BI/CPM survey 2009

Using technology to improve the way you do business

By Michael Burns

Welcome to this year’s survey on business intelligence and corporate performance management. We received 12 responses from BI/CPM vendors, up from 10 last year (see the chart in the online version).

Despite everything that has been written about BI and CPM, a lot of confusion remains. Let’s start with BI, which is essentially about turning data into information useful for making decisions. This sounds like motherhood -- everybody should have a tool for that purpose. But although here are several on the market -- including Excel, reporting programs, dashboards and online analytical processing – none is ideal.

Excel is the dominant tool, but it has limitations. The raw data often needs to be manually manipulated before it is entered, leading to inefficiency and potential errors. Once in Excel, the data often requires adjustment, which leads to further problems -- including the often-heard lack of “one version of the truth.” Meanwhile, it’s not easy to generate reports with the various report writers without programming intervention.

Dashboards have become the gateway to some enterprise resource planning systems. When you log on to ERP systems, you first see the items most important to you. These could be key performance indicators, transactions requiring approvals and graphs showing performance trends. Dashboards are a great way to present information but many systems don’t provide them yet. As well, they are fairly static in that you need to select in advance what you want to see.

OLAP is considered the gold standard for BI. It allows you to view information easily from multiple dimensions, such as region, customer type, manager or product type, as well as graphing and drilling down for details. But OLAP has traditionally been used only by a small percentage of organizations and often only a small group of people within them. Every problem is an opportunity for someone, so Microsoft is about to change things again.

According to Kristina Kerr, Microsoft BI group product manager, the company aims to provide BI to the masses through Microsoft SQL Server, Excel and SharePoint. Microsoft SQL Server is the dominant database used by ERP systems and it includes Microsoft SQL Server Analysis Services, which will generate the “cube” used for OLAP. Think of the cube as the database for OLAP. Microsoft is also working on Project Gemini, which will allow Excel users (about 500 million worldwide) to create their own BI applications and share them through SharePoint (with about 100 million users worldwide), while still allowing IT to maintain control and security of the underlying data. Excel will be enhanced to significantly increase capacity and performance in accessing, combining and manipulating large amounts of data from the cube, other spreadsheets and online sources.

CPM is typically used by larger organizations that don’t get the functionality they need from ERP systems. These organizations are looking for a budget process that includes statistical tools, Excel-like formulas and driver-based forecasts. CPM includes not only BI but also budgeting, forecasting, consolidations, scorecarding and reporting. With driver-based forecasts, you would enter your assumptions/drivers (such as number of homes sold) to generate the forecast. A consolidation program is useful for larger organizations that need to deal with intercompany eliminations and foreign currency translation. Scorecarding includes metrics that are linked to strategy. Scorecarding questions were added to this year’s survey. Reporting includes operational and financial reporting for both internal and external use. This is also useful, given that external reporting is often a problem for organizations that need total control over the report format. CPM will never be a tool for the masses; according to Kerr, Microsoft is leaving this market to its business partners, which are considered more able to handle the diversity of customer requirements across industries.

As with all our surveys, we were unable to validate the information supplied to us by the vendors. We don’t think there will be that many intentional mistakes, partly because the vendors will lose credibility if they are caught.

We hope you find our survey useful. If you have suggestions for improvement, please let us know.

2009 Corporate Performance Management / Business Intelligence Survey

Michael Burns, MBA, CA, is president of 180 Systems (www.180systems.com/), which provides independent consulting services, including business process review, system selection and IT audit. Contact: 416-485-2200 or mburns@180systems.com.