Standardizing on toolsets can reduce hard-dollar information costs

Rarely is too much intelligence considered a problem. But according to Ventana Research, a Belmont, Calif.-based performance management and consulting firm, many companies do, in fact, have too many tools for gathering business intelligence (BI) and too many tools end up compromising the goal of getting good information.

"We're working with a Fortune 350 manufacturer with 10 or 11 divisions and at least 20 tools and applications that provide information in forms, reports, and metrics [using common functionality]," says Mark Smith, Ventana's CEO and senior VP of research. The problem, he maintains, is it's almost impossible to get a consistent set of facts concerning the status of the enterprise.

Worst-case scenarios for too many tools include slow decisions, bad decisions, or no decisions.

Ventana says the cost of multiple tools includes those that can be calculated, but more important, those that can't.

Most significant in terms of impact on performance—hence the bottom line—are costs associated with these danger zones:

• Incompatible versions of the "truth"
• Restrictions on total visibility of operations
• Failed performance management initiatives.

CIOs are well advised, says Smith, to reduce the number of BI tools they use. Standardization, however, can be thorny, particularly due to resistance to greater cross-functional and business-unit transparency, and end-user adoption.