Elusive Goal: Useful Information

Dec. 21, 2004

More often than not, the data you get is not the information you want. Too much data to make sense. Data that lacks any context or comparative yardstick. Product-sales information without corresponding profitability measures. Lots of fancy icons on a computer screen. Great, but where's the really pertinent scorecard information you need to run the business more intelligently? Compounding the problem is the fact that most executives and managers aren't computer types. Simply put, they're too busy running the business to figure out how to write a query that their enterprise-resource-planning or manufacturing-execution system can understand. Enter business-information -- aka "business intelligence" -- systems. This breed of software promises to take all the data on customer accounts, product costs, and sales that resides in corporate databases and data warehouses and make it not only useful, but downright valuable. Although there are a number of excellent business-information systems available, a couple in particular come to mind. Personal Analyst, a package from San Diego-based Inalysys Inc., gathers information from different data sources in a company and compiles it in a variety of formats determined by the user. Instead of being restricted by traditional financial-reporting dimensions, an executive could, for instance, use Personal Analyst to look at the business in terms of profit per square foot, revenue per check, sales and expenses per unit, cost per procedure, and sales versus company and industry benchmarks. "This software puts a strategic edge on information that enables us to run the business better," says Bill Darsney, operation controller at Hypertherm Inc., a manufacturer of metal-cutting equipment in Hanover, N.H. Darsney says that company managers previously had no way to analyze sales trends to discover underlying causes. "We had no real way of simplifying reporting and analyzing what was going on with our sales," he says. "If someone asked why sales patterns changed, we couldn't come up with answers." Half the company's sales staff is using the system, and managers now are starting to use it as a budgeting tool to measure actuals versus plan. It took Hypertherm just two days to get up and running, with "minimal consulting help," Darsney says. "With other software, you just get data out. With this, you get useful information. You get high-level multidimensional views of the business." Another performance-oriented system is QuickView, developed by Panorama Business Views, a Toronto software firm. The software employs a "balanced scorecard" framework, linking overall performance to metrics for financials, customers, internal processes, and innovation. Color bar graphs can be used to depict on-time delivery, billing accuracy, shipment accuracy, short shipments, gross margin, advertising and promotion costs -- essentially any kind of business-performance metric. There's even a briefing-book feature for computer-shy executives, allowing them to operate within the look and feel of a traditional briefing book. The executive team at Highmark Blue Cross Blue Shield, a large health insurance firm in Pittsburgh, has begun using Panorama's pb views, replacing paper reports. "We've already identified new ways to look at our performance," says Highmark business development consultant Joy Kalajainen. "Now we're using it to evaluate new markets and business plans." Both software programs recognize that managers need certain kinds of information that they're not getting, or at least not without some major manual effort. Why is this so, you ask? Why do companies spend untold billions of dollars on information-technology systems that fail to respond to the needs of those who run them? I suspect the answer is that although the majority of those in business with personal computers have spreadsheet software, those programs typically don't have access to this kind of performance-oriented data. Sometimes the data is in such raw, basic form that only users who are sophisticated in the arcane science of writing SQL (structured query language) data inquiries can get their arms around the real information they're seeking. When are the techies going to give business leaders the right stuff?

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