Realizing A Real-Time Enterprise With Business Performance Management
By John Medicke, Executive IT Architect; Architect, SMB and Mid-Market Architecture, IBM
Reacting with speed to changing business conditions, occurring either internally or in the marketplace, requires insight and agility. More than ever, businesses need to leverage their business intelligence systems to fuel this responsiveness. However, many legacy data warehouse environments are holding organizations back with their crusty structures and stale data.
There is good news. Business Performance Management solutions offer a new approach to corporate informational alignment. Business performance management derives performance from the business process coalescing the operational and the analytical environments. The business process management environment, as the superstructure of operational activity, is the perfect channel for the fluid execution of performance management. Business measures are streamlined into the analytical environment and actionable knowledge is turned into action by driving business process operations.
Constrained by Your Legacy Infrastructure
Many organizations are inhibited by their existing data warehouse infrastructure. Throughout the creation of the warehouse, it has had many masters. It has been driven by very specific point requirements and becomes a hodgepodge of varying informational content jumbled together through some very bazaar ETL techniques. ETL, which is almost always the most expensive part of any data warehouse upgrade, severely limits growth in functionality. Of course, the pace of the analytical thirst is not slowing down to accommodate this legacy, but is ever-increasing.
Cost and complexity are not the only inhibitors. The sluggishness of the warehouse population can leave the reports as day-old news. To meet business goals, business intelligence needs real-time information. It is no good to find out that a particular unit missed its profit target for the day at the close of business. You need that information while you can still do something to change the outcome. But many legacy warehouses are too cumbersome in their ETL processing and too slow in the warehouse and data mart roll-ups to meet the requirement for real-time information.
Lost in Disorganization
Many data warehouses are a convolution of data models that do not reflect the organizational or process structure of the business. Multiple data marts and often multiple data warehouses exist in one enterprise. The data models of the data warehouses are often fragmented, reflecting the data islands of information that exist in the operational environment. Changes in business requirements and changes in IT strategy have brought about this state of disorganization.
Disorganization exists not only in the data structures, but in the analytical reports as well. Some businesses have well over a thousand business intelligence reports that are printed daily. The sheer volume of information being thrown at management can make it impossible to manage. Finding the important data, finding the critical data, is an extremely difficult task in a mountain of reports.
What truly is needed is correct alignment of the analytical environment with business goals, but the reality is this there is misalignment across multiple dimensions:
Informational misalignment -- the enterprise data model exists as disconnected fragments of information.
Organizational misalignment -- multiple lines of business have developed their own analytical capacities that do not share a common viewpoint on business operations.
Process misalignment -- the reports do not reflect the way the organization does business or how they execute on core business processes.
Strategic misalignment -- the analytical information does not align with business strategy and does not facilitate the drive of strategic targets down into operational business measures.
In addition, an action gap exists delaying and often preventing response to actionable business intelligence information. Detecting and reacting to business situations is often a manual process with no integrated automation.
Business Performance Management
What is required is a new approach that correctly aligns the analytics along the strategic and process foundations. Business Performance Management creates a flexible and fluid infrastructure that unifies the operational and analytical environments into a collaborative real-time engine for managing business operations. It provides closed-loop management of performance to address the action gap and aligns performance management KPIs to strategic targets.
Business Performance Management has enabling technologies that transform the analytical infrastructure into a responsive performance management system:
Enterprise Services Bus -- The ESB provides a ubiquitous infrastructure for the communication of business events. As an instantiation of service-oriented architectures (SOA), the ESB provides the flexible infrastructure for both service invocation and event flow.
Business Process Integration - BPI moves the business process outside of any application, giving businesses the control of their processes that they need to be responsive.
Information Integration -- II offers the ability to easily compose disjoint islands of information into a unified information model.
Strategic Management Systems -- SMS transforms data warehouse reporting systems into strategic planning and controls systems that facilitate the alignment of business measures with strategic goals, including support for balanced scorecards, activity-based costing (ABC), and key performance indicators (KPIs).
Sense & Respond -- this moves the analytical systems from passive report generation into active monitoring. It addresses the IT blindness that occurs in which the situational data exists but there is nothing to connect the dots to reach the business insight.
Business Performance Management transforms the operational and analytical environments into engine of performance execution. It elevates a disjointed and disconnected infrastructure into a common business lingua franca through integration. Unified business models in the process environment shortcut costly ETL processing and drive real-time performance measures on the ESB. In addition to alignment on the IT dimension, Business Performance Management aligns along the business dimension by creating the channel for measurable and manageable strategy to flow down into operations. Finally, with sense & respond technology, Business Performance Management transforms the analytical environment from being ad hoc to being proactive and responsive. The end-result is a business that is responsive to changing business conditions through an integrated and aligned performance management infrastructure.
About the Author
John Medicke is the chief architect for IBM's Small Business Software Solutions and has over 20 years in the IT field with deep experience across various industries including retail, electronics, automotive, and healthcare. He is the author of multiple articles in various trade journals and the author of the book Industry Solutions with DB2. John can be reached via email at firstname.lastname@example.org.
IBM is the world's largest information technology company, with 80 years of leadership in helping businesses innovate. Drawing on resources from across IBM and key IBM Business Partners, IBM offers a wide range of services, solutions and technologies that enable customers, large and small, to take full advantage of the new era of on demand business. For more information about IBM, visit http://www.ibm.com.