Post written by Wade W., BI Consultant at Ideaca. Read more about BI on his blog: Pragmatic Business Intelligence.
In reading industry material, I recently came across a statement that can only be, in my opinion, the product of tunnel vision. It was one of the most short-sighted and fundamentally erroneous statements I have seen in some time. Analytics
In reading industry material, I recently came across a statement that can only be, in my opinion, the product of tunnel vision. It was one of the most short-sighted and fundamentally erroneous statements I have seen in some time. Analytics
“At the 2005 Emetrics Summit in London, Bob Chatham from
Forrester Research described what it means to be the key. He told the
assemblage that we are the leaders of tomorrow – and he wasn’t just preaching
to the choir to curry favor – he made sense. Chatham told us that “web
analytics” would eventually be subsumed into business intelligence, thereby
changing the game. Instead of giant data warehouses being sifted in hopes of
finding patterns, it would be the likes of us web analysts in charge.” (Jim Sterne, Target Marketing of Santa
Barbara, edited by Erika Lindroth, The Weather Channel Interactive, Inc.)
I agree that web
analytics will be (and is starting to be) subsumed into BI. However, I
question the sentiment that “giant data warehouses [are] being sifted in hopes
of finding patterns” and that Web Analytics would “change the game.” Is
Web Analytics really going to revolutionize the art of Business Intelligence so
significantly? The implication in this quote is that somehow traditional
Business Intelligence is somehow inferior to Web Analytics.
I think this is an
excellent example of what happens when someone seen as a leader in a field
becomes too engrossed in what he is evangelizing…he becomes blind to the bigger
picture.
The fact is that Web
Analytics, though impressive in its power to aggregate user behaviour and use
this to optimize website profitability, it is by nature a limited field. You
are able to track user behaviour – generally anonymous at that – through a single
customer-facing channel. Web Analytics is Business
Intelligence, that only leverages a single source.
“Giant Data Warehouses,” however, are repositories of cross-organizational data, in most cases that extracted from up to hundreds of disparate data sources – Legacy systems, ERPs, CRM systems, finance, operations, HR, desktop apps, web services, external sources – and loaded into a database of a very specific architectural design optimized to return query results on the huge amounts of data very quickly.
Further, this data
will certainly have different meanings across and organization – what does
“Customer” mean? How do we define this? Part of the process is to work closely
with the business to define common business definitions of business entities…so
all that data of all that depth and breadth and richness is (should be….) based
on common meanings that have been agreed to by key stakeholders. We can
mine the data to identify unknown customer segments. We can do Predictive
Modeling. Starting with a business mentality, there is the potential to
leverage some powerful Business Intelligence.
But I do agree that
Web-sourced data represents a substantial opportunity. We can take those
Web-specific data sources that power our Web Analytics Apps, and add that to
the existing Data Warehouse, passing through the same business rules to ensure
heterogeneous data has a single meaning. Now we are talking organization
wide, multi-source Business Intellligence. Plug BI’s powerful analytical
tools into our database, and with some targeted, business-driven KPI’s, and we
have another, very powerful means of driving profitability
Web Analytics could be
said to be proportionally less expensive than traditional BI – same basic cost range
for the analytics tool, but less demand for investment in multiple software
licenses from different vendors (possibly), less complex data massage (or not…)
and shorter time to implement. And that in itself is a strong argument in
favour of Web Analytics – reduced time to market. However, you won’t have
the spectrum of information you have in a well-implemented Data Warehouse.
I believe that Web Analytics
is a complement to BI. It can be integrated into a dashboard, or can stand
alone to guide developers and webmasters to optimize content. It does have an
effect on our database architecture – we must adapt the design of the database
to integrate web data. But does it “change the game”? No – it
makes it more interesting. And as a Business Intelligence professional, I
welcome another tool that will add value to my service offering and to my
clients.
Wade Walker
