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Business Intelligence: Organizational Design for Optimal Business Impact

Originally published July 25, 2011

Many organizations are rethinking their business intelligence (BI) programs these days. Having invested sizable sums in business intelligence/data warehouse (DW) program efforts for years, senior business stakeholders are not often seeing these investments pay off in tangible ways. This has spawned efforts in many organizations to make current BI capabilities more mature to better support improved business results.

In our work as business intelligence consultants, we've seen the many challenges organizations face when they begin the journey to achieve mature BI capabilities. This is due to the fact that mature BI capabilities entail a significant paradigm shift in how information is positioned in the organization.

Most organizations have historically thought of information as a cost center, and have primarily positioned their “decision support” or “management information” efforts toward producing reports or providing individual users with ad hoc reports or data downloads on demand. Business intelligence/data warehousing efforts are often regarded as a new and improved extension of these legacy information models. In a cost center model, there is typically little – if any – understanding of how information is being used by the business. The operating model is generally to have IT fill orders for information based on individual business users’ requests.

Mature business intelligence programs, in contrast, position information as a potential profit center. Information is regarded as a competitive enabler that can support business stakeholders in proactively managing organizational performance to achieve improved business results. Organizations with mature BI capabilities have moved away from the “order taking” model toward identifying new and innovative ways that information can be used in a consistent fashion across the organization to achieve optimal business results.

BI Capabilities and Organizational Design Shifts

To achieve the business benefits associated with this radical shift in how information is regarded by the organization, significant organizational shifts must also occur. Achieving mature business intelligence capabilities demands that key business stakeholders invest time and effort in leading and driving the BI program direction. Examples of organizational design shifts associated with mature BI capabilities are as follows:

Business Executives 
Typically business executives have not spent much mindshare on information needs. Historically their primary role has been to approve budgets for ongoing business information needs, usually aimed at supporting ongoing requests for reporting and data. The need for a significant increase in business executive involvement and leadership is clear as an organization moves toward regarding information as a competitive enabler.

Mature BI programs involve business executives in crafting innovative uses of information that will serve to “move the dial” in supporting improved business performance. Business executives also play the critical role of determining and governing the priorities and direction of business intelligence investments, based on business needs and priorities. This often also includes playing a leadership role in approving changes to key business processes based on new BI capabilities. It also includes involvement in enterprise data governance efforts that are critical to ensuring the quality of data used to develop new, strategically important information capabilities.

Business Management
Business managers have traditionally viewed information as standard reports and ad hoc reporting, or as data downloads needed to resolve a business issue that surfaces that day or that week. Information needs are typically defined one at a time, by individuals, based on recent business events.  Little, if any, thought is typically given to how information ideally would be available, not only to report on and track current business results, but also to optimize business processes, measure business performance, analyze trends, determine the root causes of and act upon issues associated with negative business performance.

As organizations move toward maturing business intelligence capabilities, it is critical that business management engage in redefining how information should be available to key business units and how it should be used to support optimal business decision making to achieve maximum business results. This transition in roles and responsibilities is vital in migrating the organization away from problems associated with BI/DW investments that have often left organizations “data-rich” and “information-poor.”

Other Business Users 
As new information capabilities become available, business users are responsible for using the information in the way it was envisioned to achieve improved results. This requires business change management efforts that help business users migrate away from the “old way” of doing business based on legacy information capabilities (e.g., siloed views of a customer based on brand or line of business), toward the “new way” of doing business based on new BI capabilities (e.g., coordinating across lines of business with a 360-degree customer view). Without changes in how the business uses information, business intelligence cannot make a significant impact to the bottom line.

IT Executives 
IT executives, like business executives, also need to buy into the new information paradigm. This means getting involved in the conversation about the strategic direction of the business and helping to define how information assets can be better leveraged to achieve business results. Typically, mature BI organizations create a partnership between business and IT executives to provide the leadership needed to prioritize and govern the business intelligence program in order to evolve and mature information capabilities.

Business Intelligence/Data Warehousing Technical Team Members  
Assuming that the organizational leadership is in place, BI/DW team members are responsible for utilizing industry best practices to identify, design, and develop new mature BI capabilities.

Bottom Line:
On the Path to BI Maturity, Expect Growing Pains

As the saying goes, “No pain, no gain.”  Organizations that are complacent about their current business intelligence/data warehousing capabilities can continue using dated information paradigms to support information capabilities. Organizations that are committed to advancing BI capabilities, however, must by definition change what they are doing to achieve improved business results. One critical success factor in achieving business intelligence maturity is to evolve and redefine the business and technology organizational model.

  • Nancy WilliamsNancy Williams

    Nancy serves as Vice President for DecisionPath Consulting. Focusing her work on how business intelligence (BI) and data warehousing (DW) can be leveraged to improve business performance, Nancy is a well-known industry educator, author, and practitioner. Nancy’s experience includes more than 25 years of business management and technical experience. She has been involved in numerous consulting engagements, providing expertise in the areas of BI/DW assessments, BI/DW strategy, portfolio development and roadmaps, BI/DW requirements and data modeling, and BI/DW project and program management. Nancy is a regular speaker and keynote presenter at TDWI industry events,  co-hosts the BI impact channel on the BeyeNETWORK, and is co-author of the highly rated book The Profit Impact of Business Intelligence. She received her MBA from the Darden School at the University of Virginia. 

    Editor's Note: Visit Nancy and Steve Williams' BeyeNETWORK Expert Channel for more articles and resources as well as Nancy's blog.

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