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(1)

Business Intelligence…more than a pretty face!

January 26, 2016

Danny Baker

Vice President, Market Strategy

Enterprise Performance Management

(2)
(3)

Agenda

A Brief History of Business Intelligence

Set the Stage

3 Issues Keys to Success

5 Tenets to Getting Started

(4)

Business Intelligence Defined:

“The set of techniques and tools for the

transformation of raw data into

meaningful and useful information for

business analysis purposes.”

(5)

Business Intelligence Purpose:

“Identifying new opportunities and

implementing an effective strategy based

on insights can provide businesses with

a competitive market advantage and

long-term stability.”

(6)

Richard Millar Devens – 1865

Used the term to describe how the

banker, Sir Henry Furnese, gained

profit by receiving and acting upon

information about his environment,

prior to his competitors.

Hans Peter Luhn – 1958

“the ability to apprehend the

interrelationships of presented

facts in such a way as to guide

action towards a desired goal.”

Howard Dresner – 1989

“concepts and methods to improve

business decision making by using

(7)

Thomas Davenport

Querying

Reporting

Online Analytical Processing

(OLAP)

Alerts Tool

(8)

Data analytics and decision making

Source: Bain & Company, 2013

2X

More likely

to have

top-quartile

financial

performance

5X

More likely

to make

decisions “much

faster” than

competition

3X

More likely

to execute

decisions as

intended

2X

More likely

to use data

very

frequently

when

making

decisions

(9)

Positive Impact Responses by User

Using Analytics for Data-Driven Decisions

41%

40%

43%

41%

37%

45%

37%

48%

53%

59%

51%

50%

46%

36%

56%

56%

59%

58%

59%

54%

46%

78%

78%

78%

75%

71%

70%

60%

Increasing

Productivity

Reduced

Risks

Cost

Reduction

Faster Decision

Making

Program

Improvements

Improved

Financial

Performance

New Business

Approaches

Isolated Users

Some Functions Only

Some Departments

Corporate-Wide

Source: Harvard Business Review Analytic Services

(10)

Top Banks Use Analytics to Differentiate

67%

63%

59%

44%

46%

46%

45%

23%

Established method for

defining KPIs

Ability to measure

performance against

corporate goals

Cross-departmental

information sharing and

collaboration

Formal process for

incorporating KPIs into

day-to-day operations

Top-Performing Banks

All Other Banks

(11)

What is Business Intelligence?

(12)
(13)

Mercury Space Capsule

Michael Collins - Astronaut

Yardley’s Law:

“Pretty…is what works”

John Yardley - Engineer

McDonnell Aircraft Co.

(14)
(15)

Key #1: What do you “REALLY” need to know?

Law of Unintended Consequences:

actions of people

(and especially government) always have effects that are

unanticipated or unintended.

(16)

Norris’s Law:

“If you know the answer, then you don’t

know the question”

(17)

Freakonomics Series

Levitt & Dubner

“If it takes a lot courage to admit you don’t

know all the answers, just imagine how

hard it is to admit you don’t even know the

right question. But if you ask the wrong

question, you are almost guaranteed to

get the wrong answer.”

(18)

Freakonomics Series

Levitt & Dubner

“Here is a broader point: whatever you’re

trying to solve make sure you’re not just

attacking the noisy part of the problem

that happens to capture your attention.”

(19)
(20)

Choose the right

data inputs -

wider is better

Understand

Limitations

Correlation

doesn’t mean

causation

(21)

Key #2: Data

“How to become a millionaire…”

(22)

What is Business Intelligence?

First you

get the data

(23)

Sherlock Holmes

Holmes Second Law:

“It is a capital mistake to

theorize before one has

data”

(24)
(25)

Nassim Taleb

“Let us discuss one main effect of

information: impediment to knowledge.”

“Additional knowledge of the minutiae of

daily business can be useless, even

(26)
(27)
(28)

American Banker

(29)

American Banker

Comments in Forum: Do CEO’s Fear The Data-Driven Decision?

Executives don't fear analytics. They generally see the potential

value, and most are using analytics at some level, but they are

appropriately wary of silver bullets peddled by vendors and

consultants.

They understand they can't just buy an analytics package,

flip a switch and produce useful insights that convert themselves into

increased revenue and profits. Effectively harnessing customer data

requires large, complex multi-year investments of financial and human

resources in defining, collecting and organizing data; purchasing and

installing analytics tools; developing and running queries and models;

and interpreting outputs. And when all of that is completed, there must

be the capacity to apply the insights

.

Executives don't fear analytics,

they fear programs that don't produce returns and divert resources

from other, potentially more valuable initiatives.

(30)
(31)

Sponsorship at the highest levels

Convincing results from early experiments applying

value-based modeling to marketing initiatives

Having interdepartmental representation from the beginning

(32)

What person or group within your

institution is responsible for the data

(33)

Who’s Job Is this?

163 Respondents

(34)

“The end result…is not an accurate

picture of tomorrow, but better decisions

about the future.”

– Peter Schwartz,

(35)

Five Tenets To Getting Started

Begin With the End in Mind

• Advanced analytics is a means to an end, not an end in itself – focus energy to achieve limited

and specific business goals

Start Small, Remain Focused

• There is really no end to analytics – invite a new way of doing things as much as

implementing new technology

Get Help

• There is a steep learning curve with analytics – invest in assistance to hasten your

project deployment for superior results

Change Your Culture

• Learn from history (CRM) – benefits from analytics requires a devotion to culture,

organization and procedural changes

Manage Expectations

• All this is easier said than done – deriving benefit from analytics is more of a

journey than a destination

(36)

Unwritten Laws

Yardley’s Law:

“Pretty…is what works”

Norris’s Law:

“If you know the answer, then you don’t

know the question”

Holmes Second Law:

“It is a capital mistake to theorize before

one has data”

(37)

Thank You

Danny Baker

danny.baker@fiserv.com

References

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