10 Steps to 21st Century BI & Performance Management - InformationWeek
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10 Steps to 21st Century BI & Performance Management

To improve decision making, follow top tips including reducing the number of spreadsheets in use and expanding the use of performance metrics.

The Findings

Ventana Research undertook this benchmark research to assess the current state of maturity, trends and best practices. The goal was to determine how organizations approach BI and performance management and prioritize their key components, and to identify what elements they desire in a comprehensive approach. (In this report we refer to BI or performance management separately when discussing uses and capabilities particular to each; at other times we refer to them together as we discuss them functioning in combination to serve business needs and goals.)

The research found strong interest in and growing demand for BI and performance management, with two-fifths (41%) of 308 qualified survey respondents reporting they view them as a high priority in their organization. As a group, managers (62%) prioritized them highly more often than other categories of employees; departmentally, the most growth in adoption of BI tools to support performance management has been in operations (51%), finance (50%) and customer management (49%).

Current, Planned & Hoped-For BI

However, the research paints a picture of a market in an early stage of development. It shows that most organizations face considerable obstacles. They have only basic BI capabilities such as querying sources for specific data (74%), generating reports from data (74%) and accessing data from a spreadsheet for further analysis (70%). Moreover, the capabilities they currently are working to deploy are only somewhat more sophisticated: communicating data in the right format (27%), searching for data (26%), presenting data effectively (25%) and creating measures and metrics (24%). Organizations are aware that more advanced capabilities exist; the ones our participants said most often that they hope to establish are being able to access data via a mobile device (27%), to conduct what-if analysis (25%) and to collaborate on data and metrics (23%).

These and other findings lead us to conclude that in general, organizations are still maturing in their use of BI and performance management. Our research finds that this Information immaturity largely is the result of the ineffectiveness of the tools these organizations currently use. More than half of participants (53%) said they are only somewhat confident or not confident at all that their BI technology meets the needs of the organization. In addition, nearly half said it is significantly difficult (32%) or extremely difficult (14%) to standardize BI into a consistent and reliable technology. Overall, only 9 percent are very satisfied with their organization’s BI efforts.

Both Information and Technology maturity are held back by the persistent use of desktop tools for BI and performance management -- tasks for which they were not designed. All but 13 percent of organizations use spreadsheets universally (40%) or regularly (47%) for BI. Not coincidentally, 39 percent frequently find errors in them, and 47 percent have to correct errors often or very often after a spreadsheet has been shared with others. More sophisticated capabilities of performance management, such as dashboards, analytics and metrics, are simply beyond the reach of desktop spreadsheets. We conclude that organizations will have difficulty maturing until they adopt more capable, flexible tools.

Very large organizations (defined as having 10,000 or more employees or more than US $10 billion in revenue) are the farthest along in applying BI and performance management. Half the participants from very large organizations, as measured by number of employees, prioritize BI and performance management highly, compared to only 32 percent of those from midsize organizations. Very large organizations also have done new software implementations more often than others (38% by employees and 37% by revenue).

We attribute the progressive stance of very large organizations to their need to manage enormous volumes of data and provide it to a great many users and to their more abundant resources than smaller companies have. On the other hand, midsize organizations, having experienced growth (sometimes rapid growth), often lack sufficient resources to advance their capabilities and must make do with tools they have outgrown.

The research found a ray of hope for midsize organizations and others under funding constraints. The research shows that lack of resources (60%) and lack of a budget (43%) are the two most common barriers to improving BI and performance management. A significant percentage of the participants said that in the next year or two they will choose hosted software managed off-site or rented software as a service (SaaS) as the means of deploying such software. These methods can be more economical than the traditional on-premises deployment and require fewer in-house resources such as hardware and IT staff.

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