Just about every company in existence looks to reporting to run their business. Many of them spend millions each year to try and improve their reporting systems. The way I look at it there are two reasons companies look to reporting. One is to audit the past. This type of activity typically is to support things like tax accounting and budgeting. The reporting goal here is see the data, summarized in some cases in detailed form. I call this “operational reporting.” It is very important, but typically supports the operations that support the business, not drive the business. Reporting solutions do very well at this task.
The other reason companies look to reporting is for decision support. This is where the focus of improving reporting has been and is most of the continued investment. So what is decision support and why is it important? Decision support in a nutshell is using data about what happened in the past to predict the future and then using these predictions to make decisions that change the future (sound familiar? If not, read our website). If companies, or anyone for that matter, could predict accurately what is going to happen tomorrow they would be able to achieve very great things.
With all the focus on reporting solutions, I think many would admit the promise of predicting the future has fallen short. Don’t get me wrong, reporting has given companies data to make better decision, but in many cases these decisions are still based on gut, or worse, the reporting does not deliver the right data needed to make these decisions. In my 20 years in the industry, I have seen many data warehouse and reporting projects fail at the goal line when the people asking the questions are delivered tools they don’t know how to use or can’t figure out how to ask the right questions.
The real goal of reporting is to be a Magic 8 Ball that works. Ask it questions and it tells you the answer, or like the Magic 8 Ball sometimes it tells you it needs more data (i.e. Reply hazy, try again…).
The search for the Magic 8 Ball is why reporting is evolving to analytics and analytics is evolving to predictive analytics and predictive analytics will evolve to prescriptive analytics (I will revisit this evolution in a future blog).
I end this short diatribe on reporting with this question: which would you rather have, a reporting system that has all the bells and whistles, dashboards, drag and drop, slice and dice that can tell you exact lottery results from yesterday through 10 years into the past OR a crumbled up piece of paper with the winning lottery numbers for tomorrow? Let’s ask the Magic 8 Ball…