As a music lover in today's digital era, I can claim a fairly extensive collection, including several hundred CDs and well over 2,000 digital tracks on my devices and online. And while I thoroughly enjoy the wide range of titles and artists, and the portability and convenience of digital music, I have a confession to make – I've developed a love affair with vinyl. Albums. LPs. A record. A big honkin’ piece of vinyl that can only be played on a turntable, at a speed of 33 RPM. One of those things your parents listened to long before Pandora, Rhapsody, Spotify, and iPods.
Sure, when listening to the digital version, I enjoy the clean, crisp sounds of the vocals and instruments with no imperfections or distortions, and being able to hear even the slightest nuance of sound, like the “whoosh” of the brushes on the drum sets. But even when listening to a vinyl album in mint condition, and hearing a bit of hiss on the playback, it is clear that the recording is not as sanitized, but does have a fuller, richer and warmer sound than the digital version.
I wanted to know why there was such a remarkable difference, so I talked to sound engineers and did some research. Apparently, digital music can be incredibly accurate in terms of replay, but because digital music is frequently engineered for higher and higher sound volumes during playback, and to provide smaller and smaller file size to allow for more efficient storage and streaming, this leads to what one engineer explained as, “fatiguing – hyper-compressed songs that squish out the dynamics and textures that give recordings their depth and vitality.”
I also learned that a vinyl record can contain more musical information than the corresponding digital file. What you hear when listening to a streaming site such as Amazon, Pandora, or YouTube is, by design, of lower quality than what you will hear from a good piece of vinyl. In many cases the full range of sound originally recorded has been “clipped” from the digital version to allow for smaller files and more efficient digital access. This is why vinyl can be a much truer representation of the actual sound as it was captured.
There is an interesting parallel in the world of business intelligence and analytics. Corporate performance management (CPM) - and all of the activities associated with organizational, financial, and operational reporting - has been around for decades. Organizations handle CPM with varying degrees of sophistication, automation, and complexity. And without careful examination of their current approach, they may not be aware of deficiencies they could be experiencing.
Similar to a digital representation of music, CPM summarizes key elements of the organization's financial and operating health in a completely standardized, highly regulated format. Not only has the data in these reports been thoroughly audited and sanitized as a result, it has also been heavily “engineered,” or compressed for a cleaner, more efficient and standardized presentation.
Also like digital music, the information in these financial reports has been clipped and pruned, containing only what the business has been deemed the most important key elements. For example, a single number on an income statement may reflect total sales for the month, but lacks the details of day-over-day performance, performance by region, vertical industry, sales rep or product line, and a variety of other data views. The end result is that the CPM view of the data, similar to the digital representation of a popular track, no longer includes the full-fidelity, richness, and dimensionality of the source data.
I'm not recommending a migration back to vinyl, leaving behind all of the advances in digital technology, nor am I trying to de-emphasize the importance and business impact of a well-designed CPM portfolio. Instead, I use this vinyl analogy to illustrate a few points to ponder when considering business intelligence and analytics and the information that CPM platforms represent.
Beware of Loss of Fidelity
CPM systems summarize and present data clearly but only represent a subset of data, and only the data deemed valuable enough to be included in the top-level reporting. Although additional data is still available, it is not as readily accessible for analysis. Consider how this data can be made available for a more expansive, full-fidelity experience as part of a CPM environment or incorporated into a more comprehensive Business Instrumentation and Analytics environment to allow users the opportunity to derive new value from this data.
Keep in Tune with Your Output
In addition to building awareness for the loss of fidelity in music (and data), an organization should keep its ear tuned to the output being generated by this process, such as the relevant key performance indicators (KPIs), analytics, and visualizations. The reduction in detailed reporting may have also negatively affected or minimized the use of KPIs and dashboards, and the use of real-time analytics. By continuing to provide the business with a more rich, robust, and comprehensive set of data, you may see new ways of viewing the business that were previously overlooked. Use this new perspective to identify possible weak signals that signify a change in business climate, customer base, or competition. Identify and recognize those leading indicators that may signify a new business opportunity on which you can capitalize.
Consider Multiple Formats for Multiple Uses
Similar to consumers migrating to digital, organizations have standardized on financial and operational reporting as a cornerstone for their business over the years. More often than not, this reporting is the primary, if not the only source of data used for analysis. It's time to rethink that, and consider different formats and tools for different uses. A hybrid approach can provide exceptional value to the business in a scalable, supportable, sustainable manner. For example:
Leverage a highly structured, optimized, and summarized data warehouse – ideal for providing rapid, rich comparative analysis, swift rendering of dashboards and KPIs that drive the business, and a multi-dimensional perspective of the data not readily available within the original transactional systems.
Use big data - characterized by high volume, velocity, variety, and volatility - to reveal (expose, discover) changing conditions, patterns, and trends buried in the data and encoded in data sets that are rarely, if ever, examined.
Use raw data for detailed drill downs, data exploration, and browsing to identify new data elements of interest, to determine how to best support new analyses, and to allow for consolidation and mashups with other data sources to yield new perspectives.
Explore and enable multiple tools
The toolsets optimized for presenting crisp, actionable dashboards and business analytics from the data warehouse are likely to have different strengths and applicability than those tools that have been optimized for browsing and exploring raw data and creating ad-hoc mashups to analyze the data. Those tools in turn are likely to be different than the tools designed for CPM, such as budgeting, forecasting, and financial reporting. A single toolset that provides all of this functionality has the advantage of having all of this included in a single product, with the downside being a one-size-fits-all approach for users and licensing, resulting in a less cost-effective platform. As a result, a hybrid approach for end user tools is increasingly finding favor within organizations, and for good reason.
I am by no means suggesting that we move away from financial and operational reporting and the platforms we have built any more than I am suggesting that we scrap our digital music collections in favor of a complete return to vinyl and analog. On the other hand, the original sources of your data, as well as the emerging data sources now available, are robust, compelling, and high fidelity – and the tools available to access them are more powerful and diverse than ever.
When used properly, a hybrid approach to business intelligence, reporting, and analytics can provide a rich and very powerful experience for your users. It can enable them to derive compelling insights from the business that were previously hidden. It can generate impactful predictive and prescriptive analytics, resulting in substantial business value. Rather than leaving the majority of the available data behind, consider revisiting and re-evaluating it – in high-fidelity, from different sources, in different formats, and for different uses. When combined with the right tools, you'll have a new appreciation for the business and yield surprising and very rewarding insights.