CIO 004 Not very Intelligent Created by James on 6/13/2013 3:14:42 PM
Much emphasis has been placed in recent years on "business intelligence". A range of expensive "BI" software tools and resources are available, conferences are held on the subject of business intelligence and yet the indications are that BI is not delivering.
An article published in Computer Business Review Africa May 2005 included comments like:
"Attendees of Gartner's Business Intelligence Summit in London last month were not surprised to hear that most enterprises are still failing to use business intelligence (BI) strategically."
"Gartner's survey of over 1300 CIOs returned some unimpressive findings about the state of BI implementations: Gartner's vice president of research summed up the situation nicely by saying: 'Most organisations are not making better decisions than they did five years go.'"
Senior executives of large organizations continue to find themselves unable to find the strategic decision support information they really need despite investments of millions or even tens or hundreds of millions on big new E.R.P. and other brand name systems.
Middle managers, often with University qualifications and even certified chartered accountants sit for weeks every month behind massive spreadsheets as the custodians of management information despite the risks of typing, formula and other error in spreadsheets which should call into question their reliability as ongoing decision support and reporting tools. Large brand name analysis tools meanwhile gather dust and do not deliver a fraction of the potential that led to their purchase.
Why is this happening?
A major factor behind this lies in what I term "data engineering". Another factor lies in the reality that computers are dumb adding machines while human beings are super computers by comparison.
Part of the answer to true business intelligence lies in having one or more staff members who are experts in the collection, collation, STORAGE, retrieval and analysis of strategic information and who are supported by the tools and human resources to enable them to quickly and efficiently store and retrieve information on any subject. PEOPLE providing a technologically advanced strategic information analysis capability who can extract answers to complex queries quickly and efficiently because they know the information repository well and how to access it.
Much of this information will not be in the traditional operational repositories it will be in a repository designed specifically for the purpose -- an extension of the traditional corporate library.
At the same time organizations have vast amounts of operational information stored away in the databases of their E.R.P. and other operational software systems. Correctly analysed this information will provide a wealth of information on operational performance in support of business strategy. However, the data is not structured appropriately.
Computers are dumb machines, they can only manipulate data intelligently to the extent that there is intelligence built into the codes that describe the data. The General Ledger Chart of Accounts is a prime example of this problem. If the chart of accounts is designed from a perspective of strategic management analysis and coded accordingly, huge reserves of intelligent data are unlocked in the corporation. Sadly virtually no chart of accounts satisfies this requirement and huge volumes of data lie largely untapped for strategic analysis.
Similar weaknesses are found with the classification of customers, products, manufacturing resources, etcetera with the net effect that promised decision support capability lies largely outside the reach of business executives.
Effective strategic engineering of information classification schemes and information taxonomy, starting with the general ledger and extending throughout the operational systems represents a huge opportunity for organizations in the decades ahead.
Will your organization reach out to create intelligence in its data?
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