Business Intelligence for SMBs: MBS Excel Applications and Competitive Analysis

Additional MBS Applications

In May, Microsoft announced the availability of a private beta release of a new server-based business performance management (BPM) scorecard application. Code-named "Maestro", the new application will reportedly take advantage of the power of the Microsoft Office System to help organizations perform deeper analyses by allowing them to build, manage, and use scorecards and key performance indicators (KPI)—all within an intuitive and collaborative environment. It should provide companies with a broad view of business opportunities, through which employees could better understand business challenges, shape solutions, and quickly execute solution objectives.

Decision-making is increasingly happening across all levels of an organization, and empowering employees with powerful business intelligence (BI) solutions should help employees to have a greater impact. To capitalize on this, BI continues to be a natural and important area of investment for Microsoft's Information Worker Business division, which is focused on helping individuals, teams, and organizations be more productive with the range of programs, servers, and services that make up the Microsoft Office System.

Enhancing BI technologies that were originally released in Business Scorecard Accelerator last summer (see Part One of this note), Maestro is well-suited to business scorecard projects for which ease of use, deployment, and integration with Microsoft Office System solutions are important. Microsoft believes the product should allow a user company to do the following:

• Align actions with strategy. Many companies reportedly struggle to articulate business strategies and align employees' daily activities with those goals. Scorecards built with Maestro should thus provide a reliable and pragmatic approach to how businesses define strategy, provide information and access to employees, and show how projects align with KPIs and objectives. The product will allow scorecards, initiatives, and action plans to be monitored, managed, and measured throughout the organization.
  
  
• Gain more complete insight into context. Maestro should help companies make sense of their business data by putting it in the context of KPIs, whereby employees can gain deeper insight by combining the product's scorecarding functionality with reports, charting, graphs, and analysis tools, and with unstructured data such as documents, spreadsheets, and Web sites.
  
  
• Collaborate on business management and action. The product will provide a framework for interpreting and working with business information, allowing people to not only understand data in its appropriate context, but to more effectively collaborate on group analysis and take action to improve business performance.
  
  
• Empower employees to monitor and deliver against key metrics. Integrating with user-friendly tools such as the Microsoft Office 2003 Editions and Microsoft Office SharePoint Portal Server 2003, Maestro will empower end users to build, manage, and use scorecards, while at the same time, it will leverage a company's existing skills, technology, and investments to help the business get more value with less cost and time.
  
  
• Achieve extensible functionality. Although many might see Microsoft's expanding its offering from the mere underpinnings of BI, such as online application processing (OLAP), data mining, extract-transform-load (ETL), and reporting tools, to full-fledged BI applications, Maestro should still offer a scalable platform. Independent software vendors (ISV), value-added reseller (VAR), and systems integrators (SI) can customize and extend the offering's functionality or integrate scorecards into line-of-business (LOB) applications, or create other custom applications by using Microsoft Office System platform, Microsoft SQL Server platform, and Visual Studio tool set. Maestro has already been released to testing partners, such as Panorama Software, as part of a private beta release, while a public, beta version is scheduled to be available this summer. Estimated retail prices and final availability are yet to be determined.

This is Part Two of a two-part note.

Part One discussed how Excel is being used to address the need for business intelligence.

Competitive Analysis

Many believe that Microsoft ventured into the reporting sector of the broader BI market when it first unveiled Microsoft SQL Server Reporting Services in 2003, which has since forced competitors, such as Business Objects, former Crystal, and Cognos to make defensive moves. As a result, many renowned enterprise-level analytic and reporting vendors, such as Actuate, Business Objects, MicroStrategy, OutlookSoft, or ProClarity provide Excel add-in products, thus further confirming Excel's popularity at the desktop, especially since even in largest corporations, not everyone is delighted with the idea of familiarizing with yet another proprietary user interface (UI), workflows, and navigation.

Seeking new growth opportunity, vendors have been creating new solutions for small and medium businesses and are now offering BI solutions. Hoping to cash in on the dominancy of Excel, Oracle recently announced an Excel add-in, made possible by its purchase of iLytix Systems AS. Even enterprise resource planning (ERP) giant SAP believes SMBs will be able to make dramatic gains in productivity and business insight using the new reporting and BI capabilities available in SAP Business One, the ERP product geared to the lower-end of the market (see SoftBrands to Institute Fourth Shift for SAP Business One Manufacturing Work-Plan). SAP has and will continue to integrate the assets and employees of SoftBrands, a small, privately-held company that it acquired, into SAP's operations and Global Development team as part of the transaction.

Former iLytix' XL Reporter made information from SAP Business One immediately available in Excel, like it has previously done with Microsoft Axapta, Great Plains, and Solomon, thus eliminating the time-consuming task of exporting and re-formatting data. The solution also allows customers to easily create new or modify existing financial and business reports and schedule reports for automatic delivery to managers, chartered public accountants (CPA), and other key decision makers. The solution's reporting and BI features make it a powerful and easy-to-use tool for accountants and financial professionals, enabling them to leverage information from both SAP Business One and other sources for up-to-the minute analytics and insight across the business. Users have the ability to create comprehensive business reports, comparisons and "what-if" scenarios on-the-fly, with new point-and-click and drag-and-drop features. Because the reporting tool uses Excel, formatting, calculations and other activities can be easily mastered, facilitating widespread adoption of the solution.

These examples of Excel analytic add-ins or Excel-based products tend to adopt the look, feel, and functionality of Excel, and they typically manage a wide range of tasks, especially if they are connecting to a multidimensional data source, such as an online analytical processing (OLAP) cube. These solutions generally provide all-purpose, ad hoc, "slice-and-dice" analytic capabilities, definite analytic functions (such as, data mining, dashboard, or scorecard visualization), or the ability to generate enterprise or operational reports from within Excel. An additional list of commonly available capabilities includes

• Excel's ability to have multiple worksheets stored in one workbook file makes it appealing for management briefing books. Users can access their data, populated from multiple data sources and queries in one file, and off-line. Therefore, users can format information into content packages (reports and report packs) that they can e-mail to other users, access over Web portals, or collaboratively share with other Excel users.
  
  
• Given Excel's ability to "massage data" via sorting, creating formulas, and even fixing bad data, one can select data tree hierarchies or dimensions within those hierarchies to construct meaningful data views, such as picking explicit cities, product categories, or salespeople within a territory hierarchy to help with sales analysis.
  
  
• Users can navigate data presented by these views by drilling-down, drilling-across (from one hierarchy to another), or drilling-through (from the summary to individual transaction level data).
  
  
• Given that Excel charts and all the associated controls over scaling, axes, and labels have become a standard, users can picture the data presented by these views in the form of graphs, tables, hierarchy trees, 2-D and 3-D charts, scorecards, and top-n or bottom-n rankings.
  
  
• Bidirectional data integration, whereby any changes made to numbers during the analytic process can be written back to the data source from Excel. For example, this can be used to increase or decrease budget or forecast numbers after they are compared to the actual ones. Also, users should be able to create metadata layers to allow them to better understand, find their way, and select data in complex underlying transactional enterprise systems.
  
  
• User have roles-based data security, so that users will only see what they are entitled to. They can also use simple business rules to highlight exceptions in the data, such as using a numeric threshold to change the color of the data if a value is above or below the threshold level.

Use Excel With Caution

The traditional spreadsheet approach remains popular despite its tendency to be labor-intensive, time-consuming, and error-prone. Further, although Excel may be undisputedly the most widespread analytic tool, it is also quite susceptible to creating harmful multiple versions of the truth. For example, multiple users will execute the same query against one central data warehouse and unload the data into Excel. Then, one user will filter the data in Excel with a particular set of criteria and create some personal formulas, while other users will filter it slightly differently, and some may make errors when creating or using a formula.

Thus, not knowing which version of the truth is correct, an excessive amount of time can be spent reconciling the multiple versions rather than garnering business insight, and the same process is repeated each time the query is refreshed and the results are re-exported. Therefore, using these processes for financial reporting can cause adverse Sarbanes-Oxley (SOX) noncompliance issues, since there might be little assurance as to which spreadsheet is valid, despite the fact that financial analysts are often the best-versed Excel users.

Also, while SOX will cover financial reporting, other regulatory reporting, such that for the US Environmental Protection Agency (EPA) for environmental factors or the US Food & Drug Administration (FDA) for food and life sciences, has equally strict requirements. More stringent policies should be implemented to spreadsheets that are critical to the business. For that reason, savvy Excel add-in BI tools should be helpful because they can track ownership via password protection. They can also create an audit trail of changes made to the Excel spreadsheet, and store spreadsheets within a BI repository. The Excel spreadsheet could be refreshed with new data, typically by maintaining a link to the original query file.

Consequently, companies relying on an Excel or an Excel-like system need to know that while Excel might suffice for ad hoc analysis and data storage for individuals or small groups, the technological flow of data and referential integrity prevents it from a corporate-wide, collaborative effort like planning and budgeting, not to mention product development and sourcing. Users increasingly require streamlined analyses using fewer mouse clicks to perform functions such as sorting and highlighting. Additionally, they are looking for more options for graphs and analyses shortcuts that allow specific sub-filtering. But, to further complicate things, while business managers are largely unaware of the problems associated with using spreadsheets, the IT department often regards these as falling outside its jurisdiction, leaving the management of critical spreadsheets in a "no man's land".