Robert Kugel's Analyst Perspectives

IBM Business Analytics Workshop Illuminates Performance Management

Posted by Robert Kugel on Nov 27, 2010 11:57:22 AM

As part of its recent IBM Business Analytics Industry Analyst Summit, I participated in a demonstration of IBM Business Analytics Workshop, a simulation that the company uses to demonstrate the capabilities of its performance management software. Rather than offering a canned demo or a Microsoft PowerPoint deck, the workshop gives a team of individuals from a company a reasonably realistic interactive experience of using the software for a purpose. The group starts with a set of financial goals and then has to comb quickly through a set of operating data to establish a product strategy for the coming year - which products to emphasize in which segments of the geographical markets it serves. In a series of "moves," participants progress through the year, seeing how well they've done, adjusting their strategy if necessary, reforecasting and making sure that the company's resources are aligned with the strategy that they established. IBM and its analytics from acquisition of Cognos offers different flavors of the workshop: The shortest, most basic one takes several hours and can be played with a handful of people, but longer versions that involve many more players and get into many more details are also available.

This simulation arrives at an appropriate time for performance management software. Most suites have matured to the point where it's increasingly difficult to sell them to business people based on "speeds and feeds" - purely by touting features and functions. I believe one of the biggest challenges vendors face in selling this type of software is getting senior executives to understand what they can do with it and how that is a major improvement on what they are doing today. (In my judgment, most companies that have deployed planning software only scratch the surface of its potential.) It's difficult to deliver this understanding through sound bites or passive demonstrations in a way that is either believable or compelling. Neither management consultants nor implementation consultants provide corporations with clear pictures of how improving the way they use information technology can make them more effective (not just more efficient) in executing to strategy. Thus, the need for a workshop.

The consolidation of the software industry over the past decade has brought together a broad set of once discrete categories of applications in ways that enable the integrated vendors to offer more comprehensive solutions that support complete and complex business processes. Consequently, this software can transform the way organizations work, but only if senior executives understand that making changes can quickly enhance their company's effectiveness. The Business Analytics Workshop may not be the only way to create this awareness, but it's a fresh approach and a good start.

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Robert D. Kugel - SVP Research

Topics: Performance Management, Operational Performance Management (OPM), Business Analytics, Business Intelligence, Business Performance Management (BPM), Customer Performance Management (CPM), Financial Performance Management (FPM), Information Management (IM), Sales Performance Management (SPM), Workforce Performance Management (WPM)

Robert Kugel

Written by Robert Kugel

Rob heads up the CFO and business research focusing on the intersection of information technology with the finance organization and business. The financial performance management (FPM) research agenda includes the application of IT to financial process optimization and collaborative systems; control systems and analytics; and advanced budgeting and planning. Prior to joining Ventana Research he was an equity research analyst at several firms including First Albany Corporation, Morgan Stanley, and Drexel Burnham, and a consultant with McKinsey and Company. Rob was an Institutional Investor All-American Team member and on the Wall Street Journal All-Star list. Rob has experience in aerospace and defense, banking, manufacturing and retail and consumer services. Rob earned his BA in Economics/Finance at Hampshire College, an MBA in Finance/Accounting at Columbia University, and is a CFA charter holder.