To be able to extend strategic decision making across the entire enterprise, a company first must recognize the value of its information. Companies are fast learning that in order to be competitive, they need to treat their data as an asset, says Colin White, founder and president of BI Research.

In this Q&A, White discusses how strategically approaching your information through an enterprise data warehouse (EDW) will enhance decision making—and, hence, your business’ success.

Q: From your perspective, could you define what it means for companies to take a strategic approach to information?

A: An enterprise data warehouse and associated applications are used to monitor, measure and manage business performance. As such, we use them to manage day-to-day business operations. A strategic approach to information is to use the information in an enterprise data warehouse to look at the overall performance of a company to determine what it’s doing against strategic business goals like reducing costs and increasing revenues.

Q: More specifically, what exactly is meant by treating data as an asset? Would you consider an EDW one of the best ways to enable data as an asset?

A: If you treat data as an asset, it means you see value from a business viewpoint in the data. It follows then, that the information in an enterprise data warehouse has value in the sense that it enables you to understand your business operations and business performance. It enables you to understand your customers, how well you are performing against your competition and your products and how well they’re selling. And it helps you understand your sales force and how efficient it is. All this adds up to optimizing your business. You can improve the way you sell products. You can look for ways of reducing costs. You can look for ways to improve revenue and become more competitive.

Q: Are business executives starting to see the value of providing enterprise-wide access to data? If so, why?

A: I think with any technology we have leaders [in companies] who really see the benefit in new technology and can leverage it. Once they’ve demonstrated that the technology is successful, we tend to get the masses of people who implement it. Then we get the laggards—the people who come in last in implementing that technology. I think we’ve reached the stage now where business intelligence [BI] and enterprise data warehousing have proved their worth. Major corporations are providing access to this information, and there’s no question, there are many documented business cases where companies are getting value out of information from an enterprise data warehouse. They are the people who are treating data as an asset and are using it to run their businesses more efficiently, there’s no question about that.

Q: If companies implement an EDW, what are the competitive benefits?

A: Information in an enterprise data warehouse enables you to really understand your business—what is selling well, what isn’t selling well—your costs and the efficiency of your sales organization, and enables you to compare that against your competition. And so you can compete by being more efficient in your sales organization; you can compete by keeping costs to a minimum and therefore have competitive pricing. But it also enables you to understand your customers in terms of the kind of products they want, the kind of services they want, and also allows you to understand from a customer’s satisfaction what they need. And if you can use that information to understand those factors and improve those factors, you inevitably become more competitive.

Q: What are some other advantages for companies that have enabled end users to access centralized data for decision making?

A: Providing people with better access to data enables them to make more informed decisions. When you make a decision, you need information to make that decision. You need information about your customers and your products; you need information about what really is going on in your organization. Enterprise data warehouses enable you to really look at that information, not only from a current perspective but also looking back in time, as well as to predict future outcomes of a particular decision. And more informed decisions are better decisions, which is better for the business.

Q: Are users still looking to the EDW for efficiency improvements?

A: You can improve customer satisfaction in terms of improving efficiency, call centers and so on. You can also improve the way you work with your key partners and suppliers. Effectiveness has a number of benefits both in terms of revenues and profits and reducing costs. Equally important is improving satisfaction of your partners, employees and customers.

Q: It appears that business and IT are starting to speak the same language when it comes to managing data across the enterprise. However, there still seems to be some question about why businesses aren’t seeing a more immediate gain in productivity or revenue. Why is this?

A: I think many organizations are achieving benefits from using BI. The successful ones are those that are not installing technology for technology’s sake, but address the business issues in their organizations that information technology [IT] like BI can help address. I think again it’s a matter of IT and business-line managers learning to speak the same language. It also requires that IT does a better job of explaining to business managers the bottom-line benefit of technology improvements in business terms. T

Elizabeth Lipp is a freelance IT writer based in Dublin, PA.

Outlook: strategic approach to information In the future, what exactly can business and IT leaders expect in terms of the value of strategic information approaches? Henry Morris, vice president and general manager for integration, development and application strategies at IDC Research, presented the following information on the topic at the IDC Business Intelligence (BI) and Business Process Forum earlier this year and shared his insights with Teradata Magazine. For starters, Morris observes a tremendous interest in dashboards. A dashboard is an intranet for C-level executives that brings them the critical information they need to make the best decisions they can for their companies. A dashboard basically serves three purposes: > Answers fundamental questions about the business or business unit > Alerts the executive to problems with sales, revenue or inventory > Helps the business leader make decisions about the business using one or any combination of the key performance indicators (KPIs). These could include increasing sales force, expansion or relocation, increasing or decreasing production or changing the product mix. Additionally, Morris expects more movement toward—and greater comfort with—intelligent process automation. “Intelligent process automation is the convergence of the BI tools and business process deployment software,” Morris says. “Intelligent process automation software automates repeatable, operational decisions within business process sets in response to events where analytics drive the workflow. We’re moving closer to real time. [Business managers] don’t like latency and they need to be able to take action quickly.” Intelligent process automation, which operates in response to events, is characterized by repeatable, operational decisions and analytics-driven workflow. Morris says these roots are common in operations research within airlines and supply-chain management. “It’s continuous in-process, rather than after-the-fact data integration,” he says. “Intelligent process automation requires event-driven capabilities, including business activity monitoring, or BAM; the event monitoring triggers a process, such as exception handling, as well as access to structured and unstructured data in a process context. The analytics drives the workflow using predictive models to evaluate alternatives, selecting the one most likely to produce the optimal outcome.” Morris says challenges facing intelligent process automation are two-fold: organizational and technical. “The organizational piece consists of senior-management sponsorship with incentives for inter-group collaboration and the identification and capture of best practices for decision-making processes,” he says. “The technical piece is access to analytic models, supporting business rule/policy formation, attaching business rules to analytic models and delivering the models, plus rules to each relevant action site and making recommendations on a real-time basis.” Morris also believes that business will make a greater commitment to standards and consolidation when strategically approaching information. “Consolidation has been an ongoing trend in the last five years,” he notes. “After the dot-com bust, the market crash and 9/11 [all in 2001], managers recognized that they needed to take inventory of their assets, metadata, master data, structured and unstructured information, infrastructure and applications. Decisions must be made on where consolidation is possible and advisable, given the massive challenges of such initiatives.” —E.L.

Teradata Magazine-December 2006