There has been a lot noise around traditional BI being a failed promise. In fact, Market Dynamics, a UK-based research organization, published a report on how Fortune 500 companies are losing millions of dollars in lost opportunities.Can it truly be attributed to traditional BI alone? Well, to answer that question one needs to comprehend the context in which BI is implemented.Traditionally, IS reports have been used by management executives to formulate strategies for their organization at a global level. Say, for instance, a pharmaceutical company would be more interested in identifying patterns to better understanding the usage of a particular drug for a region or occurrences of particular diseases in a geographic location.These, as you may well understand, are data which have been accumulated over a period of time, at times ranging in years. On the contrary, a downstream manufacturing company would benefit more from tracking whether their shipments are being delivered on time as that affects their business directly.As you can see, that the former approach falls more in the traditional BI category where the top brass would use the data to start an R&D initiative for a new drug or come up with a strategy to position a different drug for a particular market. The key thing to note is that to take such a decision you would require data with a wider time window, possibly a few months/years of data.In the latter scenario, the time window to respond to anomalies is extremely short and it directly impacts operations within as well as outside the organization to make decisions very quickly. As an example, a semiconductor company could be providing low budget components to mobile manufacturers. In today’s uncertain times, most of the manufacturers keep a very low inventory and are dependent on the downstream suppliers to deliver components in a timely manner as their assembly line is completely dependent on it.As you may be aware that a delay in shipment can trigger a flurry of activities affecting the line of business executives directly dealing with the customer, the finance department as a delay in shipment could affect the payment position, the planning department would need to rework on the next schedule and above all the customer would have to be informed about the delay so that they could possibly take necessary actions to handle their assembly line. This is what operational BI would help in solving: a short time window and people at the operations taking immediate decisions.Having said that, traditional BI is important, especially when identifying patterns to formulate strategies. On the other hand, for organizations to operate to the strategies, operational BI is better equipped to address it.In a nutshell:
Operational BI

• Alerting on predefined Key Performance Indicators based on thresholds
• Shorter time window, more operational visibility
• Quick response time
• Information available to the right people at the right time
• Transactional

Traditional BI

• Helps in identifying patterns
• Works on a wider time-window
• More towards formulating strategies
• Deals mainly with historic data

Key areas for success — in general:

• Quality of Data
• Indentifying organizational-specific KPIs
• Aggregation of data from various sources
• Data source format and integration

As you can see, for the latter scenario an approach based on traditional BI may not suffice as the time to react is very short whereas for the former scenario operational BI would not be effective as given the short time window, a strategist may not be able to conclude based on the data points available.

soumadeep Email Entry Operational BI, Traditional BI