How to maximise the value of your company’s business intelligence
Enhance your organisation's decision-making capabilities with insights from a new study by the Nelson Mandela University Business School
Many companies’ business intelligence (BI) departments produce volumes and volumes of information and reports, but when you look at the value that comes from those resources, do they lead to better business decisions?
If the answer is no, says Sam February, director of the Graduate School of Business at Nelson Mandela University, you almost nullify the existence of these departments.
So, how can enterprises get the most value out of their BI departments? This is an important question, as not only can the strategic use of BI provide a competitive advantage, but the technologies and skills used to create it can be costly.
It’s also one that February set out to answer in his new study, “A Business Intelligence Effectiveness Model: Enhancing organisations’ decision-making capability”, which was co-authored by professor Hanlie Smuts from the University of Pretoria.
It proposes a BI effectiveness model to improve an organisation’s decision-making support. This model is made up of three interrelated factors: strategy, the availability and usability of the information generated, and the utilisation of this information.
February says that a BI department’s strategy should be geared towards providing the right information to the right person at the right time and in the right format.
The first step is identifying the audience who will be using this information — and exactly what sort of information they need.
Says February: “When you invite three or four executives into a room and ask them if the reports they’re receiving support their basic decision-making needs, you want the answer to be ‘yes’.”
However, when the researchers surveyed respondents working in the SA telecommunications industry, they found that, in reality, the answer was all too often “no”.
The solution, says February, is to ask decisionmakers what questions they’d like answered on a daily basis — and “then for the BI department to generate information that will support these questions and help to provide answers that can shape executive decisions”.
The findings also revealed that it’s important to show decisionmakers how to drill down into the information provided to extract what they need. Otherwise, only a fraction of BI output is constructively used.
Of course, once the necessary data is available in a usable format, it’s essential that it’s actually used if a company wants to maximise the value it derives from its BI department.
As February puts it, once key players are receiving the necessary dashboards and reports, they must ask themselves: “Am I using these for decision-making — or do they just look pretty on a PowerPoint presentation?”
Click here to find out more about the management and leadership programmes on offer at the Nelson Mandela University Business School.
This article was paid for by Nelson Mandela University Business School.