text
Walk before
you run
White Paper | Walk before you run | 1
Introduction
Index
Introduction
The Journey
Step 1: Make reporting fast and
easy
Step 2: Ask WHY with analysis
Step 3: Get the picture with
dashboards
Step 4: Set goals with KPIs and
Scorecards
Step 5: Be alerted!
10
Step 6: Ask what if?
11
Conclusions
12
This white paper is aimed at users of Microsoft Dynamics
AX, NAV and CRM business systems, and describes a stepby-step approach to building business intelligence (BI)
capabilities, starting with reporting, and ending with whatif analysis. BI is a broad term and is likely to bring many
different capabilities that may be new to your organization.
Does this mean you need to use them all at once? No. Often
its more of a journey, which starts with the fundamentals, like
improving reporting, then builds capabilities as users become
more confident and familiar with the new system. Youll take
your own path of course; whats outlined here is a common
approach weve seen many new BI users take.
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The Journey
This diagram illustrates a common approach to building BI
capabilities. The most common starting point is reporting.
Many Dynamics customers need to improve reporting,
whether this means speeding it up, making it more flexible, or
reducing the reliance on IT experts or on using disconnected
spreadsheets... What you need to keep in mind is that
reporting is only the beginning of the journey. If today, you
think you just need to fix reporting, tomorrow you might
find that youre drowning in reports, and you need to use
highly visual dashboards to summarize just the key data, or
to use alerts to notify staff when performance drops below
expectations. If youre considering a reporting or BI solution,
make sure you plan for future requirements.
Capabilities beyond reporting include:
Ad-hoc analysis to understand the reasons WHY
something has occurred
Dashboards to provide an instant visual picture of
performance
Key Performance Indicators to set goals
Scorecards to monitor performance
Alerts to exceptions in performance so they can be
managed proactively
What-if analysis to model future scenarios
!
Reports & Automation
Ad-hoc Analysis
Dashboards
KPIs & Scorecards
Exception Alerting
What-if?
The Business Intelligence Journey
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Make reporting
1 fast and easy
STEP
Everyone who uses Microsoft Dynamics needs reports so
they can get an overview of the transactions occurring in the
Dynamics system. Common types of reports include billing
payment history, sales orders, and sales pipeline reports.
Its very common for Microsoft Dynamics users to get stuck in
one of two reporting scenarios.
1.
Relying on technical staff for report creation and
maintenance. Whether through an internally hired resource
or outsourced contractor, many report writing tools require
technical skills that cost by the hour. In any fast-paced
organization, information needs are dynamic, resulting in
frequent changes for any fixed report structures. This results
in delays and associated costs as deep programming skills
are needed to create multiple reports to keep up. We heard
of one Microsoft Dynamics customer who was quoted nearly
$20,000 for a single report to be created.
2.
Using unsecured spreadsheets for reporting. When
reporting is rigid and slow, users often resort to exporting
data to offline spreadsheets that are not connected to the
corporate data source. This causes other problems, most
notably data discrepancies and errors. Disputes around data
validity can arise when users have conflicting versions of
the truth caused by data pulled from corporate systems at
different times and potential errors during data manipulation.
Whats the end result of these scenarios?
Reporting is a burden on the business. It costs more time
and money than it should, and staff are tied up churning out
reports using manual processes. The business becomes slow
to react, because reporting is inflexible and cumbersome. We
recommend a three-step approach to improving reporting
with a business intelligence system:
1.
Shift reporting ownership from IT to the business
If youre a business person, how much time do you waste
trying to explain to a technical person what you want to see in
a report? And how frustrating is it when what comes back isnt
what you wanted, or you have to wait your turn in the queue
for a report to be changed when you have an urgent deadline
looming? Business users should be able to create and change
their own reports, without needing IT help. After all, theyre
the people who actually know the data, and understand what
they want from it. This makes reporting faster, more flexible
and more responsive. By empowering everyone to produce
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reports, bottlenecks are freed, and your technical staff have
more time to focus on other duties. Said one Microsoft
Dynamics AX customer who made this change:
...our users have been empowered to slice data and create
their their own reports. This has been a huge advantage
for our limited IT Staff, and means those who require the
business insight are the ones in control of the results.
Eric Olson, Director of IT, Harmonic Drive
our users have been
empowered to slice data and
create their own reports. This has
been a huge advantage for our
limited IT Staff, and means those
who require the business insight
are the ones in control of the
results.
Eric Olson, Director of IT
Harmonic Drive
A BI solution should have powerful, user-friendly and flexible
reporting as an essential foundation.
2.
Automate report distribution
Once you have the reports you need, wouldnt it be good if
you could automatically have them distributed to the right
people, at the right time? And have security in place so that
end users see only what theyre meant to? You can really
speed up your reporting practices if you can automate report
distribution and again, any business user should be able to
do this without IT help.
3.
Centralize management reporting
Ask your nearest line manager how much time they spend
preparing management reports like contributions to board
reports. Then multiple that by your line managers, add some
more for your CEO, and youll start to see that management
reporting is wasting a lot of time that could be used more
productively. Its normally done in a variety of offline tools
word processing, spreadsheets all individually, then brought
together by some poor person at the end of the process.
Again, theres lots of potential for errors. A BI solution should
provide a means for geographically dispersed teams to
work on management reports together, drawing reports and
analysis directly from source systems, and producing a PDF
management report that can be distributed easily.
What does improving reporting do? It makes your teams more
productive. If they can spend less time on reporting, they
have more time for value-added activities.
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Why reports are not enough
While reports can provide users with critical information
necessary for decision making, they are often lengthy and
difficult to understand, due to the amount of detail they
contain. The rapid proliferation of data in business today can
leave organizations struggling to cope with the sheer volume
of transactional data they accumulate, and subsequently
report on at length. This can lead to the staff merely skimming
or even ignoring reports, because they simply dont have the
time to wade through the masses of information provided to
find what they want to know.
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Ask WHY
2 with analysis
STEP
Traditionally, reports only tell you WHAT happened what
they dont tell you is WHY. Imagine if your sales manager
notices an issue, such as sales of a certain product suddenly
dropping. The sales manager needs to interact with the data
to discover instantly the causes of the issue. Organizations
need to transform transactions into an even more powerful
asset real intelligence and insight. Looking at the same
reports over and over does not foster a culture of proactive
management and continuous improvement.
When a particular outcome or process is not meeting
the expected performance levels, analysis is required to
understand why this has happened. Business intelligence is
optimized for querying the data, commonly via OLAP, which
stands for online analytical processing. OLAP technology
presents information in a format that provides powerful
analysis capabilities without any additional programming
required. For a business intelligence user, analysis is an
instant, simple process because data is already stored in a
format optimized for querying.
A good BI solution should have a user-friendly interface that
doesnt require technical skills or programming, and as such,
a BI user can immediately determine the causes for a certain
result by asking any question at any time, and exploring
data from many different perspectives using filtering, drilling
down, slicing, and dicing. Good BI solutions allow you to
navigate your data on the fly, and find answers to even
the most complex questions, without having to write new
reports. Business intelligence provides users with the ability
to make good decisions quickly, providing a SPEED TO ACT
advantage.
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STEP
Get the picture
3 with dashboards
Dashboards are a collection of analytics that are composed
into a unified display to provide an instant visual picture of
performance, and can be filtered and sliced in various ways to
help users explore the data. They help you visualize how your
business is performing, how its changing, and what the trends
are.
...companies that have
employed dashboard
technology to improve business
visibility have seen marked
performance improvements
over their peers not currently
leveraging dashboards...
Aberdeen Group
Analyst firm Aberdeen found that the top two pressures
driving dashboard initiatives were the need to gain visibility
into key business processes, and the need to replace gut
feel decisions with fact based decisions. They found
that, those companies that have employed dashboard
technology to improve business visibility have seen marked
performance improvements over their peers not currently
leveraging dashboards. 1 Performance improvements
included improved service delivery performance to
customer; improved customer issue resolution speed; and
improved sales new pipeline accounts identified.
Dashboards can be strategic - CXOs in particular often use
dashboards to gain a fast, overall view of performance from
many departments. Dashboards can also be operational. We
have a manufacturing customer that uses a flatscreen monitor
on the production floor to track daily production metrics.
When it comes to implementing dashboards, youll find that
usability plays a big part in user adoption. Dashboards must
be easy to create and modify, allowing users to create highly
relevant dashboards quickly that will aid decision-making.
Taking it a step further, if you can use pre-built dashboards
that you simply modify to suit your needs, you can greatly
reduce the time and barriers to user adoption. Aberdeen2
research showed that organizations using pre-built dashboard
solutions implement their solution in about half the time of a
fully custom solution. They also found that pre-built solutions
were usually also faster to use in general, because their
customizations were more likely to be through configuration,
not coding.
Executive Dashboards: The Key to Unlocking
Double Digit Profit Growth, Aberdeen Group, 2009
Pre-Built Dashboard Solutions Delivering Fast
Value, Aberdeen Group, 2010
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STEP
Set goals with
KPIs and Scorecards
Key Performance Indicators (KPIs) and scorecards help
organizations actually reach their goals, by monitoring the
performance of everything that is important. A business
intelligence system can help a company monitor every single
outcome and process to accepted levels or thresholds.
The top pressure driving
the use of KPIs is the need
to understand operational
performance drivers...
characterized by their
immediacy.
Aberdeen Group
Aberdeen research has found that in mid-market
organizations, the top pressure driving the use of KPIs is
the need to understand operational performance drivers.
Unlike strategic performance drivers (trend-based KPIs that
change slowly over time), operational performance drivers are
characterized by their immediacy.3
For example, service quality can be improved greatly
if on-time deliveries by both distributors and suppliers
are monitored and flagged the minute they fall short of
expectations. When companies dont already use KPIs, it can
seem a daunting process to develop the right metrics that will
help improve performance. But it doesnt have to be hard, as
your existing reports will tell you whats important to measure.
For example, take a look at your current reports at the row
and column level, and examine the acceptable thresholds of
performance at data level or summary level.
Example: A large retailer monitors delivery performance of
its suppliers. If the agreed delivery performance by each
distributor is three days, then this metric is already set. Using
a business intelligence system, if there is one distributor
whose deliveries take 4.5 days, the retailer can easily identify
other distributors whose performance is above the acceptable
threshold, and restructure the supply chain.
A business intelligence solution is fundamentally designed to
allow business users to create KPIs to monitor goals, and roll
the KPIs up into scorecards that provide an overview this
can be at individual, departmental, workgroup, divisional or
company level.
Performance Management in the Mid-Market,
Aberdeen Group, 2009
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STEP
!
Use alerts to improve
productivity, increase efficiency,
and monitor cost drivers before
they get out of hand.
Be alerted!
Once you have KPIs in place, you dont want to rely on
employees remembering to check the BI system to see if
targets are being met, or to look for outliers that indicate
that data has been incorrectly entered in your business
system. You want to automatically alert them the minute that
performance differs from expectations, so that issues can
be managed proactively before they get out of control. By
alerting them to exceptions, youre also cutting down the
amount of data they need to wade through, and only telling
them what they need to know.
By having alerts in place, you can improve productivity,
increase efficiency, and even monitor key cost drivers before
they get out of hand.
For example, critical business alerts can be used to:
Monitor stock levels of key products
Identify price discounts being offered in the field by your
sales reps
Highlight expense over-runs by individual departments
Show production managers where inefficiencies lie in
current processes, before they cause large cost over-runs
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STEP
6 Ask what if?
Use what-if analysis to decide
on the best course of action.
What weve talked about so far is analysis of past events
whats already happened. But BI can also be used to model
future scenarios, using what-if analysis to decide on the best
course of action. Business managers can develop what-if
scenarios that include multiple revenue and cost drivers
that support business planning and review processes. They
can even be used in the development of new products and
services.
Examples include:
Manufacturing companies can use what-if analysis for
every work center to determine the potential savings if a
work centers efficiency is increased by N% (where you
can choose different percentages to model the different
outcomes).
Construction and development companies can use what-if
analysis to model the net profit/losses that will be derived
through projects they are bidding for.
Financial managers can model future P&L and cashflow
effects by developing what-if models that allow multiple
revenue and cost scenarios to be quickly developed.
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Conclusions
Moving from using static reports to a BI solution is a big jump
in capabilities. Its a jump that will give you new insights, and
the ability to monitor and manage performance. Companies
with a BI solution gain a speed to act advantage, can reduce
costs and improve performance management, as they
manage their business proactively.
You may choose to take a staggered approach in how your
organization adopts these new BI capabilities, usually starting
with improving daily, weekly and monthly reporting. Even if
reporting is your top priority, make sure you remain mindful of
your organizations future needs, and choose a solution that
can grow with you. What you dont want is a multitude of
different technologies that you try to bolt on to your Dynamics
business system, and dont talk to each other. For example,
you might choose a pure reporting tool, then decide you need
a data warehouse for multi-dimensional analysis, then you
need a better way to create dashboards for end users.
For more information about ZAP Business Intelligence for
Microsoft Dynamics CRM, NAV and AX solutions visit
www.zaptechnology.com.
ZAP
One Embarcadero Center, Suite 1560
San Francisco, CA 94111
[email protected]
www.zaptechnology.com
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