It is evident that grey suits are making way for Gucci and Prada in today's boardrooms. Gone are the days when grey old men with accounting backgrounds ran companies, and with that, gone is the way information is used in the boardroom.
Many of today's executives started off in MDMA (marketing, design, media and advertising) industries - what can be considered a distinctly more colourful group, who place emphasis on being able to negotiate and work across cultures, ethnic groups, borders, industries, disciplines and technologies.
Moreover, in today's business environment, the executive focus has shifted. Management's success depends on their ability to see opportunity in ideas, knowledge and intellectual resources - ensuring continued profit from trading in real products and tangible assets. Whereas in the past, business was more cyclical, rhythmic and geographically specific - it has become increasingly globalised, borderless and weightless.
The new guard
These shifts are giving rise to new leaders in the market, focused on business and economic models and practices such as social enterprise, creative destruction and consumer-centric business models. This is ultimately affecting business intelligence (BI). To understand this change, however, it is crucial to understand the demands being placed on these new business leaders, some of which include:
* Being environmentally friendly and socially responsible is becoming as important as the quality of products and services for companies, as they are increasingly being held accountable by their investors, clients and public in general.
* Executives must devise business models requiring human, emotional and touch skills that cannot be automated. This requires a fine balance and sometimes contradiction between the cost of traditional interaction and savings from automation versus the consumer's deep-seated need for personal human attention.
* A demographically diversified strategy is increasingly needed in the marketplace. Diversity is increasing sharply and will continue to do so, not only among consumers, but also employees and management.
* Globalisation and technology is sweeping away the market and industry structures that have historically defined competition. Gone too are the classic approaches to corporate strategy - instead of making decisions mainly focusing on reports generated from operational systems, executives now need to predict behaviour and market directions with a focus on external factors.
* Corporate strategy should be dynamic and change constantly in order to contend with market and geopolitical turbulences. Executives of established companies should brace themselves for a future of hyper-competition, where profit margins are frequently dependent on unpredictable external factors. Executives have let go of the notion that strategic outcomes can be predetermined and that long-term competitive advantage can be defined and achieved.
* Management is also expected to embrace changes in technology: Web 2.0, globalisation, robotics, nanotechnology, cybernetics, nutraceuticals, biotech and renewable energies, to name a few. Executives cannot continue to hide from technology, but must incorporate it in every aspect of decision-making.
* Strong targeted marketing and advertising spend is required for more effective reach. With increased competition, cost will increasingly become a decisive factor. More customers must be reached with the same spend - this has become very challenging since the consumer is no longer spending evenings in front of the television, but engaging in other social networking activities.
So, how does all of this effect BI, and what are the changes required for this technology to still be effective?
Delivering the right information on time is the key; however, the volume of information available has become overwhelming. Between devising strategies and managing resources, busy executives must now wade through masses of information too, which is not their forte - and rightly so. The challenge within corporate BI is to provide all relevant and current information to executives in a format that can be easily absorbed and delivered via a multitude of technologies.
Executives cannot continue to hide from technology.
Gerhard Botha is principal consultant at PBT.
Within the context of the changing face of corporate management, there are several focus areas to address:
* Presentation and delivery - spreadsheets and detailed reports must be replaced with graphical analytical tools, with BI on the go via smartphones, but must also be easy enough to use for the most technologically challenged executive.
* 360^0 view of intelligence - a larger portion of information must be obtained from outside the company. Specifically, competitor intelligence, consumer intelligence, supplier intelligence, market direction and trends, regulatory changes and geopolitical intelligence.
* Reduced latency - yesterday's news is old news. Near real-time information is required in many industries to be the first to market.
* Democratisation of BI - sharing BI with customers, investors and even competitors will grow significantly in the future, especially when considering mashups and Web 2.0 impact on the economy, and the advent of software as a service (SaaS) and services-oriented architecture (SOA). Consumers will no longer be satisfied with a nice advertising slogan, but may rely more on in-depth business intelligence.
* Operational intelligence - intelligence is no longer the domain of executives only. There is an increasing need for intelligence by managers on all levels.
* Cloud computing - a general term for anything that involves delivering hosted services over the Internet. Cloud computing will deliver the quick scalability and changes required by today's business environment.
* BI as SOA - managing business processes with a services-oriented architecture moves the business data beyond boundaries of a single separate application. Silo thinking and management is something of the past, and strong interaction between the units within a company is expected by today's executive - this is SOA's promise. It supports and follows the business processes and enables the possibility to manage the total quality of data and information delivery in a seamless way.
Today's executives are more likely to spend their time looking outward and forward than reviewing old sales figures and productivity reviews. These are individuals more in tune with marketing trends than technical jargon - speaking English, not SQL. BI departments must change their strategy to align with the new face of management, and deliver information appropriate to this audience. It's certainly the way forward for business, and more importantly, the way forward for BI.
* Gerhard Botha is principal consultant at PBT.
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