Wednesday, June 17, 2009

The Business Intelligence Chronicles Part 15 : The Cost of Intelligence- A Fistful of Dollars? or a Few Dollars More?

A recent study by Gartner about reducing the costs of reporting through data mart consolidation finds "Organizations can save up to 20% of data reporting costs and provide better business information by replacing fragmented reporting in disparate data marts with a single instance of widely used data."

Data Reporting Costs? How much are they? With "spreadmarts" (personal spreadsheets, thousands of desktop database instances, customized reporting solutions for small business groups etc.) proliferating all across an organization, it is very difficult to get a good estimate of the Data Reporting Costs.

And in the absence of a good estimate it often becomes difficult to calculate the ROI of BI initiatives (Show me the money .....Should I ? :Can we easily or accurately calculate the ROI of delivering key Business Intelligence to Sales Reps on their handheld devices versus the information being mailed to them periodically ?)

The existing Data Reporting Costs used by the Enterprise Information Management proponents for their savings projections are challenged by those who favor a more Distributed Information Management strategy and vice-versa.

So in absence of a good estimate should we assume the existing Data Reporting Costs to be "A Fistful of Dollars"?

I would recommend any IT organization making a case for enterprise wide consolidation of BI capabilities to first initiate a study to identify existing "spreadmarts" and the costs associated with them. This could be through a questionnaire or 1:1 interaction with key stakeholders. These stakeholders are likely to be the same ones who will have a key voice in whether the company goes ahead with an enterprise strategy so this will also give an opportunity to get them engaged early on. The process of answering questions related to the costs may also help them realize the many hidden costs associated with such "spreadmarts" and the savings that can accrue in their own area if they are rationalized. If they feel like owners of the cost saving resulting from an enterprise strategy they will become its staunchest advocates.

Well, are the costs just a Few Dollars More than a Fistful of Dollars ? That will determine The Good, The Bad and The Ugly of further discussions on any Enterprise Information Management Strategy.

(p.s. you can guess I am a fan of Sergei Leone's Clint Eastwood starring Spaghetti Westerns)


Rich said...

Intersting analogy to the classic Sphagetti Westerns. Seems as though our DW/BI initiatives often result in the same kinds of "stand-offs" that were portrayed in those movies so effectively. Example: The Mexican (3-way) standoff in the 3rd movie is often like the classic tension between time, money & project scope.

Jennifer said...

Nice article. Great comparison. Its clear through the chronicles that you have a keen knowledge of the topic.

Any interest in having the "Chronicles" republished in our newsletter? Your reach would go to over 30,000 professionals.

Let me know...

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