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Business Intelligence Infrastructure

Many SMEs are now taking steps to raise their competitiveness by implementing business intelligence systems, writes ALAN CHAN

The ongoing quest for cost efficiency, enhanced customer relationship's and new markets has resulted in unprecedented growth in the Business Intelligence (BI) services sector over the past few years. In view of the overwhelming importance of BI to companies, the deployment of BI application infrastructure -- ERP systems -- is vitally important.

BI is a process that helps businesses increase their competitive advantage by intelligent use of available data in the decision-making process. BI is about turning a pool of raw data into information you can act on and that is relevant to management's area of interest, such as sales/customer relationship management (CRM), finance and production. Managerial personnel should be able to gain insights from the information, make the most informed decision, formulate the appropriate business strategy and eventually achieve greater profitability for the enterprise.

It is widely agreed that BI is not the same as a decision-making system, nevertheless an ERP system is an indispensable component of it. Today, large enterprises are already deploying their second generation BI infrastructure. But for SMEs, many are just starting to take the initiative to outperform their industry peers by choosing a right BI tool.

The most crucial factor of formulating a successful BI strategy is the capability of an ERP system to provide accurate real-time, on-line, up-to-the-minute information. With Internet-based ERP solutions, management not only can access sites locally, but also remotely and to multiple manufacturing facilities, sales rep offices or logistic centers in real time. This gives multinational companies the flexibility to access company information 24 hours a day, seven days a week via a remote dialup, over the Internet or across WAN.

Custom-formatted reports are another pre-requisite of BI tools. Management needs to be able to obtain the analysis reports specific to their interest and needs, and generate online analysis reports in seconds.

How a business benefits from an ERP system

Sales/CRM -- Customer-related processes will become more efficient and customer relationships will be improved. With BI, sales rep performances can be monitored and assessed. Management can acquire a better sales forecast through analysis of product demand trends. It also helps to identify the source and pattern of revenue and hence develop appropriate sales, product and marketing strategy.

Finance -- Effective financial management will be achieved from better cash flow control and planning, better control of AR and AP, easy-to-use report writer that provide information on the company financial status in different perspective, real-time calculation of production cost that includes overhead cost, labour cost and materials consumption cost, accurate up-to-the-minute inventory report in quantity and value, capabilities to handle multi-currency, multi-company and multi-branch business operations.

Production -- Enterprise will enjoy enhanced efficiency in production due to a better monitoring of production process and inventory levels. A swift, accurate and timely MRP report can be generated in minutes. Through the Demand Analysis, Actual Real-time Costing, High Performance CRP and APS, the enterprise will be able to obtain immediate and efficient production schedules to cope with any changes in orders. APS module will provide a  what-if-simulation to forecast if an enquiry (not confirmed orders) could be fulfilled. Capacity Loading Analysis will also allow managerial personnel to spot production bottleneck and minimise unbalanced workloads among different work processes.

How an ERP system can be set up in your business

Implementation of an ERP system streamlines business operations and aligns the system with the business strategies and goals of the enterprise. In general, implementation can be divided into six phases:

1. Preparation Phase  Define project scope and objectives and prepare project-working schedule.

2. Business Workflow Study  Discuss workflow of the organisation and see if re-engineering is needed for the business.

3. Realisation Phase  Finalise the business workflow and configure master tables and settings.

4. Final Preparation Phase  End user education and training will be conducted in this phase. Start entry of opening balances and backdate entries.

5. Parallel Run  Keep on improving and fine-tuning processes and verify reports with existing system.

6. Result Measurement  Management training, result evaluation and measurement will proceed.  

Alan Chan is the Chief Technical Officer at B.E.L. Systems Ltd. He can be reached at, alan@belhk.com, or visit www.belhk.com for more details on ERP.