BI on a Budget

You don't need new analytic tools to gain insight into your business. Here's how to make the most of what you've got.

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Those efforts paid off before a single new report was created. The business saved on software support and licensing costs, and the simplified tools portfolio made user training easier.

Standardizing on a single set of tools also made it easier for different groups to share and reuse models. Before, for example, the sales and finance groups had separate profitability models that they had created using different tools. "If they got different results, you'd spend time trying to rationalize why that was," Abbattista says. Now different units can feel confident that they're comparing apples to apples.

2. Let Business Take the Driver's Seat

It's more important than ever for companies to make sure that BI technology is being applied to solve the right business problems. IT organizations still fall into the trap of putting their technology out front rather than creating models that respond to changing business needs, says Millman.

The key is to work with the business before developing new information models. "Start with a clear vision of how information will generate value for the organization," Millman says. "Think about what business interventions you hope to derive from BI tools. Understand where the business benefit is going to come from, then configure the tools and processes."

At Allstate, two areas of focus are managing loss expense ratios and measuring the effectiveness of the call center. "We've taken experts in the tools and methods and put them together with the business people to find these high-value targets," says Abbattista.

The temptation in larger organizations is to try to do too many things with BI, he observes. Having fewer tools helps with that problem, but management also needs to prioritize what is most important.

"These times have been good because they've brought focus on measuring fewer things well," says Abbattista. At the highest level of the business, Allstate's management is watching 10 or 12 different metrics, he says. While business intelligence tools used by the business units include a wider range of metrics, they are all designed to support the upstream metrics that management is watching.

3. Use New Data Models for New Markets

Right now, says Gartner Inc. analyst Bill Hostmann, "there's a big strategy change in many organizations from high-value product offerings to low-cost offerings." But businesses that can't compete in the low-cost market must figure out a way to move up the value chain -- and they're using BI tools to get there.

Which is what Creativity did. To combat the commoditization trend in its core markets, it used the Cognos 8 BI suite to identify and develop high-value products that couldn't be easily commoditized by its low-cost competitors.

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