An introduction to business intelligence for IT Managers

This content is 15 years old. I don't routinely update old blog posts as they are only intended to represent a view at a particular point in time. Please be warned that the information here may be out of date.

A few weeks ago, I caught one of the IT Manager series of webcasts that Microsoft is running, where Andrew Fryer was introducing Business Intelligence for IT Managers (I’ll steer clear of the obvious joke about IT managers and intelligence there… I might want a job as an IT Manager one day…). This was an interesting presentation for a couple of reasons: it’s not a topic that I know well; and Andrew presented 290 slides in less than an hour (which sounds a lot, but it wasn’t – he used slides with just a few words or a picture, in rapid succession – and I like that style).

I can’t find the recorded version of the presentation online but this blog post attempts to capture the main points.

According to Wikipedia, Business Intelligence (BI) can be defined as follows:

“Business intelligence (BI) refers to skills, technologies, applications and practices used to help a business acquire a better understanding of its commercial context. Business intelligence may also refer to the collected information itself.”

That’s a bit of a mouthful, but basically it makes BI seem hard. So, let’s think about intelligence without the business context – is it: knowledge and understanding (we used to think the world was flat!); about meaning and context (some information can seem obvious without context); about foresight (to predict future events); the ability to solve complex problems; or the ability to make decisions?

We make decisions all the time – and some of those decisions are poor ones – so if intelligence is about making decisions (and decisions require people), what makes a good decision? The answer is information. The information provides the meaning and context together with the background information (knowledge and understanding, likelihood of a given event occurring, etc.) to allow someone to make the right decision.

Information has been used throughout history to share stories, to learn and to discover things. Over time, information has helped to provide answers and to unlock secrets, which allowed innovation. Information has provided answers – and answers have allowed people to make decisions.

In a business context, the information is derived from data (about people, products, places, etc.). Where there are questions (which products are best? how are the sales figures looking? how are my people?), some insight is required to provide meaning and to convert raw data to information.

That data needs to be stored – originally it was stored in paper files and later on computer disks and tapes – but it also needs to be managed. The advent of databases provided a means for data to be stored and managed but business applications were needed to abstract the management of the database from business end users. These business applications provided a better way to collect data, easing the process of data entry and managing access, to ensure that those who needed access were able to find answers to business questions. But is wasn’t easy – the data was sourced from many locations. Reports were one approach, but they were one-dimensional and siloed, fragmented and lacking insight.

The advent of data warehouses allowed data from multiple locations to be organised, managed and accessed – or consumed. Now the business applications could analyse as well as report and the term “Business Intelligence” was born. Promising more access, from more locations, BI vendors created demand for more data. This led to businesses wanting faster access to data (improved performance). But as the volume of data exploded, so did the use of personal computers, and most data ended up in desktop productivity applications like Microsoft Excel, and Access. There was no single version of the truth upon which to base decisions, the data was hard to maintain and the BI tools cost a lot of money, so vendors had to find a way to reduce costs and offer increased functionality. The result was a period of vendor consolidation in the BI tools space and the formation of a few BI platforms, from companies like Oracle, SAP, IBM and Microsoft, offering more tools and more functionality, for both online and offline access.

But, for all the promises, BI tools were still not working. Business users were still confused and the business couldn’t get the answers that were needed. It wasn’t about people – it was still about disparate systems, with access to data controlled by the IT department. An overstretched IT department. So business users started to circumvent IT departments, but the BI tools were not intuitive and the users didn’t have the time to be IT administrators. Suddenly BI was about usability, and turning data into the right format to be easily consumed by people, with that data managed by IT.

There’s not just the data in the databases to consider either – there is unstructured data too. That unstructured data comes from places like blogs, wikis, e-mail messages, documents, presentations, and videos – at one point analysts considered that 80% of business was conducted based on unstructured data.

So BI is about the right person, accessing the right data, at the right time – and it needs to be people-centric because it’s generally people that make decisions, not computers. Businesses need to do more to collaborate, search, and communicate about questions and answers in order to drive innovation. Even in today’s times of economic uncertainly, BI is still a priority at CxO level in order for businesses to do more with less, to provide better insight for better decision-making, for more people.

Reporting and scorecards are important components of the BI toolset, along with dashboards to display key performance indicators, for analysis. On the desktop we still use applications like Excel but the data lives in the warehouse. Other BI features include data mining (e.g. the shopping basket analysis that supermarket chains carry out using our loyalty cards). For unstructured data, we have portals for collaboration.

In today’s BI implementations the critical success factors are sponsorship (at a senior level in the company), a compelling need, a culture of analysis (rather than looking for divine inspiration) and, most importantly, partnership between the IT department and business users.

I don’t pretend to know anything about any of the specialist BI tools but, on the Microsoft infrastructure side, we already have some useful tools. Office gives us desktop applications like Excel, there are collaboration services in the form of SharePoint products and technologies, and we have a scalable database engine in SQL Server – there’s more information on Microsoft’s BI blog and learn more about the products on Microsoft’s BI website. There’s also advice on planning for BI in the SharePoint Server TechCenter, webcasts, videos, virtual labs and podcasts and more advice for IT Managers and their teams on the TechNet website. Finally, if you just want the highlights and a bit of technical analysis, Andrew Fryer’s “Insufficient Data” blog is worth a read.

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