Energy and Finance Companies are Behind the BI Eight Ball
Energy and finance companies will tell you they are using advanced analytics and BI but most of them are reading dated reports (not in real-time), usually compiled by hand, and created in Excel. In my previous Solutions Review post called, “Business Intelligence is Not What You Think It Is” I talked about how some companies are using the same sorts of information management systems today as their father’s did 20 years ago such as static analyses created in Excel and standard reports created through ERP systems. This isn’t business intelligence!
Since we are talking about BI I think it’s appropriate that I put some survey data behind my position. In a Forbes article written by Tom Groenfeldt called “Business Intelligence (BI) Isn’t. Very Intelligent. Yet,” Mr. Groenfeldt refers to a SunGard survey of senior managers in the energy and finance space which exhibits that only 20% use proactive and investigative methods in their analytic techniques which include but are not limited to scorecards, heat maps, word clouds, dashboards.
Below are some takeaways from the SunGard Survey:
- For a majority of respondents, reactive and ‘after-the-fact’ analyses are the primary means of data analysis. A companies’ reliance on spreadsheets, manual data manipulation and periodic reports can limit their ability to conduct proactive analysis.”
- Almost half the companies (45 percent) fill reporting needs through manual extraction and data cleansing tools, feeding the information to spreadsheets or PDF formats.
- A large percentage of companies still are focused on department-specific BI type initiatives.
- Only 13% of respondents utilize advanced BI techniques such as predictive analytics and alerts.
- A very large percentage were using a lot of manual data manipulation, or relying on batch results generated daily, weekly, monthly or at the ends of the financial period.
A CFO trying to make sense of data from different divisions and geographies for financial reporting, credit risk, and risk profiles is going to “be behind the BI eight ball.” And to make matters worse it doesn’t seem like things are going to change anytime soon. Tom Groenfeldt presents some good reasons why finance and energy companies will continue to lag behind in BI.
“The current disparate systems may take extra time, but the business analysts have become experts in their areas.”
“Many companies don’t want to replace different systems with a single system because each of those is best in class and does what it is supposed to do.”
“The systems might be quite different for trading power in the US and natural gas in Europe and coal in Asia.”
Do you believe that finance and energy companies will overcome these obstacles and get up to speed with BI or even become a BI trailblazer? Let us know your thoughts.
Click here to read the entire article by Tom Groenfeldt and learn why finance and energy companies are lagging behind in business intelligence and will continue to lag behind.
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Doug Atkinson
An entrepreneur and executive with a passion for enterprise technology, Doug founded Solutions Review in 2012. He has previously served as a newspaper boy, a McDonald's grill cook, a bartender, a political consultant, a web developer, the VP of Sales for e-Dialog - a digital marketing agency - and as Special Assistant to Governor William Weld of Massachusetts.
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