Austrian economist Friedrich Hayek described the Business Intelligence dilemma best, even though he probably never knew of the existence of BI.
In his scholarly article The Use of Knowledge in Society written in 1945, Hayek argued that a centrally planned economy couldn’t work because the central planners themselves only have a limited amount of knowledge of the market. However, the millions of individual actors in the market, with their unique, localized knowledge, combine that knowledge to make much more efficient use of economic resources than central planners could possibly dictate with their limited knowledge.
In other words, we trust the people who are doing the work to know how best to do the work, rather than rely on the limited knowledge of the leaders to tell them how to do their work.
This has been the dilemma of business intelligence efforts for decades. Most data visualization tools within traditional business intelligence platforms have fallen short of meeting end users’ needs. They have limited visualization capabilities, and have made collaboration and publication of usable reports to the people that need them cumbersome at best. In fact, Gartner has reported that less than 3% of potential end-users at organizations that have adopted one of the major analytics platforms actually use these tools. That’s a problem.
But that’s all changing thanks to the self-service BI revolution.
Self-Service BI to the Rescue: Empowering End-Users with Data
The purpose of business intelligence, analytics and data visualization tools has always been to empower business users to make better decisions by providing them with actionable insights into their data. In fact, most of the current BI projects are driven and funded by the lines of business, not the IT department.
The complexity, and in most cases the required IT background needed to create reports using traditional BI platforms, have been a stumbling block to end users. So what have end-users done instead? They’ve relied on their favorite fallback solution, what I call the ultimate self-service analytics tool, Excel. Users would get their reports from the traditional BI tools and send the data to Excel, where they would perform ad-hoc analysis, create pivot tables, massage the data, and publish their own management reports. But using Excel comes with its own hazards: data manipulation, no single version of the truth, and inaccuracies.
Today Self service BI is finally challenging these shortcomings by giving the end user an approach to easily access and work with information with minimal IT involvement. Tools such as Qlikview, Tableau and SAP Lumira, to name a few, are giving end-users access to easy-to-use self-service data analysis and visualization capabilities so they can get the data they need to do their jobs.
Four Factors Driving Self-Service BI Adoption
Though self-service analytical tools have been available for about 5 years now, why does adoption seem to be gaining momentum right now? Here are four reasons:
1. Big Data
The explosive growth in Big Data has made more data available to organizations than they know what to do with. Firms have been collecting data on their customers, vendors, operational processes, social media, and from the exponentially growing number of network connected devices – and now they need to do something with it. At the same time, end-users are demanding access to the data they know is being collected.
2. Advances in Technology
This is an obvious, but no less exciting, factor contributing to self-service BI growth. In recent years the large BI vendors, such as SAP with their Lumira product, as well as new market entrants like Qlikview or Tableau, have developed new visualization technologies that allow end users to easily control data. Business users can integrate data sources, perform transformations, analyze the data and create the visualizations they need.
3. Business Agility
We’ve discussed the use of agile in business previously. The increasing speed with which we have to make decisions today demands that managers on the front lines have access to the analytical capabilities to make decisions on the fly.
An example of this is the self-organization trend in business modeled on how Navy SEALS make decisions in the field. Self-service BI tools allow self-organizing teams to be empowered to make decisions without having to wait for IT to create the reports they need.
Empowering a National Health Club
Let’s make self-service BI a little more concrete with a recent client example. We were working with a national chain of health clubs that had previously made a significant investment in a large, traditional business intelligence platform.
We discovered that individual regions and locations that needed to run marketing campaigns to increase membership and decrease client attrition, would take the reports and send them to Excel spreadsheets or even Access databases to perform their own analytics and visualizations.
We set up an initial proof of concept to show them some of the self-service tools that were available, and as a result they were able to run the types of analyses and data visualizations they needed to improve their marketing results.
The Future of Self-Service BI
So what’s the future of self-service BI? We will hopefully be seeing exciting enhancements and new developments in two areas: mobility and alerts. With 42% of American adults owning a tablet computer, and 90% who own a cell phone, becoming mobile-compliant is a must. We expect to see major enhancements in current BI mobile options, ranging from ease of use and new visualization capabilities to better ways to efficiently navigate through the data.
In order to become really valuable, BI tools must also become alert-based. Just as you can set automatic alerts when your bank balance falls below a certain threshold, BI tools will eventually allow end-users to set alerts for important data points. For example, if inventory runs low on a certain item for your e-commerce website, your iWatch will alert you so you can avert a disastrous shortage. Or you could set an alert when your social media sentiment analysis suddenly turns negative.
What’s Next For Your Company?
If you want to start a self-service analytics initiative at your company, I recommend the following steps that look into three important aspects to ensure success: People, Processes and Technology.
- People: The right combination of business users and IT personnel is a must. Business users acting as subject matter experts and IT as enablers to ensure environment efficiency.
- Processes: Narrow down your business case. If the project is for marketing, do you need to perform segmentation analysis? Feasibility analysis? Campaign management? If it’s for finance, what kind of management reports do you need to create? What KPIs do you want to track? What kind of data is needed, and how you can ensure it’s relevant?
- Technology: Build a Proof of Concept. If you’re working with a 3rd party provider they might recommend a solution based on what you currently have, or show you what tools are available through a POC .
Whatever you do, realize that your company can only make the best decisions when your people are empowered to make those decisions backed by accurate real-time data. Data they can analyze, visualize, export and play with it. For that, you need self-service BI tools.
Learn more about Softtek's Business Intelligence and Analytical Services, and our Nearshore SAP Business Intelligence integration services.
