Active enterprise intelligence is a natural evolution for companies that leverage information to drive their business. Building a centralized repository of information and consolidating data marts contributes to decision making by making it easy to find and access information for reporting, but that is only partway down the path shown in figure 1, below.

Add business intelligence (BI) tools and data mining, plus visualization tools for gleaning insights, and you move along the decision-making spectrum from reporting to ad hoc analysis and predictive analytics. As you continue adding more back-office knowledge workers to the mix, your reporting and BI workload increase while everyone benefits from the single view of the business. We define these activities collectively as strategic intelligence.

But companies that stop there with their enterprise data warehouses (EDWs) will miss the potentially biggest bang for the buck. Your company is probably already doing a good job of using technology to improve strategic decision making. But can you provide access to information and/or interject nuggets of strategic insights for the people and systems on the front line? Extending the reach of data-based decisioning from the handful of people who do BI to your front-line operational users and systems is operational intelligence.

How many front-line users do you have? Thousands? These may be people who are customer-facing, but the list can also include internal people in receiving, manufacturing, quality assurance and other areas who make hundreds of thousands of operational decisions daily. Also, what about making information available to customers, vendors and partners? Additionally, the front line is more than just people. If you've adopted self-service technology, you probably have thousands of interactions each day through front-end systems that have some degree of decisioning built into them.

Active enterprise intelligence is the combination of strategic intelligence and operational intelligence to make better, faster decisions at all levels of the enterprise. It's the application of EDW data and insights to operational systems and processes, so all decisions are aligned and accelerated.

enlarge These stepping stones show progress on the road to active enterprise intelligence.

enlarge Active enterprise intelligence is about aligning decision making.

Aligning decisions
Operational decisions are quite different from strategic decisions. Operational decisions are smaller in scope, and they usually have to be made within hard time constraints. For these decisions to be made better, they need to be aligned with corporate goals and objectives.

To show the differences in the scope of decision making, consider figure 2, below, left. It shows strategic intelligence at the top and operational intelligence at the bottom. The supply chain runs from left to right, with your company in the middle, your suppliers or upstream vendors on the left, and your customers on the right.

In the upper right corner of the figure is a strategic person in marketing, perhaps the chief marketing officer (CMO). He is responsible for strategic decisions like which customer segments to target, when to target them, and acquisition and retention campaigns, as well as budget decisions for money allocation for each target. This is a customer-facing, strategic role. He most likely has a staff of mid-level people who design the marketing campaigns.

The CMO and mid-level campaign designers' decisions are quite different from those of someone on the front line (shown in the lower right). For example, a customer care agent fielding a call may need to decide quickly whether to salvage a bad situation by offering a discount. This decision should not be made independently but should be aligned with what the marketing department would like customer treatments for that segment and situation to be.

The left side of the figure shows the vice president of vendor management, who focuses on strategic decisions including which vendors are contributing to or hurting profit, and whether to investigate second-sourcing for a vendor that's not performing. The scope of these decisions is large and quite different from a front-line worker deciding to expedite goods in the supply chain. These front-line decisions are made frequently each day, and they need to align with corporate goals for the amount of money spent on special shipping cases.

Plenty of other internal decision makers exist who are not customer- or vendor-facing. Upper-level finance people focus on issues such as quarterly outlooks, cash flows, compliance with financial reporting rules and closing the books. At the operational level, a financial analyst might be assigned to work with one business group in the company to monitor its daily spending. For example, a financial analyst can analyze the relationship between money spent on TV advertising for a new product and the impact on sales, with the authority to decide to stop the advertising earlier than planned.

Active enterprise intelligence can also contribute to cross-organizational and inter-enterprise flows of decision making, so that information can be quickly communicated from the point of customer contact through the organization to the supplier in order to address a specific concern.

Aligning and applying strategic intelligence is the first goal of active enterprise intelligence. It's about providing simple access to data to the front line. It is also about taking the deep insights and forward-looking goals and applying them to the operational systems so all people, processes and systems are aligned.

Accelerating decisions
The second goal, acceleration, occurs when we not only align everyone but also make the systems as fast as needed to make a business impact. According to the Teradata 2006 Enterprise Decision-Making Survey Report, a survey of more than 1,200 executives found that 71% of respondents thought they needed more current information from which to make decisions, and 85% of the people thought that real-time decision making was more important than in the past.

How can we speed decision making? The left graph in figure 3, below, shows a time-value curve illustrating the time intervals between when a business event occurs and when a business takes action. There are three kinds of latencies to reduce:

	Capture latency is the time between event occurrence and data capture in the EDW.
	Analysis latency is the time it takes to analyze the event.
	Decision latency is the time it takes to make a decision and push the analysis to the front line.

The right graph in figure 3 shows there is an opportunity to look smart only if you can decrease latencies so that you can affect the operational system while it is still timely—i.e., while the customer is still interacting with your call center or while the truck is still at the loading dock. The minute the customer or truck leaves, the value drops.

enlarge Active enterprise intelligence accelerates decision making so it can make a business impact. The left graph is adapted from "Response time latency," figure 2 in Dr. Richard Hackathorn's article "Active data warehousing: from nice to necessary," originally published in Teradata Magazine Online, Vol. 6, No. 2.

Making smart decisions fast
The evolution to active enterprise intelligence, powered by Teradata's active data warehouse technologies and services, can help you drive toward operational intelligence for your front-line people so their decisions are smarter and faster, too.

As Frank Rohde wrote in "Little Decisions Add Up," published in the June 2005 issue of Harvard Business Review:

"We judge leaders by how well they make big, strategic decisions. But corporate success also depends on how well rank-and-file employees make thousands of small decisions: Do I give this client a special price? How do I handle this customer's complaint? Should I offer a seat upgrade to this passenger?

"By themselves, such daily calls—increasingly made with the help of enterprise decision-management technology—have little impact on business performance. Taken together, they influence everything from profitability to reputation."

You are off to a good start on your journey if you have an EDW. Growing the use of your EDW by opening it up to the front line increases the value of your Teradata investment. As a result, your entire company can make better, faster decisions. T

At Belgacom, customer events drive operational processes As an important telecommunications provider in Belgium, Belgacom provides a variety of products and product bundles, but it is more than these that give the company the upper hand on the competition. Wim Casteur, business intelligence manager for fixed-line services at Belgacom, led a campaign to collect and analyze all customer contact data to gain a complete view of the customer. With this data in its Teradata Warehouse, the company can drive both strategic and operational decision making. Belgacom's event-oriented culture enables it to use the information from the data warehouse to actively maintain and grow relationships with customers. When a customer calls in, the interactive voice-response menu is customized based on relevant details from that person's account so only options that make sense are part of the menu. Call center agents can make informed decisions quickly, often considering information based on event monitoring to offer suitable and enticing cross- and up-sell opportunities to callers. This active capability makes communications with the customer more efficient for Belgacom and more effective and meaningful to customers, creating loyalty. A year ago, the marketing department at Belgacom created a Web and print ad campaign designed to drive customers to visit the Web site or call in to make sure they're getting the best price for their services—in essence, a "telecom invoice checkup," which in the meanwhile became a regulatory obligation. When the customer contacts Belgacom, the agent uses the Teradata Warehouse to analyze the call detail of the retail traffic and come up with the best-matched plan to meet that customer's needs. Belgacom's ability to apply the insights and context from the data warehouse allows it to actively manage each customer event. On the cutting edge, Belgacom continues to explore ways to use its active data warehouse to drive and react to customer events and make faster, better decisions throughout the enterprise. —Julie Heileman

Dave Schrader is director of Strategy and Marketing for Teradata.

Photograph by Eric Audras/Getty

Teradata Magazine-June 2007