COMMENTARY--Information has always been the true currency of business. Those who have been able to understand both what they know and what it means have always had a tremendous competitive advantage.Companies and organizations today are compiling and exchanging more information than ever, thanks to Internet and e-business technologies.
Business planning can be a hit or miss affair if you cannot extract meaningful insight from this information on demand--as conditions change, and in time to make decisions that will affect business outcomes.
But this information now resides in so many environments--and in so many different formats--that quickly extracting this insight has become a daunting challenge. And it's only going to become more so, as emerging technologies such as pervasive and RFID generate even more information, and increase both the number of people who access this information and their points of access.
The rewards, however, make it worth the undertaking. What if companies could tap into their corporate data and documents to uncover lucrative business opportunities? What if they had the "inside information" they needed to retain customers in a highly-competitive market? What if they could uncover fraudulent activities earlier and avoid their damaging consequences? What if they could use real-time analytics to obtain predictive analysis of their business instead of only analyzing historical data?
Savvy executives ask these questions. And they're finding highly profitable answers, through analytical tools that mine all of the information scattered throughout their organization, in all forms--including e-mail, graphics, video and voice-mail. Using business information as a tool to provide customized intelligence and faster insight gets companies closer to their customers--and that can mean the difference between success and failure.
To attract and retain its best customers, a company needs a precise portrait of what they are--their wants, needs, and buying patterns. Business intelligence paints that picture by analyzing and interpreting vast quantities of data: customer demographics, product-purchase histories, cross-sales, service calls, Internet experiences and online transactions--turning information into insight and developing conclusive, fact-based strategies to gain that competitive edge.
Every day, companies make bet-the-business decisions about their customers, competitors, new products and even their own reputations based on account balances, delivery schedules, profit margins, and more. Many do it with crossed fingers. That's because they know that they are making decisions based on incomplete or conflicting information--meaning hunches often play as big a role as insight in determining which way to go. True, business decision making is an art. But it should also be science.
It can be. Imagine a company could look at it all this information at once. Spot hidden trends before they occur. Recognize opportunities before they knock. That's business intelligence.
Imagine what this kind of market intelligence would do for business in terms of reducing the time and risk associated with developing new products.
Entertainment companies would be able to take a real-time pulse of moviegoers and record buyers to find out what they think and want.
Investment companies could more easily understand investor concerns about their products and go-to-market strategies. Pharmaceutical companies could better understand what doctors, pharmacists and patients are thinking about their latest drugs. Retailers would be able to better gauge what consumers will buy at holiday time--which could be linked to suppliers--and reduce lead time in making buying and product inventory decisions.
This amounts to moving to a "sense and respond" model of doing business--sensing the key patterns and trends affecting a company's business, and responding quickly with new products or solutions to capitalize on these insights--rather than making gut decisions and hoping for the best.
Pioneers like Florida Hospital have improved medical treatment and reduced costs thanks to business intelligence technologies. Using analytical software, Florida Hospital clinicians were able to establish statistical patterns relevant to specific diseases and, more importantly, identify successful standardized treatments for those diseases. The hospital can correlate such variables as ailment, degree of illness, treatment, gender, age and geography to identify and learn from patterns that can save lives and reduce unnecessary tests--not only reducing stress and inconvenience for patients, but saving money as well.
As Florida Hospital and other organizations are discovering, the best part of this emerging technology is its limitless horizons--breakthroughs occur virtually every day in our understanding of how to harness information and data to facilitate real-time decision-making. Those businesses that get it will capitalize on this deep insight ahead of their competitors, and be able to anticipate trends across a broad spectrum of products and services.
When that happens, the headaches are reduced--and the odds of winning in business are substantially higher. And it's much easier to make business bets when the odds are better.
biography
Janet Perna is general manager, information management solutions for IBM.
