The value of business intelligence

"Up to 50 percent of managers place no confidence in the numbers presented to them". Business intelligence research, Cambridge University 2009

Is that to hide behind the brand or personal failure?

I am a great fan of publications of KPMG International. I quoted them before and will do again as I fully agree with one of their latest published studies:

"Being the best Thriving not just surviving" - "Insights from leading finance functions"

What really hit me is the conclusions that;

A) Real business intelligence is still rare and it’s time to stop downloading and reworking.

B) Almost half of business leaders do not place confidence in numbers of current external resources.

Before putting my own input on these conclusions I would like to share some of the text from this study first.

"In today’s global economic environment, there are two key components to building greater influence – better business intelligence (right information, right time) and deep business skills (right people)".

Here I will focus on better business intelligence as we cannot offer the right people. We have them but they are not for rent, our intelligence is. The study continues with “Real business intelligence is still rare”.

“Business intelligence is a term that means many things to many people. Simply put, it is a collection of ‘intelligent’ information that helps business leaders make better business decisions that enhance shareholder value.

“When it works, it can deliver the real competitive advantage that business leaders strive for. It is the provision of robust business intelligence that in many cases differentiates top performers from the rest”.

“High quality business intelligence is driven by a collection of processes, applications and technologies designed to gather, store and provide easy access to information. At the heart of this, however, is data”.

Absolutely true! But do business leaders really want to be helped? When the data is wrong would that not be the perfect excuse for internal / personal failure? Would that in this challenging climate be a reason not to go for the “change”?

“In many cases it is the underlying data structures and hierarchies that are driving inefficiencies in the production of real business intelligence. These problems also contribute to why such a high proportion of business leaders place no confidence in the numbers presented to them”.

“Finance leaders should address these issues head on. They should invest to align data with key business metrics, and focus on getting to the root cause of inefficient data structures”.

What decides what is best (for themselves or the company)? I am confronted with finance leaders who assume they are fully covered. I would say wrong covered because would that indicate there is no better solution?

Business intelligence inefficiency in terms of cost and time are put aside as long as other priorities are in place in the current downturn. Short or long term vision?

“The recent market conditions have also illustrated the need for a much greater focus on cash and working capital information. The need for truly effective business intelligence, addressing multiple business dimensions, has never been greater”.

“Can the future of the finance function be manipulating data in spreadsheets to “cobble” together information for boards and investors? Top performers know change is needed and are well on the way to developing solutions that deliver real competitive advantage”.

To not only create cash on the short term more effective business intelligence is a must. Manipulating data by collecting certain information from the internet for example should be banned.

How can out of date info become guidance to the board or investors?

To make change business leaders should be willing to change first and to have the ability to change.

Only cutting costs and not spending smarter will not make the change while waiting for market conditions to improve a search for better business intelligence should become a priority instead of postponing.

"Adapting the finance function is now more urgent than ever, by providing the right information at the right time to help business leaders navigate through turbulent times".

Jochen R Pampel
Global Head of Financial Management - KPMG

It seems combining the words of Mr. Pampel and the above mentioned conclusions (A and B) point out that providers of business intelligence can only succeed when:

1. Distinguishing from others. By offering better quality data, more synergy such as time savings and finally helping cutting costs will be directly contribute to “change”.

2. Delivering the right information to the right people will help much better than receiving an overload of information (overlapping) or doing a non core business search internally. Especially now business leaders are more time limited than ever.

3. Finally the urgency as discussed by KPMG should not be interrupted by budget restrictions. Here I would like to give the following example:

Business threats are not only coming from industries and economies but also for example from a simple computer virus. Imagine tomorrow your office is hit by a new virus.

Would the responsible IT or other leaders postpone a cure because of budget restrictions and have to wait till the next budget cycle?

This is exactly what currently happens in regards to macroeconomic intelligence. While facing the worst economic decline in their own professional career many business leaders cannot access valuable reports.

Even when country reports on a monthly basis only cost a few dollars. Understanding this from a rational point of view can justify this decision but would that not undermine the current needs of quality information?

Or is it really like the computer virus that fighting an economic downturn can be done by not changing (improving) your information streams as this only can be done when market conditions have improved?

This might be the answer why almost 50% of the managers place no confidence in the numbers presented to them. I would rather say they lack own confidence in making a change or convincing their management to do so.

I look forward to get your opinion. I sincerely hope business leaders start welcoming better economic intelligence. Not only for us but to finally serve better professionals who for market insights need the kind of data we publish.

Thank you all for the attention in this discussion.

Warm regards,


Martijn Oostveen


FocusEconomics / LatinFocus
Barcelona - Spain
Tel. +34 93 265 1040 / Fax. +34 93 265 0804 / Skype: fe_martijn
www.focus-economics.com / www.latin-focus.com
"FocusEconomics: Global Economic Insight with a Regional Focus"
LinkedIn: http://www.linkedin.com/in/martijnoostveen