5 Common Problems in Business Intelligence

Since data can be collected in a passive manner, many businesses collect data whenever they have an opportunity. The amount of data collected can be staggering, and may contain useful information that helps marketing, sales, product development teams and human resource departments. Properly utilized, business intelligence (BI) can help retain employees, manage inventory levels and maximize marketing efforts. Some sources estimate that every $1 spent on business data analysis can result in up to $10.66 ROI on average. But just because a company uses BI is no guarantee that it will use BI effectively.

Strategy

One way businesses can fail is when they lack a strategy when developing BI projects. Questions businesses should ask typically include: Why is the data being collected and what kind of decisions will be made upon analysis? Who is going to get the data and what kind of problems are being targeted?

The strategy should drive the data collection process, as good planning can help determine which actions to take after the data is thoroughly analyzed. Poor data collection efforts can doom the best strategy. Not asking the right questions or asking them at the wrong time can create just as much confusion as an ambiguous or poorly worded question. Unfocused, bad or questionable data can also have a negative impact on business intelligence efforts.

Bad Execution & Management Support

Many BI projects can also fail because of poor execution on a well-intentioned plan. Execution failures can result from not enough employees with the right skills to deliver on time, or from bad management, a shortage of sufficient funding or lack of executive support. If a company is not prepared to bring in the necessary talent and provide funding and support, they typically do not succeed in high-level data analysis tasks.

Subcontracting & Stakeholder Involvement

Outsourcing can also lead to failure. Data can come from many directions and is often stored in different places. Valuable data may be stored in an Excel file, or on a workstation operated by an individual who recently retired. The IT department may have a cabinet of hard drives filled with old databases. Outside talent may not know about these data repositories and others that might exist. Even when they know or suspect such data stores exist, their efforts to acquire them could be hampered for a number of reasons simply because they are external to the company.

Business intelligence projects are often complex and may need cooperation from a variety of groups within the organization. Without support, funding, talent and strategy they may become nothing more than another expensive project that ends in failure. End-users, management, and executives should recognize the vital role they can play in the process, and IT should begin to reach out and bring them into the process.