Dr. James Thomann

DecisionPath Consulting

November 14, 2007

Determining the Success of

Your BI Initiative

Determining the Success of Your BI Initiative

Dr. James ThomannPrincipal Consultant

TDWI Webinar

November 14, 2007

Topics

Introduction

BI Success

Measuring BI Success

Impacts on BI

Summary

Introduction – Goal of BI

Business Intelligence (BI)

provides information to the

business in order to

achieve improved business

results – i.e. IMPACT the

business

Introduction – Need Proof

At some point you will need

to prove that your BI

Initiative has the desired

impact. Return on Investment

(ROI)

Return on Assets (ROA)

Total Cost of Ownership

Total Value of Ownership

PROOF

BI Success – Definition

Success is the difference

between what is being

achieved prior to BI and

what is being achieved with

BI

Results business

currently achieving

Results after BI

delivered

BI Success – Challenges

Challenges: What is the expected

impact of this new BI?

How will you define

success?

Can you measure

success?o It is very difficult to

extract what can be

attributed to BI

o Not all the impact may be

measurable in dollars

o Costs are very visible

and easy to measure

For whom must success

be defined and measured?

Growth due to BI

Expected Growth

BI Success – 3 Critical Areas

Business Success

Political Success Technical Success

BI Success – Business Success

It is the impact on the

business results that can

be attributed to BI

BI delivers information that

directly contributes to the

organization meeting its

drivers, goals, strategies

and tactics

Success can be measured

at Enterprise, Division,

Departmental, and

Application levels

Business Success

BI Success – Political Success

It is delivering the right

information to the people

who need it

These are the people who

the BI applications were

designed and constructed

for

Others may be drawn to it

The applications provide

access, are available, and

the customers are happy

with them

Political Success

Business Success

BI Success – Technical Success

Using the right technology

for the “problem” being

solved

Using the chosen

technology correctly

Everyone has the ability to

use the technology as

designed

Deals in reach, range,

maneuverability, capability,

and quality

Business Success

Political Success Technical Success

BI Success – Failing is Easy

If failure occurs in one

success area, then …

Business Success

Political Success Technical Success

BI Success – Failing is Easy

If failure occurs in one

success area, then

eventually it will occur in all

three

It may not be possible to

concentrate on all 3 areas

at the same time

If not start with the Political

area

Business Success

Political Success Technical Success

BI Success – Proving It

ROI (for example) can not

be calculated without data

Where does the data come

from? – It needs to be

measured and collected

If the expectations for the BI

initiative are unknown, then

how can anything be

measured

SURVEY1.2.3.4.5.6.7.8.9.10.

Measurement

BI Success Data

Impact Measurement Results

needed

for

BI Success – Common Metrics

These may be OK, but … Which metrics actually

provide the data that tells

you when you are meeting

the customers’ expectations

Are the baselines known?

Measuring BI Success – GQMM Approach

BI’s Information

Environment is developed

using the GQMM Approach

GQMM stands for: Goal

Question

Metric

Measure

BI’s Information Environment

BI Success Data

Mining Data

Exploration

Metric Data

Analysis

Reports

Review

SURVEY1.2.3.4.5.6.7.8.9.10.

Measurement

Measuring BI Success – Goals

The organization’s goals for

BI

What are the expectations

for BI?

Success goals should be

from all 3 areas: Business,

Political, and Technical

Analyze & Act

Measure

Goal

Question

Metric

Measuring BI Success – Questions

The questions define the

details of what needs to be

known about the goals for

BI Success

The answer to these

questions provide the tools

to determine if BI is

successful for not.

Analyze & Act

Measure

Goal

Question

Metric

Measuring BI Success – Metrics

The metric defines the form

and content of the answer

or part of the answer for

each question

It defines: The subject, quantum,

strata, and application

The units of measure and

their standards

Any needed algorithms

The same metric may be

needed for more than one

question

Analyze & Act

Measure

Goal

Question

Metric

Measuring BI Success – Measures

The measures are the data

items required to derive a

metric value.

Each measure may support

multiple metrics

They must conform to: Standards for the units of

measure

Any related business

context Analyze &

Act

Measure

Goal

Question

Metric

Measuring BI Success – Summary

BI can be considered its

own “enterprise”

A BI Initiative needs its own

information in order to be

successful

GQMM is the basis of

almost every successful BI

Approach

Constraints require that the

approach be simpler for BI,

yet comprehensive over

time

Analyze & Act

Measure

Goal

Question

Metric

Impacts on BI – Time

Success will not be

achieved at once, it takes

time

Success measurement is

not done just once, it must

be done continuously over

time

It should continue as long

as the BI application is

actively usedTime – Months

Resu

lts –

$

BI Success

Costs

Impacts on BI – Many Applications

Cost of Measurement

Problems of separate

efforts: Funds

Overlap

Etc.

One measurement program

for the success of all BI

Facilitates looking at overall

success, each application,

and managing the costs of

measurement

Data Warehouse

Under Construction

Metric CubeData

Mart

Custom Tables

Metric Cube

Flat Files

Impacts on BI – Program Management

Managing BI as a Program,

rather than a series of

separate projects, also

facilitates measuring the

success of the BI Program,

since Program management

manages BI as a single

effort with many

components

Data Warehouse

Under Construction

Metric CubeData

Mart

Custom Tables

Metric Cube

Flat Files

Data Warehouse

Data Warehouse

Under ConstructionUnder Construction

Metric CubeMetric CubeMetric CubeData

MartData MartData Mart

Custom Tables

Custom Tables

Custom Tables

Metric CubeMetric CubeMetric Cube

Flat FilesFlat FilesFlat Files

Impacts on BI – Also Impacted

This effort also helps the BI

Initiative to manage: Expectations

Quality

Change

Growth

Improvements

Etc.

Program Management

Project Management

Change M

anagem

ent Q

ua

lity M

ana

ge

me

nt

Data Warehouse

Under Construction

Metric CubeData

Mart

Custom Tables

Metric Cube

Flat Files

Data Warehouse

Data Warehouse

Under ConstructionUnder Construction

Metric CubeMetric CubeMetric CubeData

MartData MartData Mart

Custom Tables

Custom Tables

Custom Tables

Metric CubeMetric CubeMetric Cube

Flat FilesFlat FilesFlat Files

Summary

BI Success is the difference

between what is being

achieved prior to BI, what is

being achieved after BI,

less any expected growth

BI Success has 3 critical

areas: Business, Political,

and Technical

Success can not be

guessed at, it must be

measured.

GQMM is a practical

approach to develop the

appropriate metrics and

measures

Determining the Success of HP’s

BI Initiative

29

BI/EDW GOALS

• Single source of all information used for BI

• Global scope for analytics for KPIs, customer

understanding, Supply chain, channels etc.

• Source data once

• Enable all operational managers to directly benefit from BI

• Extend to suppliers and customers

30

Production

Control

MRP

Inventory

Control

Parts

Management

Logistics

Shipping

Raw Goods

Order Control

Purchasing

Marketing

Finance

Sales

Accounting

Management

Reporting

Engineering

Actuarial

Human

Resources

Legacy Applications + Datamarts = Chaos

• Problematic data integration

•72 ERPs

•,22,000 SAP extracts

• 35 EDWs

• Over 762 BI assets i.e. data mart sprawl

• Data metrics, meanings and

uses

• Lacking enterprise data

model/warehouse

Where we started in 2005

31

Where we will be by the end of 2008

Production Control

MRP

InventoryControl

Parts Management

Logistics

Shipping

Raw Goods

Order Control

Purchasing

Data

Warehouse

Enterprise Data Warehouse = Simplification

Principles

• Obtain data once and at the source

• Data is complete and detailed

• Global scope

• Define, model, and map all data

• Ensure all data has integrity

• Provide complete access

• Flexibility and scale

Single

version of the truth

32

HP IT EDW project:

Enterprise data warehouse strategy

Time

Priority

Customer

Sales

Shipments

Product

Customer

Global revenue

unit—margin30 April 2006

Dollarized

Incidents

Tech

support

Call details

Service

Contracts

Finance

September 2005

Supply chainGap

resolutionContinuous

improvement2008

700+ Data Marts and 35 Data warehouses (September 2005)

1

CRM/MRM

1000+ reports

80,000+ reports

180,000+ reports

350,000+ reports

300 users

on new system

50,000 users

EDW

33

Governance – Global Business Intelligence

Steering Committee• Representatives from all business groups, geographies, corporate and IT

• Central point of authority over initial and continuing MDM, reporting, BI solutions and

infrastructure planning groups and goals setting

• Measure achievement of those goals on quarterly basis

Global BI

Exec SteeringCommittee

Finance &

Corp Functions

IPG

PSG

GO

Marketing

Services

Sales

*Direct

TSG

EMEA

APJ

Americas

WW

*Indirect

Data Quality

Supply Chain

IT Mandatory

Work

34

Determining the success

• Technical Success Using the right technology for the “problem” being solved

Everyone has the ability to use the technology as designed

• Political Success It is delivering the right information to the people who need it

Others may be drawn to it

The applications provide access, are available, and the customers are

happy with them

• Business Success Has impact on the business results that can be attributed to BI

BI delivers information that directly contributes to the organization

meeting its drivers, goals, strategies and tactics

Success can be measured at Enterprise, Division, Departmental, and

Application levels

35

Logical View of EDW

Browser eMail PDA-?

Portal (Presentation/ Security layer)

Dashboards Standard reports

Reporting Engine & Analytics

Ad Hoc Queries

Source systems

Integration layer (ETL = Extract, Translate, Load)

Enterprise Data Warehouse

(integration & centralization of data stores)

Transactional / operational systems

Windows/Linux/Unix

HP/UX

1 Neoview EDW

256 CPU 300TB

Windows/ .Net

36

Technical success criteria

• Meeting decommissioning schedule of

data marts

• Providing better/trusted data

• All managers have logins and can do ad

hoc, pre-planned analytical queries and

reporting queries

37

Political success

• All managers that are given access are using it

• All managers given access to the EDW complete training on its use and

how to create their own ad hoc queries

• All managers given access are doing ad hoc queries in addition to

standard daily, weekly, monthly and quarterly queries

• Managers who have switched from decommissioned data marts to EDW

are:

– happy with the switch

– are getting more and better decision-enabling data.

• Managers still using yet-to-be-decommissioned data marts want access

to the EDW.

38

Business success

• Supply chain efficiency has risen

• Cost of product has gone down

• Revenue predictability has improved

• Complete 360° view of every customer

– Every product, purchasing channel, contract,

revenue, profitability, trends etc.

• Constantly updated KPIs are visualized for management

• Analytical detection of events affecting revenue

• Optimized product, options and component rationalization

• Etc.

39

Questions??

40

Contact Information

• If you have further questions or comments:

Jim Thomann, DecisionPath ConsultingJimThomann@aol.com

Jim Henry, HPjim.henry@hp.com