Assessment

In 2003, as Ventana Research investigated the use of business intelligence technology, we observed that most new deployments of BI were not for general purpose or ad-hoc analytical use by elite business analysts, but were designed to address information needs of specific business operations and finance managers and staff. Based on those observations, Ventana Research defined a new, large, growing market category for BI labeled "Operational BI." Operational BI is different from other BI use because it enables business operations, and focuses on specific activities and processes rather than enable ad-hoc analysis. It is used on a daily if not hourly basis, and it has simplistic but very easy to use interfaces. Deployments often scale to thousands, if not hundreds of thousands, of users. It is also tuned for consistent, fast query performance. Operational BI enhances the efficiency and effectiveness of operational decision making, facilitating 'management by exception' through alerting, prioritization and prescription.

In 2003, Ventana Research began the research of business intelligence technology to improve business operations and to enhance the effectiveness of individuals. Based upon initial quantitative and qualitative research ("Operational Performance Management" and "Business Intelligence for Operational Performance") where Ventana Research examined the market's maturity, adoption rates and key trends. In these two research studies have examined over 1000 organizations, making the research effort the most definitive exploration of the the importance and relevance of leveraging BI in operational tasks and roles.

Ventana's research from 2004 in BI for Operational Performance examined operational BI from the user perspective, and focused on identifying benefits and missing or incomplete capabilities. Respondents rated a comprehensive list of benefits to help rank their importance or prevalence and also provided insight on best practices for IT departments and line-of-business managers. In addition, business needs, application justification practices, user needs, technical requirements and project management practices were analyzed. Results indicated that deployment of business intelligence 'applications' to line-of-business workers to enable/improve performance in business operations is widespread. Nearly 3/4 (73%) of the respondents indicated that they were involved with deployments of BI for operations and finance. In fact, Ventana Research believes that operational use of business intelligence is far more widespread than strategic management use of BI. This is not to say that the market is saturated. It is not. Rather, we are at the beginning of a wave of significant deployments of BI for operations and finance where the research found 51% of the respondents stated that their companies planned to deploy additional analytic applications in the next 12 months.

Ventana Research initially believed that deployment of business intelligence for operations was an exclusively large-scale endeavor. However, respondents reported deployments of all sizes ranging from 20 users to 10,000+ users. Many of the deployments were small (5-100 users). Adding users to existing applications was also a commonly cited future intention. These applications were mission critical -- as many as 48% of the respondents said that their applications were accessed by users one or more times per day, whereas only 28% said that their applications were used one or more times per week. Ventana Research believes that these applications are providing significant operational efficiency improvements.

The research found that organizations intending to deploy business intelligence for operations and finance can expect to gain not only improved data access, efficiency and customer service, but also will likely reduce costs. Respondents noted that their ability to analyze organizational and personal performance against goals was a leading benefit of these applications. The research also found that these applications were used for issue investigation, enabling root cause analysis via drill down and comprehensive views of customers/products. Ventana Research believes that these two uses, measuring/monitoring operational performance and facilitating business operations are common throughout the industry. This indicates that business intelligence in its many forms, and not just in its traditional incarnation as a management report or dashboard, is a fundamental enabler for operational performance management.

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Business intelligence technology should be viewed as having far greater and broader value to organizations than just in its traditional supporting -- and infrequent -- role for strategic decision-making. Ongoing performance assessments (especially of financial performance), tactical root cause analysis, and daily customer and product updates are examples of daily operational use of business intelligence. Many organizations today deliver their operational BI applications up and down their chain of command and across multiple departments or divisions. Not deploying these information assets to business operations may limit efficiency and resulting effectiveness of the organization.

Business Intelligence and Reporting technology platforms provide robust, scalable platforms for delivering information and insight to small and large-scale business operations. While the platforms support a variety of usage modes, including basic reporting, they also support a variety of specific and broad based applications. Ventana Research recommends that organizations interested in deploying business intelligence and reporting applications for operational and financial performance management assess existing approaches. Operational use of business intelligence technology should be a top line candidate for strategic IT investment.