Beyond The Executive Branch

Dec. 11, 2006
Companies are moving business intelligence into formerly uncharted areas to maximize its benefits.

In the early days of business intelligence (BI) systems, users of the applications belonged to a very exclusive club. They were the senior-level executives and business analysts who used the tools to view narrowly focused performance metrics, such as sales data. But as technology advisory firm IDC points out, analysts and managers represent only an estimated 15% to 20% of an entire organization. By excluding other stakeholders within the enterprise, companies are not utilizing BI's full potential.

In a recent study, IDC notes that the next cycle of BI will extend across the entire enterprise and supply chain, including suppliers, partners, customers and government agencies.

Briggs & Stratton Corp., a $2.65 billion small-engine maker based in Wauwatosa, Wis., has been using BI this way for nearly 20 years. Briggs & Stratton's BI strategy is based on the company's vision of operational excellence, which is producing "high-volume, low-cost, good-quality products," says Grant Felsing, decision support manager.

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To accomplish this, the company has extended BI to approximately 1,500 users from various departments companywide who can view and analyze different metrics through an SAS suite. On the production side this might include bills of materials, routings, standard costs and inventory levels. For credit managers, the BI data might include accounts receivable, outstanding orders or risk-level information, Felsing says.

The company has saved several millions of dollars in warranty costs with a warranty-analytic tool within the BI system that sifts through claims and helps the company identify quality issues, according to Felsing.

"Each of those departments has the number of applications that they require to be intelligent, making good decisions all the time," Felsing notes as he describes his company's wide, across-the-enterprise deployment of BI.

Approaches similar to Briggs & Stratton's are driven by "customer demand for real-time decision making," according to a recent BI study conducted by Boston Corporate Finance, a technology-focused investment banking firm.

In response, vendors are merging once disparate applications -- such as data visualization, business activity monitoring, budgeting and balanced scorecards -- into one enterprise BI suite, Boston Corporate Finance reports.

Kansas City-based business consulting firm MarketSphere Consulting LLC is seeing more clients who want long-term, enterprise-wide BI systems, says Jeff Aldridge, managing director of MarketSphere's enterprise performance management practice.

"They're looking at it more synergistically than ever before, and the software vendors have enabled that by creating more integrated software over the last couple of years."

Manufacturers are using these integrated suites to share information between the financial side and the operations side, says Robert Mick, vice president, emerging technologies with Dedham, Mass., analyst firm ARC Advisory Group.

"There's a need to get some of the operations information into the business systems for better planning purposes, and then the opposite of that would be for some of the operations to have more financial information so they can understand better the impact of some of the decisions that they make and some of the actions that they take," he explains.

Alcoa Inc., a $26.2 billion aluminum manufacturer with 129,000 employees in 43 countries is one such example, says Jeff Aldridge, managing director of Kansas City, Mo.-based MarketSphere Consulting LLC's enterprise performance management practice. "They have different types of operations so it's not a one-size-fits-all need throughout the organization for BI." Aldridge says manufacturers like Alcoa need to establish a BI strategy. This includes planning how they're going to implement the system and determining their long-term goals with BI.

Another example of a company using BI to bridge an information gap is Henny Penny Corp. The Eaton, Ohio-based foodservice equipment manufacturer's China operations has an enterprise resource planning (ERP) system that the privately owned company's U.S. headquarters already supports. Still, government restrictions in China created connectivity challenges for Henny Penny, which couldn't share information from its ERP systems via its virtual private network, says Don Garland, development manager for information systems at Henny Penny. A Web-enabled BI solution from Information Builders Inc. called WebFocus helped Henny Penny work around such obstacles.

Now, nearly half the company's 600 employees can access a variety of data in real time. One of the key features is being able to view information about the electronic boards that are placed on various pieces of food service equipment. This includes where the boards originated, their testing history and the panel to which they were affixed. The information is then presented on a single dashboard. Before the data were buried inside the company's ERP system, which created a cumbersome process of employees having to conduct their own data mining. "There was always a delay of at least two days to get something to production. Not only that, it excluded other data," Garland says.

Henny Penny could have modified its ERP system to fit its needs, but the cost of adding WebFocus was "pennies" compared to the efforts of updating the data warehouse, according to Garland.

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