Over the years I have found business intelligence author and consultant Neil Raden to be a welcome voice of common sense, from calling for simplicity for successful BI, insisting on avoiding hype, to a healthy disdain for BI buzzwords:
I've reluctantly come to the conclusion that "analytics" means anything the speaker/writer/vendor/analyst wants it to mean—
Neil Raden (@NeilRaden) October 04, 2010
One particular Neil Raden blog article really struck a chord with me. The title speaks for itself: You Cannot Fix a Broken Company by Measuring How Broken it is. Neil Raden’s post goes to the heart of what Business Intelligence is – and what it is not:
The BI industry has sort of casually sent the message that BI makes companies better… But the question is, once you expose something that needs attention, what next? As a consultant and implementer of data warehousing and BI for many years, I never really came up with a good answer…
And here is an especially important comment:
Even when we did everything we set out to do [in our BI/DW consulting engagement], when approaching management about the next phase of the operation, to help the client start addressing the problems with employee morale, high turnover, inventory snafus, poor customer service, etc., the response was usually something like, “Neil, aren’t you the data warehouse guy? Shouldn’t we get McKinsey in here to work on that?”
I empathize with Neil and this condescending ‘You’re just the techie’ brush-off from management. It also raises much more serious concern: Why would management’s first response to serious business problems be to bring in outside consultants to handle it? Isn’t that their job? Was management basically admitting they’re not up to the job of addressing these issues on their own?
One more quote from Neil’s post:
In short, if you’re involved with BI, you may have as good or even better insight into what is going on in the company, but you clearly lack the portfolio to do anything about it…
To Neil’s point, I see an analogy between BI tools and medical devices: Both can identify serious “illnesses” within companies and patients, respectively, but neither can provide a “cure” on their own. (This is an incomplete analogy, of course, as BI can help identify ‘good’ things too, like uncovering positive new business trends, etc., but it matches the experience shared by Neil Raden).
Many years ago I spoke with the founder of a start-up medical device company, who told me that in order for a new medical diagnostic system to be successful, a course of treatment must also exist. He explained, for example, that several years ago a then-recently developed medical device detecting bone density loss was of limited benefit (and a limited market), because there wasn’t as of yet an effective treatment for the patient to take (today, thankfully, that is no longer the case).
The good news for practitioners and developers of BI/DW technology is there are indeed plenty of “courses of treatment” to reverse the effects of low employee morale, high turnover, inventory snafus, poor customer service, etc. These courses of treatment, however, require strong leadership dedicated to rolling up their sleeves, and actively using BI tools as part of a culture of data-informed decision-making.
In contrast, if management is so hands-off that its default is to halfheartedly “sub out” addressing pervasive business problems to outside consultants – or, even worse, chooses to deny certain problems exist at all – no amount of BI may be enough to effect authentic change. It’s a bit like a doctor showing a chain-smoking patient an x-ray of his damaged lungs, and yet the patient somehow can’t bring himself to actually kick the habit.
I’d like to point to the University of Maryland, Baltimore County (I very much enjoyed working with UMBC, a customer of a former employer of mine; see my case study here) as an excellent example of an organization embracing that essential culture of data-informed decision-making. This culture is actively advocated from the top, by UMBC President Dr. Freeman Hrabowski. It’s no coincidence that President Hrabowski repeatedly emphasized the importance of a “culture of critical thinking” and the need for a “deliberate effort” to engage in conversations and problem-solving with others.
The bottom line is BI can inform management as a diagnostic tool, but management in turn has to believe in the efficacy of the “courses of treatment” and actively commit to a managerial culture of data-informed decision-making that does not regard practicing good business health as somehow being someone else’s responsibility.