Almost every day I hear of cases where Business Intelligence (BI) initiatives in companies are achieving tremendous results (3,623% ROI in 1 case) or are dismal failures and are wasting money.  In my experience, there are two very key elements which are present in every successful BI project, and without them the initiatives are almost guaranteed to underwhelm.

In last month’s newsletter I described the first of two major factors which have a major impact on the success or failure of Business Intelligence initiatives – having the correct metrics. And to paraphrase Mark Twain – The difference between almost the right metric and the right metric is the difference between the lightning bug and lightning. This month’s article focuses on the second of the two success factors – Executive Sponsorship.

First let me draw a distinction between BI and reporting systems. Reporting systems are narrower in scope, usually based around a single subject area (such as a general ledger) and present data in useful but not necessarily insightful ways. It’s not to say they aren’t useful, but useful in the way a phone book is useful.

Business Intelligence is a system, not simply a technology. BI initiatives deliver information critical for informed decision-making. The information is targeted, clearly understood, actionable, and specific. The underlying data may originate in multiple systems and departments, and is timely, clean and conformed.

For a BI initiative to succeed, there are a number of activities and people across typically unrelated areas that have to work in concert. These steps often involve not only IT, but finance, operations and various management business areas.  This naturally requires a great deal of coordination, cooperation and rapid communication with a focus on the following factors:

  • IT needs to have a keen understanding of the business.
  • Data needs to be available, accurate and timely.
  • The processes must be in place to capture and accurately record critical information.
  • Confidence in the speed, accuracy and reliability of the system must be widely accepted by the user community.
  • Strong and agile project management builds credibility with frequent deliverables, keeping the business engaged.
  • The business is able to act on the metrics.
  • ROI is delivered, measured and promoted.
  • Sufficient funding is secured.

With the breadth of areas covered by these points, the only way they work together is with strong executive leadership, sponsorship, vision and belief in the BI initiative.

Executive leadership is the second of my critical success factors. The success of any BI project depends on too many areas and crosses too many divisional and functional boundaries to succeed without it. No single manager in one of these areas can make the project work by him/herself. When there is a lack of leadership, coordination failures usually occur in many of the areas at the same time. The effect is quite dramatic and unmistakable.

Does this mean that your BI initiative is doomed to failure without effective executive sponsorship? Not necessarily. However, if you have the vision and direction for your BI initiative and your sponsoring executive does not, you have your work cut out for you. You will have to champion the vision for the areas where you can – perhaps a departmental area. By building on successes and developing expertise and knowledge in that area, your vision will eventually spread. The good news is that it’s possible, and there’s never been a better time to be excited about the possibilities fueled by BI. Did I mention the 3,623% ROI?