CXOs Should Treat BI as a Business Initiative

by Amit Tripathi    Jan 24, 2005

Expansion in business in addition with extended ERP solutions in the corporate landscape necessitates the need for that extra analysis. Mere insight into change seemingly is just not enough. And this is where Business intelligence (BI) takes on a different hue.

In a daylong discussion on BI in Mumbai recently, CIOs spelt out the drivers for BI and the challenges associated with it.

A thematic BI process involves extracting and cleansing of data followed by delivery of summarized / drill down information that in turn enables deeper business understanding through personalized analysis of trends and reports

Sharing the trends towards adoption of BI, Arvind Kathpalia, group head-operations, technology, & finance, Kotak Mahindra, said, “Dashboards have become the buzzword (originated from quality department, now provides graphical metrics for all dimensions) in all divisions of an enterprise. The re-emergence of the concept of datamining, web-based service and service oriented architecture (SOA), has made the necessity of analysis and monitoring of data and timely action as dictated by them.” Suggesting a roadmap for CXOs, he said, “Before adopting BI, standardization of processes and culture of the organization is extremely significant.”

But the concept of BI is not new. At Mahindra & Mahindra, it has been there since more than a decade. Detailing on the evolution of BI, Arvind Tawade, CIO- Mahindra & Mahindra, said, “During the SAP phase (in the 90s) ‘One Phase Summary’ was used among 3000 ‘Z’ SAP reports. At the operational level SAP R/3 reports were in use for production, distribution, inner communication, cost, and quality assurance. The ERP also helped in shift target monitoring, order tracing for the users to get exact position of their orders. Now we have the ability of just-in-time (JIT) manufacturing through which our suppliers can transact online and can view all necessary reports.”

Spelling out the challenges in BI, Mani Mulki, CIO-Godrej Industries, said, “In today’s enterprises, inter-departmental boundaries have blurred as far as their operations and inter-dependence is concerned. Thus, any BI initiative should bring about benefits to all the departments. Similarly, when departments are geographically dispersed, data synchronisation (due to data duplicacy and data variability) is very significant.”

In addition, CIOs need to walk that extra mile in anticipating the user’s need of analysis and information. Mulki suggests, “Users both at the decision making as well as lower level, are used to a specific set of reports and a fixed habit of interpretation. Here the IT head must understand and anticipate what type of data usage pattern is usually done and what new analysis can be brought in by the users.”

Arguably, any CIO faces a humongous task in getting budgets for projects like BI from the top management. So according to Mulki, the CIO approach should be to focus on what cannot be done rather than what can be without BI. He added, “The top management might think that all possible information is at their finger tips but the CIO must point out at what cost are those available.”

Deliberating on the need to institutionalize performance integrators, both at the enterprise as well as the individual employee level, Mulki stressed, “The performance of BI benefits can be done only when the performance of the individual as well as the enterprise is measured, which makes institutionalization of the performance a necessity.”

This is true since each person in the organization has multiple roles and dashboards. Key performance indicators need to reflect this with different views for different processes. For e.g. a sales manager may need one dashboard for sales pipeline, another for customer satisfaction, and another for the human resource activities of his team.

While it is understandable that BI ought to be a business initiative, however, how easy is it to embark on such an initiative?

Answers M. D. Agarwal, chief manager-IS department, refinery division, BPCL, “Getting a uniform BI solution that addresses every change in case of a rapidly growing business (for instance BPCL) is extremely difficult. In this regard we need to innovate from the approach of re-engineering to new-engineering.”

Giving examples of new-engineering approach he cited the efforts by pharma companies towards sales force automation or the JIT approach by some manufacturing industries, as the result of innovation or new engineering rather than re-engineering.