued automatically by decision engines that monitor actionable intelligence produced by automated analysis servers analysing business events as they happen. So called ‘near-real time CPM’ is almost always overlooked as being an essential requirement needed to manage the business. Perhaps a better term for this is operational performance management. Combining strategic performance management (scorecards, dashboards at the strategic planning level) with operational performance management (near-real time operational analytics at the operational decisions level) is what is needed to manage a business. Enterprise analytics on the other hand are sandwiched between the operational and strategic performance management. Enterprise analytics are at the tactical analysis level and are used to measure business performance.
Figure 3 – integrated Business Intelligence applications
The second main component of integrated business intelligence is an intelligent business suite. Ideally the intelligent business suite consists of a suite of tools that are integrated on shared common metadata (see Figure 4). The custom or packaged business intelligence applications sit on top of the intelligent business suite and deliver integrated actionable Business Intelligence via an enterprise or Business Intelligence portal. The components of the intelligent business suite are as follows:
- A Business Intelligence and/or enterprise portal
- A Business Intelligence interactive development environment (IDE) for analytic application development and customisation of packaged analytic applications
- Scorecard and Dashboard builders
- Business intelligence tools for
- Planning
- Reporting and analysis
- Prediction (mining, forecasting, optimization)
- Data integration platform: batch and event-driven data integration tools to build real-time store, data warehouse, and data marts. For event driven data integration it is necessary for these tools to integrate with EAI products such as application integration brokers to capture XML events in near real-time. Popular data integration tools such as Assential DataStage XE, Business Objects Data Integrator, DB2 Warehouse Manager, Informatica PowercenterRT, Oracle Warehouse Builder and SAS ETL Studio all have this capability today.
Figure 4 – Integrating Business Intelligence into the Intelligent Business Suite
Options for deploying an intelligent business suite include:
- Buy an intelligent business suite from a single vendor
- Buy and integrate best-of-breed Business Intelligence products from multiple vendors
- Buy an intelligent business suite, and integrate missing products as required
Summary
Business Intelligence projects must be related to strategic, tactical and operational business objectives. In addition CPM, enterprise analytics and operational Business Intelligence must be integrated into an overall Business Intelligence framework. Portals and analytic application development tools are becoming key components of this Business Intelligence framework were support for XML and Web Services are key directions. Finally, CPM needs to be redefined to include not only strategic planning applications but also real-time processing
Acknowledgements
I would like to thank by business partner Colin White for his thoughts and help in putting this article together.
About the Author
Mike Ferguson is Managing Director of Intelligent Business Strategies Limited, a leading information technology analyst and consulting company. As an analyst and consultant he specializes in enterprise business intelligence, enterprise business integration, and enterprise portals. Mike can be contacted at (44) (0) 1625 520700 or e-mail at .
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Techniques for Integrating BI Into The Enterprise – Part 2
Techniques for Integrating BI Into The Enterprise – Part 1
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