Many business leaders find themselves asking, “How much Business Intelligence do I need” when faced with the task of determining where they stand in the market, where they can improve, and/or how they can cut costs. Of course, if that business had unlimited resources, then the answer is “give me everything you’ve got”. Unfortunately, most of us don’t have those kind of resources, so the question becomes: how much business intelligence (BI) do I need.
To discover how much business intelligence you need, you need to know
- What is the purpose of business intelligence, and do I need it?
- What is the goal that I need to accomplish? Is it to increase sales/productivity, or is it to reduce cost/time-to-market?
There isn’t a one-size-fits-all answer to this question. This means that anyone trying to find out just how much BI they need should take a few steps first.
- Derive a solid plan, which includes the following:
- What is the problem you want to solve?
- Don’t try to boil the ocean!! I have seen several examples where the goal was so big that people either lost track of what they were trying to do, or they became overwhelmed and gave up. You don’t want a goal that is too broad, or too high-level. For example, I want to increase my manufacturing output by 100%. First, is the goal realistic? Second, can it be achieved?
- Where is the data for the analysis?
- Research your data. From my experience, this is a very important step. I have seen too many examples where people dive right into the project and only realize they have insufficient data or there is lack of process in place to collect data. For example, if you are doing BI on sales related data, you’ll need to collect data on revenue, sales by date and time, sales by location/store/geography, sales by different products/SKU, customers’ information, etc.
- Also, what’s the cadence of the data collection? For example, how are you going to measure daily sales performance if your sales data is collected on a weekly or monthly basis? Remember, your BI can only be as good as what the data can provide. Spend the extra time on your research, it will pay off in the long run.
- I always tell my customers to “think-long-measure-short” - think long term, and measure in short intervals. You should always plan for future expandability for your system. Often it will cost you less in the long run if you plan ahead of time, even if it means that you don’t implement everything initially.
- In addition, always consider setting up interim milestones. Typically, I would recommend something between 3 to 6 months per milestone so that you can measure and evaluate progress before getting elbow-deep into a project only to realize you are off track.
- What is the problem you want to solve?
- Other considerations:
- Don’t drown yourself. Remember, business intelligence is meant to provide insight so you can make smart business decisions. If you have a complex data environment, you may find that you can spend eternity doing data mining and analysis – but the more important task is to take actions based on the insights. It is essential to strike that balance between analysis and optimization, and to realize when to accept good enough, and when to push for perfect.
- Expect the unexpected – especially if you’re tackling a large scale project. As the project progresses, you will discover roadblocks and obstacles along the way. Roadblocks could be anything from lack of data or data quality issues, to problems with data-flow or business process. You have to persevere and be creative in finding ways to overcome these issues to achieve your goal. Some may take longer than others so plan accordingly.
- Technology or platforms? This should be the last thing you should worry about. While it is important, choosing a tool doesn’t make sense until you know what data you need to gather and what you’re going to do with that data. More often than not, this is the part where you can hire consultants to do the work for you. And if you have your own internal IT group, it would be good to talk to them once you have a plan in place.
To summarize, do your research and planning before you tackle business intelligence. In addition, make sure you’re collecting solid data in a systemized way. Taking on business intelligence without having a system could return results that are inaccurate or worse - misleading. And taking insight on misleading information could end up doing more harm than good.