Editor’s note: What is the purpose of a Business Intelligence Competence Center (BICC) and what value can a BICC produce? Many enterprises of all sizes are already using BICCs and many more plan to invest in establishing BICCs next year, according to the findings in Dresner Advisory Services’ “Business Intelligence Competency Center Market Study” in the Wisdom of Crowds® series. I spoke with Howard Dresner, chief research officer at Dresner Advisory Services about the trends in BICCs. In this interview, he discusses how companies fund, staff and structure BICCs, the role of technology in a BICC, plans for 2015 and much more.
What is a Business Intelligence Competency Center? And what drove you to add BICCs this year to your annual series of BI market studies?
Howard Dresner: A BICC is a group within an organization, which is charged with defining, delivering, documenting and promoting best-practice BI solutions. I’ve researched and written about BICCs since 2001. An uptick in the use of BICCs became apparent over the past couple of years in our studies, so we decided to study it more get users’ in-depth perspectives on where this market is today, and where it’s headed.
Are the users mostly early adopters or is this a well-established market?
Howard Dresner: Experience with BI competency centers reveals many long-experienced organizations as well as recent adopters. More than 50 percent of large organizations of 5,001 and more employees have had BICCs in place for at least six years. Thirty-five percent of all the respondents say their BICC is two years old or less.
Which industries are most prone to implement BICCs?
Howard Dresner: Healthcare is the leader with almost 70 percent of these respondents reporting their BICC is at least six years old. Manufacturing, financial services and technology are the newest users.
You mentioned earlier that a BICC’s task is to promote best practices in BI solutions. Is this the primary value?
Howard Dresner: BICCs have different charters; some are more or less expansive than others. But certainly most of them have a mandate to drive business intelligence usage throughout the organization. Indeed, our study found that where established BICCs exist, organizations are able to achieve far greater BI user penetration than otherwise.
The use of BICCs is a topic that has come up several times in my weekly #BIWisdom tweetchats on Twitter. In a recent session, several participants tweeted that a BICC leads to a single version of the truth in data and may also help discover analytic flaws. Another benefit brought up in the tweetchat is that a BICC operates across silos and thus can quickly find new insights for the business. Another participant mentioned that many large organizations have “multiple BI flavors” and duplicate their efforts. A BICC can eliminate that duplication and streamline costs and processes.
Our study found that respondents using BICCs set a higher standard for their infrastructure and are more likely to report fragmented departmental data and multiple inconsistent data sources. They also reported better decision making.
But the primary value is that organizations where a BI competency center is in place view their business intelligence initiatives as more successful.
What growth trends for BICCs were revealed in your study?
A wide majority of respondents — more than 90 percent — indicate that their BICC will receive increased funding over the next two years. Nearly half of the surveyed organizations are increasing budgets by up to 10 percent and another one-third is raising budgets by 11-30 percent. Fewer than 10 percent of organizations are decreasing 2015 budgets.
Within functional areas, technology organizations and financial service industry organizations have the most aggressive investment profiles for 2014 and 2015. More than 50 percent of tech organizations will increase BICC spending 11 percent or more in 2014 and plan sharp increases for 2015. Half of financial service organizations will increase spending 11 percent or more in 2014 and 2015.
Does the size of the organization matter when it comes to increasing the investment in BICCs?
Howard Dresner: Smaller and some mid-sized organizations have the most ambitious funding plans for the BICC this year and next. Organizations of up to 1,000 employees all plan increases in 2015 over the current year. Some mid-sized organizations are planning the largest budget increases (> 50 percent) this year and next.
How are most BI competency centers funded? Are they primarily cost centers in an organization?
Howard Dresner: Most organizations, especially in North America, view the BICC as a direct cost or cost of doing business. About one-third of organizations, especially in Latin America and EMEA, budget and pay for annual project costs and maintenance, and many are covered under fixed infrastructure budgets. About 12 percent use a charge-back model based on actual utilization/consumption of the BICC.
Where does a BI Competency Center fit in an enterprise organizational structure?
Howard Dresner: Responsibility and oversight of the BICC can fall to different departments within an organization. In about one-third of the survey respondents’ organizations the competency center rolls up to IT. Operations is the next most likely overseer of the BICC followed by finance.
From my personal observation and experience over more than a decade, reporting into finance tends to work well as finance has a cross-organizational charter and is already adept at managing the business using data and metrics.
How large is a typical BICC and what roles are typically assigned to a BICC? Is it mostly data scientists and business analysts?
Howard Dresner: The majority of our study respondents report BICC headcounts between one and 10. However, more than 40 percent of the North American surveyed businesses report 11 or more BICC people, and more than 25 percent assign more than 50 people to their BICC.
The report, “Business Intelligence Competency Center Market Study,” breaks out the presence of these roles per industry, organization size and geography.
From your experience and observation, if a company wants to implement a BICC, what is the best approach for success?
Howard Dresner: Organizations need to start small, build success and then grow. Technology can be an important enabler, but success is more about method and management than technology. The BICC charter should be enterprise wide. Also, building a portfolio of successful projects is important.
Our data suggests that BICCs that have been in place for more than three years are the most successful. But three years is a long time in an agile BI marketplace. So management commitment is key to success. Initially it’s not easy to build a BICC and it takes time. But it pays dividends once it’s in place.
Almost 50 percent of respondents’ organizations are in North America (United States, Canada and Puerto Rico). More than one-third is in Europe, Middle East and Africa. Approximately one-fourth of the respondents work in very small organizations (1 – 100 employees), and a similar number represent very large organizations of 10,000 and more, and the middle quartiles fall mostly to organizations of 101 – 1,000 and 2,001 – 5000.
Howard Dresner is president, founder and chief research officer at Dresner Advisory Services, LLC, an independent advisory firm. He is one of the foremost thought leaders in Business Intelligence and related areas having coined the term “Business Intelligence” in 1989. He has published two books on the subject, The Performance Management Revolution — Business Results through Insight and Action, and Profiles in Performance — Business Intelligence Journeys and the Roadmap for Change. He hosts a weekly tweet chat (#BIWisdom) on Twitter each Friday. Prior to Dresner Advisory Services, Howard served as chief strategy officer at Hyperion Solutions and was a research fellow at Gartner, where he led its Business Intelligence research practice for 13 years.
Kathleen Goolsby is managing editor of SandHill.com.