BPM picks up the BI baton

Jason Goodwin of SAS believes business performance management has come of age

IT Week: As head of customer intelligence at SAS, can you explain what makes a business performance management [BPM] system?

Jason Goodwin: Scorecarding [software that measures business performance against key performance indicators] is a big part of BPM, but SAS advocates that BPM is much broader than just scorecarding. It includes budgeting, planning, financial forecasting, risk analysis and strategic performance management software as well as the business intelligence [BI] tools required to access, clean, analyse and deliver data to different users.

Is consolidation in the BI and BPM sectors a good thing for customers?

Firms spent millions collecting data and integrating apps to manage it, but now they are thinking, "We've got all this data, but how do we turn it into actionable intelligence to inform our decisions?" To meet this demand the BI vendors are moving from pure historical reporting using techniques such as Olap to using the data through BPM solutions. Vendors like Business Objects have seen this market opportunity and are looking to buy their way into it.

What are the benefits of BPM tools?

You get the obvious stuff, like better planning and better understanding of your business, but the ultimate benefit is improved decision making. BPM lets you make sure your performance is tracked against your plans, and that insight allows managers to make decisions earlier.

How can this help firms?

A BPM solution allows you to assess where your revenue is likely to stand at the end of the month, for example, which lets you take redemptive action to get closer to your target. Not only can you make decisions earlier, they are better decisions because in a full BPM environment you can model the impact of different decisions and pick the best one.

How should firms install BPM?

It sounds like a massive investment of time and money, but the best approach is on a piecemeal basis. The biggest problem for IT managers is [to decide] what to measure - this is where professional consultants can help. For example, you can use BPM systems to develop a customer loyalty index, but an IT manager may not be best placed to know what data points you need to measure to gauge customer retention.

Why are more companies showing an interest in BPM now?

A number of factors have combined to drive the current interest. The need to comply with regulation is certainly leading to more interest from IT managers as they look to use BPM solutions to improve data accuracy and provide audit trails. However, it is also being driven by a cultural change in consumer behaviour. The introduction of the internet and focus on consumer issues is making customers more fickle and more price-sensitive. They are more aware of alternatives and less loyal to individual suppliers, which means firms are interested in systems that can ensure they keep their customers.

About Jason Goodwin

Jason Goodwin is head of customer intelligence at SAS. Previously, he was head of CRM and BI at Plaut Consulting.

Goodwin has also managed an e-business and CRM team for Siemens Business Services.