Part V Big Data and Future Directions for Business
4.1 Opening Vignette: Self-Service Reporting environment Saves Millions for Corporate Customers
Headquartered in Omaha, Nebraska, Travel and Transport, Inc., is the sixth largest travel management company in the United States, with more than 700 employee-owners located nationwide. The company has extensive experience in multiple verticals, including travel management, loyalty solutions programs, meeting and incentive planning, and leisure travel services.
chaLLenge
In the field of employee travel services, the ability to effectively communicate a value proposition to existing and potential customers is critical to winning and retaining business. With travel arrangements often made on an ad hoc basis, customers find it difficult to analyze costs or instate optimal purchase agreements. Travel and Transport wanted to overcome these challenges by implementing an integrated reporting and analysis system to enhance relationships with existing clients, while providing the kind of value-added services that would attract new prospects.
sOLutiOn
Travel and Transport implemented Information Builders’ WebFOCUS business intelligence (BI) platform (called eTTek Review) as the foundation of a dynamic customer self- service BI environment. This dashboard-driven expense-management application helps more than 800 external clients like Robert W. Baird & Co., MetLife, and American Family Insurance to plan, track, analyze, and budget their travel expenses more efficiently and to benchmark them against similar companies, saving them millions of dollars. More than 200 internal employees, including customer service specialists, also have access to the system, using it to generate more precise forecasts for clients and to streamline and accel- erate other key support processes such as quarterly reviews.
Thanks to WebFOCUS, Travel and Transport doesn’t just tell its clients how much they are saving by using its services—it shows them. This has helped the company to differentiate itself in a market defined by aggressive competition. Additionally, WebFOCUS
eliminates manual report compilation for client service specialists, saving the company close to $200,000 in lost time each year.
an intuitive, graphicaL Way tO Manage traveL Data
Using stunning graphics created with WebFOCUS and Adobe Flex, the business intelli- gence system provides access to thousands of reports that show individual client metrics, benchmarked information against aggregated market data, and even ad hoc reports that users can specify as needed. “For most of our corporate customers, we thoroughly manage their travel from planning and reservations to billing, fulfillment, and ongoing analysis,”
says Mike Kubasik, senior vice president and CIO at Travel and Transport. “WebFOCUS is important to our business. It helps our customers monitor employee spending, book travel with preferred vendors, and negotiate corporate purchasing agreements that can save them millions of dollars per year.”
Clients love it, and it’s giving Travel and Transport a competitive edge in a crowded marketplace. “I use Travel and Transport’s eTTek Review to automatically e-mail reports throughout the company for a variety of reasons, such as monitoring travel trends and company expenditures and assisting with airline expense reconciliation and allocations,”
says Cathy Moulton, vice president and travel manager at Robert W. Baird & Co., a prominent financial services company. What she loves about the WebFOCUS-enabled Web portal is that it makes all of the company’s travel information available in just a few clicks. “I have the data at my fingertips,” she adds. “I don’t have to wait for someone to go in and do it for me. I can set up the reports on my own. Then we can go to the hotels and preferred vendors armed with detailed information that gives us leverage to negotiate our rates.”
Robert W. Baird & Co. isn’t the only firm benefiting from this advanced access to reporting. Many of Travel and Transport’s other clients are also happy with the technol- ogy. “With Travel and Transport’s state-of-the-art reporting technology, MetLife is able to measure its travel program through data analysis, standard reporting, and the ability to create ad hoc reports dynamically,” says Tom Molesky, director of travel services at MetLife. “Metrics derived from actionable data provide direction and drive us toward our goals. This is key to helping us negotiate with our suppliers, enforce our travel policy, and save our company money. Travel and Transport’s leading-edge product has helped us to meet and, in some cases, exceed our travel goals.”
reaDy fOr takeOff
Travel and Transport used WebFOCUS to create an online system that allows clients to access information directly, so they won’t have to rely on the IT department to run reports for them. Its objective was to give customers online tools to monitor corporate travel expenditures throughout their companies. By giving clients access to the right data, Travel and Transport can help make sure its customers are getting the best pricing from airlines, hotels, car rental companies, and other vendors. “We needed more than just pretty reports,” Kubasik recalls, looking back on the early phases of the BI project.
“We wanted to build a reporting environment that was powerful enough to handle transaction-intensive operations, yet simple enough to deploy over the Web.” It was a winning formula. Clients and customer service specialists continue to use eTTek Review to create forecasts for the coming year and to target specific areas of business travel expenditures. These users can choose from dozens of management reports. Popular reports include travel summary, airline compliance, hotel analysis, and car analysis.
Travel managers at about 700 corporations use these reports to analyze corporate travel spending on a daily, weekly, monthly, quarterly, and annual basis. About 160 standard reports and more than 3,000 custom reports are currently set up in eTTek Review,
including everything from noncompliance reports that reveal why an employee did not obtain the lowest airfare for a particular flight to executive overviews that summarize spending patterns. Most reports are parameter driven with Information Builders’ unique guided ad hoc reporting technology.
peer revieW systeM keeps expenses On track
Users can also run reports that compare their own travel metrics with aggregated travel data from other Travel and Transport clients. This benchmarking service lets them gauge whether their expenditures, preferred rates, and other metrics are in line with those of other companies of a similar size or within the same industry. By pooling the data, Travel and Transport helps protect individual clients’ information while also enabling its entire customer base to achieve lower rates by giving them leverage for their negotiations.
Reports can be run interactively or in batch mode, with results displayed on the screen, stored in a library, saved to a PDF file, loaded into an Excel spreadsheet, or sent as an Active Report that permits additional analysis. “Our clients love the visual metaphors provided by Information Builders’ graphical displays, including Adobe Flex and WebFOCUS Active PDF files,” explains Steve Cords, IT manager at Travel and Transport and team leader for the eTTek Review project. “Most summary reports have drill-down capability to a detailed report. All reports can be run for a particular hierarchy structure, and more than one hierarchy can be selected.”
Of course, users never see the code that makes all of this possible. They operate in an intuitive dashboard environment with drop-down menus and drillable graphs, all accessible through a browser-based interface that requires no client-side software. This architecture makes it easy and cost-effective for users to tap into eTTek Review from any location. Collectively, customers run an estimated 50,000 reports per month. About 20,000 of those reports are automatically generated and distributed via WebFOCUS ReportCaster.
an efficient architecture that yieLDs sOaring resuLts
Travel and Transport captures travel information from reservation systems known as Global Distribution Systems (GDS) via a proprietary back-office system that resides in a DB2 database on an IBM iSeries computer. They use SQL tables to store user IDs and passwords, and use other databases to store the information. “The database can be sorted according to a specific hierarchy to match the breakdown of reports required by each company,” continues Cords. “If they want to see just marketing and accounting information, we can deliver it. If they want to see the particular level of detail reflecting a given cost center, we can deliver that, too.”
Because all data is securely stored for three years, clients can generate trend reports to compare current travel to previous years. They can also use the BI system to monitor where employees are traveling at any point in time. The reports are so easy to use that Cords and his team have started replacing outdated processes with new automated ones using the same WebFOCUS technology. The company also uses WebFOCUS to streamline their quarterly review process. In the past, client service managers had to manually create these quarterly reports by aggregating data from a variety of clients. The 80-page report took one week to create at the end of every quarter.
Travel and Transport has completely automated the quarterly review system using WebFOCUS so the managers can select the pages, percentages, and specific data they want to include. This gives them more time to do further analysis and make better use of the information. Cords estimates that the time savings add up to about $200,000 every year for this project alone. “Metrics derived from actionable data are key to helping us negotiate with our suppliers, enforce our travel policy, and save our company money,” continues Cords. “During the recession, the travel industry was hit particularly hard, but Travel and
Transport managed to add new multimillion dollar accounts even in the worst of times. We attribute a lot of this growth to the cutting-edge reporting technology we offer to clients.”
QuestiOns fOr the Opening vignette 1. What does Travel and Transport, Inc., do?
2. Describe the complexity and the competitive nature of the business environment in which Travel and Transport, Inc., functions.
3. What were the main business challenges?
4. What was the solution? How was it implemented?
5. Why do you think a multi-vendor, multi-tool solution was implemented?
6. List and comment on at least three main benefits of the implemented system. Can you think of other potential benefits that are not mentioned in the case?
What We can Learn frOM this vignette
Trying to survive (and thrive) in a highly competitive industry, Travel and Transport, Inc., was aware of the need to create and effectively communicate a value proposition to its existing and potential customers. As is the case in many industries, in the travel business, success or mere survival depends on continuously winning new customers while retaining the existing ones. The key was to provide value-added services to the client so that they can efficiently analyze costs and other options to quickly instate optimal purchase agreements. Using WebFOCUS (an integrated reporting and information visualization environment by Information Builders), Travel and Transport empowered their clients to access information whenever and wherever they need it. Information is the power that decision makers need the most to make better and faster decisions. When economic conditions are tight, every managerial decision—every business transaction—
counts. Travel and Transport used a variety of reputable vendors/products (hardware and software) to create a cutting-edge reporting technology so that their clients can make better, faster decisions to improve their financial well-being.
Source: Information Builders, Customer Success Story, informationbuilders.com/applications/travel-and- transport (accessed February 2013).
4.2 Business RepoRting Definitions AnD ConCepts
Decision makers are in need of information to make accurate and timely decisions.
Information is essentially the contextualization of data. Information is often provided in the form of a written report (digital or on paper), although it can also be provided orally.
Simply put, a report is any communication artifact prepared with the specific intention of conveying information in a presentable form to whoever needs it, whenever and wherever they may need it. It is usually a document that contains information (usually driven from data and personal experiences) organized in a narrative, graphic, and/or tabular form, prepared periodically (recurring) or on an as-required (ad hoc) basis, referring to specific time periods, events, occurrences, or subjects.
In business settings, types of reports include memos, minutes, lab reports, sales reports, progress reports, justification reports, compliance reports, annual reports, and policies and procedures. Reports can fulfill many different (but often related) functions.
Here are a few of the most prevailing ones:
• To ensure that all departments are functioning properly
• To provide information
• To provide the results of an analysis
• To persuade others to act
• To create an organizational memory (as part of a knowledge management system) Reports can be lengthy at times. For those reports, there usually is an executive summary for those who do not have the time and interest to go through it all. The summary (or abstract, or more commonly called executive brief) should be crafted carefully, expressing only the important points in a very concise and precise manner, and lasting no more than a page or two.
In addition to business reports, examples of other types of reports include crime scene reports, police reports, credit reports, scientific reports, recommendation reports, white papers, annual reports, auditor’s reports, workplace reports, census reports, trip reports, progress reports, investigative reports, budget reports, policy reports, demographic reports, credit reports, appraisal reports, inspection reports, and military reports, among others. In this chapter we are particularly interested in business reports.
What is a Business Report?
A business report is a written document that contains information regarding business matters. Business reporting (also called enterprise reporting) is an essential part of the larger drive toward improved managerial decision making and organizational knowledge management. The foundation of these reports is various sources of data coming from both inside and outside the organization. Creation of these reports involves ETL (extract, transform, and load) procedures in coordination with a data warehouse and then using one or more reporting tools. While reports can be distributed in print form or via e-mail, they are typically accessed via a corporate intranet.
Due to the expansion of information technology coupled with the need for improved competitiveness in businesses, there has been an increase in the use of computing power to produce unified reports that join different views of the enterprise in one place. Usually, this reporting process involves querying structured data sources, most of which are created by using different logical data models and data dictionaries to produce a human-readable, easily digestible report. These types of business reports allow managers and coworkers to stay informed and involved, review options and alternatives, and make informed decisions. Figure 4.1 shows the continuous cycle of data acquisition S information generation S decision making S business process management. Perhaps the most critical task in this cyclic process is the reporting (i.e., information generation)— converting data from different sources into actionable information.
The key to any successful report is clarity, brevity, completeness, and correctness.
In terms of content and format, there are only a few categories of business report: infor- mal, formal, and short. Informal reports are usually up to 10 pages long; are routine and internal; follow a letter or memo format; and use personal pronouns and contractions.
Formal reports are 10 to 100 pages long; do not use personal pronouns or contractions;
include a title page, table of contents, and an executive summary; are based on deep research or an analytic study; and are distributed to external or internal people with a need-to-know designation. Short reports are to inform people about events or system status changes and are often periodic, investigative, compliance, and situational focused.
The nature of the report also changes significantly based on whom the report is created for. Most of the research in effective reporting is dedicated to internal reports that inform stakeholders and decision makers within the organization. There are also external reports between businesses and the government (e.g., for tax purposes or for regular filings to the Securities and Exchange Commission). These formal reports are mostly standardized and periodically filed either nationally or internationally. Standard Business Reporting, which is a collection of international programs instigated by a
number of governments, aims to reduce the regulatory burden for business by simplifying and standardizing reporting requirements. The idea is to make business the epicenter when it comes to managing business-to-government reporting obligations. Businesses conduct their own financial administration; the facts they record and decisions they make should drive their reporting. The government should be able to receive and process this information without imposing undue constraints on how businesses administer their finances. Application Case 4.1 illustrates an excellent example for overcoming the challenges of financial reporting.
Business Functions
X UOB 2.1
UOB 2.2
X UOB 3.0
UOB 1.0
Data Repositories
Decision Maker Information
(reporting)
DEPLOYMENT CHART
DEPT 1
PHASE 1 PHASE 2 PHASE 3 PHASE 4 PHASE 5 DEPT 2
DEPT 3 DEPT 4
1 2 3 4 5
Action (decision) Data
Transactional Records Exception Event Symbol Count Description
Machine Failure 1
figuRe 4.1 The Role of Information Reporting in Managerial Decision Making.
Application Case 4.1
Delta Lloyd Group Ensures Accuracy and Efficiency in Financial Reporting Delta Lloyd Group is a financial services provider
based in the Netherlands. It offers insurance, pen- sions, investing, and banking services to its private and corporate clients through its three strong brands:
Delta Lloyd, OHRA, and ABN AMRO Insurance.
Since its founding in 1807, the company has grown in the Netherlands, Germany, and Belgium, and now employs around 5,400 permanent staff. Its 2011 full-year financial reports show €5.5 billion in gross written premiums, with shareholders’ funds amounting
to €3.9 billion and investments under management worth nearly €74 billion.
challenges
Since Delta Lloyd Group is publicly listed on the NYSE Euronext Amsterdam, it is obliged to produce annual and half-year reports. Various subsidiaries in Delta Lloyd Group must also produce reports to fulfill local legal requirements: for example, banking and (Continued)
Application Case 4.1 (Continued)
insurance reports are obligatory in the Netherlands.
In addition, Delta Lloyd Group must provide reports to meet international requirements, such as the IFRS (International Financial Reporting Standards) for accounting and the EU Solvency I Directive for insurance companies. The data for these reports is gathered by the group’s finance department, which is divided into small teams in several locations, and then converted into XML so that it can be published on the corporate Web site.
importance of accuracy
The most challenging part of the reporting process is the “last mile”—the stage at which the consolidated figures are cited, formatted, and described to form the final text of the report. Delta Lloyd Group was using Microsoft Excel for the last-mile stage of the reporting process. To minimize the risk of errors, the finance team needed to manually check all the data in its reports for accuracy. These manual checks were very time-consuming. Arnold Honig, team leader for reporting at Delta Lloyd Group, comments: “Accuracy is essential in financial reporting, since errors could lead to penalties, reputational damage, and even a negative impact on the company’s stock price. We needed a new solution that would automate some of the last mile processes and reduce the risk of manual error.”
solution
The group decided to implement IBM Cognos Financial Statement Reporting (FSR). The implemen- tation of the software was completed in just 6 weeks during the late summer. This rapid implementation gave the finance department enough time to prepare a trial draft of the annual report in FSR, based on figures from the third financial quarter. The success- ful creation of this draft gave Delta Lloyd Group enough confidence to use Cognos FSR for the final version of the annual report, which was published shortly after the end of the year.
results
Employees are delighted with the IBM Cognos FSR solution. Delta Lloyd Group has divided the annual
report into chapters, and each member of the report- ing team is responsible for one chapter. Arnold Honig says, “Since employees can work on documents simultaneously, they can share the huge workload involved in report generation. Before, the reporting process was inefficient, because only one person could work on the report at a time.”
Since the workload can be divided up, staff can complete the report with less overtime. Arnold Honig comments, “Previously, employees were putting in 2 weeks of overtime during the 8 weeks required to generate a report. This year, the 10 members of staff involved in the report generation process worked 25 percent less overtime, even though they were still getting used to the new software. This is a big win for Delta Lloyd Group and its staff.” The group is expecting further reductions in employee overtime in the future as staff becomes more familiar with the software.
accurate reports
The IBM Cognos FSR solution automates key stages in the report-writing process by populating the final report with accurate, up-to-date financial data.
Wherever the text of the report needs to mention a specific financial figure, the finance team simply inserts a “variable”—a tag that is linked to an under- lying data source. Wherever the variable appears in the document, FSR will pull the figure through from the source into the report. If the value of the figure needs to be changed, the team can simply update it in the source, and the new value will automatically flow through into the text, maintain- ing accuracy and consistency of data throughout the report.
Arnold Honig comments, “The ability to update figures automatically across the whole report reduces the scope for manual error inherent in spreadsheet-based processes and activities. Since we have full control of our reporting processes, we can produce better quality reports more effi- ciently and reduce our business risk.” IBM Cognos FSR also provides a comparison feature, which highlights any changes made to reports. This feature makes it quicker and easier for users to review new versions of documents and ensure the accuracy of their reports.