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Wayne Eckerson

Welcome to Wayne's World, my blog that illuminates the latest thinking about how to deliver insights from business data and celebrates out-of-the-box thinkers and doers in the business intelligence (BI), performance management and data warehousing (DW) fields. Tune in here if you want to keep abreast of the latest trends, techniques, and technologies in this dynamic industry.

About the author >

Wayne has been a thought leader in the business intelligence field since the early 1990s. He has conducted numerous research studies and is a noted speaker, blogger, and consultant. He is the author of two widely read books: Performance Dashboards: Measuring, Monitoring, and Managing Your Business (2005, 2010) and The Secrets of Analytical Leaders: Insights from Information Insiders (2012).

Wayne is currently director of BI Leadership Research, an education and research service run by TechTarget that provides objective, vendor neutral content to business intelligence (BI) professionals worldwide. Wayne’s consulting company, BI Leader Consulting, provides strategic planning, architectural reviews, internal workshops, and long-term mentoring to both user and vendor organizations. For many years, Wayne served as director of education and research at The Data Warehousing Institute (TDWI) where he oversaw the company’s content and training programs and chaired its BI Executive Summit. He can be reached by email at weckerson@techtarget.com.

Recently in Business Intelligence Category

The origin of every business intelligence (BI) team is quite simple. A company starts doing business and then recognizes it needs to track how it's doing. So business unit heads hire analysts who create a bevy of reports using whatever low-cost tools they can find, usually Excel and Access. Although managers get answers to their questions, it comes at a high cost: analysts spend more time integrating data than analyzing it and create a bevy of redundant data silos that are costly to maintain and prevent executives from getting a single, integrated view of the business. When the CEO can't get an answer to a simple question, such as "How many customers do we have?" or the CFO sees a red balance sheet caused by a proliferation of redundant people and systems, they take action.

Usually, executives decide to move reporting, analysis and data management out of the business units and into a shared corporate service. By centralizing the BI function, executives pull BI-related professionals out of the business units and put them onto an enterprise BI team that is charged with building an enterprise data warehouse and creating all reports and dashboards for business units. The goal of the new group is to align the business with uniform data and deliver cost savings through economies of scale. This reorganization swings the pendulum from a decentralized approach to managing BI to a centralized one.

Problems

All goes well until business units start to grumble that the new corporate BI team isn't meeting their information needs in a timely manner. Whereas in the past, a business person could initiate a project by talking with an analyst in the next cubicle, now she needs to submit a proposal to the corporate BI team, participate in a scoping process, and then wait for the BI team to decide whether or not to do the project. And this is all before a single line of code gets written. Once a project finally starts, the BI team takes longer to build the solution because it's now a step removed from the business unit and doesn't know its processes, data or people well enough to work efficiently or effectively. Given these circumstances, some business unit heads decide they can't wait for corporate BI to meet their needs and hire analysts to build reports for their group, effectively replacing the ones that the corporate BI team "stole" from them.

Finding the Middle

By swinging from one end of the organizational spectrum to the other--from decentralized to centralized--the BI program becomes a bottleneck for getting things done. At this point, some executives throw up their hands and slash the BI budget or outsource it. Yet enlightened executives seek counsel to find a more nuanced way to structure the BI program so that it marries the best of both worlds. In essence, they find a middle ground that I call this a federated BI organizationthat delivers both the nimbleness and agility of a decentralized approach and the standards and consistency of a centralized approach. (See figure below.)

Figure 1. Evolution of BI Organizations
Evolution of BI Teams.jpg

A federated BI team maintains a unified BI architecture that delivers consistent, accurate, timely, and relevant data that makes the CEO happy. And it delivers economies of scale that makes the CFO happy. Moreover, because a federated BI organization embeds BI professionals in the divisions, it delivers BI solutions quickly, which makes business unit heads happy. Finally, through cross-training and support provided by collocated BI professionals, business analysts finally become proficient with self-service BI tools, which makes them happy.

So there is a lot to like with a federated BI organization, and very little to dislike. In essence, this approach creates a common charter that impels the business and IT to collaborate at a deep and more productive level. The only real challenge is managing the web of matrixed relationships and co-managed teams that maintain the proper balance between business and IT. We'll discuss these relationships in a future blog post.


Posted October 17, 2013 10:39 AM
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I am immersing myself in the world of location intelligence this week, attending ESRI's annual user conference in San Diego. Here's an eye opener: there are 15,000 people attending this event!

Location intelligence, also known as spatial analytics, creates maps that enable users to view the relationship of objects in space and perform a variety of spatial calculations, such as, "How long will it take to drive from Detroit to Cleveland?" or "What percentage of high income customers are located within a 15 minute drive of this store?" Or "What's my risk exposure to a hurricane that plows through Dade County, Florida?"

Parallel Worlds

Like business intelligence, location intelligence supports analysis and decision making. But for the past 20 years ago, these two data-centric disciplines have forged independent, but parallel paths. Only now are they beginning to converge.

After my presentation here, one attendee asked, "Why hasn't location intelligence taken off in the business intelligence community?" My first response was that a majority of BI shops have been consumed trying to get adoption for basic reporting and analysis applications and only now are ready to incorporate new capabilities, such as location intelligence, predictive analytics, and unstructured data.

But later I realized that the BI community has already embraced location intelligence, at least the mapping part of it. During the past 10 years, most BI professionals have spent significant time learning how to display the shape and content of data in visual form, using charts and graphics, including maps. Meanwhile, BI vendors have invested heavily in beefing up the visualization capabilities of their tools and adding new charting components, including maps. To BI professionals, maps are now an integral charting component of any BI portfolio.

Spatial Analysis Via GIS

But location intelligence is more than just a map with dots on it. Location intelligence is a full-fledged analytical system. These so-called geographical information systems, or GIS, specialize in storing and manipulating spatial data, which consists of points, lines, and polygons plotted as coordinates in space. Each spatial object can be imbued with various properties or rules that govern its behavior.

For example, a road (i.e., a line) has a surface condition and a speed limit, and the only points that can be located in the middle of the road are traffic lights. Spatial engines can then run complex calculations against coordinate data to determine relationships among spatial objects, such as the driving distance between two cities or the shadows that a proposed skyscraper casts on surrounding buildings, or RFID tagged products that move beyond a specific area (e.g. geofencing.) In essence, a GIS is an object-oriented analytical system that models things in space.

So without access to a GIS system, analytically-driven organizations miss valuable insights. Until recently, most spatial analysis was conducted by a handful of GIS specialists working in the bowels of a company who imported business data into a GIS system to create spatial models. But now, spatial insights can be delivered to all users via GIS-enabled applications, including BI, ERP, and CRM. And some location intelligence providers, like ESRI, can publish GIS applications to the cloud, allowing users to access interactive maps and spatial applications via Web browsers.

Integration with Business Intelligence

In the BI world, the first step towards converging location and business intelligence is plotting business metrics on a map. Like other types of visualizations, maps bring data to life and make it easier for business users to identify the significant trends and issues contained in most reports and dashboards. But location intelligence goes beyond basic geographical displays; it delivers interactive spatial models that correlate business data on a three-dimensional surface.

For example, BI users might use interactive maps to sift through hundreds of variables to optimize the siting of new stores, dealerships, branch offices, factories, drill heads, pipelines, and so on. Or they could use maps to view how the buying habits and demographics of customers located around stores have changed over time. Facilities managers could use interactive maps to plot the optimal evacuation routes from any point in an office building or estimate the physical and financial impact of a nearby bomb explosion. Insurance agents could use GIS-enabled BI tools to simulate what they would have to pay policy holders based on the wind speed and path of an oncoming hurricane. (See figure 1.)

Figure 1. A Dashboard With Embedded Interactive Map
ins-risk-filter-query-result.png
This dashboard embeds an interactive map that lets users model the risk exposure of simulated hurricanes. Or it can integrate a real-time weather feed and display the physical and financial impact of an actual hurricane.Image courtesy of ESRI.

Finally, the explosion of mobile devices, such as smartphones and tablet computers, places a premium on integrating business and location intelligence. For example, mobile dashboards can notify plant managers about the status of poorly performing machines as they walk a factory floor or alert store managers about stock-outs as they move through the aisles. Mobile dashboards can deliver executives and salespeople a 360-degree view of a customer as they approach a customer site. The use cases are endless, and organizations will discover new ones once they GIS-enable their BI applications.

Integration Options

Integrating BI and GIS applications is not as hard as it once was. GIS vendors, like ESRI, now offer rich REST-based, Web services APIs that developers can use to integrate with other applications. And some, like ESRI, now offer cloud-based GIS services so you don't even need to own a GIS system to create spatial applications.

As a result, BI vendors are integrating greater GIS functionality into their applications. A decade ago, BI vendors delivered static, graphical maps that customers could overlay with dots. Many now embed GIS shape files that enable BI users to plot business data on standard baseline maps that support basic GIS functionality, such as zoom, hover, drill, and synchronized filtering. And a few interface directly with GIS systems, allowing BI report authors to easily add custom maps and more sophisticated GIS functionality to reports and dashboards without having to write code.

Summary. As BI shops seek to infuse reports and dashboards with better visualization and more analytics, it's imperative that they explore the rich opportunities afforded by location intelligence. GIS-enabling a BI tool is a simple way to add more robust analytical capabilities to run-of-the-mill reports and dashboards.


Posted July 25, 2012 8:30 AM
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In the quest to deliver business intelligence (BI) solutions, we often get wrapped up in the technology and lose sight of the end game, which is to help the business make better decisions.

Lately, I've been reading about decision making. One book, "Decide and Deliver: 5 Steps to Breakthrough Performance in Your Organization," is chock full of practical advice about improving decision making in organizations. Written by a trio of Bain consultants, the book, offers some great anecdotes and useful tools for improving your company's decision effectiveness.

One key point is that decision speed and execution are as important as decision quality. The authors quote Bill Graber, a long-time General Electric executive, who describes the source of GE's extraordinary performance during the 1980s and 1990s. "There is this myth that we made better decisions than our competitors. That's just not true. Our decisions probably weren't any better than many other companies. What GE did do was make decisions a lot faster than anybody else, and once we made a decision, we followed through to make sure we delivered the results we were expecting."

The authors say there are four elements to decision effectiveness:


  1. Quality. Good decisions are based on facts, not opinions, and take into account risk. There is also healthy debate among valid alternatives.

  2. Speed. Good decisions are made at the right speed. If made too slowly, the competition gains an advantage. If made too fast, valid alternatives are not explored and wrong decisions are made.

  3. Yield. Yield refers to an organizations' ability to execute decisions. Decisions that don't trickle down to the people that need to carry out the actions don't succeed.

  4. Effort. Effort refers to the "time, trouble, expense, and sheer emotional energy" required to make or execute a decision. Too much effort slows decision making, too little effort results in poor quality decisions.

The authors created a survey instrument to help organizations quantify their capabilities along these four dimensions. They also created a formula to determine an organization's overall decision effectiveness: Quality x Speed x Yield - Effort.

As BI professionals, we need to strive to deliver the "right information to the right people in the right format" - a critical success factor touted in the book. Thus, it's imperative we embrace agile development techniques and operationalize our data flows to ensure timely delivery of information to decision makers so they can not only make the right decision, but do so quicker than the competition.


Posted January 3, 2012 8:37 AM
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Despite all the talk about self-service business intelligence (BI), no one has really delivered a tool that makes it easy for casual users to perform true ad hoc queries. Until now.

Most so-called self-service BI tools are better suited to super users, those tech-savvy business people who gravitate to information technology and become the "go to" people in their departments who create ad hoc reports or analyses for themselves and their colleagues. These tools include semantic layers, lists of data objects that users can drag and drop onto a query panel to generate custom queries, and mashboards, which enable users to drag predefined report parts (e.g., charts, tables, controls) from a widget library onto a dashboard canvas.

Visual discovery tools also provide some measure of ad hoc capabilities to casual users within the context of a published performance dashboard. Performance dashboards enable casual users to drill down on top-level metrics and do some root cause analysis, but not perform unfettered exploration. A well-designed performance dashboard is a sandbox that is large enough to answer 60% to 80% of casual users' questions, yet small enough that they don't get lost.

True Ad Hoc for Casual Users

What about the 20% to 40% of time that casual users want to explore data without guardrails? Today's self-service BI tools are just too difficult for them to use. It's not that executives, managers, and front-line workers are dumb, they simply don't have time to learn how to use self-service BI tools or they forget how to use them since they use the functionality so infrequently. It's a lot easier for a casual user to ask Fred, the super user, to do the analysis for them.

For the past several years, I've argued that the search technology is the only way to empower casual with self-service. My BI Framework 2020 holds a spot for such technology, depicted in the wedge that sits between Business Intelligence and Content Intelligence. (See figure 1.) This technology consists of a Google-like tool that enables casual users to type words into a search box and generate ad hoc queries and reports.

Figure 1. BI Framework 2020
BI Framework 2020.jpg
The intersection of Business Intelligence and Content Intelligence gives casual users the ability to explore unstructured and structured content through a keyword search interface.

Several vendors offer products with these capabilities, including Endeca (Lattitude), SAP BusinessObjects (Explorer), and Information Builders (Magnify). Except for SAP BusinessObjects Explorer, which is less a search engine than a visual slicer/dicer of semantic layer fields and data, none have really caught on, which has puzzled me. My sense is that the market just isn't ready for this capability.

EasyAsk: Natural Language Meets Voice Recognition

I recently met with EasyAsk, which has long offered a BI search tool that uses natural language processing (NLP) to understand the intent and meaning of words that users type into a keyword search box. In the use of NLP, they are fairly unique. Their tool is the search engine for Land's End and about 250 other online retailers, but they also offer the tool in the BI space. They believe market events are converging to finally make BI search a reality, and I think they're right.

For one, IBM Watson, which trumped World Jeopardy champions this year, has demonstrated the power of NLP to correctly interpret complex human language. Second, the advent of Apple's Siri for the iPhone 4s is teaching a generation of consumers about the power of voice recognition as a search engine interface. EasyAsk has long boasted an interface to voice recognition software but is currently building a iPhone application as well.

"Siri is teaching people how to search the right way," says Craig Bassin, CEO of EasyAsk. Instead of typing a single word and getting thousands of results, which is the case with most search engines operate, Siri encourages people to submit requests using English phases and sentences. "The user interface of the future will be a big search box in the middle of the screen or a voice recognition system," says Bassin.

This sentiment was echoed by Tim Leonard, chief technology officer of US Xpress, a nationwide shipping company in a recent conversation that I had with him. "BI is going mobile and soon our users will submit queries verbally, by speaking a request into their phones."

Another factor that will help push BI search to the forefront is the NoSQL movement, which uses search-like storage indexes to bring together structured and unstructured data in one system, designed for information processing, reporting, and analysis. These systems are raising expectations that users should be able query both types of data within a single interface. EasyAsk, which is designed to run against SQL databases and product catalogs, now boasts a connector to Hadoop that bridges the worlds of structured and unstructured data.

Summary

BI search is inevitable. It's the only way to give casual users ad hoc query and exploration capabilities. As voice recognition, natural language processing, and NoSQL databases go mainstream, BI search will surely join them.


Posted December 16, 2011 11:19 AM
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The previous two articles in this series covered the organizational and technical factors required to succeed with advanced analytics. But as with most things in life, the hardest part is getting started. This final article shows how to kickstart an analytics practice and rev it into high gear.

The problem with selling an analytics practice is that most business executives who would support and fund the initiative haven't heard of the term. Some will think it's another IT boondoggle in the making and will politely deny or put off your request. You're caught in the chicken-or-egg riddle: it's hard to sell the value of analytics until you've shown tangible results. But you can't deliver tangible results until an executive buys into the program.

Of course, you may be fortunate to have enlightened executives who intuitively understand the value of analytics and are coming to you to build a practice. That's a nice fairy tale. Even with enlightened executives, you still need to prove the value of the technology and, more importantly, your ability to harness it. Even in a best-case scenario, you get one chance to prove yourself.

So, here are ten steps you can take to jumpstart an analytics practice, whether you are working at the grassroots level or working at the behest of a eager senior executive.

1. Find an Analyst. This seems too obvious to state, but it's hard to do in practice. Good analysts are hard to come by. They combine a unique knowledge of business process, data, and analytical tools. As people, they are critical thinkers who are inquisitive, doggedly persistent, and passionate about what they do. Many analysts have M.B.A. degrees or trained as social scientists, statisticians, or Six Sigma practitioners. Occasionally, you'll be able to elevate a precocious data analyst or BI report developer into the role.

2. Find an Executive. Good sponsors are almost as rare as good analysts. A good sponsor is someone who is willing to test long-held assumptions using data. For instance, event companies mail their brochures 12 weeks before every conference. Why? No one knows; it's the way it's always been done. But maybe they could get a bigger lift from their marketing investments if they mailed the brochures 11 or 13 weeks out, or shifted some of their marketing spend from direct mail to email and social media channels. A good sponsor is willing to test such assumptions.

3. Focus Your Efforts. If you've piqued an executive's interest, then explain what resources you need, if any, to conduct a test. But don't ask for much, because you don't need much to get going. Ideally, you should be able to make do with people and tools you have inhouse. A good analyst can work miracles with Excel and SQL and there are many open source data mining packages on the market today as well as low cost statistical add-ins to Excel and BI tools. Select a project that is interesting enough to be valuable to the company, but small enough to minimize risk.

4. Talk Profits. It's very important to remember that your business sponsor won't trust your computer model. They will go with their gut instinct rather than rely on a mathematical model to make a major decision. They will only trust the model if it shows either tangible lift (i.e., more revenues or profits), or it validates their own experience and knowledge. For example, the head of marketing for an online retailer will trust a market basket model if he realizes that the model has detected purchasing habits of corporate procurement officers who buy office items for new hires.

5. Act on Results. There is no point creating analytical models if the business doesn't act on them. There are many ways to make models actionable. You can present the results to executives whose go-to-market strategies might be shaped by the findings. Or you can embed the models in a weekly churn report distributed to sales people that indicates which customers are likely to attrite in the near future. (See figure 1.) Or you can embed models in operational applications so they are triggered by new events (e.g., a customer transaction) and automatically spit out recommendations (e.g., cross-sell offers.)

Figure 1. An Actionable Report
Part V - Actionable Report.jpg

6. Make it Useful. The models not only should be actionable, they should be proactive. The worst thing you can do is tell a salesperson something they already know. For instance, if the model says, "This customer is likely to churn because they haven't purchased anything in 90 days", a salesperson is likely to say, "Duh, tell me something I don't already know." A better model would be one that detects patterns not immediately obvious to the salesperson. For example, "This customer makes frequent purchases but their overall monthly expenditures have dropped ten percent since the beginning of the year."

7. Consolidate Data. Too often, analysts play the role of IT manager by accessing, moving, and transforming data before they begin analyze it. Although the DW team will never be able to identify and consolidate all the data that analysts might need, it can always do a better job understanding their requirements and making the right data available at the right level of granularity. This might require purchasing demographic data and creating specialized wide, flat tables preferred by modelers. It might also mean supporting specialized analytical functions inside the database that lets the modelers profile, prepare, and model data.

8. Unlock Your Data. Unfortunately, most IT managers don't provide analysts ready access to corporate data for fear that their SQL queries will grind an operational system or data warehouse to a halt. To balance access and performance, IT managers should create an analytical sandbox that enables modelers to upload their own data and mix it with corporate data in the warehouse. These sandboxes can be virtual table partitions inside the data warehouse or dedicated analytical machines that contain a replica of corporate data or an entirely new data set. In either case, the modelers get free and open access to data and IT managers get to worry less about resource contention.

9. Govern Your Data. Because analysts are so versatile with data, they often get pulled in multiple directions. The lowest value-added activity they perform is creating ad hoc queries for business colleagues. This type of work is better left to super users in each department. But to prevent Super Users from generating thousands of duplicate or conflicting reports, the BI team needs to establish a report governance committee that evaluates requests for new reports, maps them to an existing inventory, and decides which ones to build or roll into existing report structures. Ideally, the report governance committee is comprised of Super Users who are already creating most of the reports users use.

10. Centralize Analysts. It's imperative that analysts feel part of a team and not isolated in some departmental silo. An Analytics Center of Excellence can help build camaraderie among analysts, cross train them in different disciplines and business processes, and mentor new analysts. A director of analytics needs to prioritize analytics projects, cultivate an analytics mindset in the corporation, and maintain a close alliance with the data warehousing team. In fact, it's best if the director of analytics also has responsibility for the data warehouse. Ideally, 80% to 90% of analysts are embedded in the departments where they work side by side with business users and the rest reside at corporate headquarters where they focus on cross-departmental initiatives.

Summary

Although some of the steps defined above are clearly for novices, even analytics teams that are more advanced still struggle with many of the items. To succeed with analytics ultimately requires a receptive culture, top-notch people (i.e., analysts), comprehensive and clean data, and the proper tools. Success will not come quickly but takes a sustained effort. But the payoff, when it comes, is usually substantial.


Posted November 21, 2011 7:34 AM
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