COMMENT: Analyst's Corner
Business Intelligence Gets PervasiveBy David Baum
Analytic capabilities are embedded in most processes, from sales to supply chain.
Oracle Magazine spoke with Henry Morris, group vice president and general manager for IDC's Integration, Development, and Application Strategies (IDeAS) solutions research group, about the latest trends in analytic software.
Oracle Magazine: What is business analytics, and where does it fall within the broader category of business intelligence [BI]?
Morris: Most people associate business intelligence with tools and technologies for query and reporting, along with advanced analytic functions such as statistical data mining and predictive analysis. Business analytics refers to packaged business intelligence capabilities that have been applied to a specific function, such as budgeting, planning, customer segmentation, marketing analysis, and so forth.
Oracle Magazine: How is business analytics software evolving as BI applications become more pervasive?
Morris: We're seeing analytic capabilities embedded in more and more types of business processes, whether to enable better marketing campaigns or improve the performance of call-center agents. In the case of marketing, for example, you want an analytic process that helps you execute the campaign, collect the results, and determine who to target in the next campaign. With its acquisitions of PeopleSoft and Siebel, Oracle has obtained analytic applications for sales, service, marketing, contact center, finance, supplier management, supply chain, and human resources. Analytic applications capture best practices for specific processes, so organizations can deploy BI more quickly and gain immediate business value.
Oracle Magazine: Do analytic applications access data in a warehouse or interface with operational systems directly?
Morris: You can use analytic applications to leverage the insight contained in both historical and real-time data sources to drive better decisions in practically any situation. Some analytic applications "listen" for certain types of events and make recommendations according to current conditions. With Oracle's acquisition of Siebel Business Analytics—which includes real-time decision software—this type of intelligence can be built into the process and delivered in real time to appropriate users. Sometimes called "sense and respond," this technology can monitor a process and adapt to continuously changing information.
Oracle Magazine: Is there also an overlap between these analytic applications and what we commonly think of as business performance management or corporate performance management software?
Morris: Business performance management was originally used in the Finance department to establish goals and track progress against those goals, such as for planning and budgeting. Like balanced scorecards, these applications look at leading indicators and help you analyze past events. Ideally, you should be able to compare your goals with your strategy to predict upcoming performance. At the end of the day, you want to improve the process and motivate better actions by enabling managers to intervene. It's one thing to analyze sales at the end of the quarter. It's quite another to determine whether your sales are on track and take action to bring in the revenue you expect.
Oracle Magazine: Can these analytic applications deliver information as it's needed—for example, as part of a functional workflow?
Morris: Sure. You might see this type of analytic scenario in the context of real-time offer management, field service optimization, predictive call routing, or fraud detection. In a call-center setting, agents might want to recommend products or services based on what customers are telling them at a specific moment in time.
In many cases, analytic capabilities can be embedded in a business process. For example, let's say a lender is trying to determine whether to approve a loan. The loan agent analyzes information supplied by the applicant in conjunction with a credit score. Then the agent has to make a decision: Do I extend the loan or not? Especially given today's heightened compliance regulations, you don't want different credit managers using different criteria. Analytic applications help you form repeatable processes around how these decisions are made. They are designed to capture information in a specific context and then offer guided insight about how to respond.
David Baum (firstname.lastname@example.org) is a freelance business writer based in Santa Barbara, California.
IDC is a global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets.