Editor’s note: Eric Lonefield is the business intelligence practice lead at Ironworks Consulting.
________________________________________________________________________________________Looking at how today’s organizations reign over the vast tracts of data in their information systems, it is clear that most companies are operating in an informational feudal system. One does not have to be a scholar of history to see the glaring similarities between the dark ages of European history and how companies have historically managed their most important asset, their data.
Fortunately, recent advances in technology in the area of Business Intelligence are serving as a catalyst for change and is moving companies out of the dark ages and into an “informational age of enlightenment.”
We’ll explore this analogy; the feudal cast of characters and the social and economic drivers that led to the dark ages and how that relates to information management in companies today. We’ll then look at how emerging business intelligence technologies are ushering in an informational renaissance.
The Dark Age
The feudal system can be generalized as an early caste system where all the land was owned by a king, who leased the land to, and collected taxes from, a few nobles who in turn worked the land with serfs or peasants through a manorial system. An additional influence and class of the feudal society was the clergy. The clergy provided structure and order to the feudal society and often wielded power over the nobles and great influence with the king. These manors were self sufficient, de-centralized societies that were isolated, well fortified, and there was little or no interaction between the nobles aside from their allegiance to their king. Communication was often difficult as few ever left their individual fiefdom.
As we compare this to the way companies currently manage their data, the similarities are almost astonishing. Companies (“the king”) have their data spread out and managed in disparate information systems managed and run by business unit leaders (“the nobles”) and their staff (“the serfs”). Finance and accounting manages the general ledger, sales and marketing are responsible for managing customers, and operations manages supplier and fulfillment needs. The information technology organization (“the clergy”) provides structure and order for each of these business units and holds significant influence within the company.
While there is significant interaction between business units in today’s companies, data is often isolated and well fortified within each different information system. This system came about because technology manufacturers were focused on business applications that improved business process and lowered transactional cost. They were looking to make the manorial system as efficient as possible. The reporting out of these systems was meant to be self sufficient for the line of business that was using them. Even for those organizations whose ERP systems were well integrated, there was little thought put into the extraction of data for business analysis purpose across functional areas or for aggregate corporate level reporting.
The New Age
The Age of Enlightenment that grew out of the Dark and Middle Ages of Europe was driven by several key factors. Tremendous discoveries in science and technology ushered in a shift in thinking away from the religious teachings of faith towards individual understanding, the scientific method and a belief in progress. This age of enlightenment led to a shift in artistic realism and the way individuals viewed their surroundings.
Technology advancements coupled with recent consolidation in the Business Intelligence technology space and companies desire to leverage their information is ushering in a new age of information management. Data integration between differing technology platforms has become far simpler, reporting has become dynamic and interactive and is no longer confined to the printed page. Analytic tools allow for complex, data and visual analysis and are no longer confined by data constraints. Visualization tools allow for complex analysis to be easily interpreted and allow analysts to paint a new realistic view of a business problem or opportunity. Most importantly, companies are beginning to understand the data they have and are aligning their information with strategy, business process, as well as their external partners to gain a better understanding of the corporate self.
Companies are on the cusp of a new age of information management. Early adapters will have a significant competitive advantage because they will have an understanding of their markets, their customers, their suppliers, their core competencies, and their value proposition. They will no longer be constrained by their kings and nobles, they will be free to learn, grow, create and explore new opportunities.