10 Imposters of Business Intelligence
My career has offered me conversations with 1000’s of companies about growth through the use of Business Intelligence (BI) and I’ve made some observations, many of which were accused of being subjective observations.
One of the observations that I’ve made is that many businesses have settled for Imposters of BI — Reports, Overviews, Forms, Charts, etc — rather than BI itself.
As you read the list of imposters below you could argue with perfect utility that any of these imposters of BI can make a huge contribution to BI. This is true, but on their own they are not BI and making the mistake of labelling them as such immediately reduces the Vision that your business has for BI.
I hope this blog helps you distinguish between imposters and the real thing so that your investment into BI becomes a unified, recognized asset rather than a fragmented set of data renders.
Why is this Distinction Important?
Because directing your investment into BI rather than its imposter almost certainly means the difference between a negative ROI and a High ROI on your investment in BI.
If you play this out for a minute:
A COO — trusting the team of BI professionals will obtain the best outcomes — mandates ‘better reporting’ and consequently the team proceeds to recreate all legacy reports in a modern BI tool. The consequence of this linguistic error is often damaging. Among other things, the consequences likely include:
A recreation of what may have been poor or out-dated reporting
Forgetting to reflect on the true intention of the mandate
Fragmented Data and Fragmented Reports
No anchor to the business’s Strategic Goals
What was intended by the COO to be an organization-wide reliance on data for decision-making to aid business growth, has manifested in a thoughtless and fragmented manifestation of a collection of charts, KPIs, Variances and Overviews.
Leaving the company in the same fix it was before: micro assets in want of profundity and offer only partial answers to pressing business questions.
The 10 Imposters of Business Intelligence
These are ‘micro-assets’ that mascaraed as Business Intelligence. We’ve all seen for example, a Line Chart informing us how much we’ve sold for the past 12 months parading as BI. The truth is that such a Line Chart on its own, is useless information for the purpose of business growth.
1) Reporting
Reporting is often used as an generic word for obtaining the information needed to run the business. I think it’s meaning has landed mid-way between a Business Form and Business Intelligence.
A Report is usually something that serves an isolated part of the business, like information about our Sales Pipeline or Inventory-on-Hand or Accounts Receivable or even our General Ledger.
I would summarize the deficit of the Report being its isolation from other biz drivers because Reports are not inter-functional beings and are not anchored in the Strategic Goals of the Business.
2) Modernizing Legacy Reports
The imposter here is the idea that improving a set of reports that may already not be serving the company
3) Factual Data
Factual Data is not BI, it’s just a Data Render, usually historical in nature
4) Overviews
I frequently see the word ‘Overview’ in the title of Dashboards. Dashboards have to have a declared purpose. The trouble with the word ‘Overview’ is that it gives permission to the Dashboard to have no accountability to a declared purpose.
5) Process Support
Process Support relies on accurate and timely organizational data but is not BI. An example of data supporting processes could be a list of products that failed QA or a Commission Calculations Report
6) Statutory Reporting
Regulatory Filings and Environmental Sustainability Reports are examples of Statutory Reports that are mandated and are very seldom anchored in the economic engine and growth of the business.
7) Charts
Charts have the ability to display information in a beautiful and succinct way but just bc they’re beautiful does not ensure that they satisfy the definition of BI
8) Benchmarking
Benchmarking can form a very meaningful component of BI but Benchmarking on its own is useless to the growth of your business. Knowing that the average Inventory Turnover Ratio is 24 to 28 times per year for my industry is of now use to me unless it reveals something about my inventory levels and the actions I can take to maximize my cash flow.
9) Variancing
Variancing is essential to good BI because comparisons have to be made to understand the significance of any measurement. But knowing that we’re over or under does not tell me how this came about and what needs to be done to meet or exceed the targeted performance.
10) KPIs
The right KPIs are also essential to BI but they too are not BI on their own. Two virtues that KPIs have to honor are 1) choosing the right KPI for their purpose and 2) comparing them to the appropriate benchmarks.
But even the best selected and well compared KPI is a building block of BI and not BI on its own.
What is Business Intelligence?
“Real-Time Information that offers specific courses of action to grow your Business”
WHAT ARE SOME DISTINCTION OF TRUE BUSINESS INTELLIGENCE FROM ITS IMPOSTERS ?
1) Inception
True BI begins with the organism in mind, with a convincing business purpose. It is birthed in language akin to ‘when we build this solution for our purposes, how do we build it in a way that can be reused as it is, across the whole organization?’
2) Federation vs Fragmentation
BI ensures that all investments into BI are unified in 2 major ways: i)Data Federation AND ii)Strategic Federation (Anchored in Strategy). In these 2 important categories, the more fragmented, the more they tend toward being imposters because fragmentation is the common thread woven into all Imposters of BI.
3) Standards
The Federated nature of true BI lends itself to standardization of data (data governance), of the semantics of the data (a standard language for the business) and of the user’s experience.
4) Executive Championing
I’ve personally never seen an Executive championing a single Report, Overview, Form or Chart. Why? Because Executives are primarily interested in the success of the organism and they know that success comes from relying on Intelligence that prescribes optimal and specific actions that benefit the whole organism.
5) Cross-Functional
If I suggested that your Sales Pipeline/Orders has a direct impact on your Cash Flow, you may respond saying this is obvious. But is your data platform aware of this and does your analytics speak to you in this way ?
6) Anchored in Strategy
If our 2 year goal is to double in size through New Markets and Diverse Products then it would not make much sense to have our Analytics team primarily focused on analytics of Legacy Products in Legacy Markets. All BI should be birthed in the Strategic Objectives of the business. This unifies the tribal language with the strategy and the living content (Dashboards that serve as presentations, internal and external communication suppliments, meeting aids, interactive Q&A tools) across all teams.
7) Prescriptive
Prescriptive BI is considered as the highest form of BI when traversing the BI Maturity Model for an organization. Prescriptive BI suggests actions to take for growth and to achieve this, of course it has to be Unified and Anchored in Strategy.
8) Data-Driven Culture
A Data-Driven Culture is considered the apex state in the organizational maturity of a business committed to being ‘data-first’. From a data perspective, only true Business Intelligence can form the foundation for a Data-Driven Culture, not its imposters.
9) Incorporating Macro-Economic Intelligence
True BI does not have tunnel vision. Rather it incorporates intelligence not germaine to the organization, to offer a complete view of the company’s performance and identify Opportunities and Threats to business.
10) Incorporates Artificial Intelligence into Prescriptive Analytics
Prescriptive Analytics — being the apex state of Business Intelligence Maturity within a business — has as its foundation, rich, trusted and well-governed data, vitalized semantic models and likely an established data-driven culture. All of these being a solid foundation to obtain meaningful prescriptive analytics from AI.
Conclusion
The quickest way to identify Imposters of BI is by their fragmented nature and their focus on the technology rather than a focus on your business.
True BI has virtues rooted in putting Business first, avoiding fragmentation, strong governance and a commitment to building attaining Prescriptive Analytics that supports a data-driven culture.
Don’t allow the allure of Charts, Reporting and KPIs to detract from what your business needs most — intelligence that is anchored in your business’s strategic objectives and leads to the growth of your business.