Business Intelligence Maturity Models
Doing the right things and doing the things right is a company’s key for success. Business Intelligence solutions are being used to get the most insights from their data, which has a direct impact on performance, decision agility and revenue. No company can afford to miss the opportunity of gaining these insights, if it wants to be a competitive player on the market. The Gartner Group’s definition of Business Intelligence from the year 1996 still holds true:
“Data analysis, reporting, and query tools can help business users wade through a sea of data to synthesize valuable information from it – today these tools collectively fall into a category called ́Business Intelligence.”
As the data volumes are continuously increasing, companies are facing yet another challenge – data handling. Large efforts and resources are required to get the meaningful insights.
Business Intelligence Maturity Models help to understand and measure the invested efforts. More importantly, they are a tool to define the necessary steps to achieve even larger maturity. What all the models share is describing a typical development path, starting from an initial stage and ending with full maturity, usually described in three to six levels of maturity. The maturity models developed by consulting companies are to be distinguished from the scientific ones. The scientific models generally focus on specific problems, whereas consulting models use a broader approach to make branch comparisons and certifications possible.
TDWI’s Business Intelligence Maturity Model
In this article I want to introduce you to the TDWI’s Business Intelligence Maturity Model. It was developed in the year 2004 by Wayne Eckerson. TDWI is a neutral and independent Business Intelligence and Analytics community, which acts as a platform for scientists, users and consulting companies.
The model describes six levels of maturity. They are divided in eight sectors: Scope, Analytical Structure, Executive Perceptions, Type of Analytics, Stewardship, Funding, Technology Platform and Change Management and Administration.
The first level “Prenatal” of the model describes the state before companies introduce Business Intelligence solutions – standard reporting is in place, but individual ad-hoc reports based on the theoretical available information can’t be generated.
On level two “Infant”, spreadmarts – sheets or small databases – are used to collect data. As the spreadmarts are not connected it can lead to inconsistencies and result in issues when taking decisions. This level is defined as a “Pre-Stage” of a data warehouse.
The model describes level three as “Child”. On this level the spreadmarts are transformed to department wide data warehouses. To make the step from level two to three, the so called “Gulf” must be overcome. It means that the Business Intelligence applications must provide 150 % of the performance and functionality compared to the former spreadmarts. Central data storing, and standardization makes the analysis of historical trends possible.
Level four is called “Teenager”. The key to the level is in the integration of department wide data warehouses into central data warehouses, enabling companywide analysis of data and the introduction of key performance figures. The necessity of companywide standardization of Business Intelligence solutions is understood by leading managers. Separate teams to improve the solutions are found, and external consultants support their work.
To reach level five – “Adult”, companies must leap the “Chasm”. All managers must understand the criticality of Business Intelligence solutions for the overall success. Continuous improvement of reports and applications needs to be done, to react to the changing market requirements.
The final level “Sage” distinguishes itself through Centers of Excellence, meaning that the enhancements of the Business Intelligence solution is being developed by the departments. The central team to support the data warehouse is still in place, but focuses on the development of companywide reports, as well as key performance indicators. Through their Business Intelligence solution, companies reached this level, secured a strong competitive advantage and a high return on investment.
As Business Intelligence is one of the key factors for the competitive ability of companies, large amounts of money are invested. Business Intelligence Maturity Models are a tool to understand and plan all aspects and steps necessary to make the most out of the investments. For complex projects it is mandatory to develop strategies to measure the progress and define future action. Business Intelligence Maturity Models offer the chance to make this efforts and achievements visible. They also make a direct comparison with competitors on market possible.