Disposable Business Intelligence, Part 2: KPIs 2.0 (Keep Pursuing Insights)
“The important thing is not to stop questioning. Curiosity has its own reason for existing.” -Albert Einstein
As I discussed in last week’s post, I believe the value of business intelligence (BI) is becoming more valuable in yielding momentary new insights than in curating old insights for ongoing decision making. An example of this is the practice of developing and maintaining key performance indicators (KPIs).
In my professional practice, I have used BI to yield many valuable insights for leaders in the organizations I have worked. Oftentimes, the executive would appreciate the insights so much, they would want me to curate it as a repeated measurement or KPI. This way, they could continue to monitor it on an ongoing basis. However, I noticed that once an insight was solidified into a metric, the interest in it went down. Since the insight was no longer needed in that moment to make a key decision, people’s interest waned. The value of BI is all about supplying the right information at the right time. It may still be the right information, but its time has passed. As a result, its value diminishes. Just like a Styrofoam cup is still a perfectly viable cup, the drink it once held is gone.
What I realized is the true value of BI and analytics is in the problem it solves, the question it answers, the insight it yields and the discovery to which it leads. It is the action of solving, answering and discovering that value from analysis is gained.
I once heard a satirical acronym that KPI really means “Kills Personal Initiative.” Many people view BI as a means to an end, and one of those ends is a key performance indicator. Conventional thought has told us that a KPI is the end-all, because once you know what to measure to indicate performance, you are done. You just measure the KPI and if you get a green light on your BI dashboard, all is right with the world. However, we know that is not the case. The big data explosion has taught us that it is often the unknown that holds the next critical information needed. If we rest on the laurels of our KPIs, we may miss the next key insight. So maybe KPI should mean “Keep Pursuing Insights” instead.
Certainly, KPIs, metrics, published reports and automated BI have their value and replace. I still go back and thumb through my photo albums (digital and print) to remember important things I have forgotten. However, we can live too long in the past. The same is true in our BI and analytics efforts. If we rely too much on historic indicators and our tried-and-true (or tired-and-true) KPIs, we may miss the next big insight.
For a company in the midmarket, adopting a disposable mindset in terms of BI may prove to a competitive advantage. Medium-sized business can be more nimble than their larger counterparts, because they can react to situations with speed and agility due to their lighter, less cumbersome weight. Larger companies require KPIs and metrics to monitor the entire enterprise and are more likely to get stuck in an insight-less rut of their own making. Smaller enterprises can more aptly pursue a game-changing insight and quickly move out in front to grasp the lead.
As Einstein said, “Never stop questioning.” This goes for BI and analytics as well. Try not to think about the BI and analysis work you do in terms of its persistence, but in maximizing its momentary value. It may turn out the BI we ended up disposing of was the most valuable of all.
Disclaimer: This post was brought to you by IBM for Midsize Business and opinions are my own. To read more on this topic, visit IBM’s Midsize Insider. Dedicated to providing businesses with expertise, solutions and tools that are specific to small and midsized companies, the Midsize Business program provides businesses with the materials and knowledge they need to become engines of a smarter planet.