Gaining a Competitive Edge
Continued
For example, Eaton Vance calculates various effective fee and flow rates across all of its product lines. This can be problematic unless everyone is using the same business logic and sourcing the data from the same place, Pannella says. “So if someone takes an annualized fee and divides it by x, and the person in the office next door is dividing it by y, you get two different answers,” he says. “They both may be right under varying circumstances, but only if you know which divisor was applied and why. You need consistency.”
You also need speed, especially in a turbulent financial climate where investment values can change in a split second. Quick calculation is crucial for Eaton Vance. With Excel, the company had an unacceptable lag in its analysis and reporting because, although it was possible to achieve the answers they were looking for, the process was extremely cumbersome. “We had a horrible report-generation process,” says Pannella. “It could take a full day to actually generate the reports. With Hyperion, we can run those reports on the spot and have an answer in three minutes.”
It also wasn’t an easily repeatable process, he says. “If we wanted to know what was going on previously with our flow rates on a given set of funds, we would have to go back to a general ledger. Maybe print out some trials. Maybe get some information from some other places. Put it together, turn that answer around. It might take a little while,” he says. “And if you wanted to repeat it, you had to go back through your pivot tables and your spreadsheets to get there.”
Today, with Hyperion software, report generation is completely automated and very quick. “Now we give our senior management a lot more information than they’ve ever been able to get before, and in a much more rapid time frame,” he says.
Moving to an automated BI program also helped reduce errors and contributed to productivity gains, says Pannella. “With certain tasks, if you automate them, you don’t have to think about them,” he says. “That adds to the company’s general efficiency.”
The Human Obstacle
As with many software and technology implementations, there was a high level of change management required to achieve these benefits. BI applications are very social applications, notes O’Connell. The more time you spend using and talking about BI, the more opportunities you will find to use the software. But there’s an inherent reluctance in the financial services industry to shift from a proven practice to an application with the potential to create problems. People are cautious about moving from something that works, even if it’s slow and clumsy, to something that may take time to get used to. The Eaton Vance experience was no different, says Pannella.
“It was really painful,” he says. “When people are used to rolling up their sleeves and doing things a certain way for 10 years, and now we’re asking them to let the application do it but they can’t see the mechanics of it, it’s really tough.”
In retrospect, Pannella says he should have gotten many more people involved earlier in the process. “We would have done a lot more formal training,” he says. “We would have tried to get end-user buy-in earlier. End users don’t want a whole lot of whizbang. They want to know at the end of the day that what we’re asking them to do will help them do their jobs more easily.”
O’Connell suggests creating opportunities to demonstrate how business intelligence can help users and benefit the company. Face-to-face meetings can also help IT executives find new uses for the software, he says. “There should be road shows that describe BI and tell users what’s in it for them on a department-by-department basis. Those users might come up to you at the end of the meeting and say, ‘You know, everything you mentioned is really cool, but can we also do this or that?’” O’Connell says another smart strategy is creating BI competency centers within the organization or, at least, a BI advocate or evangelist who can work one on one with departments and users.
