Maximising the value of Business Intelligence strategy

How to get more value from your business intelligence

Are you, and your organisation, getting your best value from your Business Intelligence department?

That is a key question that Nelson Mandela University’s Business School hopes to answer with its new study “A Business Intelligence Effectiveness Model: Enhancing organisations’ decision-making capability“.

Graduate School director Dr Sam February outlined the fundamental concepts behind business intelligence (BI) and why it is so vital for senior decision-makers to use this resource efficiently.

His research paper, co-authored with Prof Hanlie Smuts from the University of Pretoria, aimed to identify the elements by looking at the South African telecommunications industry.

The research proposes a BI effectiveness model to improve decision-making support, by ensuring that decision makers receive the right information at the right time in the most appropriate format.

“The biggest component is identifying the audience,” said Dr February. “There is the group of people that BI supports so they can make informed decisions, and there is another group which produces the data for them.

“What is the value of a BI department within an organisation?”

An organisation needs to invest wisely in BI, his research suggests, as the technologies and skills which create BI can be costly.

BI produces reports and dashboards as well as predicts and analyses trends. In the process it assembles, collates and maintains large quantities of data.

However, asked Dr February, when you look at the value that comes out of those resources, does this necessarily lead to better business decisions?

“A lot of BI departments produce volumes and volumes of information and reports which do not answer specific business questions and, at that very point, you almost nullify the existence of the department.”

After all, said Dr February “when you invite three or four executives into a room, and actually ask them if the reports they are receiving support their basic decision-making needs, you want the answer to be ‘yes’.”

All too often, unfortunately, the answer was “no”.

Dr February said the availability of BI was only one aspect.

“Another aspect talks about the utilisation of the information by decision makers, as in, ‘I am receiving dashboards and reports, but am I actually using these for decision making?’

“Or do they just look pretty on a PowerPoint presentation?

“What are the key questions that you want to answer on a daily basis? Now let’s create information from the BI department that will support these questions, and help to provide answers that can shape executive decisions.

“That is what this paper is about: how we use information from the BI department more effectively – and how this contributes to the successful implementation of BI strategies within organisations.”

As Dr February has found, many BI specialists have a technical rather than a business background.

“For them it is about coding, extracting information, and functionality. They may not necessarily understand the value of what they actually produce but, if they do not, it has a major impact on the value of the BI department.”

It was important to show the end-user how to drill down into the information and extract what they needed. Otherwise, only a fraction of BI output was constructively used.

“This model essentially shows us the relationship between the different variables and this was supported with the quantitative research method that was used. We could actually pick up the different relationships in the analysis,” said Dr February.

By applying this BI effectiveness model, therefore, BI departments would add value as they were better able to support decision-makers.

CLICK HERE to view the full study:

A Business Intelligence Effectiveness Model: Enhancing organisations’ decision-making capability.