Interview With Ventana's Eric Rogge

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Eric Rogge is vice president and research director for Business Intelligence at Ventana Research, a preeminent performance management research and advisory services firm that helps clients leverage technology and business processes to improve efficiency and effectiveness throughout their organizations. The focus at Ventana Research is on the practice of performance management to maximize stakeholder value – leveraging assets to understand, optimize, and align strategies and processes to increase profitability.

IB MAGAZINE: Tell us about yourself and your role at Ventana.

ROGGE: Prior to my role at Ventana Research, I worked for many years in the business intelligence and enterprise software industry as a consultant, developer, marketer and salesperson. Many of those "in the trenches" experiences – especially those that occurred during late hours meeting delivery deadlines – have contributed to my perspectives on what’s required in today's business intelligence industry.

IB MAGAZINE: What is Operational Business Intelligence, and what distinguishes Operational BI systems from other types of BI systems?

ROGGE: At Ventana Research, we call it "Business Intelligence for Operations," which distinguishes it from "BI for Strategic Planning" (commonly used by executives) and Tactical BI (used by analysts). BI for Operations primarily serves front-line workers and their supervisors, providing information for daily and even hourly decision-making. Respondents to our survey about BI for Operations cite concrete business benefits such as greater insight into performance against plans or forecasts, more complete views of customers and products, and the ability to correctly diagnose issues and opportunities.

Another term we commonly hear these days is Enterprise BI, which refers to large, enterprise-wide BI deployments, as opposed to smaller departmental deployments. Enterprise BI systems must have the product functionality and breadth to meet the analytic needs of an entire enterprise.

IB MAGAZINE: Is Operational BI an esoteric concept or a production strategy? What kind of penetration are you seeing for these types of systems?

ROGGE: With many of these new concepts, one wonders whether the acronym or the trend is popularized first. That said, over the last two years, we have noticed a lot of similarity among large-scale deployments of BI technology. Most of these BI systems facilitate a particular group of users involved in a specific set of daily or even hourly tasks. If this discrete level of usage isn't operational, I don't know what is.

The managers of these operational deployments often describe them as BI applications. A recent statistical survey by Ventana Research showed that today's enterprises are aggressively deploying BI applications to operations. Half of the organizations we surveyed intend to deploy additional applications of this type in the next 12 months.

IB MAGAZINE: What types of users benefit from Operational BI, and what types of information are they accessing?

ROGGE: Users and benefactors of BI for Operations are typically front-line workers and their first- and second-level managers. These applications are also used to present summarized views of the same data to executives and managers higher in the organization. BI applications for operations are more prevalent in customer-facing and human-intensive domains (as opposed to system-intensive domains). This is opposed to applications primarily used by a small number of users who want to "slice and dice" the data, often called analytical applications. These applications are commonly found among sales, support and marketing departments.

IB MAGAZINE: Is Operational BI something that mainly impacts enterprise applications, or are you seeing departmental implementations as well?

ROGGE: The prevailing view in the industry is that departmental BI deployments are small, typically 200 users or less. In fact, approximately 35 to 50 percent of these applications serve 25 people or less, according to our own research. On the other hand, I know of one BI application for operations that has been rolled out to a department of 13,000 users. Is that considered a departmental or an enterprise deployment?

So, as you can see, size isn't particularly relevant. Our research shows that operational use can extend from small groups to extremely large ones. What is relevant is what these systems can do, for a group of any size: they are designed to improve the efficiency and effectiveness of daily business operations by providing useful information in a timely way to the people who operate the business. BI for Operations often delivers enterprise-level benefits such as huge cost reductions, efficiency improvements, and revenue increases. As many of Information Builders' success stories demonstrate, successfully deploying these information systems can improve profitability and significantly boost an enterprise's bottom line.

IB MAGAZINE: What is "actionable" information, and is that a pertinent concept here?

ROGGE: The word actionable describes a key purpose of BI for Operations. Business operations are all about action – this is the lifeblood of the enterprise. Operations workers use these applications to obtain up-to-date information and improve their awareness of emerging issues, along with the context to assess critical business events, options for resolution, and feedback mechanisms to launch actions. In many organizations, these BI applications are now mission-critical. Without them, the organization could not carry on normal operations effectively.

IB MAGAZINE: Is there an overlap between Operational BI and Business Activity Monitoring (BAM)? Can you explain the similarities and differences?

ROGGE: BAM is all about watching the action, which can be a valuable endeavor. Business Intelligence for Operations is a key part of the action.

IB MAGAZINE: Who tends to sponsor Operational BI projects? Who are the most likely stakeholders?

ROGGE: According to our research, line-of-business managers initiate these projects twice as often as IT managers – primarily because they are the executives and managers who run business operations. As they champion these application initiatives, they justify them in terms of benefits to their business domains.

IB MAGAZINE: How can managers guarantee the success of Operational BI initiatives?

ROGGE: Involving the users early on, such as during the definition of the application, helps guarantee a successful deployment. It is also important to have a solid understanding of the specific business challenges, rather than just the user's feature requirements.

IB MAGAZINE: What are the primary technical challenges that organizations face when implementing Operational BI systems? How about cultural and business challenges?

ROGGE: Data is at the center of the most difficult technical challengesassuring data quality, integrating data from multiple data sources, and providing real-time access to data are perhaps the leading examples. Surprisingly, when queried about whether cultural, business, technology or execution challenges are greater, cultural challenges top the list. Clearly, organizations that intend to deploy these applications have to carefully consider each aspect of the initiative before proceeding.

IB MAGAZINE: What kind of growth are you seeing in the Operational BI market? Can you share any statistics?

ROGGE: BI vendor license revenue from deployment of Business Intelligence for Operations is growing at nearly the same rate as the entire BI market – somewhere between 5 percent and 10 percent per year. We believe that operational usage of BI is most often the driver behind large-scale enterprise BI license purchases, so perhaps it is the engine of growth for BI.

IB MAGAZINE: What are the primary technical capabilities you should look for in an Operational BI toolset?

ROGGE: This topic could consume a graduate course in computer science! From the user's perspective, an Operational BI application should provide relevant information to daily tasks while being extremely easy to learn and use. For developers and administrators, this entails high-performing, highly configurable systems that can be readily embedded into the user's existing computing environment.