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How significant is business intelligence (BI) for enterprises in present day environment?
The Indian business community has been considered laggard in terms of overall information technology (IT) in comparison to its Asian counterparts. Even among the top 1,000 businesses in India, IT adoption has been slower than that in other developing economies. Business Intelligence, as an application, is new to many businesses. And it is only now that databases are swelling with the growing maturity of IT in organizations.

BI applications are significant as they include the activities of online analytical processing (OLAP), report generation, decision support systems (DSS), query and reporting, statistical analysis, forecasting, data warehousing, and data mining.

More specifically, the Indian services industry has matured very rapidly over the past two decades. BI solutions are gaining momentum in service segments such as banking, telecom, insurance, and call centre companies. In fact, the BI solution seems to have gained more acceptances in sectors where customers play a pivotal role in deciding the future of the company.

Many CIOs complain that ERP installations either go over-time or over-budget. Don’t you think this would deter them to move up the value chain towards mature BI solutions?
Not really. It is true that implementation of ERP solutions among various industry segments in India has failed to take off, but there have been success stories as well. In today’s fast-changing environment, managing expenses and justifying returns on investment is one of the greatest challenges facing any organization. While BI systems can significantly enhance decision-making, they represent a major investment and require sound management and evaluation to maximize return on investment (ROI).

In my opinion, the Indian industry is still in the data mining and data warehousing phase, with limited cases of sophisticated applications such as churn and business performance management implemented successfully. The market is expected to take over a year-and-a-half to mature and demand these applications.

What are some of the popular BI tools in use among enterprises?
One of the most popular BI tools is the multi-dimensional analysis software, which are also popularly known as online analytical processing (OLAP) tools. This software gives the end-user an opportunity to look at the data from various angles. Then, there are data mining tools which again is a software that automatically searches for significant patterns or correlations in the data. There are also query tools that allow the user to ask questions about patterns or details in the data.

What are the key issues a CIO has to keep in mind when he is using BI tools for data analysis?
The issue of return on investments derived from the information technology initiatives has always been a contentious issue in enterprises. This problem is aggravated if the solution invested in gives results that are highly intangible—aspects such as impact of new strategies, tactics, and enhanced customer knowledge.

In my opinion, data availability is a key issue here. This is not just a question of data being available all the time, but also of data being captured in time into various systems such as ERP applications. So if you have deployed such systems, ensure its optimal usage first for data capture.

Another issue concerns data cleaning. Once data is captured, it has to be cleaned and transformed into a uniform format before loading into a data warehouse. You need tools, and human expertise to do this. There is also the issue of analysing trends. CIOs need to be careful about jumping to conclusion—one day’s data doesn’t necessarily equal a trend. The challenge for CIOs is to create an enterprise-wide awareness to deduce correct inferences.

What benefits can BI applications and technologies give to an enterprise?
The use of BI helps an enterprise to find out which their top-selling products are, who their most loyal customers are, which businesses are performing the best and which need improvement, the efficacy of their promotional campaigns and how exactly this is reflected in sales.

For pharmaceuticals major Nicholas Piramal Enterprises, investing in a BI solution has meant three things:

1) More informed sales workforce. Territory managers have instant access to not only current data, but data of the last three years as well. This enables them to analyze sales in their territories based on sales persons, areas and products, on the fly, leading to more informed decisions.

2) Better inventory management. Complete visibility of inventory levels has helped in improving the distribution planning.

3. Better management of credit policies and account receivables.

Which market segments offer more potential for BI implementation?
The banking, finance and insurance sector in India is a very potent market for BI solutions. The IT adoption in these verticals has been high and with greater privatization of banks and insurance companies, the market is set to increase. The hospitality and transportation industry has also shown a strong inclination towards these solutions. ITES companies have been the front-runners in the adoption of e-business applications and are expected to leverage the process level information generated from other e-business applications by implementing BI solutions.