Needs and Challenges of Business Intelligence for Small and Medium Enterprises
Once Albert Einstein said - “Information is not Knowledge”, it is just well said and I could connect the idea that BI could have been originated with this thought only. For a prospective more from the SME standpoint, let’s look how SMEs are contributing in the Indian Economy.
SME are playing a vital role in Indian GDP. They contribute more than 37 percent of the GDP and contribute 45 percent of the industrial output, 40 percent of exports. As a result, MSMEs today are exposed to greater opportunities for expansion and diversification across the sectors.
SME System Challenges:
1. They have lean IT team which cannot match the speed of CEO decision making process.
2. They have multiple systems but the MIS team is incapable to consolidate and correlate all data points which forces everyone to speak a single language.
3. Multiple systems have different sets of Information which is stopping everyone to speak one language.
4. Different sources of information have low quality of information making it difficult to analyze.
In this scenario BI implementation is very essential from SME’s growth prospective.
BI is just not a tool or technology or a methodology. BI is a new & powerful management approach and thinking which leads to business growth. When done right, BI can deliver knowledge, efficiency, better decision leading to growth and profits.
Critical Success Factors for BI Implementation:
To take out value out of BI Implementation, it should go beyond technical implementation and should not be just project of IT department or limited to involvement of CIO from top management.
In most of the cases it is seen that BI implementation lands up into just a reporting tool. This can be avoided by strictly focusing on Critical Success factors:
1. Management Prospective: Committed CXO team and sponsorship support for BI implementation is a must. They must give clear business vision and plan. Well defined objective to be taken out of BI Implementation.
2. Process Perspective: Well defined Processes and willingness to re-engineer processes to get desired result out of BI implementation is key for success of
3. Technology Perspective: Integration between BI system and other systems, Data quality and appropriate changes in integrated system to improve data quality.
4. Implementation Prospective: Regular reviews by Management, Effective change management and enforcement of BI system to certain extent in case of skill and legacy challenges.
However; BI Implementation strategy in small enterprises must be in Phases. Since, system and process maturity in SMEs is seen to be low, small enterprises must avoid Big Bang Approach. Implementation in Phases will also help to keep the budget adequate and move from one phase to another phase only after success. Small Enterprises must take “Crawl – Walk – Run” approach for BI Implementation. Initially implement only simple operational reports and some summary dashboards
Once Phase-I is successful then they can move to operational dashboard and ad-hoc query and some more complicated analysis. This way implementation will be more successful and mistakes made in the earlier phase can be corrected in next phase.
Be extra careful while selection of tool IT in this case should not only consider cost and timelines of first phase however; they must consider future need as well.
Cost, Time, Features, Infra and Skilled resource availability in market must be taken into consideration.
Make sure solutions can work on latest technologies like cloud, virtualization, mobile, social media so on.
Study licensing norms carefully. Most of BI product has complex licensing policy. There are various norms like licenses for connectors, multiple applications access, virtualization, CPU based licenses so on. Ignoring these facts may result in a bottleneck in the future for BI expansions.
Implementation partner selection is another important factor. Partner must have well experience and skilled resources availability. His market reputation should be excellent as he is the single entity who is going to develop your entire BI strategy.
As stated earlier, BI is source of Business success; CIO must take extra precaution before and after implementation.
A well thought and executed BI Implementation is a source of competitive advantage to small enterprises.
BI is much more than a system; it is management which tells you the way of business.