Webinar: Enterprise BI - Increase Your Competitive Advantage

Enterprise BI – Increase Your Competitive

Advantage

Oliver Weigel - Global CoE for Analytics

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© 2011 SAP AG. All rights reserved. 2

Agenda

Executive Summary

Background

Impact of Enterprise-wide BI

Components of an Enterprise BI Strategy

Enterprise BI value

Business Intelligence Benchmarking

Summary


Agenda

Executive Summary

Background



Enterprise BI value


Summary


Enterprise BI enables your business to transform today’s

challenges in opportunities

Double revenue growth: companies undertaking higher strategic & informational projects

Spend less on BI through BI standardization and installation of a formal BI competency center

Spend even less on BI through a higher percentage of business users proficient in creating active reports

Have greater ability to create actionable insights through enhanced information access

Have higher information access through higher usage of BI across business processes

Benefits from

an Enterprise

BI are too

large

to ignore

Cost of Information evaporated, asking for standardized BI to disclose information

Difficult economy demands coordinated actions between strategy and execution

Unlock value of your existing transactional systems

Integrate information and business partners for improved business insights and optimal business actions

Why now?


Agenda

Executive Summary

Background



Enterprise BI value & benefits


Summary


Increased Adoption

for Business Users

Analytics,

Reinvented !

Standardized

BI Model

Organizations spending on

user adoption rather than

technical implementation.

Mobile BI in the spotlight.

Organizations moving to a

flexible enterprise-wide

architecture at a lesser cost.

Further adoption of

advanced and predictive

analytics. In-memory

analytics drawing more

attention.

More Pressure on Organizations for

Enhancing Information

Access

Reducing Information

Delivery Costs

Powerful trends are driving change in Business

Intelligence


Lessons from the Recent Past Wrenching Change, Happening in Moments

Source: International Monetary Fund


Enterprise BI

Different Needs Require Different Experience

Executive

Individual Contributor

Middle Management

Business Analyst

Enterprise BI

Placeholder

text

Placeholder

text

Placeholder

text

Analyze regional goals and

strategic KPIs

Analyze information to measure

the progress toward set goals and

KPIs.

Leverage actual and historical data

to create detailed planning scenarios

Leverage data and tools to provide

answers ad-hoc to the management

and executive team so that

decisions are based on solid

information.

Oversee cross department / line of

business performance and evaluate

different scenarios for planning and

forecasting purposes.

Combine and review analytics with

company strategies and goals to

continuously improve company

performance

Review regular account

statements to control customer

invoices and vendor accounts.

Fulfill management requests for

information as simply as

possible.


"The lack of a clear, well developed and articulated BI Strategy along with appropriate executive sponsorship are among the top reasons why BI initiatives do not achieve their potential or fail outright.―

Bill Hostmann, VP Distinguished Analyst, Gartner

Enterprise BI – Strategy is critical for success


Today’s business challenges require a solid BI deploy-

ment, to enable agile and accurate business decisions

Effective decisions with the data

stored in the transactional systems,

not rely on gut-feel…

Get key business information into

the hands of employees so that they

can impact corporate performance…

Leverage the information I have to

create new business opportunities…

Efficiently fulfill all information needs

from the various ERP, CRM and

other back-end applications..

Reduce the complexity and costs of

my current business intelligence

infrastructure…

Enhance information access

and dissemination

Include BI in all relevant

business processes

Improve turnaround time for

business decisions

Reduce costs of overall

information architecture

Increase BI delivery efficiency


Enterprise BI – Handle technology and business

changes

ERP

Processes

Data In

Analytics

CRM PLM BI

DW

Planning

Collaboration

Mobility

Systems of

Record

Data Out

Systems of

Engagement

Transactional

Database

Data

Warehouse

Data Mart ETL

Social Hadoop Hana


Agenda

Executive Summary

Background



Enterprise BI value


Summary


Best run companies use High-Impact Strategies for BI to

build and sustain their competitive advantage

Reduce Costs

Align BI Strategy to Overall Business Strategy 1

Embed BI in all Business Processes 2

Improve Business Insight 3

Optimize BI Expenditures 4

Organize for Responsiveness, Scale & Optimal Support 5

Drive Revenue


Align BI strategy with overall business strategy

How to do This?

Identify information needed to drive

growth "Turn data into dollars"

Engage business stakeholders in

formulating best practices

Define landscape requirements in

light of growth and acquisition goals

Adopt a business centric and

enterprise wide BI architecture

What Are Best Practices & Their Impact?

1

―Companies that adopt a business centric and enterprise wide BI

architecture, undertake 8% more strategic and informational projects.‖

59.7 64.5 64.4

Low Medium High

Strategic & Informational Projects As % of Total Projects

+8%

Source: SAP BI Benchmarking 2011, based on data from over 400 SAP customers and non customers across over 25 industries

5 2 3 4 1

―Companies that undertake higher strategic & informational projects have

on an average, double the revenue growth than lagging peers‖

+1.75x

2.9 5.3

8.0

Low Meduim High

Revenue Growth (%)


Embed BI in all business processes

How to do This?

Provide BI support for relevant business

processes

Align operational KPIs with LoB

business drivers and goals

Allow tracking of operational

performance against LoB goals


2

―Companies with flexible information systems have 24% higher usage of

business intelligence to manage in their business processes.‖

2.3 2.8 2.9

Low Medium High

Usage of BI/Analytics to Manage Business Processes (1=low, 5=high)

+24%


5 2 3 4 1

―Companies that have higher usage of BI to manage business processes,

have on average 63% higher information access through BI tools.‖

24.3 33.0 39.7

Low Medium High

Percentage of Employees Receiving Analytical Info From BI Tools

+63%


Improve business insight

How to do This?

Establish business user access to

operational data, at all levels

Provide ability to anticipate future trends

Enable real-time analysis

Provide ability to analyze complex data

for strategic decision making

Enhance self service and usability at all

levels


3

―Companies that have enhanced business user access to information, have

10% more timely information to create actionable insights.‖

+10%


Note* – Self service is measured by ‗Percentage of Active Reports Created by Business (as opposed to by IT)‘

5 2 3 4 1

2.5 2.6 2.8

Low Medium High

Availability of Real-time/Predictive Insights into Business (1=low, 5=high)

―Companies with easy to use self service analysis tools have 38% more

reports created directly by the business (not by IT).‖

33.3 38.0 46.0

Low Medium High

Self Service Levels

+38%


Optimize BI expenditures

How to do This?

Standardize BI approach across the

enterprise

Rationalize and consolidate existing BI

landscape and tools


4

―Companies that consolidate multiple BI tools into a standardized and

enterprise-wide portfolio, have 36% lower BI expenditures.‖

0.084 0.055 0.054

Low Medium High

BI Spend (% of Revenue)

(36)%

―Companies that have higher percentage of business users proficient in

creating active reports, have 34% lower BI expenditures‖

314.6 343.5 209.0

Low Medium High

BI Spend per Employee

(34)%

5 2 3 4 1



Organize for responsiveness, scale & optimal support

How to do This?

Establish a BI CoE to address key BI

integration & adoption challenges

Foster Business-IT Partnership


5 5 2 3 4 1

―Companies that have a formal BI competency centre in place, have 11%

lower BI expenditures.‖

0.075

0.069 0.067

Low Medium High

BI Spend As a % of Revenue

(11)%



Agenda

Executive Summary

Background



Enterprise BI value


Summary



Objectives Enterprise BI

Needs Business

Case

Information Structure and Technology

Organization Implemen-

tation

Purpose and

Goals

Current State

and History

BI Objectives

and Scope

Summary of BI

Needs

Envisioned To-

Be State

Priorities and

Alignment

Value

Proposition of

Enterprise BI

Expected

Benefits –

Future State

KPI Levels

Payback

Information

Categories

Architecture

and Standards

BI Applications

Governance

Structure

Program

Management

Roadmap and

Milestones

Measurement

Education /

Training

Support


Agenda

Executive Summary

Background





Summary


Enterprise BI strategy benefits

Help align with business partners, formalize

business needs

Create prioritized roadmap for the enterprise of

short, medium and long term projects aligned

with strategic business goals delivering

measurable results

Creating business justification for an enterprise

scope and end-to-end BI including data

management

How does Enterprise BI strategy benefit IT?

Have departmental spend go further and

contribute to enterprise investments required

A departmental BI often involves data from other

groups.

Solve the departmental pain points by removing

limits of a departmental focus through an

enterprise-wide strategy

An enterprise BI approach provides a unified

approach by all departments allowing everyone

to ―speak the same language‖

How does Enterprise BI strategy benefit a LOB?


Value Proposition & Customer Pain Points

Enterprise BI approach delivers Customer Pain Points

• IT/Technology-driven BI

initiatives

• Multiple BI systems

• Missing BI standards

• Limited or no-data governance

• Multiple unsynchronized

reporting solutions

• Data collection from several

systems

• Time consuming data

processing

• Lack of collaborative BI

environment

• Data Quality Issues

• Business-driven BI

• Single Point of Truth

• Collaborative BI environment

• Effective (data) governance

• Enterprise BI strategy align with

the overall corporate goals

• Wider BI adoption

• Better decision- making abilities

• Standardized BI (project)

methodologies

• Data quality issues adressed


What happened?

Why did it happen?

What will happen?

What is the best that could happen?

Value

Org

an

izati

on

al &

Co

mp

eti

tive I

mp

act

Enterprise BI Moving towards Real-time Insights


Standard Reports

Ad-hoc Reports

OLAP & Visualization

Dashboards & Scorecards

Exploration & Visualization

Value

Predictive Modeling

Traditional Business Intelligence

Enterprise BI

Org

an

izati

on

al &

Co

mp

eti

tive I

mp

act

Not all BIs are the same The Analytical Tools Continuum


Enterprise BI covers all imperatives that impact risk

mitigation, cost optimization and benefit realization

A common Business Intelligence platform that will satisfy strategic objectives

Value Drivers Areas of Impact

Business

Management

Operational

Excellence

IT

Optimization

Process

Standardization

• Global design, local flexibility

• Faster adoption

• Replicate best practices

Operational

Effectiveness

• Real-time visibility across the enterprise

• Better collaboration and decision making

• Speed of acquisition and integration

Growth • Timely visibility

• Accelerate change initiatives

• Take advantage of opportunities

Risk Reduction • Non-disruption – production and delivery

• International compliance

• Coherent information across the organization

IT Portfolio

Simplification

• Simpler IT architecture

• More funds for innovation

• Reduction of IT cost base


Agenda

Executive Summary

Background





Summary


SAP’s Performance Benchmarking program covers BI,

both in terms of comparison material and peers

Established end of 2004

Reach:

Over 10,000 participants from over 3,000 companies

Global program: in 2010 over 50% participants outside

North-America

Partnerships with 7 user groups, 3 industry associations

Studies available in 10 languages

Content Coverage for Business Intelligence:

36 BI-relevant Key Performance Indicators

29 Best Practices

Over 475 peers


BI Performance Benchmarking: compare performance & best

practice adoption, and recommend strategic improvements

Measuring Performance against Industry and Size Measuring ‘Best Practice’ Adoption

Observation of correlation between ‘Best Practices’ and Performance Strategies with high impact ‘High Impact Strategies’

Category Metric Company

Peer Group 1 (P1) Peer Group 2 (P2)

Avg. Q1 Avg. Q1

Eff

icie

ncy

Strategic & Informational Projects as % of Total Projects 55 61 82 61 84

% Active Reports Created by Business (as Opposed to by IT) 40 42 89 39 89

Development Time – Report (in days) 9 17 2 16 2

Implementation Time – Data Source (in days) 20 41 5 43 5

System Uptime % 98.2 97.4 99.9 97.1 100.0

% Reports Failed 13.0 5.8 0.4 3.8 0.0

% ETL Failed 0.5 8.0 0.5 4.9 0.1

Queries per Week per User 43 12 26 14 35

Co

st/

Inve

stm

en

ts

BI Support FTEs per 1000 Users 29 15 2 18 2

BI Spend as % of IT Spend 4.4 5.6 1.4 6.2 1.3

IT Spend as % of Revenue 3.4 1.5 0.5 1.4 0.3

1 = No Coverage5 = Full Coverage

Best Practice Listing

Company Internal

Gap

1The company has consolidated multiple BI tools into a standardized and enterprise-wide portfolio

3

2BI system allows for an automated ETL (Extract, Transform, Load) process to add new data sources

1

3One logical enterprise BI instance is deployed (even if there are multiple physical instances)

2

4BI system allows for proactive monitoring of system usage patterns and load

2

5BI system provides an scalable and fault-tolerant architecture

2

6

BI system provides users with guidance such as expected report run time and expected resource utilization when scheduling or running a report

1

….

Best Practice Ranking – Peer Group P1

Top 25%

Between Average and Top 25%

Below AverageCoverage Ranking:

1 = No Coverage5 = Full Coverage

0

1

2

3

4

5

6

1 2 3 4 5 6 7 8 9 10

Average Coverage Q1 Coverage

Company Coverage Company Importance

Coverage Ranking:

0.069%

0.033%

Low High

BI Spend as % of Revenue

-52%

Best Practice Question:

―A formal BI Organization/ Center of Excellence exists that is either physically or virtually centralized across the organization. BI roles, accountabilities and

responsibilities are defined and consistently applied across the organization‖ (1-Low, 5-High)

Enterprise Performance

% Active Reports Created by Business

BI Spend as % of Revenue

% of Employees Receiving Analytical Information

Align BI strategy with overall business strategy

Identify information needed to drive competitive advantage "Turn data into dollars"

Define landscape requirements in light of growth and acquisition goals

Adopt a business centric and enterprise wide BI architecture

XX

Usage of BI/ Analytics to Manage Business Processes

Improve efficiency of BI usage

Decrease time to information and time to action

Enhance self service and usability at all levels

Improve relevance and trustworthiness of data (e.g., MDM, data quality)

Optimize BI system for stability and scalability

X

Improve business insight

Establish business user access to operational data, at all levels (e.g., dashboards)

Gain control over data sources (e.g. internal and external data)

Enable real time analysis

Provide ability to anticipate future trends (e.g., predictive analysis)

X

X

X

Optimize BI expenditures

Standardize BI approach across the enterprise

Rationalize and consolidate existing BI landscape and tools

Reengineer data structures and BI processes (e.g., ETL, "Store once use many")

Establish a BI competency centre to address key BI deployments, integration & adoption

challenges

XX


Other SAP Performance Benchmarking surveys may indi-

cate improvement areas that can be monitored with SAP BI

Financial Excellence

Finance

Financial Compliance

Financial Performance and Risk

Management

Public Sector: Finance

Finance Shared Services

Superior Customer Value

Sales Effectiveness

Customer Contact Center

Customer Service and Support

Consumer Products: Trade

Promotions Mgt.

Product and Service

Leadership

Product Lifecycle Mgt.

Responsive Supply Networks

Supply Chain Planning

Warehouse Mgt.

Transportation Mgt.

Retail: Integrated Demand and

Replenishment Planning

Oil and Gas: Primary Distribution

Fashion: Supply Chain Planning

Professional Business Networks

Operational Excellence

Manufacturing

Procurement

Fashion: Procurement

Lean Enterprise

Healthcare: Accountable Care

Organizations

End to End Processes

Enterprise Health Check -

Manufacturing

Enterprise Health Check - Services

Public Sector Health Check

Order to Cash

Fashion: Order to Cash

Retail: Merchandising

Private Equity: Operational Assessment

Best People and Talent

HCM

Talent Management

HR Shared Services

Strategic IT

Business Intelligence

Enterprise Information Management

High Performance Analytics

Enterprise Mobility

Total Cost of Ownership

Best Run IT

Value Management

Enterprise Architecture

Implementation Services

High Performing Assets

EH&S Compliance

Enterprise Asset Mgt.

Utilities: Optimized Asset Mgt and

Operations

Benchmarking Survey

Best Practices Survey

Industry Specific Benchmarking Survey


Agenda

Executive Summary

Background





Summary

© 2011 SAP AG. All rights reserved. 32 © SAP 2009 /

Page 32

Companies need to become Analytics Competitors Core Competencies are BI strategy and governance

“ Make analytics part of your overreaching competitive strategy […]

You‘ll arm your employees with the best evidence and quantitative

tools for making the best decisions—big and small, every day.

Source: Competing on Analytics by Thomas H. Davenport

Endorse the analytics

culture, process, and

skills at the company

leadership level

Prepare to lead and

utilize an analytics-

focused organization

for strategic and

competitive advantage

Establish centralized

leadership/ownership

for analytics across

the organization

Facilitate data sharing

and establish best

practices and

standards

Utilize common

technology and tools

to avoid

inconsistencies and

simplify management

Establish standards

across business

processes

Business Process

systems to generate

relevant business

data

Enterprise systems &

architecture to store

and present data to

support the org. over

3-5 year growth

Champion

from the Top

Establish Central

Ownership

Maintain BI

Standards

Use the Right

Technology


Your Enterprise BI Strategy should start with the business requirements, not with the

DWH

Key Points to take home

Use Cases should come from the business, not from the IT department

Users don‘t need all BI client products, but will not always be satisfied with a single

product.

Make use of Product Interoperability for sharing and navigation purposes.

Remember…. There is no ―silver bullet‖. If in doubt – let the business decide.

Thank You!

Contact information:

Oliver Weigel

Global CoE Solution Director BI

SAP AG – Dietmar-Hopp-Allee 16 – 69190 Walldorf

[email protected]

M: +49 151 62345014

mailto:[email protected]

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Webinar: Enterprise BI - Increase Your Competitive Advantage