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"The SAP BusinessObjects portfolio provides comprehensive
solutions that can empower you to optimize your business performance. These solutions can
help you define your business strategy, close the gap between strategy and execution, and
balance risk and profitability."
Six Mistakes Companies Are Making Today and How You Can Avoid Them
is also known as:
Business Intelligence BI
Business Intelligence Software
SAP Business Intelligence
Business Intelligence Reporting Tool
Business Intelligence Capabilities
Business Intelligence Data Management
Complete Business Intelligence Solution
Improve Business Intelligence,
What is BI,
Scalable Business Intelligence,
Set Business Intelligence,
Comprehensive Business Intelligence,
Comprehensive Business Intelligence Functionalities,
Set BI Solutions,
BI Technology Solutions,
BI KPI Performance,
BI Tools White Paper,
Corporate Performance Management.
When the economy slows, many businesses react
by retrenching and cutting costs in order to weather
the downturn. While such cost reduction is important,
often overlook equally critical strategic
decisions - opportunities to use valuable business
information to strengthen product and service offerings
and emerge ahead of the competition.
"The reality is that you can derive added
value from your existing information,"
explains Don Tapscott, an internationally
renowned author and authority on the
strategic value and impact of information
technology. "Once you can have
sensible discussions about your data,
you can leverage it to make better
decisions and achieve sustainability
and higher profits."
Organizations need technology that
can unlock the value of information.
Information can drive new insights to
help transform and significantly improve
the business, especially critical in an
uncertain economy. According to
Gartner, "The economic crisis will reveal
which enterprises have the information
and tools to support management
decisions and which do not."
This paper highlights common mistakes
companies make in a down economy
and discusses how organizations can
use business intelligence to avoid them.
Use the self-assessment questionnaire
at the end of this paper to determine
the level of business intelligence
opportunity across your organization.
When demand slows, the last thing you
want to do is to take your customer
base for granted by assuming existing
customers will remain loyal through tough
economic times. Instead, customers
may be faced with their own financial
difficulties or could be lured away by
incentives from the competition. Staying
in tune with the needs of your customers
and reacting appropriately can help
shore up loyalty and maintain sales.
You need a simple and effective way
to identify top customers based on
profitability, size, or potential. But if
customer and sales data is located in
multiple software applications, it could
be difficult to access the information and
build an overall picture needed for valuable
insight into customer behaviors.
According to a recent survey of CIO s and
IT managers conducted by Information
Age, business intelligence tools can help.
Most of the 350 respondents believe
business intelligence could significantly
improve marketing analytics - that is,
how you evaluate campaign, product,
and customer performance. Additionally,
respondents feel business intelligence
is particularly well suited for robust
profitability analysis, helping you identify
the most profitable customers and
You can use data integration and
cleansing tools to bring together information
from disparate sources. Dashboards
and visualization tools help make
data accessible, providing visibility into
customer trends. What can you do with
business intelligence tools like these?
As an example, for each major customer
or customer segment, you can analyze
multiple scenarios to find an approach
that builds on existing relationships and
increases your share of each customer's
wallet. You might decide to extend credit
or develop creative payment plans for
your most important customers. Or
analyze customer satisfaction scores
to identify areas where improvement
is needed, such as product quality or
customer service - ensuring that profitable
customers stay happy and loyal.
Even with limited investment funds, you
still have to make fact-based decisions
about short- and long-term opportunities
to grow top-line revenues - whether
you're trying to expand into new markets
or extend a successful product line.
Many great brands were launched during
recessionary times and yet able to
capitalize on unique market opportunities.
To invest in and seize market opportunities
with confidence, you need a
solution that helps you see trends and
variances, analyze scenarios, and select
the right combination of initiatives to
maximize your returns.
A complete business intelligence solution supports the entire
range of enterprise reporting - periodic, highly detailed
reports that give insight into overall business performance
and provide increased reporting transparency for all stakeholders.
The result is increased trust and stronger collaboration
at all levels, inside and outside the business.
But if you're hampered by difficult-to-use
analytic tools that limit your ability to
perform in-depth market analysis, your
company may be slow to recognize or
react to opportunities. In fact, according
to a recent Gartner report, "Through
2012, more than 35% of the top 5,000
global companies will fail to make
insightful decisions about significant
changes in their business and markets
due to underinvestment in their information
infrastructure and business user
tools." Don't let this happen to you.
To inform the right decisions, you need
simple, intuitive ad hoc reporting and
analysis. A business intelligence solution
should support interactive exploration
across multiple dimensions of your
business and let you create queries
using business-friendly language.
What-if analysis allows you to model
the operational and financial impact of
multiple scenarios on revenue, costs,
and cash flow - to understand the results
of each market opportunity before you
act on it. Layer on risk assessment to
determine the range of potential outcomes
for each opportunity and add
economic analysis to select and prioritize
promising scenarios. The result?
You have the hard facts to back up the
investment decisions that drive sales,
cash flow, and operational efficiency.
To keep the cost of delivering goods
and services in line, you must continually
find ways to reduce waste and
eliminate inefficiencies. If operational
wastefulness persists, you can lose
control of your cost structures - and
that puts pressure on your gross margins.
Economic woes and restricted
cash flows are forcing companies to
analyze cost structures by delving
deeper into the information already
at their fingertips. Because of this,
analysts point to a rising interest in
business intelligence software.
An integrated business intelligence
solution that generates timely and
accurate data puts you in a position
to identify - and quickly address -
inefficiencies. Dashboards can deliver
immediate feedback on administrative
waste and unnecessary overtime. Use
analytics to monitor manufacturing
defects, maintenance costs, and inventory
levels; then track progress to
minimize rework and rationalize SKUs.
According to David Thomson, author
of the best-selling book Blueprint to
a Billion: 7 Essentials to Achieve Exponential
Growth, you may need to perform
a competitive analysis to determine
how your gross margins compare to
industry averages. "If you find that
your product costs are too high, you'll
need the ability to further investigate
costs throughout the supply chain and
seek areas to optimize systems and
processes," notes Thomson.
Even if your gross margins are better than
average, expenses may be high. For
example, Thomson found that leading
companies carefully manage expenses
in sales and marketing and R & D to
deliver a consistent cash flow-positive
business across all types of market
cycles. The best-run public companies
that generated the highest market values,
as they grew from US$30 million to a
billion in revenue, typically exceeded
10% earnings-before-interest-and depreciation
(EBITDA) margin. Take
a lesson from the highest-growth companies:
sell value to maximize gross
margins, contain expenses to deliver
a cash flow-positive business, and
reinvest to fuel growth.
Organizations need technology that can unlock the
value of information. Information can drive new insights
to help transform and significantly improve the business,
especially critical in an uncertain economy.
In today's business environment, an
organization needs to address all
outstanding issues - but you must first
identify and prioritize existing problems,
then focus your time and energy on the
most crucial. No organization wants to
wait until a product is drastically behind
schedule or a department significantly
over budget before taking action. However,
if you manually track project or
program status, you risk not only wasting
time and money on an ineffective
approach but also delaying your ability
to identify and then correct problems.
As Thomson notes, "Leaders of exponential
growth companies utilize a systematic
approach to problem solving."
During down market cycles, these
companies identified and eliminated
problems and then worked to optimize
their business. For example, these
companies found ways to streamline
processes, reduce headcount in selective
areas, and invest in systems and
IT infrastructure to improve customer
management or market intelligence.
By generating timely and accurate data
about your business, business intelligence
solutions help identify issues that
fall outside the norm - and signal potential
problems. For example, if your days
sales outstanding (DSO) is increasing,
business intelligence can help pinpoint
whether the cause is a pervasive quality
problem, a one-time delivery issue, or
an administrative glitch such as a wrong
address on an invoice. Once the root
cause of a problem has been identified,
you can take corrective action. Business
intelligence solutions can help monitor
and track results and alert you if problems
recur - such as a process, product,
or action falling outside acceptable
If your corporate goals aren't clearly
defined, communicated, and measured,
you're missing out on an opportunity to
encourage beneficial behaviors. You
may improve performance in one
department or division at the expense
of overall company performance. Gartner
suggests that organizations "show how
performance management efforts will
benefit the enterprise if metrics and
reporting align to corporate goals.
You need a solution that supports
greater alignment, accountability, and
performance at both the individual and
the corporate level. Integrated and
transparent software solutions make it
more likely that employees will trust the
data and understand how daily actions
affect business goals. But companies
often find their strategic initiatives disconnected
from daily operational goals,
leaving employees confused about individual
priorities. By clearly assigning
accountability for goals and timelines,
you can communicate explicit performance
expectations throughout the
company and develop incentives that
drive needed cultural and behavioral
For example, dashboards - integrated
with software, such as Microsoft Office,
that you use every day - help you communicate
metrics, track progress, and
reward success. Dashboards give
immediate performance feedback; you
get the information you need to take
quick and decisive actions to correct
behaviors, rather than having to wait for
quarterly reports to decipher trends.
Visualization tools help your employees
and you focus quickly on high-impact
issues - such as improving customer
service or reducing product defects.
Your entire team can see where data
comes from and how results are calculated,
and can interact with reports -
instilling confidence in the numbers and
encouraging individual and collaborative
actions that benefit the company.
The global economic crisis is leading
business stakeholders and governments
to demand greater transparency into
company finances, operations, decisions,
and core performance metrics. However,
many organizations find that overly
complex reporting hampers their ability
to demonstrate compliance or fiscal
health. According to Gartner analyst
Bill Hostmann, "Most organizations
find they do not have the information,
processes, and tools needed by their
managers to make informed, responsive
decisions. Too many enterprises under invest
in their information infrastructure
and business users tools."
Investors demand that you use complete
information to detect changes, make
timely decisions, and communicate
those changes in strategies. Simply
put, external stakeholders need confidence
in the soundness of your business
strategy and the accuracy of your financial
records. Ask yourself: Could my
enterprise supply my management team
with information regarding a major
business or market change without a
painful, stop-everything project? Can
my company anticipate which customers
will cut back their business and then
adjust its approach to minimize loss?
These kinds of decisions require a wide
range of internal and external information
and analysis to support rapid risk analysis
and contingency planning.
To inform the right decisions, you need simple, intuitive
ad hoc reporting and analysis. A business intelligence
solution should support interactive exploration across
multiple dimensions of your business and let you create
queries using business-friendly language.
Business intelligence solutions make it
easy to share critical business information
across internal business functions
and with external stakeholders such as
customers, suppliers, partners, and
investors. A complete business intelligence
solution supports the entire range
of enterprise reporting - periodic, highly
detailed reports that give insight into
overall business performance and provide
increased reporting transparency for
all stakeholders. The result is increased
trust and stronger collaboration at all
levels, inside and outside the business.
Tough economic conditions require
companies to go beyond slashing costs.
"Now is the time to build efficient,
high-performance organizations based
on a coherent foundation of information,"
concludes Tapscott. "Organizations
must take a global view of critical information
if they wish to move from just
reacting to economic challenges and
instead position themselves for future
Are you making the most of your business
information? Use this quick self assessment
to determine whether a
business intelligence solution can
improve your organization's decision
making and, ultimately, its performance.
- How quickly can your organization
identify top customers based on size,
profitability, and potential for growth?
- We can access this information at
any time for any customer. We can
easily produce a list of top customers
across multiple criteria - for example,
by region or product line.
- We can pull customer information
into a spreadsheet and analyze it
across basic dimensions.
- Even basic customer information is
hard to access - and even harder to
- A senior marketing manager comes
to your CEO with a proposal to
introduce a new product line. How
does your organization determine
whether the plan is feasible?
- We would run a scenario analysis
and project costs, revenues, risks,
and return outcomes across a range
of economic assumptions.
- We would analyze the proposal, but
it would take some effort to pull
together the needed data and perform
the appropriate analysis.
- We are more apt to move forward
based on gut instinct.
- Your company's overtime has
increased by 17% in the last month.
How quickly and easily can your
organization pinpoint the cause and
address the problem?
- My company can identify affected
employees and departments immediately
and go to work solving the
problem within a few days.
- We can gather information, but it
would take a while to compile and
sort the data.
- We wouldn't know where to begin.
- Days sales outstanding has
increased by five days in the last
two months. Can your organization
determine the root cause?
- Yes; within a few days my company
could analyze operational and administrative
components that might be
contributing to the increase.
- Maybe; we could gather information
from separate applications for customer,
financial, and operational data,
but it would require some effort to
analyze the data and identify root
- Doubtful; this would be a difficult
undertaking for my company.
- Customer satisfaction scores have
dropped - specific to your call center.
Your COO wants to review the metrics
in place for call center reps. Can this
information be readily provided?
- Yes; we have a dashboard that tracks
call center employee activity, including
length on call, call resolution, and
- A summary of key metrics is posted
in a common area where each
employee can see it; however, we
don't track metrics on an individual
or departmental basis.
- Unfortunately, we have yet to define
and implement metrics in this area.
- Investors want to see the ROI of
your three largest investments from
last year. How quickly can your
organization give them an accurate
- In about four hours we could provide
a complete report with clear, attractive
visuals that would make it easy
for investors to compare projects on
- Each project has its own spreadsheet;
within a few days we could create a
- One of our financial analysts would
have to go through our financials line
by line to pull out the pertinent information
and create a spreadsheet to
calculate ROI for each investment.
Add up your score:
0 points for each "A" answer
1 point for each "B" answer
2 points for each "C" answer
Layer on risk assessment to determine the range of
potential outcomes for each opportunity and add
economic analysis to select and prioritize promising
scenarios. The result? You have the hard facts to back
up the investment decisions that drive sales, cash flow,
and operational efficiency.
Rank your organization:
0-3: Information is a strategic asset.
Your organization is using business
intelligence to optimize
decision making in key areas.
Look for additional opportunities
to use business intelligence to
uncover value and drive improvements.
planning tools that can help
close the gap between strategy
and execution. Expand the use
of sophisticated what-if analyses
to model the operational and
financial impact of multiple
scenarios on revenue, costs,
and cash flow.
4-8: Take it further. Apply business
intelligence in more areas to
address untapped opportunities
to improve decision making
and performance. Seek out
opportunities to use analytics
and visualization tools to develop
clear insights into specific areas
of your business. Using these
insights, inform the right decisions
to drive operational efficiencies
or grow revenues.
9-12: Information-challenged. Your
organization could experience
significant top-line growth and
bottom-line benefits from using
business intelligence. Begin with
solutions designed to integrate
and cleanse data. Use this single
source of accurate data to create
enterprise reports and fuel ad
hoc reporting and analysis.
SAP® BusinessObjectsTM business
intelligence solutions help simplify
the way businesses use information,
allowing users to access, format,
analyze, navigate, and share information
across the organization.
The solutions enable enterprise
reporting, query and analysis, data
visualization, data integration, and
data management. As a result, organizations
gain better business insight
- improving decision making and
To learn more about SAP
BusinessObjects business intelligence
solutions, visit www.sap.com/solutions/sapbusinessobjects.