How to Improve Business Intelligence Software ROI: Page 2

Posted November 1, 2010

Jeff Vance

Jeff Vance

(Page 2 of 2)

That executive, Robert Copenhaver, Vice President, Finance, was struggling to calculate year-end bonuses for Turner Broadcasting employees. As with so many BI projects, one of the main problems Copenhaver sought to address was the lack of visibility into the process.

“We have operational groups all over the world, and coordinating everyone in a coherent bonus program is trying, to say the least,” Copenhaver said. Copenhaver would have to deal with “dueling spreadsheets,” indecipherable faxes, questionable claims that had little documentation to back them up and “mounds of information that didn’t match up.”

To fix this mess, Copenhaver began looking at some of the business intelligence software Turner Broadcasting had already deployed. “The math isn’t that difficult, and we have many business tools at our disposal. I knew we should have something that we could use for bonuses,” he said.

The company had previously deployed BI software from Arcplan to improve financial reporting. With a few modifications, the software was able to deliver actionable information about the metrics used to calculate bonuses.

By centralizing the information fed into bonus calculations and forcing employees to have concrete data to back up their sometimes exaggerated claims, Copenhaver managed to shave at least a couple of weeks off of the bonus-calculation process.

That is serious ROI. Not as concrete but just as valuable, Copenhaver no longer wakes up in a cold sweat at night when bonus time approaches. Instead, he has the luxury of a streamlined, straightforward, fact-based bonus-calculation process.

Knowing where to start seems simple but isn’t

Another common behavior that harpoons BI projects is trying to do everything at once. As companies begin digging into their data, they find all sorts of potential opportunities. If they let their optimism run wild, they risk trying to do too much, too soon and often end up failing at everything along the way.

Ohio-based wireless provider Revol Wireless started their BI efforts with a simple goal: figuring out which of their retail stores were their top performers.

“We had a lot of assumptions about performance in each of our sales channels, but we didn’t have many facts,” said George K. Mehok, CIO of Revol Wireless. “The wireless market is hyper-competitive. If you don’t know what your customers are doing, and what your competitors are doing, you won’t keep up. You have to be able to pinpoint your opportunities and root out your weaknesses in order to stay competitive.”

Revol Wireless deployed the open source BI suite from Jaspersoft and began measuring the variables that determine retail success. “After deployment, we developed a sophisticated retail ranking system. Our rankings go beyond revenue and sales to such measures as foot traffic, sales conversion and customer churn,” Mehok said.

Based on this information, Revol Wireless launched a large-scale retail redesign effort, using BI information to determine which stores to keep, which to close, where they should expand and where they needed to modernize.

“Sentiment analysis” and the future of BI

While the main hurdles to BI success tend to be cultural and behavioral issues, once the value of data is unlocked, organizations can push forward into far more profitable analytic efforts.

For instance, call center representatives are exposed to plenty of information during calls that – until now – has never been translated into data. If a caller is angry, irrational or simply frustrated, that emotional information means something. It can help companies deliver better customer service, reduce churn and retain high-value customers.

When tied to actionable back-end data, this “sentiment analysis” can be extremely valuable. A.J. Jayaraman from Connectiva Systems noted that with the proper data capture in place, companies will know ahead of time when they risk losing high-value customers. The company can leverage that information to set up systematic, proactive retention processes that make their most valuable customers happy once again.

“Often, it’s as simple as having a manager follow up with the customer in a timely fashion,” Jayaraman said. “If a customer service manager takes the time to call you and tell you exactly what is being done to resolve your problem, you are less likely to defect to a competitor.”

On the flip side, low-value customers, the ones who, say, think their mobile provider should replace the phone they just dropped in the toilet, may find themselves spending a long time on hold waiting for that elusive “next available operator.”

Summary: 5 ways to achieve BI ROI

1. Focus first on desired outcomes, not raw data.

2. Establish clear budget parameters and set up an early warning system for cost overruns.

3. Get senior-level, non-IT (CEO, COO) buy-in for BI projects.

4. Start with something simple and easy to monetize, such as retail store rankings.

5. Then, go beyond the easy stuff and embrace BI for cutting-edge analytics like “sentiment analysis” and “subscriber data monetization.”

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Tags: business intelligence, BI software, business intelligence software, business analytics, business analytics software

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