Performance Controller

There is no doubt that our very existence on the planet, as we know it, depends on our continuing intelligent interpretation of information about our ever evolving behavior.

Paul Barsch is a clever writer who pulls data analytics together succinctly in applicable easy to digest scenarios. In his recent article “It Takes Courage to Compete on Analytics” he uses an example of a small league analytics protagonist who got a competitive edge on the big guns.

He describes Billy Beane’s approach to developing and staffing a professional baseball team and it makes for a good read.

But Paul is not the first to write about Billy Beane and the teaming approach he took with his Harvard friend Paul Depodesta . A book by Michael Lewis was written and published about Beane in 2003. It was later made into the movie “Moneyball” starring Brad Pitt. This is a wonderful human story of both the success and despair of this man who took on the establishment with an unorthodox approach; and had the courage to defy decades of “common knowledge” in assembling a winning baseball team, yes using analytics.

Interesting too the book is parodied in the Simpsons episode "MoneyBART", that premièred in October, 2010 and in which Lisa manages Bart‘s Little League baseball team using sabermetric principles which are attributed to Bill James who has scientifically analyzed baseball in his writings since the 1970’s

So it seems analytics even in the ubiquitous dysfunctional world of the Simpsons touches everyone. And as Paul Barsch says about Billy Beane, who despite his oblivion now, has had the last say with his methods being all pervasive having changed the way the game is played.

But it remains clear to me that for many of us plebs, analytics is typically deemed as something for the the astute of mind. For the rest of us is it to enjoy when it shows up in a good story.

Sydney: Nov 8th, 2011

Here is an update on golfer Tim Wood, who looks like coming back to the PGA leader boards with his blistering Australian Open qualifying form today.

As a golfer how about this for a score over three rounds: 73 , 71 , and 69?

My cousin Pete, just sent me a note to say Tim is returning to top level golf after an injury, and shot this today in a PGA pre qualifying round.

A mug golfer, like me, cannot even dream about such scores. But for top players it is no cake walk either, with that level being needed just to make the cut to play in the game.

When we talk about focusing our Performance Management we know the value of feedback to achieve consistent results. But seeing this kind of performance reminds me that it needs much much more than just feedback and focus. Be it sport or any endeavor it also needs total devotion and practice at the game itself to overcome all the odds to be the best.

At a Family Christmas,as party about 17years ago I asked my then 13 year nephew what he wanted to do when he grew up. He was mad on golf so it was no surprise when he replied:

“I want to be a professional golfer”

Performance management was an understatement for this good natured kid who spent every hour he could practicing golf at a local course in Rosanna Melbourne, Australia near his family home.

His career, as many who follow golf may know, saw him join the professional ranks. The last few years has seen him with a good share of the Press and TV coverage of his leader board positions in the big PGA championships around the world including the British Open.

Peter Wood who is without doubt one of Tim’s most important supporters with wife Heather are Tim’s unofficial coaches, Pete, who is always humble about his son, is a golfer himself and these days ranks golf courses for the PGA. He is also the Captain of BarnDougle Dunes course in Tasmania which ranks as Australia’s No 1 Public Golf Course, World No 7 public access course and 35th best course in the world.

I do know too that despite his public reticence about his son’s success, he is understandably proud and updates our wider family on Tim’s progress from time to time.

I too am proud of my nephew but being more distant I am less reticent to pass on any news; especially to my Sports Bar friends in Asia to promote him. They in turn in know the “one of locals”  value of such an expat connections, and promote the local interest coverage when Tim is playing.

Today, I got this email news from Pete headed:

“A Tim Wood Update”

 

After battling the after effects of the ankle injury for so long, it has been a long time since Tim has played regular tournament golf at the top level.

With potentially 9 weeks on the Aussie tour before Christmas he was hopeful of regaining some sort of consistency within the first month so he could hope to be competitive again for the later tournaments.

He badly needed to make cuts and play tournament golf.

He came close in the WA PGA , missing the cut by one. This last week was the NSW PGA , his third tournament on the trot, and with rounds of 73 , 71 , and 69 he improved each day , made the cut, and made some money.

His attention now turned to this week’s Australian Open at the Lakes in Sydney. The field is one of the strongest on record – with 17 of the world top 25 playing as well as the likes of Tiger Woods , Greg Norman , Fred Couples.

Tim teed it up in qualifying this morning, and shot 5 under the back nine to be leading qualifying when the news came through that he was in the field anyway. He says the Lakes course is extremely tight and tough, and will be a strong test.

If he was in top form this course would probably suit him. He has been able to manage the ankle throughout the last 3 weeks, and will have treatment again the next few days to get himself ready for a big effort on Thursday.

Perhaps this year he will be known as "The Wounded Ankle" rather than "The Wounded Seagull" – haha.

Fingers crossed he can get it going

Aside from having the opportunity to promote my nephew, to keep faith with the context of this forum being about business, I reaffirm the lesson these professional sportsmen give us.

Just getting the intelligence from the coach about performance is not enough.  Like Tim Wood and his fellow professionals, being on top and staying there also means being well balanced, highly dedicated and prepared to always play the game at your best to win.

I know it is often said that figures can lie, but lies cannot figure. Or can they?

The trouble is suspended disbelief conditioning starts when we are small with fairytale stories.

This week I got a report from NYC Parking Ticket with the full set of New York City accounts for 2010 attached .

As I read them it seemed no wonder they are losing money.  I you want to know how not to do a set of accounts take a look art theirs .

When I checked on fairytale definitions I found the phrase refers to either; an interesting but highly implausible story, often and excuse; Or a story about fairies, told to amuse children. Either way the selective use or all-time favorite character, being money in the NYC report makes a good fairy story.

I also wrote back to my friend Larry Berizen, who with his partner Dan Giacomarro runs a legal practice in New York that focuses solely on helping customers resolve their parking issues in an aggressive money hungry monopoly worth over 600 million smakaroos to the New York City. In his unique practice he publishes a regular blog with tips and advice on how to handle what he refers to as the NYC parking warriors and the legal system that supports them. He finds their often cowboy style antics are frequently suspect when it comes to getting their their quota of scalps. (They call them KPI’s) This seems clear something is not right when the success rate on defending parking violations notices exceed a massage 30% of all issues.

Here is an edited copy of my note that I shared on his blog reply section.

Hi Larry,

I took a look under the covers at the NYC report for 2010. I spotted a few things as I did come counting.

The first was this set of confusing financial reports has a lot of numbers with very little that is easy to really understand; save the bottom line that says the city had lost a lot more money. The significantly large document of 377 pages to many may seem impressive, especially when you find sets of 10 year trends. But I could find no sensible performance based segmental or consolidation at all and it seemed to have repetitive and what seemed to be unrelated data with little or no performance context.

There is a great deal of detail on revenue by, what I would call products and services, but no service delivery costs are associated. Hence you cannot determine the service activity performance. Parking Meter Revenues of 147 million in the Transport Category plus $604 million in Fines in the Finance revenue together with scatted other agency parking contributed significantly to the 2010 total of 62 Billion

When I added up all the parking related revenues in all the agencies it was pushing 1 billion. Excluded grants and taxes this number that make up the majority of the total $62,813,314,759 to be exact. the parking business fell into the top 10% highest single contributors.

Interesting that such a large business has no bottom line e.g a gross contribution as all costs are lumped together under separated general activity headings with outgoings for all NYC programs .

On the subject of parking my count saw it featured 25 times in the report As such a cash cow and one of the top 10 numbers having a discrete set of incomes and direct costs would let us see how is it performing as a business. I bet they don’t know themselves so it is no wonder that are losing money if they don’t know how to account for their business. Anti-pellucidity is a word that springs to mind for most. Mushroom accounting is another.

Another related set of numbers I looked at were performance ratio across a 10 year span showing the % ratio of working meters. The health of the assets can be a good indicator of how well a business is running. (Would you get on a bus with bald tires? )

Here is the 10 history from their report and especially the last 5 reflects the total malaise.

Incidentally the Aussies have an an approach that has worked in the Gold Coast for 50 years.

There Business savvy traders understand the idea is of giving customers a good experience to keep them happy and keep them coming back.

But I wondered how NYC can run a legitimate parking business to make $146,784,983 in parking meter fees without enough working meters, let alone be entrepreneurial to provide such a value added service.

Jacking up prices is one way to achieve the 15% year on year lift in revenue to make budget so why bother incurring costs to fix the kit. Obviously the 100% revenue loss on 6% of the meters that went our of service in 2010 meant they somehow had to get the unit price up by over 25% or more Why not I say. recession or not, that seems fare doesn’t it, especially when they have a monopoly.

On the other had clearly service was not the budgetary aim as Fines were budgeted to increase 15% as well. But the rouge warrior strategy for that was clearly thwarted by the “Who Ya Gonna Call” warrior busters team of NYC Parking Ticket fame who kept it to $604,050,097. Obviously the extra speed Cameras noted in the statistical pages of the report, weren’t enough to boost the city coffers to expectations.

Another interesting chestnut that showed up was, of 24,369 City and State Disability parking permits issued during fiscal year 2008, an inventory check of seals on hand showed at least 22,000 were unaccounted for. Since anyone can create fraudulent permits using these seals it would seem an astute recipient who saw them fall of the back of the armored truck now has a license to print money? The audit report did not say someone’s head in the Department of Transport will roll, But before they do that I suggest NYC send out a ferret to check the parking places around town to find all the new Ferraris and Lamborghini’s. I bet they will find a few new ones parked by people who previously rode push bikes. Find them and the city could have its money back 10 fold from the black market traders.

Another proud boast on page XV of the cover letter to the People of New York said that improving both manual and automated City systems saw NYC collect outstanding parking tickets from claimants who received settlements from the City. Go get ‘em" team… It seems anyone who is lucky enough to get a settlement sure won’t be keeping it long with the NYC agency now commissioning ferrets to go out on the job to get their money back. Maybe they should do over the homeless as their next KPI

So, on balance it seems there is no balance in NYC books. To fix it needs some clearer and more transparent accounting and public servants who can balance business acumen to deliver on the city needs. Only then can they reverse the continued hemorrhaging that saw 2010 add another 10 million to make 108 million greenbacks down the tubes.

I know every fairy tale we read to our kids teaches them lessons we want them to learn. I love reading your stories Larry if not only for that reason. But the NYC city accounts looked like an implausible excuse. Getting to understand their cash cow parking business could actually be being managed as financial fiasco, could just the tip of the iceberg.

That’s Grimm for sure.

Cheers Gordon

Sherwood Group Consulting

 

Who You Gonna Call – Performance Busters !!!

Many people don’t realize the simplicity that comes when they have a reporting database to pull all their information together in a workflow based system. This lets everyone see and believe all their relevant data from anywhere at anytime.

Being in the industry of helping businesses measure their performance always keeps me busy. Helping clients who call to talk about ways to resolve consolidation and upcoming budget pain is actually nothing new.

But in the end it is these fundamentals that are always questioned by businesses. As they grow and best practices evolve with technology, it is important to have scalable and extensible control systems in place to manage their information.

Having a good performance reporting system even in small and medium sized business is vital. To stay in business we always need to find better ways to sped up and simplify things. That includes management planning and control processes too. Hence planning reporting system upgrades get especially critical as a company grows and adds more tenants to expand their markets and reach. Equally important is a getting scalable well maintained solution that can handle more as they grow more.

These days good integration is also an important consideration. But now even the small and mid-range ERP systems fit well into web database centric reporting systems that can pull it together fast. That means all businesses, big and small can now have the agility to plan and close the books fast.

Good database reporting systems are also now are much cheaper and easier to implement. Even so upgrades are disruptive so businesses worry they may have to go thru it all again in a just a few years as their new system age. To answer that, these days even maintenance and keeping up to date is done well by the solution providers whose survival depends on it. And in those eco-system, advisors like my firm are around in the middle to maintain watchful vigils for clients and stay current and keep the software providers on track. That means business always had somewhere to go to get help.

When an incumbent financial control function in a growing business it often find their legacy are quickly outdated and typically that is when they go looking for a new system. They then see the the risk of losing control and the need to remove the constraint for meeting their goals. Conversely when it comes to investing in cycle downturn times we are seeing a change of attitude. In the past slowdown meant change programs were put on hold as cash got tight. But we are seeing a change there now too with cloud based services going in to enable tactical and competitive rapid respond to downturn changes. This is allowing business to keep their cash while also being able to update to get change done quickly for their vital pin point decisions.

At the sharp end now typically this month also sees the flurry of year end closes around the world for all the June 30 companies. In the next month or so it will be hard to get the attention of CFO’s they deal with all their compliance reporting for the past year. For them it is too late this year to put in a Consolidation system as they continue to rely on their legacy systems with late nights and a lot of skill to bridge often cobbled systems with spreadsheets.

But for them it is too late to change this year. Simplifying the tasks will now have to wait to improve how they add it all up and sort out and eliminate intergroup trading, shareholders’ interests. Streamlining year end reconciliations, making adjustment journaling and responding to board audit committee demands are just a few of the issues they face where a new system will help. Complying with the imposing IFRS is also able to be handled well in updated reporting systems. And many know well spreadsheets are hard work when wrestling with things like with currency translations and the like to get the numbers all added up and in order. It also becomes quite nightmare that over time becomes unworkable unless a reporting database is added to allow data to be maintained in and ordered way with repotting able to be added and reformatted as needed

For the many closing the books now it is also a time to sort out who get what when it comes to income tax. We all know that one of our largest expenses in our businesses is tax. And the IRS across the globe universally get first dibs its share on any money a business makes make before the shareholders get a penny. It is not coincidence when you put those two words together namely ‘The ‘ and ‘IRS’, it spells ‘THEIRS’? With is the game over for last year to minimize tax, The scorekeeper can do no more than pay, as it is way too late to look at a planning system to get more efficient to reduce the taxes we need to pay.

So it is actually a really good time for all those companies out there who are really busy closing now to get their IT people to start looking around and do some homework to feedback on what’s possible. And as they do CFO teams should make notes on the issues and be ready to go forward when they can lift their heads.

Later in the year they can be ready to use the half year reporting cycle which is always a good time to test a change iron out the bugs for the next year end. And having a system for doing the budgets for their next year will then be quickly quickly upon them as is tax planning for the year in progress.

As advisors our firm, Sherwood Group Consulting works with and promotes Infor PM which is one of the leaders and meets all the criteria. Hence I am obliged to give them a plug or suggest you to call or contact us if you want some advice as to where to start.

To answer the question I am so often asked about where and when to start this video actually says it so well. Getting controls can start anywhere in the cycle and you can even start small then take it from there.

 

This video is excellent summary that makes the point well for CFOs’ and key business Executives to watch.

But plugs aside, if you are in business I urge you to get your CFO’s to take a look around and see how others are doing things and what systems are about that can help.

This week I visited  a company that employs about 2,000 people. As I looked at the organization charts I wondered what they all did. I was there was to advise on their business process and for that it seemed I had a daunting task to understand their work.

A management course some years ago gave some clues on alternative ways of thinking about approaches . The basis was a confronting set of ideas that makes a lot of sense. It went something like this.

Most people know what they know and try to improve on that. Useful achieve mastery in a single domain.

Others may also find out about what others know to advance. Useful but equally limiting.

Smarter people try to know what they don’t know to become mentors to others who don’t.

Intelligent people know they don’t know what they don’t know and trust to others who do. They are usually leaders.

To do the job I had  some  choices: Be an expert,  a mentor or a leader. The conundrum as always when given such choses is one would choose that will ne the most effective. Any suggestions?

A recent documentary on the History Channel noted that nearly all of containers ships crossing the Atlantic are going back empty to China. by contrast Australia has the opposite situation where exports of raw material to China are bringing a surplus

This 2009 graphic says a lot about the current financial state of the North America with USA and Canada being consumer in large quantities of China products.   It is a endemically circular as the US companies who previously dominated manufacturing now manufacturer in China to supply their domestic markets. The 30 year transition that brought the in crisis situation left the traditional manufacturing with high and permanent unemployment. US Consumers including those on welfare have no choice to buy to imported goods until the country runs out of money.

As US companies look at ways to balance the books it is bringing opportunity that Industry leaders are spotting. The imbalance reduction, albeit slow and painful is happening with local supply culture changing too so it can compete .

Other counties watching how the pendulum moves, need to watch these dynamics as the US restore its balance of trade.

It is said "Energy cannot be created nor destroyed; it can only change in form". Predicting the reformation is the challenge. One of the biggest issues is people delivering services and selling product is they don’t understand the behaviors of how they are consumed. Hence data mining to that let people understand this more, is now looming large.

When you hear about data mining and the Clementine methodology; it is nothing to do with digging for precious metals or singing some old song by the same name around a miners’ camp fire. And the job of Data Mining certainly is No Free Lunch.  A guy called Tom Khabaza, using information in telecoms and law enforcement defined a solid approach and some rules for data mining. The advanced thinking he applied is a widely used in processes in predictive analysis work.

On his website, Khabaza defines data mining this way:

Data mining is an analytical business process which applies predictive modelling algorithms to solve business problems.  Predictive analytics is a family of business solutions which embed predictive models, produced by data mining, into a business process.  Data mining is the “predictive core” of predictive analytics.

……………………………Tom Khabaza

Khabaza developed his mantra with what he calls laws These are embedded in his objectives based methodology with a knowledge centric approach that lets him create and see patterns in what many may see as unstable information. This allows him to make sensible determinations about real predictive value, while being able to understand implications of data model accuracies and the impacts of laws of change.

He asserts “Data mining is not primarily the technology, it is the process, which has one or more business objectives at its heart. Experimentation is a key aspect as is preparation more than half of every data mining process.

At the heart of our very existences is our inquisitiveness. Analytics turns that into value. Understanding what data mining is all about is not just for academics and marketing gurus It is for all of us.

Meta Brown, an advocate of the Khabaza work and an analytics software marketer, says “

Much of what passes for data mining is no more than reporting”.

Ms. Brown, on her website claims she has introduced and expanded analytics in offices and factories across the US and Canada. That sort of pedigree makes her insightful comments on Khabaza’s 9 laws noteworthy.

She interprets that there there is more to it than just needing good data but  manipulation is an important part of the data miner’s process. Her editorials makes it LL easy to understand this recommended reading in her post, also reproduced here, below fold.

Read more…

This week in my subscriptions inbox was a post from a contemporary. Larry Berezin writes about a proposed law to Pay-the-Motorist-$100-when-a–Parking-Ticket-is-Dismissed, His regular blog is on legal issues around New York Parking.

Berezin discusses the so called DenDekker Bill for a law to dis-incentivize rogue parking inspector rackets. This potentially exposes NYC to a $6M liability based on last count published statistics where 14.7% of violations were dismissed and 17.1% of appeals were granted reversal.

I agree with Michael DenDekker’s underlying sentiment and for a moment it seemed there was some hope for an end to the parking ticket scams. But as the threat to city coffers makes the bill passage tenuous, it seems going one step would obviate that by having perpetrators involved foot the $100 bill.and not the NYC.

Of course the real question is defining rouge practices. Those just doing their job, and making honest mistakes must be protected, Like the public they serve, they must not be made victims. And in the end where does it stop. Would this law set president on all pecuniary penalties? 

Hence setting the pendulum weight to bias the swing the other way, may be well intentioned, but could be potentially ugly too. Exposing the soft underbelly of law abiding public could be too tempting to any rouge parking inspector to use their inside knowledge to swap sides and then milk the system with $100 cash back scams.

The famous NYC Mayor Giuliani approach could work for zero tolerance on scams. And I like Larry’s idea about bringing back Arnie with his Terminator gun to help too. Those suspended disbelief movies were good weren’t they? And so much better than the Governator role he played that lead him to that long running Days of Our Lives series he was in. But now he has left that show, he could be up for a comeback and be of real value to the public as well.

But the best suggestion of all is Larry’s KPI approach. Six Sigma with black belts all that sounds like a fun. What I do like too is it has all the good aspects of performance management built in with no real down side. Being transparent, it is balanced and with collaborative reviews and timely alerts, makes cake-walk of continuous improvement. The statistics that NYC have too make it clear they have a good data base there already So to make that work a Business Intelligence system to do the analysis and let people see the information is all that may be required. I might just have one in stock and we have some good consultant to advise too.

So you see, with Larry Berezin’s quite brilliant big picture KPI amendments to Michael DenDekker’s equally luminous get out of jail cash back initiative gives hope to a need. And knowing we have the make it happen Ware-With All with performance management solutions, everybody wins; the NYC, the Parking Inspectors , the Public, Arnie, plus my business intelligence software based consulting firm Of course we need good Lawyer for the contracts management too Larry.

All jokes aside, I have already send a message of congratulations for a truly thinking piece.

Last year, using Infor Performance Management solution at our firm Sherwood Group Consulting, we rolled out a very successful business intelligence solution for Krung Thai AXA.  It was a winner, that has helped  this Company to leap ahead in a watch this space  style growth.

Krungthai-AXA Life Insurance aims to triple its growth as one of Thailand’s top three life insurers within three years.

We claim of course this is due to our skill to deploy this rich world class software. But the truth is business intelligence needs more than that to be a winner. It really works best when you either use it to create a winning team or you already have a winning team that wants to move to the next level.

Mike Plaxton by anyone’s standards, stands out in his class. As a long time Insurance industry Icon and veteran,  he presently heads up Krung Thai AXA as its CEO. He guides this partnership which joins the very successful AXA and Krung Thai Bank, headquartered in the “City of Angels”, better know as Bangkok in Thailand.

His aim for their new business intelligence platform was simple: To bring all the company data into one consistent and cohesive place to allow the business teams to collaborate to drive and control the business.  Meeting that challenge was actually relatively easy to get all the data together so it can be believed. The plan was not just a passive tool with vague benefit but to use it decisively to increase momentum and aggressively grow the business.

When I had asked him for guidance to get engagement and how he had already been able to create the winner team he already had, he referred me to the mantra hanging on the walls in the offices. He said it was developed by his team and is a constant reminder of what makes a winning culture: 

You will quickly note as you read thru it that it is not about individuals but focuses as a collective of team based customer service values and aims. This is a generic version of what he is happy to share. 

1. Be a winning Team
2. Have a passion for excellence in everything we do everyday
3. Focus all we do on our customers
4. Be driven to achieve results; to deliver our promises
5. Be professional, unyielding integrity and socially committed
6. By open to ideas sharing transparent and trusting
7. Be ambitious and challenge each other
8. Be entrepreneurs, embrace change and risk
9. Make the Company a Great Place to Work
10. Have a sense of humor

I am very sure the Infor PM solution and our self proclaimed brilliance to deploy it helped  this Company to grow so fast. But just having a a list of nice words and a business intelligence tool is still not what makes it all work.

What does make it work is living the values as a code of conduct and culture to continue to rise to challenges The embedded value they bring is enhanced by sharing information routinely in a quality a measurement process. Without doubt quality leadership too, capable of spotting the gaps is vital. All together I firmly believe that is what makes a winning team.

A joint PwC and IT Governance Institute research paper, just released has perhaps a less enthusiastic opinion of IT’s contribution As explained by this figure 3 which form part of their finding to this question.”To what extent does your IT function inform the enterprise about potential business opportunities enabled by new technologies?” was:

One-third of the respondents relayed that their IT function does not inform the enterprise of new business
opportunities made possible by new technologies, or does so only to a limited extent.

Another third indicated that such communication occurs only to some extent. Only one-third of enterprises can count on their
IT department to provide this type of information—information that could create a competitive advantage. Implied in this is a call to action for IT management to better communicate and align IT’s capabilities to enhance business growth through innovation.

 

The study which may be very useful reflective reading to consider who drives IT is aimed at Executive Teams and IT professionals, and has 28 graphical figures with expanded findings under the embodied questioning elements.

1. Contribution of IT to Delivery of Business Strategy.
2. IT’s Contribution to Innovation, Efficiency and Effectiveness
3. Frequency With Which IT Informs the Business on New Technologies
4. Creation of Value From IT Investments
5. Barriers Preventing Full Return on IT Investments
6. Barriers Identified
7. Perception of IT Performance.
8. Accountable for IT Governance
9. Key Champions for IT Governance.
10. Accountability for IT Governance Activities..
11. CIO as Member of Executive Team.
12. Equality of CIO’s Views With Others on Executive Team..
13. CIO Reporting
14. Reason for CIO Absence From Executive Team
15. Frequency of IT on Board Agenda ..
16. IT Topics Discussed by Board
17. Alignment of IT and Business Strategy..
18. Methods of Aligning IT and Business Strategy..
19. Sources of IT Governance Guidance
20. Relationship of IT Governance to Enterprise Governance
21. Perception of IT Governance Maturity ..
22. Correlation Between IT Governance and IT Outcome
23. Average IT Outcome Index..
24. IT Importance and IT Governance Indices for Strategists and Operators
25. IT Outcome for Strategists and Operators
26. Impact of IT Importance and IT Governance on Outcome .
27. Strategist and Operator Perceptions of IT Governance Maturity .
28. Profiles and Behaviours of Strategists and Operators

Download Here>>>

ISACA  an independent, best practice IT governance association, has further related published additional research

If you are a business manager or information provider and don’t think you have or need a BI system you may find it there anyway but it is just called your reports. Then ask yourself the humming  part of the question.

If you find reporting is slow, fragmented and hard to access; or it is  hard to drill into or do meaningful analysis and does not delver the information you need to move quickly on decisions, then it needs attention.

One acid test is to ask yourself “does it constrain your ability respond to and understand the market behavior and constrain how quick you are to be able respond to it compared to your competitors.

I agree with Lachlan James who talks about maintaining a healthy fully utilized Business Intelligence (BI) as a cyclical, never-ending process

Traditionally any branded retailer, for example, knows good analytics and business intelligence are mandatory for category planning. Hence good BI systems with potent analytics capabilities are vital and must be kept up to date.

Now days so do the Hospitality, Food and Beverage Industry, Banks and Logistics companies and in-fact many more with mass market businesses as do all multifaceted high-volume sales organizations. But not everyone one has so-called Business Intelligence tools or even know what they are. So this must be cleared up first before we can start to debate on how to maintain quality.

In both front line management and leader second chair roles e.g. CFO, IT HR or even as advisors, we all know well good information is vital to our business. Good reporting and analytics defines and shapes the business by its very nature to show where it has been and where it may be going in terms of both its market place and planning relative growth

In one way or another every business must do some reporting and analytics of some sort be-it systematic or or sporadic. Product mix, profitability client and sales activity, capital and operating expenses, projects and so on must always under constant watch. As must all mission critical aspects of their business and the market. 

As you consider updating your BI system give some serious thought to a performance management based business intelligence system that can help you with budgeting and planning too and can sit on top of all your data so you have assess and can use it well.

Once you have one or plan to get one or grade what you have that is clearly defined it must evolve with the needs and the company itself. In his writings Lachlan goes on to say that maintaining in a BI platform is like maintaining a vintage car so its body keeps sparkling, and the interior always permeates a new car smell.

His original is post linked here and is also below the fold, with the 9 key ways listed to ensure an always successful BI: As an advisor at Sherwood Group Consulting as with many others who do this work, these are mantra’s for our clients success to always be current.

Read more…

Anyone can do it is, the advice given, by CEO Mike Plaxton at Krungthai AXA Life, to those who aspire to lead of an operational sales organization.

At the highly successful Krungthai AXA Life Insurance company in late 2009, in the context of their business Intelligence system deployment needed to deliver, a conversation I had with CEO. Mike Plaxton went something like this.

“I grew up as just an ordinary kid in the midlands of the UK. So being a CEO does not mean you need a pedigree or be a genius.

For me there are just a few things to get right.

Having a clear incentive based performance management model to motivate people is one thing you need. Ensuring clear linkages and standards are set and followed is another.

Here at Krungthai AAX, which is basically a sales organization, that not only applies to sales production, but equally to delivery and in-fact all areas including support. 

We need regular information and metrics reports for everyone to maintain momentum and keep things on track. What I want is all the information all in one place so we can have better conversations to manage growth and see what is happening.’

Sometime in January 2010 this year over a coffee at his regular Starbucks hangout with his CFO, David Korunic, we were discussing the best way forward on what by then was moving into place. After a couple of months we had set up a data-warehouse and had begun deploying a business intelligence solution, for amongst other things, the daily sales reporting.

The access I had to these guys was story in itself. Mike always had an open door policy. And for a guy who headed up a 10,000 strong workforce allowing such free access to him was a testament in itself to his competency.

His clear mind meant five minutes or even less with him was always enough to get direction and the valuable clues that could save people weeks of jumping over the typical internal minefields that normally exist in corporations.  Under his guidance, in his organization, which seemed to employ not only great talent but it also engendered a team players spirit saw people emulate a very successful right of access policy followed by this walk around and listen style CEO.

Going back a step to December the BI project had gotten a huge impetus when it was driven a chance doorstop conversation in his office. By then, as part of our immediate value start approach, we had already created a platform to measure the effectiveness of the Academy function to aid in improving the effectiveness training and quality of selling and focus programs.

So when I joined Mike briefly at that time for a go forward discussion, he pointed to his white board across his spacious office, with his VP of Distribution, Roger Deacon present, and said:

“Roger’s’ teams are going for an all time record in sales this month and we would love to be able to let everyone involved see their daily performance across the total span of control of every sales team, right down to the sales agent or advisor across all the business channels. Is that possible and if so let me know what road blocks you need shifted to get it?”

That was all we needed to motivate the project into top gear with immediacy to get the daily, the new business data up into focus in a workable format. It came in warts and all and I must say some reports did not look that elegant as the source data was not all seamless or well defined in terms of its integrity.

But not being feint hearted we began deploying it initially to the top guys. To do otherwise we knew would have spelt suicide to the project, but it did more than the trick to bond the Executive to all to see the potential of this now transparent tool that begun to show up and track daily numbers first in December 2009 and ongoing thru January 2010 as the first full monthly cycle. The value too as history appeared was seeing the spikes, pipelining and delivery delays which became very obvious. And issues like cancelations and un-booked sales that were being funneled till the last few days of the month could also be seen. So even thought the project was nowhere near being at production quality, immediate operational steps were able to be taken to rectify issues and fix bottlenecks, like speeding up confirmations and streamlining underwriting.

And despite the issues it raised on data quality, which got fixed over the next few months and is a another story in adding real value in itself, we did it all this via our test database to get immediate deep access to detail previously not possible while the paper based legacy systems continued in parallel for daily sales and monthly financial reporting.

Back to that January 2010 chat over a coffee, Mike’s continuing sound advice is something that has continued to resound with me ever since.

“Getting the numbers and having them right is so important to ensure credibility. But seeing them in a timely way so you have time to respond to achieve your target is critical. Pipelining and slipping a deal till next month is common place reaction by many a salesperson, so reducing the opportunities for this and using the rhythm and beat of the numbers to ramp sales efforts up and keep them there, gets the momentum. That what is needed to succeed in Sales”  

As we talk further about integration and particularly the relationship with the financial reports he added another gem, saying,

“One of the things you have to remember is a game is often won or lost in the last few minutes. It is no less so in sales so you need to make sure you score consistently through the game and put in the extra at the end to make sure you win convincingly so you are also energized for the next game. Ensuring the scores are fully accounted for after the whistle is also important so all the sales are properly booked. Saying it does not matter and they will just get booked in the next month is a no-no and very de-motivating. It just kills the momentum which is what it is all is about. And solving this by having two sets of books to show credit is even worse. Sale and Finance just need to be the same. So even though accountants dislike me saying this it, holding the books open a day for last minute stuffing to make the numbers, is perfectly acceptable to me. It also makes the difference to move the whole organization from mediocrity to being an exceptional performer.”

David who has a reputation and stands out as a quality CFO quickly added something that made so much sense.

Giving the agents direct access to view of how they are going and how they can earn more money is our longer term aim. Giving them and managers supporting them the ability to see and translate actions that delver immediate and ongoing value to their monthly paycheck, naturally sorts out those who want to perform from those who are just on for the ride. Things such as being able to see the progressive scores in competitions and marketing campaigns with a BI tool for such self management is one of our key objectives.

It was an absolute pleasure working with these guys and such regularly informal reviews like this in the life of the project development made it work. They all both took executive and operational sponsorship lead to ensure the BI progress and value was delivered.

In April 2010 when our work was maturing they allowed me make public a “Mike Plaxton quote”, which bears repeating now to underpin a major part of what has made that BI installation so successful.

“I spend my time in conversations asking questions as I try answering none. My job is to listen so I can help people focus their efforts in discovering the answers they need to do their job from the data they collect on their job. And to engage their hearts and minds to focus so they know they are well supported. When I talk more and listen less, I only engage their minds and my ego.

Having our up-to-date performance information on tap and in sync that we can trust and all share, means we can have very good conversations. And I can then listen more to help them increase their momentum. My job is to get them to use the information they have by asking questions that help them understand our business.

Information is knowledge and knowledge is power – their power not mine.”

- Michael George Plaxton  CEO Krungthai AXA Life Insurance Co Ltd

But that was not the end of the story. To make this all happen, Mike and David also appointed a permanent Information Manager to take care of the system and facilitate ongoing use of the Business Information to maintain momentum and grow the business. The person they appointed was a bright business analyst who had been involved in the project. It is a career move for him for sure.

Mike also lead the further system rollout out himself, by making it the center piece of a strategic planning workshop in July 2010, this year, with the event being held at the Westin Hotel. There he had the cream of his business with eighty of his top people from all regions attending. I was invited to join in that planning day, which in itself was a brilliant case study in how to fast track information based culture change for managing a business and use BI to spawn strategies that directly ended up in the business plans.

The agenda and approach he took on the day was just so simple and again bore out his brilliance as a leader. The first hour he spent with his executive team reviewing the half year performance and the business objectives for the next two years. Then after his newly appointed Business Information Manager showcased the BI tool he formed eight teams’ ten people and reassigned them for the day completely new functional roles. He move people from different disciplines such as having the CIO run the Direct Sales Agency he swap around to new roles Bank Assurance and various Agency channels and Support teams like Marketing and Finance. With the new role playing clear he asked each team to spend the rest day to break out and formulate strategies to grow their part of the business by a given quantum in the next two years. The final presentations by these quasi teams to the real board of management, who reassembled at the end of the day, delivered with rational and hard numbers their plans supported by look back and other evidence they found in the BI system.

As he said to me when he was planning this workshop, this type of engagement had a risk that could have meant the whole day’s effort could completely fail.  But it became clear after the first 20 minutes into the risky part of the day that the results were going to be incredible which they were. The rest is history with Krungthai AXA now on their way to another record year of exceeding the market and their own 30% growth of last year 2009 by orders magnitude. They are also now set on a course with a well planned approach and commitment to it plus the tools to manage doubling their size in the next few years. I have no doubt as do all who are involved they will do it.

The results and growth of this company are truly outstanding and continues with this ongoing information culture approach. As an advisor, be-it only a bit part in of my role leading a consultant firm, I am proud to be part of it.

AXA; the leading European insurance company is a shareholder and partner with Krung Thai Bank PCL of  Krungthai – AXA Life Insurance. In Financial Markets AXA is positioned as a Global Leader in Financial protection.

~000~

_________________________________________________________________________

About: Krungthai AXA Life Insurance Co Ltd

AXA; the leading European insurance company is a shareholder and partner with Krung Thai Bank PCL of  Krungthai – AXA Life Insurance. In Financial Markets AXA is positioned as a Global Leader in Financial protection. Krung Thai Bank PCL symbolized by the “Wayupak bird”, is one of the leading Thailand banks. It proudly boasts one of the most established and enviable branch networks and brings to the partnership a truly dynamic value with its Bank Assurance Channel, a key contributor to the business success.

In terms of New Business, Krungthai AXA is ranked 5th on the leader board in a field of 24 major players in the market.

In our Business Performance Executive Forum recently, someone commented in response to a question put about the politics of budgeting and its value. This was based on a CFO Magazine survey that had 2/3 of readers saying their planning process was driven more by Politics than by Strategy as asked by business author Lawrence Serven, and President at XLerant, Inc 

Christo Nei Technical Sales Manager at IBM Sydney, Australia, said  The traditional budget for the sake of budgeting, without the capability to really understand and analyse why we budget is pretty much a political process, however when a budget process is driver based and linked to strategic initiatives and outcomes; it becomes more effective. In the fast changing business world that we live it is the companies with a budget and rolling forecast that really outperform. Budget as a benchmark, but the rolling forecast as the currently reality to aim for.

He went on to talk about what is needed being rolling 6 quarter, reviewed once a week

In my view and with some experience on this too, doing a forecast to bring it all back on track is equally critical step.  Mr Nei as a business man focused on selling, knows well that is all about doing the numbers. He would also know what it means not to.

CFO’s and accountants however, often lose sight of all this and can lean a lot from business people. Doing all the detail over and over again does not work for them so once done they just want to want to see what is changing and /or getting out of control as they add to the pipeline.

As a best practice experience with me and many other we now find works very well in large businesses and global corporations. Maintain a practical view is important on how to do Plan and budgets then the 6 Qtr operational forecasts. What many see a heaven forbid basis, a good CFO will embrace using the budget as the forecast then plug the variance as it moves forward to maintain the same annual outcomes and deal with just the major exceptions. This in turn means the CFO takes shared responsibility for the result. which is his job anyway. AND to stay out of jail and put the monkey back where it did the damage the CFO must also then take the proactive step to review the plugs with his CEO and operations teams on say day 2 of the reporting month and reject any that need more attention. (E.g. more than certain acceptable % variance) That then becomes a very transparent and prudent financial control process to allow them all to decide what demands attention and/or needs be answered. It also moves attention from the politics of just defending the plan against corporate /investor scrutiny to a more business management mindset too.

At the operational level then doing weekly or even daily reviews of actual numbers against the forecast is then very easy to do and focus on a part of the cycle management. This as we all know is so important to maintain the momentum and business rhythm to ensure the objectives are met.

Sorting out the trivial variance ebbs and flows to only focus on what needs crucial attention to get the answers is the aim. Doing this is more about operational value than an accountant numbers game. with this sort of process in place action also comes very fast to look at the detail on the delinquent areas. Conversely high performers who don’t cover them up,

at the CEO /CFO level a practical approach to make this work and keep the business on track to have this reviewed like this is to add in this process so you have the answer to the budget performance issues with corrective action included in the forecasts before month reporting is closed on day3. That is just so easy to do.

With 3 year plans and 6 quarter operational rolling forecasts with daily /weekly reporting then the next 12 month operational budgets becomes just another forecast (once it spans the next full year) and work the same. One day budgeting is then a very real option and the politics of budgeting can be managed to deal with more strategic issues and the longer term aims. That is just so easy to do and I have found it works well.

What is you experience?

Recently, I was fortunate to join some senior people from diverse sectors for a strategic planning workshop. This session was sponsored by ZAP Technology and one of the aims of the session was to decide what drives a business and the bases of measures of performance that may be applied.

The outcomes of these types of sessions typically differ in detail, but the fundamental activity motivators have on common thread. That is they are hierarchically driven by internal  supply chains activity which are each in turn externally influenced.

In our session a constraint was to link core business process in hierarchical internal supply order and assigning one internal and external driver to each. While client processes may haven more than one supply activity only one external diver would apply. With these constraints interesting leveling discussion pursued. The resulting matrix and how we got there I have found since leads to good debate so now I want to share a some of this.

For example in a product based business, new product development may rank very high in the delivery process that drives revenue generating activity. Whereas a category retail business may have advertising ranked much higher. In a service business alliances may be a very strong influence so marketing and sales campaigns may be the primary enabler.

But when we boil it all down we asked what really generates the business revenue? The combination of enablers in the delivery process will help but our session discussion resolved that it was driven by the outcomes of the planning activity.

To understand this more, the full planning process which most organization take seriously, is ultimately about determining direction, and levels of activity needed to achieve the organization strategic objectives This will also including adequate return to satisfy the investor.

What this does in practical terms is set up and agree goals and incentives to employ and motivate the sales force who then goes out to get the business. This in turn determines and drives delivery process objectives and defines the level resources required to met them in a then more detail resource allocation and budgeting process.

Now back to our session as we extended this thinking through the value chain in our typical business generation and delivery processes As we stepped through it we came up with a matrix of internal performance based measures attached to each process and linked to one external influencers that nay constrain or propel the business.

The following table shows what we came up with as a result after several brainstorming and filtering sessions. Without even considering what industry, the session produced range of external influences that typically drive any business.  The table here has some types of sensible measure criteria that distilled out this into this simplified list from the group inputs.

This was the outcome:

We discussed this further we noted that For a high volume business retailer, presence and market share are important. In Hotels and Hostility the driver may be alliances with agents in the travel and tourism industry. A specialist or niche business should rank high their measure of competitive capability to ensure they can maintain advantage they may have in this class of business.  Whereas a financial services business selling life insurance may have alliances with banks to bundle insurance with their lending offerings.

It was interesting when I repeated the exercise my self with another group later. this was a more detail outcome that gave a similar but different answer. I will post it here as a reference too.

Driver	Basis of Measure
Asset	Risk based return on investment
Capability	Market share on channel product
	Market share
	Quality of Process integration and Outcomes
	Sales force capability effectiveness
	Process effectiveness
	Strategy objectives achievement
	Quality of data Integration
	Process outcomes quality
	Process efficiency
	Business Process Efficiency
Investment	Return On Investment
Leadership	Market Share Growth & Asset Risk
Leads	New Business Lead conversion
Product	Unit cost
	New Product Cycle Replacement
Profit	Expense contribution
	Supply chain effectiveness
	Audit & compliance costs
	Contribution recovery
Retention	churn rate
Revenue	Item value for sales Unit /channel
	Business Generated
	Margin
	Customer Growth
	Delivery timeliness
	Customer Retention
	Business Growth
Unit cost	Supplier benchmark

I found this quite useful to springboard ideas to get myself on the understanding page of what drives related process activity in terms of the supply chain relationships inside a business. I hope it is useful for you too.

The first part of this was a question I saw in a local forum put by a business management accountant. It occurred to me that as professional business consultants, which internally in his company he is too, we answer this question frequently when designing reporting systems for our CFO and CEO clients.

It may sound ambiguous but I believe to find the answer we need both top down and bottom up perspectives.  Modern reporting trend of corporate high flyers to motivate performance, and people like software vendors may make this sound hackneyed, but I say the profit and loss and the balance sheet reports (PBSL) critical They are are the most important reports you they ever need in a business.

Having said that, here is my thoughts on what else is important and why. I will also go further to say monthly is now too slow with many companies demanding weekly or even daily reports to be able to respond to more rapid market cycles that changes are much faster.

We all know the most important reports are the ones the CEO and the executive team use to drive the business and manage the investment risks. Typically, in the equation Victory = Velocity, + “Variability, + Visibility are all the watch words a CEO needs. Reports therefore, must give the business the power to manage these elements well.

In other words business momentum, market dynamics and management transparency are the common ingredients we all need to be able manage well. And to do that and keep the rhythm going we need good information routinely delivered in each business process. More importantly we need to be able have get the answers to the questions we ask that the information brings up with an easy ability to do deeper analysis without setting up a task force commission.

As to content and who reports what, to track what’s gone on and manage what’s being planned the performance management and planning and reporting process that the CFO team provides is vital. It is a must as well that it be timely, consistent and very reliable with well integrated and easy to understand reports that everyone involved can access and see.

Taking a high level view on that content can be good. This may typically be a ratio summary or dashboard with key performance measurement (KPI) of activity critical to success. Once that is well established the collaborative of use KPI reporting is very effective. But it can take some time to mature as the behavior we see in the detail is not always intuitive at first in KPI summary. For example in one businesses a late delivery signal on a KPI may indicate serious issues that have immediate loss of business consequences with sales retention and profit then at serious risk. Where-as in other businesses while it may still be important it is less of a risk and can be managed. This may even differ from product to product  in the same business the underlying issues and impact to be addressed must understood well before a KPI view is set up.

To get that right if you are in CFO team and preparing reports you should go ask the CEO first what he or she needs and then ask the executive team and so on down to see if they are aligned on the key numbers and how they weight-out. They all will quickly tell you what is important. And when you related that to the PLBS at their level you will be able to see where it all fits. If you are the CEO and your team have KPIs that align with yours, that in turn can be their score card, If not you will have issues. To help on that the CFO team, using the PLBS as the base can tailor reports that everyone needs to show delivery performance and stay aligned with the business goals.

In the end all reports must be designed such that everyone who is involved in the business can see their part and see their current position compared to the plan and their contribution expected. And when it falls short it must show have options to make reforecast projections on recovery action.

For KPI or dashboard reports to be accepted they must also always be supported by more detail to dig down more and when things are not right and preferably down to the transaction level an updated on a real time basis in line with management responsiveness cycle at each level . For example if revenue is volatile due to market competitiveness each day, then there is no point reporting monthly as action taken on that is far too late to stop business erosion. And if you find pipeline stacking shows sales spikes at the end of the month if you change you reporting to be weekly it will flatten out and can increase the momentum.

And whether it is sales and product profitability by customer or delivery activity for supply or just compliance, the center piece for all this again is always the profit and loss statement and the balance sheet to build the performance focus around.

To understand this more the profit and loss statement has embedded in it all the trading activity that occurs.The balance sheet in turn shows the position and health of the business for all then financial resources invested, including such things as available cash and working capital and working assets and so on. The link of the trading activity to increasing net assets and in turn the shareholder value focuses attention on the investment growth and risk management and to maximizing the rate of return  And just  like the profit and loss, a must-have is the forecast update to show projections to correct erosion issues.

Finance people know traditional financials with just numbers are not enough with the performance ratios and variance reporting implicit on each. For example comparative performance to plan and last period are very key measures as is gross profit and return on investment. At the operational level, equally important are such things as the performance of accounts receivable which best measured in days overdue and inventory measured in the relative number sales days stock held.

These reports can all take differing forms and there are so many ways to visualize the key elements . They may also be called by different names and even split into parts to add more activity detail. But in the end they are fundamental. They have to disclose all revenue income and all business activity costs and relevant rations in controllable chunks to show the net trading result  The venture investment in turn, as deployed must be disclosed and grouped by risk within each class or asset at current conservative carrying values and liability at all up and even potential exposure. In corporations for example that often span multiple geographies or regions and cover varied activities the consolidations, they must also cater for often complex various ownership interests, currency perspectives group eliminations and group level fair value provisioning and must handled very efficiently.within the reporting environment.

In addition International Financial Reporting Standards, (IFRS) now being more widely adopted across the globe and by regulators, is seeing additional disclosure. For some especially in Asia where it now coming into force, the a take up effort is quite significant as changes are being made. But the flipside is the opportunity this presents to many, who the need to refocus to upgrade their reporting, to use this as the catalyst to reduce their reporting cycles times by  improving processes and systems. Better reporting aside, the cost to benefit of the improved production for a more efficient system quickly becomes very clear.

Hence these two reports which include KPI’s are the most vital as the center piece of all business management.  They are not only vital for collaborative transparency of all accountable management to see where they fit but also to let them be seen to be doing their part. All other reports are then be built around these including cash flow reporting.

The technology we have now sees, typically web based drill down and analytics with security to filter accountable reporting at all levels. So even if it all sound so complex all this is now very possible to do from this single report base taking data from multiple transaction sources and system.

So once the KPI and key financials are fully set up the next question may be, what do the operational managers want? My answer is to find out what drives the activity and how the outcome measured impacts the financials KPIs the CEO sees. Then report as a sub-set and you cannot go wrong. For example, if you are in production, the key drivers are sales orders and inventory levels to tie them into in the financials. Likewise if sales are your aims, then sales lead conversions may be your critical drivers; as do overdue accounts that tie to the working capital as debtors show at risk conversion to cash.

Hence, when all that is in the reporting model, means at any level and any perspective  performance tracking against plan and ongoing projections is now very simple. And be-it Operations, Sales or back-office or the CEO the CFO and even Corporate HQ they will know their value and can collaborate well to fix any roadblocks and marshal resources as needed in context of the overall picture. No less they can all see and discuss what is happening in the business with much more comfort in the answers they give and get to have control and more time to concentrate to grow the business.

In business intelligence projects, assembling the data is large part of the deal as you go about building an independent data warehouse or set one up in Business Intelligence reporting software itself.

The Pareto theory to focuses on 20% of effort to get 80% of the value does not work in business intelligence projects. You need to get 100% of the data right and cleaned up before it can be mapped and reported consistently.

Even cutting corners by doing a departmental business intelligence may work for a while. But in the end if it is not linked to the published finance results it will be soon be undermined and will eventually end in the scrap bin of good ideas that did not fly; along with those who attempted to fly them.

Using an enterprise level business Intelligence project as a focus to clean up data in itself is a great way to go. The benefits are most often immediate. In fact to get those jobs done any other way almost never happens as the business continues to struggle on with hybrid decision processes that hinder progress.

Building a consistent data-warehouse in fact is the real job in setting up business intelligence reporting. The problem there is cleaning up is often costly and the perception is by most that there is no problem or cleaning adds no value, so it gets left out of the value discussion.

As a Finance or IT manager how often have you heard, “We already have a good data warehouse and all we need is a Business intelligence tool to do our reporting from it.”

As one who lives in both worlds and in my case as a consultant too it actually tells me to beware to do much more proving work on the business case. And do more project due diligence work before locking in on contracts. 

In the case of the CFO or Business Vice President  championing the work, this should also be done before seeking the budget and letting procurement loose to go find a vendor and a competent consultant. Finding the bad data story after the fact, when the installed team and software is on deck, is far too late. No-one cares by then as they know you are between a rock and a hard place with little or no way out.

And if the business is performing well and the goal is for faster decisions information to maintain momentum, then  time to delivery as goal is seen as the most critical project driver. Then things like consistency are automatically assumed to be there or must be dealt with regardless of other change impact considerations.  But of course in this type of case given performance is relative in terms of these constraints, problems that most often show up are on the enterprise’s source systems themselves. So then the paradigm shift as a goal is stalled and the project, which may get off to a great start, quickly falters as these issues surface.

So it actually does take a great deal of resolve, process change management and team work to agree consistent business rules at all levels to solve the issues. That is at the heart of it all. And it is what can trip you up if you don’t stay focused and get it under control. The rest of the work is really just technical and is quite straight forward with limited risk.

Hence in well thought through projects where the value of cleaning is recognized and the correct value focus is brought to bear, it can pay for the project many times over. In such cases this should be recognized as a business benefit to be targeted and not just left as a by-the-way or left out as a buyer beware tactic to get unknown issues solved and cost savings on the cheap.

And in the end who cares what BI tool we use. The truth is if you don’t use one you are foolish as the disciplines they bring alone are worth the money, I should quickly add that this only applies if they are setup by people who actually do know what they are doing. I have seen too many IT selves with software still its shrink packed box never opened. Or when it does it is badly used by installation novices. As one of my software vendor contemporaries said to me recently

“if you don’t have a competent data management team included in your BI project, then I hope you don’t choose my software as I don’t need the reputation”

As too often we aim for the utopian state to exploit what comes only after the hidden work is done. getting there is often actually where the value is as your conversations across the business sort-out the issues in a more natural way. So seeing it as a burden and a delay to project is folly. Doing this will invariably cause frustration and loss of focus and may cause it to even falter and/or fail.

More to the point business leaders who provide budgets for this work, who may also have been part of the evolution that unknowingly or otherwise create the issues, invariable underestimate what it will takes to fix them. They must understand it takes momentum and motivation to get the tough and dirty job of cleaning done. And that business intelligence is about their future and not just some fancy reporting process that sends emails on delinquent performance and helps cuts the costs of doing things in spreadsheets.

As sponsors entitled to see more visible progress to the end game solution that they approved the budget for, they  should call to account project managers to bring to attention any value that gets the money back earlier than expected. By simply enforcing standards and making data process improvements before the project is even completed will delver this.

Hence the value is in the understanding the secondary benefit of cleaning up data and continually selling the value of the process it takes to get that work done is vital.

It is not just all about setting up dashboards and dials to help focus and understand the data but also about having consistent data that has universal acceptance and integrity.  This combination in turns allow business intelligence to be used to create an intelligent business

For many of us doing this do we really need to rethink our mission and how we manage.

 

~000~

In a related post Failing-address-data-quality-and-consistency here are some very key points

Don’t fall into these traps. Don’t assume anything about the state of the data. The areas where data quality and inconsistency problems lurk:

• Data quality within systems-of-record applications may be “masked” by corrections made within reports or spreadsheets created from this data. The people who told you the data is fine might not even be aware of these “adjustments.”
• Data does not age well. Although data quality may be fine now, there’s always the chance that you’ll have problems or inconsistencies with the historical data. The problems can also arise when applications like predicative analytics need to use historical data.
• Data quality may be fine within each systems-of-record application, but may be very inconsistent across applications. Many companies have master data inconsistency problems with product, customer and other dimensions that will not be apparent until the data is loaded into the enterprise Data warehouse.

Business people, not IT, make technology work to focus the business. The general IT role is more strategic to maintain and improve competitive positions of the business infrastructure to make people’s lives easier, It is not the other way around. Ask any CIO, he knows that. especially when he asks for a sign off on what is installed.

So why when changing a process do people go straight to IT to set up technical processes. When they do IT have no choice to do it their way, Then  they give things names that are either functional, relate to the software or are way too obscure?

There is no way this should happen in the public domain as things like product names and branded access URLs are always cleared by marketing. Then image and branding are so important. But internally that does not happen as all too IT often gets little business help or involvement.

It is like having two standards, one rule for customers and other those who service them. And that make no sense at all. Setting the service delivery culture starts with teaching people the supply chain in not about them but their suppliers and customers. So why do we still insist being too lazy to put some effort into more marketing rather than functional or geeky names.

To paraphrase from another well-known idiom.

If you feed them peanuts they will look like monkeys.

So why not give internal process the same respect you give your customers and suppliers so they will be more likely to perform and respond the way you expect. That of course needs a business person to own and manage the change process. And all too often they are missing or busy.

Most often too as learning is done in the development stage where the die is cast. “A habit of one” it is often called. When you show people something that continues to work for them they may never change even if it is improved the very next day. The process and a systems life is therefore limited by the language and thought we give it when it starts. Never mind people whom may struggle later once the initial support is gone.

http://Image076/ or some such useless ellipsis name embedded in key process URLs is unlikely to move your business forward. So why use language that you don’t understand or is not service related?

As for IT infrastructure and everything upwards it is vital for management to get involved. Once instances are set and business teams take over any plea to start where we want to end up is then forlorn and lost.  It is often too hard and too detailed for managements to consider, especially in the “lets get it done urgency” cultures to have something working and adding value yesterday. So it gets underway without good thought on the impact of a later change.

Using and understanding how to set names and use aliases in not an IT role, It is vital for business managers to break this nexus so the language of technology more natural to focus the business.

I had some interesting exchanges recently that took me to a UK  firm who specialize in data cleansing, They reminded of a survey we did some time ago that asked the question, How do Business Intelligence solutions provide value?

Of the 86 replies the answers varied in weight but it was clear Sales Growth and Operating Performance are the top issues.

In my discussion with Chris Johnson at CNM in the he said

Companies waste so much money and cause harm to the environment by not regularly cleansing their data. Data is one of our biggest assets. You wouldn’t drive around in your Ferrari or work in your high rise office block without getting it cleaned once in a while would you?

Clean data means happy informed customers and less environmental impact to our planet.

In my personal opinion it should be a legal/moral obligation to clean data regularly.

This was very sound advice which I was looking for to help me in my work in Business Intelligence that relies so much on clean data.

As I looked through the impressive product list at CNM, (Yes it is one of those coveted TLA names) it seemed to focus on these needs so well so I decided to keep it as a reference list of issues that people in business face.

For example in their How can we help? section it bring to the forefront familiar issues with some pertinent questions that just make think about the quality of your data.

Telephone Number Appending

Have you got a list of contacts without a phone number? We have one of the most efficient and accurate telephone numbering services in the UK. more…

TPS Screening

Need to comply with the law? Our TPS matching service can flag or remove TPS registered records from your data. more…

Tracing Services

Lost contact with your debtors? Our tracing service is second to none, we not only find new addresses for your debtors we can also give you an indication of how likely they are to repay their debts. more…

Data Supply

Need campaign specific profiled data? Then look no further. At CNM we have access to the most up-to-date data available in the UK. more…

Their full list of Core Services, in context also provides valuable insights about uses of data. A most useful resource.

_________________________________________________________________________

Disclaimer

I have no interest at all nor do I get any benefit from this firm aside from the value of having connected at an intellectual level.  I just like what they have to say hence I am sharing it.

I got this feed from Nigel Pendse’s Bi Verdict site.

http://www.bi-verdict.com/fileadmin/ContentPreview/microsoft_product_strategy.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+bi-verdict+%28The+BI+Verdict%29

Microsoft’s announcement last year saw  the PerformancePoint Server discontinued after July 2009 . This was a major shift in the company’s BI strategy. But PerformancePoint Server which is no longer being developed is still be supported for the few customers that still use it. And they are growing.

PerformancePoint Server had four components: planning, analysis, monitoring and reporting.

• Monitoring was covered by the Dashboard Designer, which now makes up the PerformancePoint Services in Microsoft Office SharePoint Server.
• Analysis was covered by ProClarity Analytics. ProClarity’s dashboard functions are still available as Shared Services, much like Excel Services or Forms Services in SharePoint. A few ProClarity analysis functions are available via the Dashboard Designer, but the functionality of ProClarity Analytics is being ported step by step to Office, and the product itself is in maintenance mode. This makes it clear that existing customers of ProClarity will face the need to port their applications in a few years. At the time of writing, it is still unclear whether the functionality will be delivered as desktop components or as Web components in the SharePoint Server.
• The planning component was a new development which used Analysis Services to store data. It survived for about two years before being withdrawn with  SQL Server, Analysis Services, SharePoint Server and Excel are being positioned as providers of generic planning functionality.
• Management Reporter was the reporting tool but it was never clearly developed and has been largely discontinued.

Future releases of business intelligence functionality by Microsoft are tied to the Office release cycle. Office 14, including the next release of SharePoint Server, is expected this year around June 2010. Integration of PerformancePoint, ProClarity and Excel with the SharePoint Server that goes deeper than the current Shared Services model will have to wait until 2013 or 2014.

But surpise suprise .whatI am seeing in this market space that claims to be specialists to meet the sophisticated needs of business intelligence

Here is an a open  letter I got from Stacey Barr who asked me a question.

Stacey Barr, who is widely known as a performance measure specialist, makes her living advising on how to measure business performance. She also publishes a regular newsletter, “Measure Up”

To answer her question, setting goals and achieving success is the best incentive to let me relax. On the other hand missing targets, underperforming or in-completeness makes me tired.

As someone who makes a living as a change agent I also know that success also comes by the very fact that we get commitment. That alone, as we continue to pursue a final project or campaign outcome, can see results much earlier than the expected completion aims.

I feel good reading Stacey’s letter as it reinforces this. I say we should measure and acknowledge this too as we are taking the journey. Take look for you self.

 

G’day Gordon,

I feel like I’m falling out of my groove a bit lately.

Despite my training having gone so well this year, I recently missed my goal for the 10km run at the Mooloolaba Triathlon by 25 seconds. And despite the rapid increase in subscribers to Measure Up (there are now 11,241 active subscribers), I’ve missed a couple of my revenue goals. Plus, I wanted to reduce my working hours down to 28 hours per week this year, and the trend is actually going up instead!

In all honesty, I’m feeling some of my passion and enthusiasm waning right now.

No doubt you’ve felt the same way too – when you keep missing your goals, no matter how hard you work to achieve them. In the field of performance measurement, we’re so much more aware of when we fall short of our targets.

But is it reasonable to set targets with the expectation of meeting them every time? I’ve recently been wondering if measuring performance adds most of its value to the journey (continuous improvement), not the destination (hitting targets). Measuring performance helps us stay focused on what we want, every day, and enjoy the adventure as we pursue it.

So when targets are set in the spirit of continuous improvement, perhaps pursuing them is more important than achieving them. What do you think, Gordon?

Gordon, If It’s Broken, Fix The Root Causes!

In the last issue of Measure Up I gave you a list of the typical problems that go wrong in performance measurement processes, and I promised that this time around I’d share some tips for how to fix your performance measurement process.

That’s exactly what’s in store for you, in today’s Practical Tip.

Stacey Barr, the Performance Measure Specialist

Follow me on Twitter: www.twitter.com/staceybarr

 

By the way if you think is Mooloolaba funny name for a place, if you ever go to this paradise spot on Sunshine Coats in Queensland, it will not sound funny any more.

In the meantime let Stacey know what you think too. And if you subscribe to her newsletters she will update you directly. If you forget her site it is on my Bog roll

 

Disclosure Statement

I  have no financial interest at all in Stacey Barr, her business or her offerings and I do not get any or rewards for promoting her. I am just  a fan who not only likes what she says and even on rare occasions when I may not agree, I always like the way she says it.

And being a fellow Aussie in the performance management business too, one day I will be pleased to meet her.