THE BEST-IN-CLASS DATA WAREHOUSE: FAST, SIMPLE, IMPACTFUL June 2014 Peter Krensky, Research Analyst, Analytics & Business Intelligence Report Highlights p2 p3 p5 p7 Defining the Best-in- Class Fast, simple data warehouses get more users engaged more often Improvements in data trust, collaboration, and customer response time Complementary analytical tools This Research Report examines the benefits of data warehouse solutions that offer rapid information delivery while minimizing complexity for users and IT.
2 Decision makers need data and they need it now. As the pace of business continues to accelerate, organizations are leaning heavily on data warehouses to deliver analytical grist for the mill of daily decisions. Aberdeen defines the decision window as the period of time when information is valuable for a choice at hand. Be Smart, Keep it Simple Decision makers need data, and they need it now. As the pace of business continues to accelerate, organizations are leaning heavily on data warehouses to deliver analytical grist for the mill of daily decisions. According to recent research by Aberdeen Group, 66% of organizations report that their "decision window" has shortened in the past two years (see sidebar). The average user only obtains pertinent information within that decision window 70% of the time. This same collection of organizations listed the growing volume and complexity of data as a top pressure driving analytical initiatives. IT departments must grapple with the task of managing huge amounts of data and distributing actionable information quickly. Many data warehouses are not designed to handle either demand. They lack the firepower to achieve the necessary speed of information delivery and are too convoluted to be optimally leveraged by users. Organizations that have invested resources to modernize their data warehouses demonstrate desirable results for IT and for users. Methodology Aberdeen identified all respondents to the 2014 Business Analytics survey with a data warehouse solution currently implemented, and divided them into three maturity classes (Figure 1). The metrics used to distinguish the organizations' performance are indicative of fast data warehouses that consistently deliver a user friendly experience.
3 Figure 1: Defining the Best-in-Class Aberdeen's Maturity Class Framework Aberdeen's research defines Bestin-Class performance by benchmarking organizations against several key performance metrics. Measuring each organization against these metrics allows for a breakdown into three maturity classes, as described below: Best-in-Class users are nearly universally satisfied with the speed of information delivery from their data warehouse. Rapid information access helps decision makers consistently obtain salient data points at critical moments. On average, the Best-in- Class obtain pertinent information within the decision window 92% of the time. Best-in-Class organizations also invest in tools that are easy to learn and offer a user-friendly interface. Ninetyseven percent (97%) of the Best-in-Class are satisfied with the ease of use of their analytical tools. Data warehouses that present unnecessary complexities frustrate users and create extra support work for IT. Systems that are simple for users and IT create fewer problems and carry a lower total cost of ownership (TCO). Finally, the most important function of a data warehouse is giving users access to all of the information they need to make decisions. Ninety-seven percent (97%) of the Bestin-Class are satisfied with their solution in this regard. Simple + Fast = More Engaged Users Aberdeen's data shows that when a data warehouse is easy to manage and dependably fast, more employees want to access it more often (Figure 2). The Best-in-Class deliver BI functionality to 76% of employees who have expressed a need or desire for Best-in-Class: top 20% of performers Industry Average: middle 50% of performers Laggard: bottom 30% of performers Industry Coverage Aberdeen collected data from 362 organizations in the following industries: Technology (software, hardware, or services) Professional Services Manufacturing Non-Profit (including public sector, government, and education) Financial Services Retail Utilities (oil, gas, electric, etc.) Logistics (wholesale, distribution, field service, etc.) Healthcare
4 analytics. A simple analytical solution is easier to proliferate throughout the organization, additional users are less of a burden on IT, and fewer resources are expended on training and onboarding. Painlessly granting BI access to more employees is also a self-perpetuating practice. As employees have their prayers for analytical functionality answered and sing the praises of their fast and simple data access, their peers will also want in. Figure 2: A Stronger User Base Users working with topof-the-line data warehouses will engage more frequently because they consistently get data quickly and their experience is streamlined. Fast, simple data access not only facilitates analytical proliferation, but it also heightens engagement. Best-in-Class organizations have 72% more users per capita engaging BI on a weekly or more frequent basis. Users working with top-of-theline data warehouses will engage more frequently because they consistently get data quickly and their experience is streamlined. Regular access fosters an analytical culture within the organization, where data is always brought to bear on key decisions. Conversely, users who are consistently frustrated or disappointed by their data warehouse will deprioritize data engagement as part of their decision making process.
5 On average, the Best-in-Class have over half of their users accessing data in a self-service capacity, a 38% greater proportion than all other organizations. More and more, datadriven decisions are being made at the line of business level. Users on the frontlines need the ability to find pertinent information as needed, without waiting on IT. Line of business decision makers frustrated with their ability to leverage data should push for self-service capabilities. A high percentage of self-sufficient users also enables technical experts to create additional value from data instead of spending their time bogged down with administrative duties. Saving time, energy, and resources that would have been needlessly exhausted on administration is the mark of an impactful, modern data warehouse. Saving time, energy, and resources that would have been needlessly exhausted on administration is the mark of an impactful, modern data warehouse. Improve Data-Driven Decision Making Organizations with Best-in-Class data warehouses not only strengthen their analytical user base, but they improve overall analytical performance as well (Figure 3). Eighty-eight percent (88%) of the Best-in-Class achieved an improvement in data trust over the past year. When data access is simple and users consistently get desired information quickly, trust grows. Simple data warehouses make it easier for IT to monitor data quality and ensure that users work with data that is accurate and complete. The Best-in-Class are 41% more likely than all other organizations to have achieved an improvement in customer response time. Customers usually seek highly specific data points, and customer-facing employees need to smoothly cut through all of the non-pertinent information in the system. When a customer service rep is presented with an inquiry, he/she can quickly track down the information without unnecessarily wasting the customer's time or submitting an IT request. Ideally, The Best-in-Class are 41% more likely than All Others to have achieved an improvement in customer response time.
6 information can be found without even putting the customer on hold. CMOs that trumpet their organizations as customerfocused should be especially interested in technologies that drive improvements in customer response times and overall experience. Figure 3: Improvements in the Past 12 Months Read the full report: Analytical Collaboration: The Whole is Greater than the Sum of Its Parts Fast and simple data warehouses helped 82% of the Best-in- Class drive an improvement in collaboration among internal departments. When data access is simple, multiple users in different departments can easily work from the same information towards a common goal. Just as customer requests for information move more quickly with a Best-in-Class data warehouse, so too do requests for information between lines of business. For example, a sales manager with multiple deals stuck in the pipeline can quickly reach out to marketing for customer data that will help reps breakthrough. Aberdeen's report, Analytical Collaboration: The Whole is Greater than the Sum of Its Parts, shows how overall performance improves when users share data and insights.
7 Finally, 80% of the Best-in-Class improved their overall speed of decision making. Simplifying data warehouse engagement for users and picking up the pace of information delivery can drastically reduce the time needed to acquire and analyze data. The total time needed for decisions also decreases as business leaders spend less time obtaining data and more time working with it. For example, a CIO trying to prioritize major investments can query data from multiple lines of business in a single, brief session and spend more time figuring out which functions merit the most resource allocation. As data is rapidly delivered, the end-to-end process of that complex decision is accelerated. The total time needed for decisions decreases as business leaders spend less time obtaining data and more time working with it. Technology Enablers Best-in-Class data warehouses are supplemented by modern tools that drive speed and simplicity in data access (Figure 4). Eighty-five percent (85%) of the Best-in-Class have achieved real or near, real-time time reporting and analysis. Early data warehouses only needed to create reports using batch processing to deliver information at regular intervals. Now, customers are generating new, valuable data from their mobile devices every second, and smart machines are self-reporting performance data in real-time. This data streaming ability, when handled properly, presents exciting opportunities for multiple lines of business. Real-time analytics, when coupled with a modern data warehouse, enable users to apply their understanding of massive historical data sets to constantlyarriving data, whether it is created by customer interactions or internal operations. IT departments need to gather, manage, and distribute huge data volumes on a daily basis, especially if they are working with real-time data. Eighty percent (80%) of the Best-in-Class employ data management tools. These tools enable IT to corral the huge data volumes and make that information immediately available
8 for consumption by the user base. Capabilities such as data quality tools and governance technology ensure that data is upto-date, accurate, and secure. Effective data management tools also free up IT personnel to pursue endeavors such as building predictive models or other advanced analytics. Figure 4: Complementary Analytical Tools Read the full report: Interactive Data Visualization: Strategies and Key Technologies Finally, over three-quarters of the Best-in-Class have interactive data visualization tools. Interactive visuals present the top layer of data and encourage users to dig deeper and expand their initial insights. A fast, uncomplicated data warehouse enables users to pursue opportunities in different data sources and immediately start performing analysis. For example, a marketing manager that recognizes a cluster of similar closed deals on his/her dashboard can explore customer data to identify crosssell and up-sell possibilities. Aberdeen's Interactive Data Visualization: Strategies and Key Technologies explores the strategies and capabilities that make interactive visualization an effective conduit for data engagement. Key Takeaways Organizations are collecting more data than ever and decision makers want faster, more comprehensive access to help mold
9 their insights. Best-in-Class data warehouses are able to handle that demand while minimizing unnecessary complexity that will frustrate users and cause swelling IT costs. Organizations weighing investments in intelligently simple data warehouses that deliver information when it matters, should consider the following: Users appreciate an easy, streamlined experience. Compared to all other organizations, the Best-in-Class deliver BI functionality to 77% more analytical employees per capita. These users engage BI tools more frequently and are more likely to operate in a self-service capacity. Simplicity enables IT to proliferate analytical functionality throughout the organization and ease-ofuse keeps decision makers eager to engage with data. Superior data warehouses drive analytical improvements. Best-in-Class organizations are more likely to have achieved recent improvements in data trust, collaboration, customer response time, and the speed of decision making. Keeping data systems simple helps technical experts ensure that users only engage quality data. Rapid data access enables decision makers, in different lines of business, to quickly exchange pertinent information. Customer service reps can also track down requested information faster and improve overall customer experience. Complementary tools help users and IT get it done. Modern analytical tools maximize the impact of data warehouse solutions. Eighty percent (80%) of the Best-in- Class have data management tools and 77% have interactive data visualization. These tools enable optimized delivery of information and more efficient
10 allocation of IT resources. Additionally, 85% of the Bestin-Class have the ability to work with real-time data. Slow, complicated, and expensive is no way to go through your analytical life. When pondering how to optimize the impact of a data warehouse solution, don't overthink it. Help IT streamline implementation and delivery, empower users to access data quickly, and always keep it simple. For more information on this or other research topics, please visit. Real-Time Executives: Streaming Data into the C- Suite; May 2014 Best-in-Class Reporting and Dashboards: The Workhorse of Analytics; May 2014 Holistic BI: Three Cogs in a Well-Oiled Analytical Machine; May 2014 Related Research Author: Peter Krensky, Research Analyst, Analytics & Business Intelligence (peter.krensky@aberdeen.com) About Aberdeen Group Big Data Perspectives: Users vs. IT; April 2014 Interactive Data Visualization: Strategies and Key Technologies; March 2014 Analytical Collaboration: The Whole is Greater than the Sum of its Parts; July 2013 Aberdeen Group conducts research focused on helping business leaders across sixteen different B2B technology disciplines improve their performance. Our process is simple we conduct thousands of surveys every year to identify top performing organizations and uncover what makes them different. We share these insights back with the market in the form of in-depth research reports and content assets to help our readers build business plans capable of driving better results with the right set of tools to help them get there. This document is the result of primary research performed by Aberdeen Group. Aberdeen Group's methodologies provide for objective fact-based research and represent the best analysis available at the time of publication. Unless otherwise noted, the entire contents of this publication are copyrighted by Aberdeen Group, Inc. and may not be reproduced, distributed, archived, or transmitted in any form or by any means without prior written consent by Aberdeen Group, Inc.