The State of Data Warehousing Never Looked Better

Doom and gloom? Not so, says TDWI's director of research Wayne Eckerson

An industry analyst recently asked me what I thought the future holds for business intelligence professionals. Given the current economy combined with the exodus of high-tech jobs overseas, the analyst expected me to concur with his own “gloom and doom” scenario. I somewhat shocked him when I replied, “Things never looked better!”

The cause for my optimism is simple. Organizations are now using business intelligence systems to support their most strategic, mission-critical applications. This is validated each time TDWI run its “Best Practices” contest and receives hundreds of applications from organizations doing spectacular things with business intelligence.

For example, this year’s Leadership Award winner, Continental Airlines, uses its 4TB data warehouse to support more than 30 critical applications used by over 1,000 users every day. The BI system, which integrates data from 27 source systems, enables Continental to maximize revenue per flight and better understand its most valuable customers, among other things. The firm believes the BI system in 2002 reduced costs by $31 million and increased revenues by $40 million. Not bad for a decision support system!

Another winner, Lands' End, developed two graphical workbenches that give inventory analysts real-time “actionable metrics” to ensure there is enough inventory on hand to fill customer orders. The system, which integrates a diversity of data and provide recommendations on actions to take, last year enabled Lands' End to significantly decrease lost sales, improve customer satisfaction, and increase top-line revenue growth.

Continental and Lands' End are just two of hundreds, if not thousands, of companies that are putting data warehouses and business intelligence tools to good use. For example, according to a recent TDWI survey, more than three-quarters of BI professionals (78 percent) say that their BI systems are “mission critical” or “soon will be.” More than half (58 percent) say their BI systems are either “very strategic” or “fairly strategic” to their organizations.

BI systems are strategic because they are the eyes and ears of an organization. They help organizations understand where they’ve been, where they’re going, and how best to get there. Without BI, organizations are running blind --very risky behavior in a modern economy with intense competition and a myriad of regulations.

The current trend toward “real time” BI and business performance management will drive BI even farther into the guts of organizations. Today, organizations mostly use BI for strategic and tactical planning, but “real time” BPM systems leverage BI to provide historical context for operational decision-making. In addition, scorecards, dashboards, and BI-enabled portals are enabling organizations to disseminate BI to all users—as well as customers and suppliers—not just pockets of power-users as in the past.

Although transaction systems garnered the lion's share of attention and funding in organizations in the 20th century, BI systems are now taking center stage in the 21st century. I now steer anyone seeking career advice into BI because I believe it has a healthy, robust future. How could it not? BI systems provide the understanding and knowledge organizations need to function more efficiently, effectively, and profitably. And that’s what business is all about.

About the Author

Wayne Eckerson is director of research at The Data Warehousing Institute (TDWI), a provider of in-depth education and research in the business intelligence and data warehousing industry.