10 pg paper Business Intelligence & SAP

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Introduction to Business Intelligence

SAP University Alliances

Version 2.0

Authors Klaus Freyburger

Peter Lehmann

SAP UA

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Agenda

What is Business Intelligence?
What is a „Data Warehouse“?
What are the benefits and challenges?
What does „multi-dimensional“ mean?
What is „OLAP“?
OLTP versus OLAP
Business Intelligence tool box

Agenda

SAP UA

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

What is Business Intelligence?

SAP UA

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

What is Intelligence?

Definition:

The ability to learn or understand or deal with new and trying situations
The ability to apply knowledge to manipulate one’s environment

Source: Merriam-Webster’s Online Dictionary

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Intelligence in Business

What is the current status of the business?
What’s going well?
What needs improvement?
What are the business’ strengths and weaknesses?
Are there opportunities for innovation or competitive advantage?

How do we improve our decision making?

Yesterday – Now - Tomorrow

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Main Objective of Business Intelligence

Support intelligence (e.g., knowledge of status)

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

A Brief History of Information Systems

ERP Systems

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Information Systems in a Company!?

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Definition: „Business Intelligence“

„Business Intelligence“ covers strategies, processes and technologies in order to achieve knowledge about status, potentials and perspectives of a company out of heterogeneous and distributed data.

Definition Source: Institut für Business Intelligence (IBI), http://www.i-bi.de/home/index.html

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Business Intelligence Turns Data into Knowledge

Data

Information

Knowledge

Decision

Product A

Product B

Customer Smith

buys product A

Product A & B have

a 80% sales correlation

Offer product B to

customer Smith

SAP UA

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Business Intelligence Stages

Source: Brobst, S. and J. Rarey, "Five Stages of Data Warehouse Decision Support Evolution", DSSResources.COM, 01/06/2003

SAP UA

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Agenda

What is Business Intelligence?
What is a „Data Warehouse“?
What are the benefits and challenges?
What does „multi-dimensional“ mean?
What is „OLAP“?
OLTP versus OLAP
Business Intelligence tool box

Agenda

SAP UA

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

What is a Data Warehouse?

A data warehouse is the most common
data architecture for business intelligence.
A data warehouse is a specific
company-wide data pool in order
to support decision makers.

Top management

Mid and lower management

Planners, controllers, …

…

Data Warehouse

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Data Warehouse Characteristics

"A Data Warehouse is a subject-oriented, integrated, time-variant and nonvolatile collection of data in order to support management decisions,“ Bill Inmon (1996).

Subject-oriented

The organization of data is guided by the view of decision makers on specific areas of business.

Integrated

The Data Warehouse contains data from different internal and external sources. Important is the high quality of data, i.e., its correctness and consistency.

Time-oriented

Data in a Data Warehouse has a time dimension, i.e. all data values and their changes in time can be compared and analyzed along the time axis.

Nonvolatile

As opposed to operational databases, data are stored persistently in a Data Warehouse. Access is by reading the
data; analysis does not change the data.

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Data Integration Process

Source systems

External data sources
Internal data sources

Multi-dimensional data

Information models
Aggregation

Extraction, trans-

formation, loading

Selection, extraction,
Modification, loading

Data warehouse

Data storage
Administration

Data analysis and

analytical applications

OLAP, MIS, cockpits, …
Planning, scorecard, …

SAP UA

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Business Intelligence Platforms – 2008

Source: Gartner 2008

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Business Intelligence Platforms – 2009

Source: Gartner 2009

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Business Intelligence Platforms – 2010

Source: Gartner 2010

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Agenda

What is Business Intelligence?
What is a „Data Warehouse“?
What are the benefits and challenges?
What does „multi-dimensional“ mean?
What is „OLAP“?
OLTP versus OLAP
Business Intelligence tool box

Agenda

SAP UA

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Benefit: Reduce Action Time

Added

Value

Time

Operational

Transaction

Data Available

Analysis Results

Available

Decision

Made

Action

Implemented

Data access

time

Analysis

time

Decision

time

Implementation

time

Action time

Added Value loss

Source: Hackathorn, R.: Minimizing Action Distance (2003), http://www.tdan.com/view-articles/5132/

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Benefit: Reduce Action Time to Nearly Real Time

Added

Value

Time

Operational

Transaction

Data Available

Analysis Results

Available

Decision Made

Saved Time

Saved Value

Action Implemented

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Other Benefits

Increased

Information quality by a „single version of the truth“

Competitive ability

Customer satisfaction

Inter-company and inter-department collaboration

Alignment with business strategy

Compliance with financial reporting regulations

Risk management

Financial consolidation

Corporate planning and forecasting

SOX (US), BASEL II (European Community), etc.

…

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Challenges (1)

Data Quality

Precise

Subject-oriented

Complete

Accessable

Flexibility

Security and authorisation

Time dependencies

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Challenges (2)

Business Terms – What do you mean?

„What is our revenue“?

„95% of our trains arrive just in time!“

“How many students will certainly finish?”

…

I have a stock here that could really excel !

This is

Madness!

I can‘t take anymore

Good Bye

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Challenges (3)

Tools – easy to use?

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Challenges (4)

Others

No clear project scope

No management project support

No appropriated IT infrastructure

Inadequate staff qualification

Lack of end user acceptance

…

SAP UA

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Agenda

What is Business Intelligence?
What is a „Data Warehouse“?
What are the benefits and challenges?
What does „multi-dimensional“ mean?
What is „OLAP“?
OLTP versus OLAP
Business Intelligence tool box

Agenda

SAP UA

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Multi-dimensional (1)

A key figure without a relationship to any object makes no sense!

1388486

A telephone number?

A material number?

Revenue in September 2007?

My boss‘ salary?

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Multi-dimensional (2)

San Francisco had 1,388,486 USD revenue in May 2007 by selling Mountain Bikes

Revenue in USD:
1,388,486

Month: May

Sales Organisation:
San Francisco

Group: Mountain Bike

Year: 2007

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Multi-dimensional (3)

Key figure: Revenue
Object: Values

Month  May

Year  2007

Sales Organisation  San Francisco

Material Group  Mountain Bike

Multi-dimensional means a key figure always relates to one or more objects.

SAP UA

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Agenda

What is Business Intelligence?
What is a „Data Warehouse“?
What are the benefits and challenges?
What does „multi-dimensional“ mean?
What is „OLAP“?
OLTP versus OLAP
Business Intelligence tool box

Agenda

SAP UA

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

OLAP

On-line Analytical Processing is a software technology which allows end-user driven, fast and interactive data analysis.

Revenue
1,388,486 USD

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Excel PivotTable

„What is the revenue in each country in 2007?“

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Excel PivotTable (1)

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Excel Pivot Table (2)

„What is the revenue in each country per month?“

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Pivot Table (3)

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

From Table View to a 3-Dimensional Cube

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Hierachies Allow Subcubes in a Cube

Product group  products
Year  quarter  months
Country  sales organisation

Example

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

From Cube to Report: MS Excel

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

From Cube to Report: SAP Business Explorer (1)

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

From Cube to Report: SAP Business Explorer (2)

click

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

From Cube to Report: SAP Business Explorer (3)

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Cube Navigation (1)

Slice

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Cube Navigation (2)

Rotation

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Cube Navigation (3)

Rotation, Example

Material Group and Country visible, Year restricted to 2007

Material Group and Year visible, all Countries aggregated

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Cube Navigation (4)

Dice

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Cube Navigation (5)

Drill-Down / Roll-Up

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Cube Navigation (Summary)

Rotation
Slice
Dice
Drilldown

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Is a Excel an OLAP Tool?

CFOs & controllers love it
Cheap
MS Office component
Easy to use
Nice graphics

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Is Excel an OLAP tool? What about…

Concurrent users?
Data volume?
Processing performance?
Aggregation behavior (fat client)?
Authorizations?
Metadata?
Many data sources?
Cell references?
…

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Requirement for OLAP Systems

Many concurrent users (1000+)
Sophisticated authorizations and security
Fast response time (< 5 sec)
High data volumes (>100+ GB or TB)
Multiple data sources
Easy to use (slice, dice, drill-down, roll-up)
Enhanced reporting functions

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Exercises

OLAP navigation using Excel PivotTables
OLAP navigation in SAP

Business Explorer Analyzer (Excel)

Business Explorer Web (Browser)

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

BI Architecture

Source systems

External data sources
Internal data sources

Multi-dimensional data

Information models
Aggregation

Extraction, trans-

formation, loading

Selection, extraction,
Modification, loading

Data warehouse

Data storage
Administration

Data analysis and

analytical applications

OLAP, MIS, cockpits, …
Planning, scorecard, …

SAP UA

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Examples

SAP UA

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Agenda

What is Business Intelligence?
What is a „Data Warehouse“?
What are the benefits and challenges?
What does „multi-dimensional“ mean?
What is „OLAP“?
OLTP versus OLAP
Business Intelligence tool box

Agenda

SAP UA

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Information Systems

Vertical Integration

Source: Mertens, P., Meier, M.: Integrierte Informationsverarbeitung (2009), 1.

Corporate

Planning

Accounting

Supplier Management,

Production Planning,

Cost Planning, …

Supplier

Accounting

Purchasing

Stocks

Sales

Personnel

Warehouse

Accounting

Customer
Invoices

Employee
Salary

Administration II:

Amount-Oriented

Processing

Administration I:

Value-Oriented

Processing

Disposition and
Planning

Analysis
and Controlling

Strategic

Enterprise

Management

Horizontal Integration

SAP UA

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

OLTP versus OLAP

On-line
Transactional
Processing

On-line
Analytical
Processing

Corporate

Planning

Accounting

Supplier Management,

Production Planning,

Cost Planning, …

Supplier

Accounting

Purchasing

Stocks

Sales

Personnel

Warehouse

Accounting

Customer
Invoices

Employee
Salary

Administration II:

Amount-Oriented

Processing

Administration I:

Value-Oriented

Processing

Disposition and
Planning

Analysis
and Controlling

Strategic

Enterprise

Management

Horizontal Integration

SAP UA

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

OLTP Versus OLAP (1)

OLTP	OLAP
- Optimized to get data in	- Optimized to get data out
- For management and daily business	- For administration and daily decisions
- Processes a small amount of data per transaction	- Processes a large amount of data per transaction
- Business-critical availability	- Less critical availability
- Data updates online	- Data updates regularly
- Data overwritten	- Data are time-dependent

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

OLTP Versus OLAP (2)

It is very hard to get all-in-one!

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Agenda

What is Business Intelligence?
What is a „Data Warehouse“?
What are the benefits and challenges?
What does „multi-dimensional“ mean?
What is „OLAP“?
OLTP versus OLAP
Business Intelligence tool box

Agenda

SAP UA

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Where Are the End Users?

Top Management

Middle Management

Lower Management

Corporate

Planning

Accounting

Supplier Management,

Production Planning,

Cost Planning, …

Supplier

Accounting

Purchasing

Stocks

Sales

Personnel

Warehouse

Accounting

Customer
Invoices

Employee
Salary

Administration II:

Amount-Oriented

Processing

Administration I:

Value-Oriented

Processing

Disposition and
Planning

Analysis
and Controlling

Strategic

Enterprise

Management

Horizontal Integration

SAP UA

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

What Do They Do?

Specialists

(Authors)

Analysts

Consumers

10%

20%

70%

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Consumers

Get reports on a regular base
Look over huge amount of data
Occasionally stumble on something that proves
to be useful
Sporadic usage of data
Sometimes find areas for further exploration
Heavy reliance on tools for displaying data

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Analysts

Regular access to data
Know what they are looking for
Requirements known before search for data
starts
Find small flakes of gold regularly
Make use of tools for analysis and presentation

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Specialists (Authors)

Requirements are known
Irregular access to data
Look over massive amounts of data
Sometimes find huge nuggets of gold
Unpredictable pattern of access
Access detailed data regularly
Look at relationships of data
Make use of tools of discovery, analysis and
presentation
Make results available to others (consumers,
analysts)

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Business Intelligence Tool Box

Source: Eckerson, W. (May 2006). Business intelligence 2006 - only the beginning. What Works, 21.

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SAP BI Curriculum BI1-M1 Introduction to Business Intelligence

Summary

What is Business Intelligence?
What is a „Data Warehouse“?
What are the benefits and challenges?
What does „multi-dimensional“ mean?
What is „OLAP“?
OLTP versus OLAP
Business Intelligence tool box

Agenda