BI: The Road Ahead

by Vince Kellen, Senior Consultant, Cutter Consortium

Of all the areas in which technologists can make strong contributions, business intelligence (BI) is at the top of my list. After all, BI solutions touch people who make decisions. They are a primary means, a sensory organ, by which the firm comes to know its environments, both internal and external. The visual presentation layer of the tool interacts with human thought. BI solutions lie at the tangled nexus where technology meets both human culture and human cognition and in a very important area -- strategic planning and decision making. BI solutions are at ground zero in the competitive warfare around us.

The strategic importance for BI solutions is at odds with the current state of the BI solution market. What is holding the industry back? The BI space needs something akin to the software crisis that helped lead to agile development practices -- a call to arms, so to speak. Most firms won't change their decision-making practices until they are near death's door or a wholesale change in management occurs (which is aligned with new and different decision-making approaches). Most firms are like frogs in a pot of cool water: the temperature rises slowly, lulling them into complacency, which is followed by sleep and then death.

For the most optimistic among us, the conclusions seem stark and cold. In order for firms get more value out of BI tools, they have to learn how to make decisions better. Firms need to accept the fact that for now the BI solutions are highly leveraged tools that the "masses" do not deeply use or, in some cases, even need. They need to carefully cultivate and retain those precious few employees who can think cleverly about how to tailor and use BI solutions and those who can diagnose and change decision-making processes.

These employees are sometimes in the wrong roles. Often they find their way into technical management because of their smarts. In the past, I have identified these employees by probing them more deeply in interviews to assess their expertise in and passion for analyzing technology and human processes and for building, at least on paper, new approaches. These people are usually not the best at motivating teams of other people to actually implement change but often are the best at identifying precisely what needs to be changed and what a new human-technical system can look like. These people are more than systems analysts and quant jocks. Often they have strong business analysis skills and may reside outside of IT or inside IT but in the wrong role.

For example, at an organization I have worked with in the past, the head of architecture, who has this capacity to easily dive into business and technology details and develop new solutions, came from the lower-level programming ranks. He was unnoticed by others until managers began to probe his skills and passions more deeply and moved him into his new role. You have to find them where they aren't.

To leverage unstructured data and enterprise 2.0 approaches, firms may need to adopt less hierarchical approaches to selecting and managing BI solutions, adopting a wider variety of niche tools. Firm culture must be consistent with the nature of the information within the overall BI solution [1]. Firms that remain committed to involving more users in effective use of the BI solutions must avoid the status quo techniques the BI segment has offered us so far. Changing firm culture and how it handles information will not be easy and will grow more complex as a project than deploying the technology.

If I were a product manager for one of the top BI vendors (Business Objects, Cognos, Microsoft, SAP, and Oracle), here's what I'd be thinking about:

• Developing a strong CEO and C-level change management service offering around improving decision-making processes and addressing the facilitating factors for BI. I would use this strategic consulting service as a means of helping firms invest wisely in a BI solution. This is a difficult sales job, and virtually all vendors are not ideally suited for this task. Thus, I would be looking for consulting partnerships.

• Encouraging bottom-up, enterprise 2.0 approaches within my clients and altering my product development plans accordingly, as these approaches may represent new licensing opportunities. Become an expert in these more tacit, qualitative, and social approaches to BI. Enterprise 2.0 may turn out to be just another business fad, but it doesn't have to be. Enterprise 2.0 approaches contain assumptions about new ways of interacting with business intelligence that firms should carefully consider.

• Shifting the business model from a highly leveraged one that requires expensive seat licenses to one that provides a mix of lower price points. For most BI vendors, this just isn't in their DNA, but our survey respondents have noted BI solutions' high price. While the dominant mode is to have a few BI platforms in place, it is time to think about a modular flotilla of point solutions better tailored to smaller workgroups.

• Investing more resources into the visual layer and incorporating design concepts that actually enhance user's cognitive performance with the tools [2]. Nearly all BI solutions have been built without the benefit of deeper usability planning and research into the psychology of decision making. This is another area, I believe, of potential growth in the BI market. Some industries, such as the defense industry, have taken a serious interest in the psychological validity of computer interfaces -- and for good reason. Firms can start to do the same.

• Reducing overall product cost to customers. This will require diversifying the product offerings so that vendors have a larger array of lower-cost niche products, giving buying firms more lower-priced choices. Again, this is normally not in the DNA of software vendors who seek larger licenses at higher per-seat prices.

When the Internet collided with the BI solutions market in the late 1990s, my sense then was "old wine in new skins." Vendors that could quickly provide a Web window into their fat-client software did well. And that's precisely what vendors did. The collision breathed a bit of new life into the tools. Many of us were optimistic about widespread user adoption of the tools, which, as this recent survey points out, didn't quite happen. As Web 2.0 collides with BI solutions, "RV parked in a cul-de-sac" comes to mind. Something has to give before BI adoption changes.

I believe that BI adoption will change, but only as a result of executives perceiving that competitive advantage will come from improved decision-making capabilities. This requires an admission of guilt and a desire to improve. How firms do this will be idiosyncratic to the firm and will not be easily replicated. Decision making, team building, and culture setting are all intertwined. BI solutions are either a gluing force that holds this together or merely flotsam tossed off from a tangled mess of disjointed human activity. It is time to stop considering human culture and technology as separate entities. IT professionals and the vendor community need to change their approaches and position BI solutions subservient if not invisible when compared with the more difficult, more important, and more human problems firms face.

Over the years, I have observed that firms with exceptional teamwork and decision-making skills are less frequently in need of technology. They seem to either make do with what BI tools they have or implement better the same tools that others try to adopt. Conversely, those firms without great teamwork and in need of decision-making process engineering frequently trip up in the selection and deployment of BI solutions. I believe they suffer from what I call "the sin of objectification." The organizational sins get heaped, unfairly, upon the BI solution. Why? Because the BI solution is a tangible, objective thing. It can be clearly assessed and measured, often critically by others who do not or cannot look inward at organizational ills. When the solution meets up with quirky business processes, especially ones governed by culture, power, change, and other hard-to-discuss human dynamics, it is often the solution that is found lacking due to a poor fit with the culture. Attention is focused on what is tangible, concrete, and distinct from the current culture, usually because it is far easier to do than to face difficult organizational challenges and because IT shops, with their technology-centric views, have been eager to follow suit.

For CEOs who wish to get maximum value from a BI solution, I would start at the top and work down to evaluate overall decision making in the firm -- including organizational values regarding information sharing, continuous improvement, and transparent decision making; incentives and motivation systems regarding decisions; and the actual decision-making processes themselves. If my decision-making capabilities are not good enough, I would then make alterations in the human and organizational systems first, quickly following with the technical implementation of a BI solution.

While BI solutions ought to be able to help firms make faster and better decisions, my assessment of the BI solutions market is that we don't need better tools -- we need better firms.

I welcome your comments on this issue of the Cutter Edge and encourage you to send your insights on the market in general to me at vkellen@cutter.com.

-- Vince Kellen, Senior Consultant, Cutter Consortium

References

1. Kellen, Vince. "Visualization in Search, Recognition, and Inference." Cutter Consortium Business Technology Trends & Impacts Executive Update, Vol. 7, No. 3, 2006.

2. Kellen, Vince. "Web and Enterprise 2.0: A Reasoned Perspective." Cutter Consortium Business Intelligence Executive Report, Vol. 7, No. 5, May 2007.