Business Performance Management... Meets Business Intelligence

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1 Front cover Business Performance Management... Meets Business Intelligence Proactive monitoring and management to maximize business performance Continuous data workflows for real-time business intelligence Information integration for an enterprise view Chuck Ballard Colin White Steve McDonald Jussi Myllymaki Scott McDowell Otto Goerlich Annie Neroda ibm.com/redbooks

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3 International Technical Support Organization Business Performance Management... Meets Business Intelligence July 2005 SG

4 Note: Before using this information and the product it supports, read the information in Notices on page vii. First Edition (July 2005) This edition applies to Version 8.1 of DB2 UDB, Version 8.2 of DB2 Alphablox, Version of WebSphere Business Integration, Version 5.0 of WebSphere Portal Server, and Version 5.0 and Version 5.1 of WebSphere Application Server, Version 3.5 of WebSphere MQ Workflow, Version 5.3 of WebSphere MQ, and Version 5.1 of WebSphere Studio Application Developer. Copyright International Business Machines Corporation All rights reserved. Note to U.S. Government Users Restricted Rights -- Use, duplication or disclosure restricted by GSA ADP Schedule Contract with IBM Corp.

5 Contents Notices vii Trademarks viii Preface ix The team that wrote this redbook x Become a published author xiii Comments welcome xiii Introduction Business innovation and optimization Business performance management Optimizing business performance Contents abstract Chapter 1. Understanding Business Performance Management The BPM imperative Getting to the details What is BPM again? Trends driving BPM Developing a BPM solution Summary: The BPM advantage Chapter 2. The role of business intelligence in BPM The relationship between BI and BPM Decision making areas addressed by BPM BPM impact on the business Actionable business intelligence Key Performance Indicators Alerts Putting information in a business context Analytic applications Data warehousing: An evolution The need for real-time information Data warehousing infrastructure Data federation Business intelligence: The evolution Integrating BPM and BI Chapter 3. IBM BPM enablers Copyright IBM Corp All rights reserved. iii

6 3.1 IBM BPM Platform User Access to Information Analysis and Monitoring Business Processes Making Decisions Event Infrastructure Enabling IT to help the business Bringing it all together Web services The promise of Web services Web services architecture IBM Web services Using DB2 as a Web services provider and consumer WebSphere Information Integrator and Web services Chapter 4. WebSphere: Enabling the solution integration IBM Business Integration Reference Architecture BIRA components IBM WebSphere business integration WebSphere Business Integration Modeler WebSphere Business Integration Monitor WebSphere Business Integration Server Foundation WebSphere Business Integration Server IBM WebSphere MQ WebSphere Business Integration Connect Chapter 5. DB2: Providing the infrastructure Data warehousing: The base Scalability for growth Partitioning and parallelism for performance High availability Information integration Data federation Access transparency DB2 and business intelligence Continuous update of the data warehouse Concurrent update and user access Configuration recommendations Chapter 6. BPM and BI solution demonstration Business scenario Extending the scenario Scenario product architecture Hardware and software configuration iv BPM Meets BI

7 6.2 Implementing the BPM scenario The business processes Adding BI to the demonstration Federation through WebSphere Information Integrator Federation through DB2 XML Extender Adding DB2 Alphablox to the demonstration Configuring the components Adding WebSphere Portal to the demonstration Configuring the components Completing the scenario Additional dashboard examples Appendix A. Getting started with BPM Getting started with BPM Selecting measures and KPIs Abbreviations and acronyms Glossary Related publications IBM Redbooks Other publications Online resources How to get IBM Redbooks Help from IBM Index Contents v

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9 Notices This information was developed for products and services offered in the U.S.A. IBM may not offer the products, services, or features discussed in this document in other countries. Consult your local IBM representative for information on the products and services currently available in your area. Any reference to an IBM product, program, or service is not intended to state or imply that only that IBM product, program, or service may be used. Any functionally equivalent product, program, or service that does not infringe any intellectual property right may be used instead. However, it is the user's responsibility to evaluate and verify the operation of any non-ibm product, program, or service. IBM may have patents or pending patent applications covering subject matter described in this document. The furnishing of this document does not give you any license to these patents. You can send license inquiries, in writing, to: IBM Director of Licensing, IBM Corporation, North Castle Drive Armonk, NY U.S.A. The following paragraph does not apply to the United Kingdom or any other country where such provisions are inconsistent with local law: INTERNATIONAL BUSINESS MACHINES CORPORATION PROVIDES THIS PUBLICATION "AS IS" WITHOUT WARRANTY OF ANY KIND, EITHER EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF NON-INFRINGEMENT, MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. Some states do not allow disclaimer of express or implied warranties in certain transactions, therefore, this statement may not apply to you. This information could include technical inaccuracies or typographical errors. Changes are periodically made to the information herein; these changes will be incorporated in new editions of the publication. IBM may make improvements and/or changes in the product(s) and/or the program(s) described in this publication at any time without notice. Any references in this information to non-ibm Web sites are provided for convenience only and do not in any manner serve as an endorsement of those Web sites. The materials at those Web sites are not part of the materials for this IBM product and use of those Web sites is at your own risk. IBM may use or distribute any of the information you supply in any way it believes appropriate without incurring any obligation to you. Information concerning non-ibm products was obtained from the suppliers of those products, their published announcements or other publicly available sources. IBM has not tested those products and cannot confirm the accuracy of performance, compatibility or any other claims related to non-ibm products. Questions on the capabilities of non-ibm products should be addressed to the suppliers of those products. This information contains examples of data and reports used in daily business operations. To illustrate them as completely as possible, the examples include the names of individuals, companies, brands, and products. All of these names are fictitious and any similarity to the names and addresses used by an actual business enterprise is entirely coincidental. COPYRIGHT LICENSE: This information contains sample application programs in source language, which illustrates programming techniques on various operating platforms. You may copy, modify, and distribute these sample programs in any form without payment to IBM, for the purposes of developing, using, marketing or distributing application programs conforming to the application programming interface for the operating platform for which the sample programs are written. These examples have not been thoroughly tested under all conditions. IBM, therefore, cannot guarantee or imply reliability, serviceability, or function of these programs. You may copy, modify, and distribute these sample programs in any form without payment to IBM for the purposes of developing, using, marketing, or distributing application programs conforming to IBM's application programming interfaces. Copyright IBM Corp All rights reserved. vii

10 Trademarks The following terms are trademarks of the International Business Machines Corporation in the United States, other countries, or both: Eserver Redbooks (logo) iseries z/os AIX Cube Views CICS Database 2 Distributed Relational Database Architecture Domino DB2 Connect DB2 OLAP Server DB2 Universal Database DB2 DRDA Everyplace Hummingbird Informix Intelligent Miner IntelliStation IBM IMS Lotus Notes Lotus MQSeries Notes Redbooks SupportPac Tivoli Enterprise Tivoli WebSphere Workplace The following terms are trademarks of other companies: Pentium, Intel logo, Intel Inside logo, and Intel Centrino logo are trademarks or registered trademarks of Intel Corporation or its subsidiaries in the United States, other countries, or both. Excel, Microsoft, Windows, and the Windows logo are trademarks of Microsoft Corporation in the United States, other countries, or both. EJB, Java, Java Naming and Directory Interface, JavaServer, JavaServer Pages, JDBC, JDK, JSP, JVM, J2EE, J2SE, Solaris, Sun, and all Java-based trademarks are trademarks of Sun Microsystems, Inc. in the United States, other countries, or both. Linux is a trademark of Linus Torvalds in the United States, other countries, or both. UNIX is a registered trademark of The Open Group in the United States and other countries. Other company, product, and service names may be trademarks or service marks of others. viii BPM Meets BI

11 Preface This IBM Redbook is primarily intended for use by IBM Clients and IBM Business Partners. In it we discuss and demonstrate technology, architectures, techniques, and product capabilities for business performance management (BPM). BPM is a relatively new and evolving initiative that brings together a number of technologies to monitor and manage the attainment of business measurements and goals. However, this redbook is not intended to be a comprehensive treatise on BPM, but more of an introduction to help you understand it and get started with your implementation. As the title implies, we also have a primary focus on the integration of BPM with business intelligence. That is, we want to demonstrate how this integration can better enable a more proactive, in addition to the more typical reactive, form of business intelligence. And that is what enables fast action to be taken to resolve issues and actually drive the attainment of goals and measurements rather than passive monitoring of their status. For example, we demonstrate the capability to actively monitor the business processes and integrate their status data with the operational activity data in the data warehouse. The combination of these two data sources provides an enterprise-wide view of the business for decision making and reporting. With this information, we can begin to manage and optimize business performance. This is of significant value for the enterprise, business management, and business shareholders. BPM is itself a process developed to monitor, manage, and improve business performance. It has the following three core categories of capability. These capabilities are discussed in more detail throughout this redbook: Information Management: including operational reporting, data federation, data warehousing, and business intelligence Process Management: including business processes, key performance indicators (KPIs), alerts, process status, operational activities, and real-time process monitoring Business Service Management: including systems monitoring and optimization of IT operations to meet the business goals The results of these capabilities are brought together at the point of integration for management and decision-makers - the business portal. Copyright IBM Corp All rights reserved. ix

12 As businesses move forward in the evolution to real-time business intelligence, there is a need to optimize the operational business activities. For example, they must be modified to support real-time activity reporting, and the continuous flow of data to the enterprise information repository - the DB2 data warehouse. One major impact of this evolution is enhanced decision making, and proactive avoidance of problems and issues in addition to more typical reactive measures to minimize the impact of those problems. Products such as WebSphere Business Integration and DB2 Universal Database (DB2 UDB) play a key role in BPM, and were used in the development of this redbook. We have included example system architectures, product installation and configuration examples and guidelines, examples of the use of key performance indicators, and management dashboards to enable improved business performance management. We believe this information and our examples will be of great benefit as you continue to improve the management of your business performance. The team that wrote this redbook This redbook was produced by a team of specialists from around the world working at the International Technical Support Organization, San Jose Center. The team is depicted below, along with a short biographical sketch of each: Chuck Ballard is a Project Manager at the International Technical Support Organization, in San Jose, California. He has over 35 years experience, holding positions in the areas of Product Engineering, Sales, Marketing, Technical Support, and Management. His expertise is primarily in the areas of database, data management, data warehousing, business intelligence, and process re-engineering. He has written extensively on these subjects, taught classes, and presented at conferences and seminars worldwide. Chuck has both a Bachelors degree and Masters degree in Industrial Engineering from Purdue University. Colin White is the President and Founder of BI Research. He is well-known for his in-depth knowledge of leading-edge Business Intelligence and Business Integration technologies, and how they can be integrated into an IT infrastructure for building and supporting the Smart Business. With over 35 years of IT experience, he has consulted for dozens of companies throughout the world and is a frequent speaker at leading IT events. Colin has co-authored several books, and x BPM Meets BI

13 writes columns for DM Review and the B-EYE-Network on business intelligence and enterprise business integration. Steve McDonald is a Senior IT Specialist from Australia supporting Business Integration and WebSphere. He has nine years experience in the integration field holding positions in Systems Programming, Technical Support, and Business Integration Technical sales. Steve has worked at IBM for four years. His areas of expertise include Process Integration, Application Connectivity, Distributed Systems, z/os, and Business Integration Patterns, and he is a regular presenter at conferences in Australia. Steve has a Bachelors Degree in Computing from Monash University and Postgraduate Diploma in Management from Melbourne Business School. Jussi Myllymaki is a Research Staff Member at the IBM Almaden Research Center in San Jose, California. He specializes in advanced data services for DB2, including Web services and XML, extensible analytics, and information integration. He has published extensively in the research community and has filed 20 patents. He holds a Ph.D. degree in Computer Science from the University of Wisconsin at Madison. Scott McDowell is a Certified Consulting I/T Specialist, and uses his extensive knowledge in database administration to help customers maximize their productivity using IBM software. With over 14 years experience, he joined IBM as an IT Specialist in His areas of expertise include High Availability and Disaster Recovery, DB2 UDB, and BI tools. Scott has given presentations on Disaster Recovery and High Availability at IDUG and the High Availability Conference. He has a Bachelors Degree in Management from Bellevue University in Bellevue, Nebraska. Otto Goerlich is a Certified Consulting IT Specialist supporting business intelligence presales activities in the EMEA Central Region. He has over 30 years of experience in the IT field, holding positions in the areas of Software Maintenance, Software Development, Technical Support, and BI Technical Sales. His areas of expertise include DB2 UDB for large data warehouse implementations, BI tools, data warehouse architectures, and competition. He has written articles on these subjects and is a well accepted presenter at technical conferences and seminars. Preface xi

14 Special Acknowledgements: Annie Neroda is a Senior Certified Business Intelligence Software IT Specialist. She has been assisting customers in implementing BI Solutions such as DB2 Cube Views, DB2 Warehouse Manager, DB2 OLAP Server, DB2 Intelligent Miner, and related BI tools from IBM's Business Partners for the past ten years of her 30 year career. She has held positions in DB2 technical instruction, software development, and management. She has a Bachelors Degree in Mathematics from Trinity College in Washington, D.C. Wayne Eckerson, Director of Research at The Data Warehousing Institute (TDWI). Wayne is a highly respected thought leader, published author, speaker, and consultant in the areas of Business Intelligence and Business Performance Management. We have drawn upon his insights, and in some sections have used graphics and text directly from his publicly available documents. We thank him for his written consent to use these materials. Dr. Barry Devlin, from IBM in Dublin, Ireland. Barry has long been know for his leadership and expertise in data warehousing and information integration. Thanks also to the following people for their contributions to this project: From IBM Locations Worldwide Sergio Arizpe, Tech Support - WBI Monitor and Modeler, Burlingame, CA. Jasmine Basrai, WBI Monitor and Modeler, Burlingame, CA. David Enyeart, Business Performance Management Architecture, Durham, NC. Gil Lee, Information Integration Marketing, San Jose, CA. Andrew Kumar, WebSphere Technical Sales, Melbourne, Australia. John Medicke, Executive IT Architect and Chief Architect, SMB, Raleigh, NC. Kramer Reeves, BPM Software Product Marketing, San Francisco, CA. Gary Robinson, Business Intelligence Development, San Jose, CA. Billy Rowe, Business Performance Management Architecture, Durham, NC. Jon Rubin, Product Manager, IBM Silicon Valley Lab, San Jose, CA. Guenter Sauter, Information Integration Solutions Architect, Somers, NY. Robert Spory, Worldwide Sales - WBI Monitor and Modeler, Hazelwood, MO. Jared Stehler, BI Analytics, Silicon Valley Lab, San Jose, CA. Louis Thomason, STSM - Information Integration, Somers, NY. Eric Wayne, Business Innovation and Optimization Architecture, Raleigh, NC. Paul Wilms, Information Integration Technology Solutions, San Jose, CA. Dirk Wollscheid, DB2 Information Integrator, San Jose, CA. Kathryn Zeidenstein, WebSphere II Product Management, San Jose, CA. From the International Technical Support Organization, San Jose Center Mary Comianos - Operations and Communications. xii BPM Meets BI

15 Deanna Polm - Residency Administration. Emma Jacobs - Graphics. Become a published author Join us for a two- to six-week residency program! Help write an IBM Redbook dealing with specific products or solutions, while getting hands-on experience with leading-edge technologies. You'll team with IBM technical professionals, Business Partners, and/or customers. Your efforts will help increase product acceptance and customer satisfaction. As a bonus, you'll develop a network of contacts in IBM development labs, and increase your productivity and marketability. Find out more about the residency program, browse the residency index, and apply online at: ibm.com/redbooks/residencies.html Comments welcome Your comments are important to us! We want our IBM Redbooks to be as helpful as possible. Send us your comments about this or other IBM Redbooks in one of the following ways: Use the online Contact us review redbook form found at: ibm.com/redbooks Send your comments in an Internet note to: Mail your comments to: IBM Corporation, International Technical Support Organization Dept. QXXE Building 80-E2 650 Harry Road San Jose, California Preface xiii

16 xiv BPM Meets BI

17 Introduction Before you dive into the detailed sections of this redbook, it is important to point out the business performance management (BPM) initiative is currently in its infancy and is changing rapidly. For example, there are many other terms being used to describe this area of interest. They are used at many seminars and conferences around the world. But there is indeed a lot of confusion and the definitions given are not always clear or consistent. Some terms sound similar, but are very different. Some may even have the same acronym, but mean something very different. As examples, you may have heard terms such as business activity monitoring, corporate process management, business activity management, and business process management. With those terms come acronyms such as BAM, BPM, and CPM. Though they sometimes sound similar, they do not necessarily have the same meaning, and certainly not the same solution capabilities. This redbook is intended to provide you with an introduction to BPM, its relationship to business intelligence, and an overview of the current IBM BPM solution and product capabilities. However, as an industry leader, IBM continues to evolve its BPM solution and supporting product set. As always, contact your IBM representative to be sure you have all the details on the latest functions and features of the IBM solution. Copyright IBM Corp All rights reserved. 1

18 Business innovation and optimization As an example of the IBM BPM evolution, IBM is bringing a more precisely defined initiative to this marketplace, comprised of a new name, messages, and content. Central to this theme are two key values, competitive differentiation through innovation and efficiency through optimization. The name for this initiative is Business Innovation and Optimization (BIO). This new initiative will also serve to differentiate the robust IBM offering, and avoid the confusion generated by the many definitions and related terminology that have been generated relative to the topic of business performance management. IBM Business Innovation and Optimization is not a market category; rather, it represents a collection of software technology capabilities, best practices, and industry expertise to address needs and functionality identified in several market categories, including: Business Performance Management Enterprise Performance Management Corporate Performance Management Business Intelligence Business Services Management Business Process Management Business Activity Monitoring More information on BIO will be forthcoming, but, for purposes of this redbook, we will continue to use the term BPM. BPM is a paradigm that enables success by proactively managing business performance and the attainment of business measurements, in addition to reactively resolving individual business issues when required. Managing and optimizing business performance is a critical requirement for maximizing business profitability and returning shareholder value. In fact, in many situations, it is a critical requirement for remaining viable in today s fast-moving and competitive business environment. Company executives are also feeling pressure from a growing intolerance for missed performance targets. And with performance measurement periods becoming shorter, management simply must have the capability to more proactively influence the outcome. To do this requires monitoring and tracking capabilities that can generate current, complete, and accurate information upon which they can immediately act. This information provides the required business intelligence for proactively managing business performance. Business intelligence (BI) is a key enabler of BPM. Hence the title of this redbook, Business Performance Management...Meets Business Intelligence. 2 BPM Meets BI

19 Business performance management BPM is all about taking a holistic approach for managing business performance. Businesses align strategic and operational objectives, and business activities, to fully manage performance through more informed and proactive decision making. The holistic approach enables the integration and use of business intelligence, process management, business service management, activity monitoring, and corporate performance management to achieve a single view of their enterprise. The elements of that holistic approach are depicted in Figure 1. Business Intelligence Business Process Management Business Activity Monitoring Business Performance Management Business Service Management Corporate Performance Management Figure 1 A holistic approach Then by putting that information and understanding in context against the business goals and priorities, action can be taken quickly to improve execution, successfully meet the business measurements, and truly begin to manage business performance. The following comparison may be helpful in furthering the understanding of BPM. Consider enterprise systems management (ESM), which represents a set of technologies focused on integrated monitoring and management of IT systems, for example, networks, servers, storage systems, and databases. ESM has its own set of technical performance metrics, for example, bandwidth, throughput, processor utilization, memory usage, and disk I/O ratios, along with the concept of predefined performance thresholds, operational alerts for performance outside the threshold limits, and rules-based corrective actions. It also comprises a performance management portal in the form of a consolidated management console, such as Tivoli Enterprise Console. The concepts for BPM are very Introduction 3

20 similar, but focused on the overall business processes, and at a higher level. For example, BPM actually incorporates ESM and maps the business process onto IT resources. This higher level view and the goal to align strategy throughout the enterprise provide the enterprise perspective that is required for BPM. The requirement for BPM is not new. Management has always had a need to manage business performance. Previously, however, they have not had the technology to implement it. The technology is now here to satisfy the need for BPM. This is the right solution at the right time. The demand to meet business performance goals by aligning strategy throughout the enterprise has never been more critical. And now, IBM can deliver the solutions! A BPM solution is comprised of disparate disciplines such as business process integration, enterprise application integration, information integration, business intelligence, and enterprise systems management. A common thread here is information. Do you have the information you need for BPM, or is it locked up in disparate departmental or functional areas? Can you get a business view of your enterprise, or only departmental or functional area views? The key is to unleash the power of your information. The IBM approach to BPM is to take a holistic view of those disparate departments and functional areas and integrate them across the business value chain! This gives you a more comprehensive view of your enterprise and can enable you to better manage business performance. Becoming better informed To enable BPM, businesses must become better informed, flexible, and dynamic. Becoming better informed more and more means evolving towards a real-time business intelligence environment. To enable faster decision making in this fast moving economy requires information that is more and more current. That requirement directly impacts your business operations, because one source of that critical information is the status feedback from the operational activities. Therefore, one requirement is to have the operational activities integrated with the business intelligence environment. This not only enables fast access to the results of operational activity reporting, but satisfies the need for more dynamic business processes. Static processes, or those that cannot adapt to changing needs, are a liability. As businesses analyze their operational activities in an effort to become more efficient and effective, they are looking more and more to IT to identify and implement an improved and integrated business process environment. If you are looking for this business agility and the ability to manage your business performance, information is the enabler and IBM is uniquely positioned to offer a comprehensive solution! 4 BPM Meets BI

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