Intelligence useful for the masses
Manufacturers look for ways to deliver business intelligence tools to casual users
By Bob Violino, contributing editor -- Manufacturing Business Technology, 6/1/2006 12:00:00 AM MDT
The primary technology supporting a product quality improvement program at Briggs & Stratton is not a manufacturing application—it's a business intelligence (BI) platform.
"We use the BI tools to focus on improving product quality," says Grant Felsing, decision-support manager at Briggs & Stratton, a Milwaukee-based manufacturer of air-cooled engines for outdoor power equipment such as lawn mowers. So far, Felsing adds, this BI-driven quality program has saved Briggs & Stratton $3 million—primarily from reductions in warranty claims. He also believes the initiative has improved customer satisfaction and boosted the image of the Briggs & Stratton brand.
These results explain why Briggs & Stratton is among a growing group of manufacturers looking to exploit BI technology throughout the enterprise. BI vendors have been touting the ability of their products to serve broad cross sections of users for years, even coining the term "operational BI" to describe the use of their technology in support of ongoing business processes. Only recently, however, has the technology been available to make BI tools useful to more than a handful of power users specifically trained to make sense of the information stored in large data warehouses or smaller data marts.
Eric Rogge, VP and research director at Ventana Research, San Mateo, Calif., cites the advent of Web-based systems as the prime reason for this shift. "Because of the Web, it's a lot less costly to deploy some form of reports or interactive analytics to just about anyone in an organization," Rogge says. "As a result, almost all BI products now have an operational flavor to them."
Michael Newkirk, manufacturing industry marketing manager for BI vendor SAS, says the thirst for true operational BI tools has ignited a sales explosion.
"Last year, we delivered more than 1,000 BI platforms to customers around the world," Newkirk says. "That's incredible growth. That told us customers recognize the opportunity to capitalize on their ERP investments and are starting to get decision-making tools into the hands of users up and down the line."
More than simple analysis
Industry analysts support vendor claims concerning the new versatility and popularity of BI platforms. In a recent survey of 549 companies conducted by Ventana Research, 403 said they were applying BI to operations. "These technologies aren't just doing strategic analysis anymore," says Rogge. "They can be used to figure out whether a truck at the dock should load more freight, whether salespeople should get more daily sales reports, or whether inventories are at adequate levels."
Armed with more intelligence, Rogge contends, businesses will improve processes for capacity planning, inventory management, cross-selling, and pricing analysis.
While harnessing the Web makes it easier to share data among more diverse groups of users, industry experts say true operational BI is enabled by the broad-based technology platforms that BI vendors have developed over the past several years. Most of these systems have tools capable of pulling data from multiple enterprise systems—e.g., ERP, CRM, and supply chain applications—and converting that data to a common format before placing it in a special data repository, typically called a data warehouse. From there, the data can be used in numerous ways.
Some companies prefer to create smaller warehouses—sometimes called data marts or data stores—that contain slices of data related to a certain aspect of the business, such as sales, customer service, inventory levels, or production performance. Having these smaller data marts available makes it easier for users interested in analyzing or monitoring a specific part of the business to get to the exact data they need.
Integration add-ons
Some BI vendors have even added system-integration capabilities to their platforms so that users can more easily combine bits of data pulled from various business applications to perform more meaningful analysis.
Integration is especially important for manufacturers, many of which have implemented supply chain software, ERP, and sales force automation, explains Paul Hoy, director of manufacturing industry solutions at Cognos, another BI software vendor. "Operational BI has become that bridge that integrates all those systems into one interface, one portal."
Cognos sells a product called Cognos 8 Business Intelligence, which features reporting, analysis, scorecarding, dashboards, business event management, and data integration capabilities. Companies can use the system to create business reports, dashboards, and ad hoc queries. Reports are publishable via email, HTML, PDF, Microsoft Excel, and XML.
Information Builders also is focusing on operational BI with its WebFOCUS product.
"Ninety percent of what we're doing with customers is around these more operational BI applications," says Michael Corcoran, VP of corporate strategy at Information Builders. "BI is moving far beyond traditional trend analysis," he says, adding that typical users of the company's BI software include top executives and nonanalytical staffers such as call-center staff, sales reps, and warehouse personnel.
"Years ago we never would have thought of these people as BI users," Corcoran says. Operational BI users today are "not concerned about trend analysis and long-term views of the business," he adds. "They're more concerned about what's going on at the point of impact."
Custom views
In September 2005, Business Objects launched a new version of its BI platform, called BusinessObjects XI Release 2. The system has capabilities for performance management, reporting, query & analysis, and data integration. Portal integration kits enable organizations to speed the deployment of BI content across the organization and to customers, partners, and suppliers. BusinessObjects Live Office XI integrates BI with the Microsoft Office environment to give users an easy way to use corporate data within PowerPoint, Excel, and Word documents.
The system accommodates many different types of users, says Steve Wooledge, product marketing manager at Business Objects. "Users want to access and analyze information in different ways," Wooledge says. "We understand that and have developed tools and applications that acknowledge a user and provide more or less functionality depending on their role. For example, an executive might want to work with dashboards, while a frontline worker might want to receive personalized reports via email."
Data integration, along with strong analytics, are key elements of the BI Enterprise Server platform system from SAS. "These are high-level tools that aggregate data into data warehouses, and then apply analytics to analyze the data," Newkirk says. "BI doesn't do a whole lot of good unless you can do those things."
User hierarchy
Briggs & Stratton adopted the SAS Enterprise BI Server in 2004. For its product quality program, the Briggs & Stratton IT team developed a system for tracking historical information and monitoring product quality trends, facilities operations, and failure rates for each of the company's engine series.
The system automatically alerts managers when any of these metrics indicate a potential quality problem is looming, allowing them to address the issue before it affects the product.
The Briggs & Stratton manufacturing team identified a potentially costly quality issue soon after the SAS platform was installed.
"Identifying that one problem at such an early stage in production may have saved us more than $1 million alone, and that's just the tactical savings," Felsing recalls. "Without SAS, our managers wouldn't have been able to pinpoint the problem for at least four more months."
Manufacturing managers also use information culled from the BI platform to match production schedules to actual customer demand. At a higher level of the organization, operational managers rely on the BI system to understand how different products are selling in different parts of the country, as well as which retail customers are selling—or not selling—specific products over a given time period. And even higher up the chain, corporate executives receive regular scorecards that offer a broad view of how the entire company is performing.
While BI tools can boost sales by, among other things, improving a company's ability to forecast demand, Felsing argues the tools will pay the biggest dividends if they are first used to improve internal business processes. "You have to look inwardly, to turn the BI lens on your processes to make them more efficient," before focusing on efforts such as increasing sales, he says.
Buckman Laboratories is relying on Information Builders' WebFOCUS platform to improve processes. The Memphis, Tenn.-based specialty chemicals supplier deployed the platform in 2005, hoping to give BI capabilities to a broad range of users at the strategic, tactical, and operational levels.
About 1,000 Buckman employees, primarily in marketing and sales, use the software to analyze information such as sales reports, says Mike Anderson, director of information systems.
Anderson also says it's too soon to report tangible benefits from the implementation, but he expects BI to play a significant role in future supply chain improvement and financial reporting initiatives at the company.
Look for the move toward operational BI to continue.
"Companies are looking to BI to help them make better, timelier business decisions," says Keith Gile, principal analyst at Forrester Research, Cambridge, Mass. "BI can be of huge value to [all] the decision makers within a company."
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