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Market Survey Sponsored by Noetix Finds Most Important Benefits of Business Intelligence are Intangible and Non-Measurable

  • DM Review Online, October 17, 2007

Noetix Corp., a software provider that automatically generates business intelligence (BI) content from enterprise applications, announced results from a market survey conducted to determine return on investment (ROI) for BI implementations.  The results reveal that IT professionals consider the intangible benefits of BI solutions to be of more value than any tangible benefits, and, therefore, find it very difficult to measure the ROI of these applications.

 

The Web-based market survey was conducted by Unisphere Research on behalf of Noetix in order to better understand the role of ROI analysis in IT generally and the key metrics for measuring ROI for BI specifically.

 

According to the survey, measuring the ROI for BI investment is even more challenging than for other kinds of IT projects.  The overall objective of BI is to improve company performance by putting the right information into the right hands at the right time.  Many BI implementations are intended to allow business analysts to identify significant trends in enterprise operations and to provide senior management with better information with which better decisions can be made in a timely fashion.  Over the past several years, BI implementations have also been intended to provide key metrics to front-line personnel, including the sales force, call center operators and even companies’ customers.

 

Three communities of users - IT staff, senior management and line of business personnel- were asked what they considered to be the best measures to determine the potential benefits produced by the use of BI. The most important metric for improving the productivity of both line of business personnel and senior management regarding the use of BI is the time it takes for each community to improve the access to data for making decisions.  For line of business personnel, the second most important criterion is the number of reports end-users can create on their own.  For senior management, the second most important criterion is the time senior managers must spend on analysis.

 

The productivity measures for IT staff differ from those for senior management and line of business personnel, with the most important metric being the time it takes to develop a report followed by the staff time required to respond to users’ requests.

 

The promise of BI is the potential to improve the quality of decisions made.  The most important criterion for measuring the quality of decisions made, according to survey respondents, is the quality of the information available to decision-makers, followed by the quality of information available to front-line personnel.  The least important variable to measure that is associated with the quality of decision-making is the quantity of information available to front-line or line-of-business staff.

 

Other factors that respondents listed as potentially having a material impact on calculating ROI included making BI more available to a wider community of users and vendors’ improvement of the ease of use of BI tools.

 

“Many different factors have an impact on overall company performance, so precisely measuring the influence of a BI implementation can be difficult, if not impossible,” said Elliot King, research director at Unisphere Research. “Through this market survey we see that the challenges involved in conducting ROI assessments have led many in the industry to argue that the intangible, non-measurable benefits are more important than any tangible benefits.“ 

 

Like most BI customers, National Rural Electric Cooperative Association (NRECA), an organization dedicated to representing the national interests of 900 cooperative electric utilities and the consumers they serve, has had a difficult time measuring the overall ROI for their BI tool of choice, Noetix.  NRECA uses NoetixViews to create BI reports containing valuable human resources (HR) data located within Oracle E-Business Suite. The company’s HR department benefits greatly from the improved access to critical data provided by Noetix, and estimates it would cost five times the price of purchasing and installing NoetixViews to craft these same reports internally or with outside consultants.


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