Business Intelligence and Globalisation, Part 2

Global Shifts

Published: 18 October 2006

Business intelligence is evolving – in every country and in every industry throughout the world. This second article in this BI and globalisation series looks at the forces driving the global economy.

In Part 1 of this series, we discussed how the nature of business intelligence (BI) is changing given the demands of a global economy for both companies and governments. North America has dominated business intelligence technology and application for the last several decades. However, that dominance is shifted to the global stage where hundreds of other countries are evolving business intelligence in ways unique for their local situations.

This article will look at the forces that are driving the global economy. Thomas Friedman in his book The World is Flat describes the forces that are flattening the playing field so that a diversity of countries can participate in the global economy. These changes are occurring not only across geographical regions. The exciting changes are those that have enabled and empowered individuals and small companies (and terrorist groups) to compete and collaborate (and disrupt) on peer with established multinational firms and even governments.

According to Friedman, we have matured into Globalization 3.0 where the convergence of PC technology interconnected by global fiber-optic cable and enabled with workflow services has formed a “flat-world platform.” My interpretation of this convergence is embodied in the following flattening forces:

• Opening information flows
• Connecting the players
• Integrating the platforms

First, the fall of the Berlin Wall and then the collapse of the Soviet Union were pivotal events that eliminated many political barriers for the global economy. However, these events were preceded and even precipitated by the opening of global information flows. As Friedman notes, “Totalitarian systems depend on a monopoly of information and force, and too much information started to slip through the Iron Curtain, thanks to the spread of fax machines, telephones, and, eventually the personal computer.”

Second, the world has become tiny (in Friedman’s view) with the global interconnect of the Internet. The over-investment in fiber-optic cable laid across land and oceans was a financial disaster for the cable companies, but it is now a boom for globalisation. Since then, this has resulted in a shift in power and influence away from large institutions because the usual economies of scale (and privileged access to scarce information) have been eroded. Firms in Bangalore or Bangkok are less than a second further away than firms in North American or Europe. The world is tiny!

Third, the ability to support complex workflows and collaboration on a global scale has come together as stacks of technology bond by standards. eBay and Amazon have become among the largest retailers in the world without the traditional retailing infrastructure. Illustrations of PayPal and Salesforce.com highlight that new forms of commerce have emerged based on global abilities to manage large projects, create diverse coalitions, design complex products, and inform millions of potential customers.

How does business intelligence relate to these three flattening forces?

First, opening of global information flows is the first stage in evolving a global BI infrastructure, whether for a government, corporation or individual. As an analogy, the early days of corporate data warehousing were seriously limited by the ability to extract data from transactional systems. Data was copied, often by hand, from hardcopy reports and entered for analysis. On the global scale, the input of reliable information is exploding with all publishing sources transitioning to various XML streams. A global BI infrastructure must also have an equally reliable dissemination of the information managed within the warehouse environment. Hence, the ability to deliver information across a spectrum from reporting detailed data to interactive analytics to event-driven alerts, to various remote devices.

Second, connecting among the players in the global economy moves beyond understanding what is happening to interacting amid the complex dynamics of globalization. BI analytics must assist in managing complexity of the global marketplace by suppressing the noise and highlighting significant trends, without which it would be impossible to take meaningful action.

Third, integrating the platforms for business intelligence implies creating a consistent view of global reality as is essential to understand the global economy. For information to have value, it must have a context. This is like the creation of a consistent view of business reality (or single version of the truth) within the data warehouse as is essential to a successful business. The scope should be global, rather than just enterprise-wide. Stephen Brobst and I explored what a global data warehouse would be in an article on eXtreme Data Warehousing. Our conclusion was that a data warehouse containing data about a global industry (such as electrical power generation or packaged goods transportation) was quite practical from a technology perspective, but challenges loomed for a variety of political and social issues (such as privacy and intellectual property).

The point is that business intelligence is an essential enabler of globalisation and globalisation will evolve BI in innovative ways over the coming years.

The next part in this series will take the next six flattening forces (uploading, out-sourcing, off-shoring, supply-chaining, in-sourcing, and in-forming) from Friedman’s book and explore their relationships to current developments in business intelligence.

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