The economic news has been grim on all fronts—stock markets, unemployment, real estate. Headlines tell us what some organizations are doing to make it through these hard times, namely cutting jobs and slashing budgets. Buried in business news sections are reports of management changes and reorganizations. What else are companies doing? As it turns out, they're using business intelligence and they're using it more consistently and more strategically.
Recent reports on technology spend and 2009 IT budget forecasts consistently list BI as one area still experiencing growth on both product and staffing side. A recent survey by Robert Half Technology of 1,400 CIOs showed that other categories where CIOs are still investing are information security, virtualization, and making the data center more efficient. (For more information, see Denise Dubie's article, Recession Resistant: 10 technologies CIOs are still buying in Network World.) These categories share a common theme of better managing and leveraging what companies already have in terms of data and information.
In March BusinessWeek published an article titled Business Intelligence Software's Time is Now that included a roundup of how companies are using BI to keep their companies thriving during the recession. For example, Brinker International has been collecting reams of data from their 1,700 restaurants worldwide but now they're using their BI tools in new ways to make their business more profitable. They look at customer spending patterns and change menu items accordingly.
Welch's had invested in a BI tool to use transportation data to tweak individual truckloads before the recession, but as Bill Coyne, director of purchasing and logistics, explains to BusinessWeek, "We started doing this prior to the recession, but it's been a wonderful tool in the face of the recession because it gives us more insight into our cost structure than we've ever had."
Carnival Cruise Lines is using BI to figure out ways to entice former passengers to return for another cruise. They're representative of a large group of companies that are trying to understand their existing customer base to assure their loyalty or to sell them more products and services. Where two years ago effectively leveraging the customer base was a competitive advantage it's now a matter of survival for many businesses.
GP Batteries International Limited invested more in their BI environment so that they could make information-based factory decisions, prioritize initiatives that maximize customer service, and have more visibility into supply chains. GP Batteries seems to have followed a common pattern in adopting BI, perhaps starting with financial reporting and sales enablement, but under economic pressure, finding other parts of the business that could benefit from more insight. Their objective was to use past performance as a starting point to shape future action.
Insurance.com recently acquired a BI solution that could continuously monitor both its workflow and IT systems because they had found that they lost sales opportunities if the infrastructure for their sales center was not performing well enough. In contrast to the solution at GP Batteries that took a historical perspective, Insurance.com used real-time business intelligence to ensure quality of service to critical business functions.
How are companies deciding what aspect of BI to invest in? Some companies are investing more in BI and others are simply being more disciplined or creative in how they use the information at hand. Still others are realizing the potential value of the "reams of data" they had been collecting but not using to any particular benefit.
The principle that determines investments of more money or effort for BI initiatives is what immediate benefit can a company gain from having more information about how its business is doing? What the examples mentioned here show is that companies are using BI solutions to find ways that they can weather this recession, be it by operating more efficiently or responding to even small changes in their market or simply making sure that no opportunities are overlooked or lost because of a lack of insight.
Is BI recession-proof? It seems the answer is yes. And the reason for this is that using BI may be the only way to recession-proof a business.
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