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Business Intelligence

Leveraging Business Intelligence

Today’s organisations are leveraging BI in conjunction with CRM and SCM solutions in numerous ways to derive hitherto unseen benefits and business opportunities. by Anil Patrick R.

Telecom and banking were the first industry verticals to experience the benefits that BI brings to the corporate table. They were also the first to experiment with how BI, or rather analytical capabilities in conjunction with CRM solutions can improve customer experience and thereby the business.

Among the first applications in this area were the telecom industry’s BI initiatives to reduce customer churn and the banking sector’s up-sell/cross-sell of financial products. In the case of telecom, the use of BI connected to operational CRM systems helped identify customers who were most likely to shift to another service provider, by analysing the number and nature of grievances registered by users. In the case of banking, practices like householding (Under the householding rules, companies and mutual funds may deliver a single prospectus, annual and semi-annual reports, and proxy and information statements, to investors who reside at the same address) helped reduce operational expenses per customer while analysis of customer data helped them cross-sell or up-sell multiple financial products and services to prospective customers. “Decision makers can discover new customer segments which provide great value to the company and in reality these get missed out because of their small size. Sometimes, an organisation does not want to retain a certain type of customer as it costs more to retain this type of customer than the value provided by them to the company. Customer profiling and segmentation will help to determine the profile of this segment as well,” says Vaibhav Phadnis, Director of Server Business Group, Microsoft India. Integrating applications like CRM or SCM to the BI tool is gaining acceptance with the clear advantages that the latter offers. Says Zoeb Adenwala, Chief of IT, Pidilite Industries, "Since we have integrated our other business processes to the BI tool one of the benefits has been a single window for all data reporting/analysis. Thus reports or figures accessed from anywhere are uniform and provide the same data." Some of the other advantages he feels are the ability to take quick decisions by using slice and dice and drill down functionality. This also allows for better planning and development.

After the BI is over
How are CIOs integrating their CRM/SCM systems to BI?
  • Single window for all Data reporting/ analysis
  • Same figures reported across the company
  • Quick decision making using slice and dice and drill down functionality
  • Exceptions reporting rather than details
  • All back-end systems like ERP, CRM, SCM need to be integrated by ETL methodology
  • Users do not run from pillar to post for any complex requirement/analysis
  • Users handle their day-to-day MIS needs. No IT intervention needed

THE CASE FOR DEDICATED BI SYSTEMS

While the success of these initiatives has resulted in CRM products with analytical capabilities, the case is still strong for a dedicated BI system connected to an operational CRM system—provided the linking is done optimally. This is because the new CRM products still do not match up to a full-fledged BI system’s analytical capabilities—not so far at least.

Another point in favour of a BI-CRM combination is the fact that many organisations already have a CRM solution in place. It makes more sense for such enterprises to leverage existing CRM investments and deploy a full-fledged BI system. This will ensure that data from all the data sources (including the CRM) can be brought under one roof for a better all-round perspective of the business.

For example, consider a bank which tracks the bank balance patterns of employed persons between the age of 25 and 30. Using the BI-CRM combination, it is possible to flag an abnormal situation when the person’s bank balance unexpectedly drops below a certain average threshold. This customer has had a steady balance in his account so far, and this sudden drop in the balance is usually an indicator to an unexpected financial need. This is when the bank can advance a low interest loan at very attractive terms to the customer, using its call centre.

“Using BI tools the intelligence can be built into applications itself as well. Hence a registration form processing application can assign each registration form a customer segment right at the outset. This will help to do personalised communication based on the likes and dislikes of the customer thereby improving customer loyalty and reducing churn,” says Phadnis.

GAINS ALL AROUND

Most companies can have only a rough idea of the productivity gains that can be derived from SCM as part of the entire set-up. No manufacturing company can get a 360-degree view of its operations if its SCM is a stand-alone system

The advantages of this approach are two-fold. First, the customer feels that the bank has come to his assistance in a time of need, increasing loyalty. The second is that the bank is able to gain new business from an existing customer, thus leveraging the relationship further. Similar approaches are being used by the telecom industry as well to promote its business and identify unexplored opportunities.

This powerful querying and reporting functionality that the BI-CRM approach brings—when implemented right—is yet unparalleled by any other approach available so far.

THE SMARTER SUPPLY CHAIN



Arun Ramachandran
Presales Head
India and SAARC
Sybase

BI has also made inroads in providing a consolidated view of the company including its supply chain. This has helped reduce the traditional limited view of the supply side of operations.

“Most companies can have only a rough idea of the productivity gain that can be derived from SCM as part of the entire setup. No manufacturing company can get a 360-degree view of its operations if the SCM is a stand-alone system,” says Arun Ramachandran, Presales Head, India and SAARC, Sybase.

With this new approach, the BI system also acts as an intermediary between the organisation’s CRM and SCM systems. The consolidated view aside, this approach helps the company manage its supply to match the demands of its customers. It can also help the company tailor product attributes to match changing customer needs.

For example, consider a home appliance manufacturer which is constantly receiving customer feedback on products through its CRM system. While the BI can help business managers evolve a new product line, the SCM will help coordinate with the suppliers to meet the changed production requirements.

Benchmarking BI
Is it possible to benchmark BI? Are there standardised benchmarks?

Yes and no. While there are standardised benchmarks like TPC-H, these are considered outdated by most of the industry. Most vendors have their own benchmarks which are used for reporting and ETL benchmarking.

“Benchmarking BI is about how many users can get onto the system and use it productively. It is about throughput and similar to transactional systems. The only standardised benchmark available now is TPC-H which is outdated,” says Arun Ramachandran, Presales Head, India and SAARC, Sybase. A new standard TPC-DS is expected to roll out this year.

“Although the emphasis is sometimes on TPC-H, it’s not exactly up to the mark. TPC-C is for transaction processing and TPC-H for BI, but I don’t think it is an accurate enough benchmark because the variables in BI are just too many,” says Deepak Ramanathan, Solutions Architect, Business Intelligence, SAS India.

SCI'S STILL EVOLVING



Deepak Ramanathan
Solutions Architect
Business Intelligence
SAS India

The benefits of SCM-BI aside, there are still glitches to be ironed out. Supply chain intelligence (SCI) is still hounded by problems such as lack of timely analysis, incompatibility and the resulting data definition variations between systems.

The foremost concern in SCI is about how timely the analysis from the data warehouse is. Most data warehouses used in the manufacturing industry have low volumes of data and transactions. This is why it is common to see SCI analysis being done on a weekly basis. This might be too infrequent an interval for the SCI system to deliver optimal performance. However, this issue can be resolved by doing the analysis on a daily basis.

The next issue is that traditional BI-SCM combinations use a best-of-breed approach. Most of these implementations use different tools which may not communicate with each other. “Suppose an organisation buys a new product for the supply chain. Forecasting or optimisation is already being performed on this system. When the new tool comes in, there is no way to figure out how many tools are going to be affected by it during reporting. This is because all the tools are just passing on the outputs without talking to each other. For supply chain intelligence to work, all these tools have to communicate using a metadata layer,” says Deepak Ramanathan, Solutions Architect, Business Intelligence, SAS India.

Another approach similar to the metadata layer is the semantic layer approach to tide over such issues. The metadata layer helps the reporting tool understand how a particular column has changed over time. This common layer approach is claimed to help not only in maintenance from an IT perspective, but also from a business perspective in terms of helping find the lineage of data.

— with inputs from Shivani Shinde
anilpatrick@networkmagazineindia.com

 
     
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