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BUSINESS INTELLIGENCE

BUSINESS INTELLIGENCE. IS 6800 5 NOVEMBER, 2004. Group 1: Dave Ouellette Paul Hippenmayer Rick Morgan. DAVE OUELLETTE. BUSINESS INTELLIGENCE. What is Business Intelligence?. Systematic business information acquisition and analysis *

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BUSINESS INTELLIGENCE

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  1. BUSINESS INTELLIGENCE IS 6800 5 NOVEMBER, 2004 Group 1: Dave Ouellette Paul Hippenmayer Rick Morgan

  2. DAVE OUELLETTE BUSINESS INTELLIGENCE

  3. What is Business Intelligence? • Systematic business information acquisition and analysis* • Also called Competitive Intelligence, Corporate Intelligence, Market Intelligence, Market Research, Data Warehousing, Knowledge Management BUSINESS INTELLIGENCE *Hannula et al., Journal of American Academy of Business 2(2): 593-599, 2003

  4. Business Intelligence Internal BI External BI Tangibles Intangibles Tangebles Intangebles Competitive Advantage BUSINESS INTELLIGENCE

  5. Internal BI Industrial Espionage Business Espionage BUSINESS INTELLIGENCE

  6. Trade Secrets • The term trade secret means all forms and types of financial business, • scientific, technical, economic, or engineering information, including patterns, • plans, compilations, program devices, formulas, designs, prototypes, methods, • techniques, processes, procedures, programs, or codes, whether tangible or • intangible, and whether or how stored, compiled, or memorialized physically, • electronically, graphically, photographically, or in writing if • the owner thereof has taken reasonable measures to keep such • information secret; and • the information derives independent economic value, actual or potential, • from not being generally known to, and not being readily ascertainable • through proper means by, the public. * * Economic Espionage Act of 1996 BUSINESS INTELLIGENCE

  7. ETHICS External BI Corporate Espionage BUSINESS INTELLIGENCE

  8. Case Studies * Cleveland Clinic Foundation * Avery Dennison * Kodak * Lucent * Aim-9/AFMSS * Ford * Boeing/Lockheed Martin * Air France BUSINESS INTELLIGENCE

  9. Business Intelligence Industrial Espionage Publications Conferences Knowledge Internet Corporate Espionage ETHICS Business Info CI Internal Data & Trade Secrets Trade Shows Business Espionage Intangibles Tangibles Competitive Advantage BUSINESS INTELLIGENCE

  10. Paul Hippenmeyer BUSINESS INTELLIGENCE

  11. Internal BI CCF AIM-9/AFMSS Industrial Espionage Knowledge Management Data Warehousing Internal Data & Trade Secrets Avery Dennison Business Espionage Kodak BUSINESS INTELLIGENCE

  12. Is BI Important? • # 1 or 2 Application and Technology development issue as ranked by 301 IT executives* • Conventional Wisdom: Enabler of competitive advantage via IT intensive processes *Luftman and McLean, MIS Quarterly Executive, 3(2): 89-104, 2004 BUSINESS INTELLIGENCE

  13. Internal BI • Market Intelligence, Market Research, Data Warehousing, Knowledge Management • Originally designated DSS (Decision Support Systems) or EIS (Executive Information Systems)* • Software has been specialty product • Seeing consolidation of smaller companies • Internet has changed access to information. * G. Philipson; www.theage.com.au/articles/2003/08/04/1059849328310.html?oneclick=true BUSINESS INTELLIGENCE

  14. Evolution • 1990s: IT developed ERP, CRM, SCM • Late 1990s: IT enabled data warehousing • Transaction intensive businesses (retail, telecom, financial) • 2000s: Above is commonplace Now: How to capture information for strategic advantage? BUSINESS INTELLIGENCE

  15. BI Software* • Major Software Companies • Cognos • SAS Institute • Business Objects • Hyperion • Companies to Watch • Microsoft, Oracle, SAP * G. Philipson; www.theage.com.au/articles/2003/08/04/1059849328310.html?oneclick=true BUSINESS INTELLIGENCE

  16. Software Projections* • 8.5% growth rate for the next 3 years • Advancing on three fronts • Mine data in real time • Predictive analytics • Unstructured data searches (text and internet) * The Economist, June 10, 2004 (www.economist.com/science/tq/displayStory.cfm?story_id2724407) BUSINESS INTELLIGENCE

  17. MSI* Applications • Focus • Financial (locating fraud, bundling products) • Catalog retail (bundle catalog mailing to save costs) • Athletics (past performance predicts future success) *MSI Systems Integrators, Omaha, NE. BUSINESS INTELLIGENCE

  18. MSI Approach • Collect Data • Clean the Data (right data entry in right places) • Transform (all codes compatible) • Build Storage and Processors • Statisticians • Queries • Data Mining/Discovery (open search) • Decision Support (hypothesis testing) BUSINESS INTELLIGENCE

  19. Rick Morgan BUSINESS INTELLIGENCE

  20. External BI Publications Conferences Internet Corporate Espionage Business Info ETHICS Trade Shows BUSINESS INTELLIGENCE

  21. Sources of external BI: PUBLICATIONS (magazines, newspapers, trade pubs) CONFERENCES/TRADE SHOWS INTERNET OUTSOURCING BUSINESS INTELLIGENCE

  22. OVER RELIANCE ON THE INTERNET • Good: • SAFEST (FEW ETHICAL GRAY AREAS/PUBLIC DOMAIN) • CHEAP • ANONOMOUS • APPEARS EFFICIENT • PITFALLS: • Possible misinformation • Some avenues limited to only what competitor wants you to know • Encourages “path of least resistance” mentality Fleisher, Blenkhorn; Controversies in Competitive Intelligence, the Enduring Issues; Praeger Press, Westport CT 2003 BUSINESS INTELLIGENCE

  23. “Too often, too much time is spent on collection or research, leaving inadequate time for analysis”Myburgh BUSINESS INTELLIGENCE

  24. THAT ETHICAL THING Legitimate Misrepresentation Improper Influence Improper Means Unsolicited “Others” (Comai) BUSINESS INTELLIGENCE

  25. Federal Law Uniform Trade Secrets Act of 1985 (UTSA) Economic Espionage Act of 1996 (EEA) • Provide legal protections for corporate trade secrets • IF • Company takes reasonable steps to protect them • Information hasn’t been publicly released or disseminated BUSINESS INTELLIGENCE

  26. Trade Secrets and the Federal Law 25 June 2003: “Two Former Boeing Managers Charged in Plot to Steal Trade Secrets from Lockheed-Martin” (US Dept of Justice) • Boeing accused of unethical conduct during bidding process following improper acquisition of proprietary Lockheed documents • RESULT: Boeing stripped of seven missile launches in favor of Lockheed-Martin, losses approx $1B in contracts and an indefinite suspension of future contracts US DOJ Press Release 25 June 2003 Washington Post 25 July, 2003 BUSINESS INTELLIGENCE

  27. AIR FRANCE BUSINESS INTELLIGENCE

  28. AIM-9 SIDEWINDER AFMSS BUSINESS INTELLIGENCE

  29. Business Intelligence Is It Worth It? • Hypothesis: Ability to mine internal and external data can lead to business advantages • Issue: How to measure value? • Only 13% of respondents said they calculate ROI* • 37% planning to do so * W. Eckerson, Journal of Data Warehousing 8 (4): p 64. 2003. TWDI Conference Survey, 2001 BUSINESS INTELLIGENCE

  30. Expectations from BI* Survey of the top 50 Finnish Companies BUSINESS INTELLIGENCE *Hannula et al., Journal of American Academy of Business 2(2): 593-599, 2003

  31. Difficulty in Measuring ROI • BI solutions deliver more intangible benefits than tangible* * W. Eckerson, Journal of Data Warehousing 8 (4): p 64. 2003 BUSINESS INTELLIGENCE

  32. Business Intelligence ROI • How to determine value? • Start with a purpose • Result must be measured as “net present value of the after-cash flows associated with the investment”* • Increase revenues or decrease costs • Example: • BI improves forecasting decreased inventory • BI helps customer segmentation decreased customer acquisition, increased revenues, increased customer lifetime. * Williams, S. and Williams, N., J. Data Warehousing 8(4): 30-39, 2003 BUSINESS INTELLIGENCE

  33. Process Engineering Change Management Strategic Alignment BI Technical Development BI Project Management Preconditions for ROI* Business Preconditions Business Value of Business Intelligence Technology Preconditions * Williams, S. and Williams, N., J. Data Warehousing 8(4): 30-39, 2003 BUSINESS INTELLIGENCE

  34. Enhancing ROI • Key: Finding the right BI resources at the right price* • Outsourcing and Off-shoring • Worldwide skills • Applications (OLAP, ETL, DBA) becoming common • Size of project (transaction cost); Internal competencies; move only non-critical aspects * Dodds, J. Data Warehousing 8 (3); 32-37, 2003 BUSINESS INTELLIGENCE

  35. Best Practices Eckerson, W. Best Practices in Business Performance Management: Business and Technical Strategies (http://www.dw-institute.com/print.asp?id=7105) BUSINESS INTELLIGENCE

  36. It will not do for an army to act without knowing the opponent’s condition, and to know the opponent’s condition is impossible without espionage Sun Tzu BUSINESS INTELLIGENCE

  37. QUESTIONS?

  38. BACKUPS BUSINESS INTELLIGENCE

  39. DEFINITIONS Business Intelligence: Overarching term covering all facets of the data gathering, acquisition and analysis in order to gain competitive advantage. Competitive Intelligence: Information external to the company that can be used to gain a competitive advantage Internal Intelligence: Information inside the company, including corporate metrics (such as sales, financial & marketing information) and trade secrets, that can used to gain a competitive advantage Industrial Espionage: The actions of a foreign government to acquire information on a company in order to gain advantage for its own industry. (CIA) Corporate Espionage: Legal corporate information gathering Business Espionage: Illegal corporate information gathering (CIA) BUSINESS INTELLIGENCE

  40. BOOKS Fink, Steven, Sticky Fingers, Managing the Global Risk of Economic Espionage, Dearborn, Chicago 2002. Fleischer, Craig and Blenkhorn, David L., Controversies in Competitive Intelligence, the Enduring Issues, Praeger, Westport CT, 2003 McGonagle, John J., The Internet Age of Competitive Intelligence, Quorum, Westport CT, 1999 REFERRED JOURNALS Attaway, ”A Review of Issues Related to Gathering and Assessing Competitive Intelligence”, American Business Review, 16 (1) Jan 1998 Awazu, Yukika, ”Informal Roles and Intelligence Activities; Some Management Propositions”, Journal of Competitive Intelligence and Management, Vol.2, No.1, Spring 2004. Comai, “Global Code of Ethics and Competitive Intelligence Purposes: an Ethical Perspective on Competitors.“ Journal of Competitive Intelligence and Management, 2(1), Spring 2004. Dijcks, Jean-Pierre, “Integrating Data Warehouse Process into the Overall Management Infrastructure”, Business Intelligence Journal, Summer 2003, pp56-63 Fitzpatrick, Uncovering Trade Secrets, “The Legal and Ethical Conundrum of Creative Competition”. S.A.M. Advanced Management Journal, Sum 2003 68 (3). Hammond, Mark, “Ford’s Business Assistance Center Hits the Fast Lane”, Business Intelligence Journal, Winter 2004, pp49-52 Hatcher, Don and Prentice, Bill: “The Evolution of Information Management” Business Intelligence Journal, Spring 2004, 9,2, pp49-56. Luftman and McLean, MIS Quarterly Executive, 3(2) 890-104, 2004 Luthra, Anika and Desouza, Kevin “Intelligence Sharing in Virtual Teams: Managing Organizational Effects of Technology”, Journal of Competitive Intelligence and Management, Vol1 No.3, Winter 2003, pp1-9. Nakra and College, “Info-Terrorism in the Age of the Internet: Challenges and Initiatives”. Journal of Competitive Intelligence and Management, 1 (2) Sum 2003. Cobb, Pamela; Competitive Intelligence Through Data Mining” Journal of Competitive Intelligence and Management, Vol.1 No.3, Winter 2003, pp80-89. SOURCES BUSINESS INTELLIGENCE

  41. SOURCES (Continued) OTHER JOURNALS & WHITEPAPERS Cooper, et at. “Data Warehousing Supports Corporate Strategy at First American Corporation”, MIS Quarter.y Vol 24 No4, pp547-567, Dec 2000 Erickson, W. Journal of Data Warehousing 8 (4): p64 Hannula et al., Journal of American Academy of Business, Vol2, 2, 2003, pp593-599, Myburgh, Sue, Competitive Intelligence: Bridging Organizational Boundries. Information Management Journal, Mar/Apr 2004, pp46-55 Williams, S and Williams N.J., Data Wearhousing, 8(4) 30-39, 2003 Wright, Phillip and Roy, Geraldine, Journal of Workplace Learning, 11 (2), p53 Wright, Phillip, “Industrial Espionage and Competitive Intelligence: One You Do, One You Do Not”, Journal of Workplace Learning, Vol 11, Iss 2, 1999 (uncredited), Effective Business Intelligence Approaches for Today’s Business World, Gartner Group, 2004. INTERNET Eckerson, Wayne: “Best Practices in Business Performance Management: Business and Technical Strategies” www.dw-institute.com. Viewed 24 Oct 04 Phillipson, G; www.theage.com.au/articles/2003/08/04105984328310.html viewed 25 Oct 04 www.theeconomist.com/science/tq/displaystory.cfm viewed 24 Oct 04 BUSINESS INTELLIGENCE

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