Develop dormant ROI potential through BI

30^th April 2009 | Category: BI 

Repositioning of BI: In times of crisis, budget cuts and stops on expenditure open up the way for the alignment of BI activities on ROI aspects.

In times of economic decline, Business Intelligence (BI) is usually also subjected to budget cuts and even stop on expenditure. After all, BI is often equated with IT, and is therefore seen first and foremost as a cost factor. But this attitude is the beginning of the end of the realisation of the ROI potential. If we take a look at the BI added-value chain, then potential of BI becomes apparent:

Typically, BI investments take place predominantly in the first three BI added-value stages (e.g. EDWH architectures, BI development standards, BI projects), often with losses of efficiency already apparent in the area of the provision of information, e.g. because of a lack of control-process integration, or through implementation of individual interests. On the technical side, the homework has often been done. This is understandable, inasmuch as BI is located in the IT department and the success of investments is immediately measurable. The fact is, however, that the high-volume ROI potential lies in the BI added-value steps on the line-department side. To a certain extent, the investments in BI strategy observed in recent years take account of this. So it is now a matter of closing the gap between BI strategy and technical infrastructure, so as to address the ROI-relevant drivers. This gap goes by the name of BI Management. Effective BI Management – as long as it is understood correctly from the point of view of content, processes and organisation – is the key that will unlock dormant ROI potential, which lies beyond the IT efficiency potential. This, however, calls for two paradigm shifts in the usual concept of BI:

1. BI is a core process, and must be owned by the line department, which must be responsible for it.
2. BI investments are assessed by both their efficiency potential and their effectiveness potential.

To counter the frequently proffered excuse that the effectiveness of BI cannot be measured: this is not so. Goals and statistics, such as the degree of implementation of BI strategy, level-relevant availability of information, satisfaction of the decision-makers with respect to BI, report usage rate (hit rate), BI benchmarks, etc. make control and profitability of BI possible.

Conclusion:
To develop the ROI potential of BI, BI must be rethought and re-implemented:

• The ROI potential of BI lies first and foremost in the area of effectiveness, not of efficiency.
• Effectiveness is measurable. The contribution of effectiveness must become part of the business case for BI investment decisions, in addition to optimisation of efficiency.
• BI must be understood as a management task that starts with corporate strategy and coordinates the entire BI added-value chain up to the technical implementation of BI solutions.

Marc Friedrichsen, Partner
Brightcon AG

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