Business Driven Technology 6th Edition by Paige Baltzan

Exercise 79

Intelligent Business: Is It an Oxymoron
In a pilot program by the State of New York, suburban Rockland County announced that it had uncovered $13 million in improper Medicaid claims made over a 21-month period. Because the problems were discovered before the reimbursements were made, Rockland saved itself the headaches it would have faced if it had paid out the money first and asked questions later.
The credit goes not to a crew of hardworking sleuths but to search and analysis software created by IBM that automatically sorted through thousands of forms, plucked out key bits of information, and sized them up against Medicaid rules. Government officials believe that if the program were to be applied statewide, it could deliver $3.8 billion in savings per year. "This may change the Medicaid industry in New York," said Rockland County Supervisor C. Scott Vanderhoef.
This is just one example of a change in the way corporations and governments find and use information. Data are becoming much easier to access and vastly more useful.
Better Understanding
Organizations have huge amounts of data that pass through their computer systems as they place orders, record sales, and otherwise transact business. Much of this information is stored for future use and analysis. But advances in software and hardware make it easier for companies to analyze data in real time-when the data are first whizzing through their computers-and make them available to all kinds of employees.
Technological innovations also make it possible to analyze unstructured data, such as Rockland County's Medicaid claims, that do not easily fit into the tables of a traditional database. The result of all these changes: It is now possible for companies to understand what is happening in their businesses in a detailed way and quickly take actions based on that knowledge.
These improvements have come largely as a result of advances in business intelligence software. This software-a $3 billion segment growing at about 7 percent a year-gathers information in data warehouses where it can easily be reviewed, analyzes the data, and presents reports to decision makers. In the past, the reports had to be painstakingly assembled by tech-savvy business analysts and were typically made available only to top-tier people.
Personal Google
Information easily available to anybody in an organization is a phenomenon industry folks have dubbed "pervasive business intelligence." Companies are moving from a place where only the more technical people had access to information to more of a self-service situation. People can get information themselves, said Christina McKeon, global business intelligence strategist for software maker SAS Institute, based in Cary, North Carolina.
SAS and other BI software makers are reaching out to the masses in a variety of ways. Several of them have hooked up with search leader Google to give businesspeople easier access to those data warehouses via the familiar Google search bar. They have redesigned their business intelligence web portals so people who do Google searches get not only documents that include their keywords, but also others that are thematically related.
For instance, if a business-unit leader searches for first-quarter financial results, he might also get reports on the 10 largest customers in the quarter and the customers who deliver the most profits. "The data warehouse is starting to go mainstream," said analyst Mark Beyer of tech market researcher Gartner.
Directing Traffic
Business intelligence is also being added to other standard run-the-business applications, such as order fulfillment, logistics, inventory management, and the like. Consider a busy warehouse with a limited number of loading docks. Trucking companies do not want their rigs to wait in line for hours, so some of them charge fees for waiting time at the warehouse.
To avoid those costs, companies can build business intelligence into their logistics planning systems that lets them know when trucks are stacking up and directs supervisors in the warehouse to load the trucks that charge waiting fees before those that do not. The supervisors get this information via their PCs or handhelds on the warehouse floor. People are re ceiving the benefit of business intelligence without knowing it, said Randy Lea, vice president for product and services marketing at Teradata, a division of NCR, a leader in data warehousing software.
This kind of real-time, behind-the-curtains intelligence is even becoming available to end customers. Travelocity, one of the leading travel websites, has long used business intelligence software to help it analyze buying trends and segment customer types so new services can be tailored for them. Now it has rigged its vast data warehouse directly to its consumer website so it can gather and analyze information about what is going on as it is happening.
Computer Intuition
Travelocity links the profile of individual customers who are on the site to a monitor of their current activity and to information about available airplane flights, rental cars, and vacation packages. If a customer begins asking about flights to Orlando over the Fourth of July weekend, Travelocity's system will understand that the customer is probably planning a family vacation and will place advertisements that are relevant to that kind of trip and even pitch special travel promotions. "If we want to, we could give every customer a custom offer," said Mark Hooper, Travelocity's vice president for product development.
What is next in easy-to-use business intelligence Gartner has a concept it calls " Biggle"-the intersection of BI and Google. The idea is that the data warehousing software will be so sophisticated that it understands when different people use different words to describe the same concepts or products. It creates an index of related information-á là Google-and dishes relevant results out in response to queries.
In computer science, they refer to this capability as non-obvious relationship awareness. "Nobody's doing this yet," said Gartner's Beyer. Judging from the speed of recent advances in business intelligence, though, it may not be long before companies add the term "Biggling" to their tech lexicon.
How will tactical, operational, and strategic BI be different when applied to personal Google