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The BI Watch:
Forward to the Past

  Column published in DM Review Magazine
November 2002 Issue
 
  By Richard Hackathorn

As information technology (IT) professionals amid the complexity of technology and largeness of systems, we often lose sight of our objectives. Let's turn the clock back and examine some ideals.

Imagine: It is now one hundred years earlier. Chances are we grew up in a small town or in a close-knit neighborhood of a larger city. A couple of blocks away, the corner grocery store formed a major part of our lives.

In traditional IT style, let's label the corner grocery store as CGS. I argue that the CGS is the best example of an intelligent enterprise, employing the latest BI technology.

"Johnny," yells Mrs. Hawkins, "run over to Mr. Franks' and get me a jar of mustard. I need it quickly; it's for dinner."

Mrs. Hawkins selected CGS as her preferred supplier of mustard and most other food products. For more than 20 years, she had been buying from Mr. Franks' store, building considerable loyalty over that time. Johnny always obeyed his mom; besides, it was a quick trip and nice day.

"Need a jar of that yellow mustard," asked Johnny of Mr. Franks. "Mom needs it for dinner tonight." Mr. Franks suggested, "Think your mom would like this new honey mustard? It just arrived this week from Chicago."

At the CGS, product selection was quick because of the unique color of the jar, sitting on the front shelf. The up-sell to the new mustard was quite natural, reinforced with past purchase behavior of Mrs. Hawkins for trying new things.

"I'll put it on your family's bill. Now choose the best piece of candy from this jar," offered Mr. Franks. "And, be off with you."

The credit-risk analysis and financial transfer was instantaneous, faster than any credit card transaction today. The life-value analytic of Mr. Franks always indicated that a free piece of candy was a good investment in minimizing delivery costs and in convenience for Mrs. Hawkins. The proper motivation of Johnny was a win/win situation. Besides, Mr. Franks was also investing in the future, knowing Johnny would someday be raising his family nearby.

It is ironic how Mr. Franks in his winsome style pioneered analytics that are cutting-edge in today's BI systems. As we look around our small town, we find many instances of sophisticated analytics employed by most businesses.

Suggestion: At your next staff meeting, brainstorm the objectives of your new BI system by "CGS-izing" it. Focus on distilling the business savvy of Mr. Franks, who accumulated his wisdom from years of experience. Scale your requirements back to CGS size, and ask what Mr. Franks would do. Then, enable your people with the proper informational environment to become apprentices of Mr. Franks.

Warning: If you seriously follow this suggestion, be warned that several radical thoughts may surface.

First, current CRM systems deal with only a fraction of managing the total relationships in a typical business. Instead of CRM, we need to focus on ERM (everywhere relationship management) because everywhere in our business there are important person-to-person relationships. Realize that every relationship involves at least two parties. For instance, just as we segment our customers, we need to segment (and enable) our employees who touch customers, maintaining the viability of the relationship. How do we automate the customer-to-company interactions in e-business initiatives without destroying the person-to-person relationships?

Second, it is difficult to scale the CGS because it is difficult to generalize from specific situations. Remember the old artificial intelligence projects where they probed the minds of experts (e.g., chess masters) for optimal decision rules? Chess masters see the entire board pattern as unique. Mr. Franks sees Mrs. Hawkins as a unique customer. Business processes at CGS are designed and redesigned whenever Mrs. Hawkins needs mustard. How do we balance consistency (uniformity) and diversity (variety) when scaling our business processes? Unfortunately, technology limitations and uncreative management have pushed us way off balance.

Third, Mr. Franks naturally blends tactical decision making with the strategic and short-term horizons with the long term. It may be that these prevalent distinctions are artificial, not of merit in real business environments. How do we blend our TX-ODS-DW systems to serve up the right tactical/strategic mixture appropriate for each business situation?

Life was simpler back then, but it is not irrelevant to us today. As we fast forward into our global economy, realize that we often direct our technology to achieve the common things of the past. Let us not forget those old memories, but utilize them as guiding principles for today.

...............................................................................

For more information on related topics visit the following related portals...
Business Intelligence.

Dr. Richard Hackathorn is president and founder of Bolder Technology, Inc., an established consultancy in Boulder, Colorado. Hackathorn has more than 30 years of experience in the IT industry and is a well-known technology innovator and international educator, conducting professional seminars in 18 countries. He has written three textbooks entitled Enterprise Database Connectivity, Using the Data Warehouse (with W.H. Inmon), and Web Farming for the Data Warehouse. He earned his B.S. degree from the California Institute of Technology and his M.S. and Ph.D. degrees from the University of California, Irvine. To contact, send e-mail to richardh@bolder.com.



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