Blue Print for Next Generation Analytics v1.10 … Design Chain Supply Chain Program Design Chain Cycle Time Order Fulfillment Cycle Time Customer Requirements Bill of Materials, Specification

Blue Print for Next Generation Analytics

DiscussionAugust 24, 2009

2Confidential and Proprietary

Agenda

• What is new about the next generation?

• The five (5) keys for success you need

• Strategy and approach (road map development)

– Understanding your current state

– End State - Where do you want to go?

– Gap analysis – uncovering the actionable activities you will need to accomplish success

• How to get started


What is new about the next generation?

• Visual Discovery Tools– Quickly and easily visualize and interact with data to gain new insights

and make better decisions

• Integrated Master Data Management– Clean, high quality reference data

– Customer, Product, Contract-Agreement, Location

– Mature federated environments

• High-Performance Analytical Platforms– Massively parallel (MPP) databases, ETL work streams

• Robust data acquisition and profiling products

• Closed loop processing– Analytic products feed back to OLTP

(continuous, stream-oriented query processing)

– Business Services Support (SOA)


Conceptual Analytic Platform


Analytic Platform – Example Use


Analytic Platform – Results


The five (5) keys for success

• People, not Technology

• Process, not Project

• Value, not Cost

• Insight, not Data (Data ≠ Information)

• Think out of the box


The five (5) keys for successUnderstanding what counts

People - Insight and Visibility

Customer support repCustomer support rep

“I need better access to information to make better decisions on cross-sell and up-sell opportunities.”

“I need to have the right demographic information so I can better target my opportunity prospecting.”

Sales repSales rep

Chief executive officer (CEO)Chief executive officer (CEO)

““I need to know that the people in my I need to know that the people in my organization have the right goals in place organization have the right goals in place to understand to understand and execute on the execute on the strategic initiatives of the company.strategic initiatives of the company.””

VP, operationsVP, operations

“I need better visibility into my cost of operations so I can target specific cost reduction opportunities that won’t have a negative impact.”

Chief financial officer (CFO)Chief financial officer (CFO)

““I need to improve our analytics I need to improve our analytics capabilities so we so we can understand our current business performance can understand our current business performance and do a better job of planning for the future.and do a better job of planning for the future.””

Source: “Creating the Office of Strategy Management” by Robert Kaplan and David P. Norton, Harvard Business School, April 2005

VP, sales and marketingVP, sales and marketing

“I need better visibility into our pipeline performance so I can focus on deals that help me grow business with my most profitable customers.”

Gross Margin?Profit Margin (EBIT, EBITDA, NOPAT)?Operating Expenses?Asset Turnover?Working Capital Management?GMROI?Actual Employee Turnover Costs?

Debt to Asset Ratios?Debt to Capitalization?Interest Coverage?Burden Coverage?Cash Flow? Cash Flow / Share?Return on Total Net Worth?Return on Common Equity?

Earnings Per Share?Share Prices Appreciation?Dividends Per Share?Price to Earning Ratio?Market Book Value?Value Drivers?

Our Market Share?Effectiveness of Campaigns?Selling Together?Not Selling Well?Selling in What Market?

My Customers?Their Competition?My Next Sales Opportunity?What is Selling Now?


People – What Is Needed

• Address the human-side systematically

• Obtain top level support

• Involve every layer

• Clearly communicate the business case

• Create ownership, install change agents

• Clearly and continually communicate the message

• Assess the cultural impacts and issues

• Prepare for the unexpected

• Define WIIFM (What's in it for me?) for each role or individual


Distinguish casual users from power users

Source: The Data Warehousing Institute, Wayne Erickson, February 2009

Monitor, Analyze, and Drill to detail


Match Profiles to Tool Categories

Analytic Profile % Users Users Type of Activity Type of User Optimal Tool Category Important Functionality

Miners 3% 3 Creating Statistical

Models

Statistician Data Mining Tools (neural networks,

decision trees, statistical analysis, etc.)

Workbench that supports model

development lifecycle: Database

integration

Developers 7% 7 Create reports,

queries, OLAP cubes,

applications

Programmer, Systems

Analyst, Technology

Savvy Business Analyst

Ad hoc query tools, reports writers, OLAP

tools, development tools

Query complexity, rapid development

and testing, source data access, report

broad- and select-casting

Explorers 10% 10 Analyze large

amounts of data or

data with lots of

attributes in an

interactive,

exploratory fashion

Business Analyst,

"Power Users"

Relational OLAP Performance scalability, analytical

breadth and depth

Planners 20% 20 Perform "what if"

analyses to create

budgets or planning

assumptions in order

to run a department

Managers Spreadsheets, Desktop OLAP, Multi-

Dimensional OLAP, Custom Applications

Read/write capability, collaboration,

integration with Excel

Reviewers 40% 40 Review a consistent

set of data on a

consistent basis, and

drill down to more

detail only when

something in awry in

the data

Managers, Executives,

Customers, and

Suppliers

Interactive reports (parameterized

formatted reports, pivot tables, or OLAP

views that users filter against)

Exception alerts, personalized delivery,

ease of use

Gatherers 20% 20 Retrieve a specific

piece of data in near

real-time to perform a

specific business

process

Customer Service

Representatives,

Administrative Workers

Custom applications, etc. Ease of use, sub-second response

times, reliability


Think Process, Not Projects



Design Chain Operations Reference

(DCOR) v1.0

Research IntegrateDesign Source DeliverMake

Product Design Chain Supply Chain

Program Design Chain Cycle Time Order Fulfillment Cycle Time

Customer Requirements

Bill of Materials, Specification

Product

Program and Operational

Business Plan

Supply Chain Operations Reference

(SCOR) v9.0

Product Development Global Operations

Product Lifecycle Management




Reduce Action Latency

Planning, analysis, decision and execution cycles are accelerating


Deliver value to meet business needs



Right tools for the right job

Purchase Analytic BI tools that are not too complex for casual users but are sophisticated enough for power users.



33%

23%

77%

40%

36%

65%

8%

23%

Have significant decision-support/analytical

capabilities

Value Analytical insights to a very large extent

Have above average analytical capability within

industry

Use analytics across their entire organization

Source: Competing on Analytics, Thomas Davenport

Insight – The Competitive Edge

Low Performers

High Performers

High performing companies are more likely to use analytic information strategically


Think out of the box

Source: FMS Advanced Systems Group, Sentinel Visualizer

• Find hidden relationships • Identify clusters and patterns quickly • Perform ad-hoc analysis, and test theories and scenarios • Organize complex networks into manageable groups• Geospatial Visualizations


Think out of the box


Strategy and approachRoad map development

23

IDEAL Method

Initiating

Diagnosing Establishing

Acting

Learning

ProposeFutureActions

AnalyzeandValidate

Pilot/TestSolution

CreateSolution

Develop Approach

Set Priorities

DevelopRecommendations

Characterize Current and Desired

States

CharterInfrastructure

BuildSponsorship

Stimulus for Change

Set Context

ImplementSolution

RefineSolution

Plan Actions

Roadmap for

Management

Improvement

Initiative

Assessment

Roadmap

Initiative

Projects

The IDEAL(SM) Model

The IDEAL model is an organizational

improvement model that serves as a

roadmap for initiating, planning, and

implementing improvement actions.


Creating the Road Map

1. Current State Review 2. Future State Definition 3. Initiatives Definition 4. Initiative Prioritization

Business

Objectives

Functional

Needs

High Impact

Business

Processes

Org and

Process

Improvement

Cost and

Complexity

Drivers

Functional

Initiatives

Outputs From Current

State Field Work

Performance

Targets

Guiding

Principles

Architectural

Imperatives

Organization

Initiatives

Organizational

Initiatives

Process

InitiativesRoadmap

The process will focus on

placing business

objectives, initiatives and

projects on the roadmap

1.

2.

3.

4.

5.

5. Roadmap Development

1.

2.

3.

4.

5.

Biz and Tech

Artifacts

Recommendations

Gap Analysis


Road Map – Program View

Roadmap

1.

2.

3.

4.

5.


Road Map – Details


How to get started


How to get started

• Evaluate incremental improvements to existing architecture and enabling technology – leverage what you already have

• Ensure you have the capability to deliver– Aligned with agreed strategy and goals

– Supporting organization is well defined

– Processes (vertical through planning and budgeting, or horizontal through lateral relationships (matrix) exist or can be adopted to meet the new platform

– Leverage key people and core competencies

– Performance measures and rewards match intent

• Supporting business case is sound and defensible

• Mitigate or minimize technical and design debt in the design and adoption of the new platform (http://c2.com/cgi/wiki?TechnicalDebt)


Leverage what you have


Ensure you have the capability to deliver

Do not try to build a system whose complexity

exceeds the organization's capabilities


Develop a supporting business case

Table of contents

1. Executive summary

Background

2. Current business

Description/economics

3. Proposed project

Description/strategic fit

4. Options evaluation

5. Timescale and investment

analysis

6. Standard management practices

7. Appendices

Supporting material

• Analysis of benefits• Analysis of costs• Financial spreadsheet• Metrics – ROI, NPV, etc.

• Risk analysis and mitigation• Alignment• Project change mgmt• Quality assurance• Project finance• Reporting• Governance


Plan and design carefully

So

lutio

n S

pe

cific

atio

n


A word about technical debt…

• Metaphor developed by Ward Cunningham…

• Doing things the quick and dirty way sets us up with a technical debt, which is similar to a financial debt

• Like financial debt, technical debt incurs interest payments in the form of the extra effort in future development due to the quick and dirty design choices.

• We can:

– Choose to continue paying the interest, or

– Pay down the principal by refactoring the quick and dirty design into a better design. Although it costs to pay down the principal, we gain by reduced interest payments in the future.

Questions and reference links

• Beyond Reporting - Delivering Insights with Next-Generation AnalyticsTDWI 2009, Wayne W. Eckerson

• Technical Debt (Ward Cunningham)http://c2.com/cgi/wiki?TechnicalDebt

• Applied Enterprise ArchitectureJames Parnitzkehttp://www.pragmaticarchitect.wordpress.com

• Creating the Office of Strategy Management Robert Kaplan and David P. NortonHarvard Business School, April 2005


Thank You…


Mr. Parnitzke is a hands-on technology executive, trusted partner, advisor, software publisher, and widely recognized database management and enterprise architecture thought leader. Over his career he has served in executive, technical, publisher (commercial software), and practice management roles across a wide range of industries. Now a highly sought after technology management advisor and hands-on practitioner his customers include many of the Fortune 500 as well as emerging businesses where he is known for taking complex challenges and solving for them across all levels of the customer’s organization delivering distinctive value and lasting relationships.

Contact:[email protected]

Blogs:Applied Enterprise Architecture (pragmaticarchitect.wordpress.com)

The Corner Office (cornerofficeguy.wordpress.com)

Data management professional (jparnitzke.wordpress.com)

Essential Analytics (essentialanalytics.wordpress.com)

The program office (theprogramoffice.wordpress.com)


Blue Print for Next Generation Analytics v1.10 … Design Chain Supply Chain Program Design Chain Cycle Time Order Fulfillment Cycle Time Customer Requirements Bill of Materials, Specification

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