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ERP is looked at as the holy grail of enterprise data management solutions.
In such a scenario do business intelligence (BI) tools have any potential? Yes,
says Mehta of MAIA Intelligence, while adding that BI's utilization in a
business environment has not been fully explored
It is tough to define business intelligence (BI) in a nut shell. Some believe
it has to do with query and reporting. Others look at it as a tool that has
analytics, dashboards and scorecards that can be used for performance
management.
But if you were to put it in layman terms, it can be called as software that
allows enterprises to take informed decisions. The presentation components, like
dashboards or cubes, can vary. At the end, it is a software tool that uses
captured data to help enterprises take on-the-fly decisions to resolve any pain
areas. The best analogy for BI is that of a compass. It can show you the
direction, but it can't head you that way. Similarly, BI tools read numbers and
analyze them to offer accountable decisions. But it is up to the customers to
decide how they want to act upon it.
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Sanjay
Mehta CEO, MAIA Intelligence |
Where BI stands
At a time when customers are happy and content with their enterprise
resource planning or ERP (read SAP) implementations, does this mean that BI
tools have become redundant? I think not. BI is the application that threads all
applications, including ERP and customer relationship management (CRM), which
reside across the different business lines of a customer's IT environment.
Right now what is happening is that the customer is doing all the
integration. So take the example of a user accessing different products of a
bank. He might be using the mutual funds, has two different loans, one savings
account and two credit cards. He will be keeping track of his activities and
payments for this single bank.
With BI, the bank can simply have one window for the customer across it
various product offerings and will know his credit standing, withdrawals,
deposits, stock trading, etc instantaneously. It can then decide what kind of
benefits it wants to offer customers of this profile across various parameters.
This shows that BI is still relevant in today's environment. But there is no
doubting that the awareness of its real time applications is still very low.
Different BI models
Each BI vendor has its own core competency. SAS has a purely statistical
model where it cumulates data for a certain number of years and uses algorithms
to do forecasting. So a bank might buy SAS licenses to see what the credit rate
would be five years down the line, keeping the contemporary financial data in
mind.
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| BI is the application that
threads all applications, including ERP and customer relationship management
(CRM), which reside across the different business lines of a customer's IT
environment |
Business Objects or Cognos have tools for performance management. MAIA has
skillsets in using data to offer operational solutions.
It is unfortunate though that it is perceived that BI solutions are only
meant for enterprise customers, because this is not true.
ERP is good for collecting data, but slicing and dicing it for individual
needs is not possible with it. Earlier, customers would plug in all this data
into an excel file and then work out permutations to get an understanding of
this data for making projections and estimations. But with BI, the software with
a simple dashboard display does this.
Let me give you an example. There was a company that had show cards to mark
employee attendance at its gate. We took this data from the HR department and
broke into different sub-categories. We found out how many women and men were
coming late and found out that over a period of a year it was statistically the
men who were coming in late. We also discovered that the company was losing 53
days of man hours across 1,600 employees, due to late coming.
We further sliced the same HR data into hierarchy and departments to find out
who were coming in late. We then found out the attrition rates across the same
hierarchies and departments and found that people who were regularly late were
the ones who usually quit the company.
The company was therefore able to take some steps like notifying the division
heads about chronic latecomers and rectify its manpower issues. This is a good
example of how a BI tool took some accumulated data and then found out a way to
use it to resolve their pain area-attrition and productivity improvement.
BI is barely there yet
When it comes to BI we have barely scratched the surface. There are
companies that are not aware about how BI can help them make quick decisions
that will have direct ramifications on their profitability. Even the top 100
companies are not clued into this fact, which shows the latent potential in this
area. According to a Frost and Sullivan official, the BI market was projected to
be around $70 million in 2007, up from $47 million in 2005. Dun & Bradstreet
pegs the global BI market to be around $5.7 billion, while the Indian potential
is likely to be Rs 1,200 crore.
Gartner has said that India is the fastest growing BI platforms market in
Asia (including Japan), posting a growth of 35.6 percent in 2005-06. BI
platforms revenues in India grew from $12.1 million in 2005 to reach $ 16.4
million in 2006. In APAC (including Japan), the BI platforms market grew at 16
percent in 2005 to reach $491.8 million in 2006, with Japan accounting for more
than half the overall market.
Since India is currently in the implementation wave of business applications
platforms like ERP, CRM and supply chain management (SCM), the demand for BI
platforms will continue to rise. The BI market in India has tremendous
potential, with growth expected to be over 35 percent.
What is now needed is a concentrated effort from vendors to raise customer
awareness about BI, especially in verticals like transportation, hospitality,
logistics, retailing etc. Operation BI reporting in enterprises across all
verticals allows companies to look at implementing enhanced capabilities to meet
their MIS reporting needs. Any company, which is in spreadsheet purgatory, can
be shown the merits of using BI tools because they will no longer have users
spending more time on analysis than executing action on the data.
Vinita Bhatia
vinitavs@cybermedia.co.in Page(s) 1
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