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Online File W3.1: Major Capabilities of EIS W3-1 ◆

ONLINE FILE W3.1 MAJOR CAPABILITIES OF EIS

The following is a discussion of the most important capabilities of executive information

systems (EIS).

DRILL-DOWN
Drill-down refers to providing details of any summarized information. For example, an
executive may notice a decline in corporate sales from a daily (or weekly) report. To
discover the reason, he or she might want to see the sales for each region. If a prob-
lematic region is identified, the executive might want to see further details (e.g., by
product, by salesperson). In certain cases, this drill-down process may continue into
several levels of detail.
Drill-down paths that are manually constructed and maintained typically use
hypertext-style connections rather than menus in systems with a graphical user inter-
face (GUI). For example, the button for requesting a drill-down path is typically
defined as a hot spot directly over the high-level data to be explained. This frees up
screen space for delivering information and can speed access to drill-down information
by eliminating the additional mouse movements typically required with pull-down or
pop-up menus. Similarly, Web tools and hyperlinks can be used for intranet-based drill-
down.
Menu-driven drill-down is generally a characteristic of ad hoc query applications,
and the menus in these applications are almost always automatically generated by the
software, based on the user’s logical position in the database and knowledge of the
structure of the database. This knowledge of the database structure may have been
specified in advance, or it may have been obtained dynamically by the application
directly querying the database dictionary. Conceivably, a query application could gen-
erate several hundred menus and submenus, covering all possible combinations of log-
ical positions and valid drill-down paths.
Online analytical processing (OLAP) tools include drill-down. With an OLAP
application, at a mouse click, a user can disaggregate a summary row or column in a
tabular report. The user can re-aggregate rows and columns through a process called
roll-up. You can try this out in the Temtec Executive Viewer OLAP package (see
temtec.com).

CRITICAL SUCCESS FACTORS

Factors that must be considered in attaining an organization’s goals are called critical
success factors (CSF). Such factors can be strategic, managerial, or operational, and
they are derived mainly from three sources: organizational, industrial, and environ-
mental. Success factors exist at the corporate level as well as at the industry, division,
plant, department, and individual levels. The strategic planning process involves identi-
fying CSF at all levels.
Once identified, CSF can be monitored according to five types of information: key
problem narratives, highlight charts, top-level financials, key factors, and detailed
responsibility reports. The monitoring can be done by intelligent agents. A brief
description of each of the five types follows:
• Key problem narratives. These reports highlight overall performance, key prob-
lems, and possible reasons for the problems within an organization. Explanations
are often combined with tables, graphs, or tabular information.
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◆ W3-2 Online File W3.2: SAP Analytics

• Highlight charts. These summary displays show high-level information based on

the user’s own judgment or preference. Because they are designed from the user’s
perspective, these displays quickly highlight areas of concern, visually signaling
the state of organizational performance against CSF.
• Top-level financials. These displays provide information on the overall financial
health of the company, in the form of absolute numbers and comparative perfor-
mance ratios.
• Key factors. These factors provide specific measures of CSF, called key perfor-
mance indicators (KPI), at the corporate level. The displays are often used on an
exception basis to examine specific measures of CSF flagged as problems on high-
lighted charts.
• Detailed KPI responsibility reports. These reports indicate the detailed performance
of individuals or business units in areas critical to the success of the company.

STATUS ACCESS
In status access mode, the latest data or reports on the status of key indicators can be
accessed at any time via networks. The relevance of information is important, and
emphasis is placed on current data. This may require daily or even hourly operational
tracking and reporting. In extreme cases, real-time reporting may be required.

ONLINE FILE W3.2: SAP ANALYTICS

SAP Analytics is a suite of model-driven, composite applications used across more than
25 industries. SAP Analytics aims at merging data from SAP and non-SAP enterprise
resource planning (ERP) applications with business intelligence (BI) queries, to eliminate
disparate islands of data. It also combines transactional, analytic, and collaborative steps
across multiple business functions, departments, and even organizational boundaries.
Unlike traditional after-the-fact reporting tools, SAP Analytics applications aim at
pulling all relevant information—whether historical or current—from across a wide
variety of enterprise systems, such as ERP, supply-chain management (SCM), and cus-
tomer relationship management (CRM), and delivering clear and broad business
insight that should help users improve current processes. These applications deliver
data in the business context of the specific process—letting a business manager know,
for example, not only the day’s sales figures but also whether those figures are on tar-
get compared with past performance and the current monthly and quarterly revenue
goals. For details, see Meier et al. (2005). Some examples include the following:

• SAP Analytics for retail helps store managers better understand and predict the
performance of core activities, such as trade promotions, in order to make adjust-
ments to processes and strategies while there is time to affect outcomes.
• SAP Analytics for credit management allows financial service companies to dis-
play customers’ credit information, buying behavior, past purchases, and credit
lines in the historical context of data stored in SAP and non-SAP systems. Users
can then increase (or stop) access to credit lines for a given customer or partner,
and they can even authorize (or block) individual purchases.
• SAP Analytics for tax management complements the SAP for Public Sector solu-
tion. It allows organizations to better monitor and understand the tax basis, see
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Online File W3.3: Trends in Visualization Products for Decision Support W3-3 ◆
where contributions are coming from in the context of historical tax collection,
and take steps to reclaim amounts due.
• SAP Analytics for high-tech manufacturing allows users at manufacturing plants
and warehouses to gain an insight into order status, plant utilization, order back-
log, and restocking levels. It also includes product lifecycle analytics.
• SAP Analytics for CRM complements the mySAP CRM solution by providing
visualization across marketing, sales lead generation, product pipeline visibility,
sales effectiveness, and individual customer views. By unifying sales data with
financial data, fulfillment data, and manufacturing inventory data, SAP Analytics
for CRM empowers sales executives and corporate offices with a complete view
of customer buying patterns and profitability, allowing them, for example, to
detect hidden opportunities for future business growth.
• SAP Analytics for SCM mySAP SCM supports supply chain visibility design with
features and functions that enable supply chain design with visibility across the
whole supply chain network, planners and key decision makers can carry out
strategic and tactical business planning through test scenarios to determine how
the supply chain network can deal with changes in the market, the business, or
customer demand. Supply chain analytics enables decision makers to define,
select, and monitor KPIs to get an integrated, comprehensive view of perfor-
mance across the supply chain. KPIs can also be predefined based on the supply
chain operations reference (SCOR) model to monitor sourcing, planning, produc-
tion, distribution, and returns processes.

Reference
Meier, M., W. Sigzig, and P. Mertens. (2005). Enterprise Management with SAP SEM/Business Analytics, 2nd ed. Berlin:
Springer.

ONLINE FILE W3.3: TRENDS IN VISUALIZATION PRODUCTS

FOR DECISION SUPPORT

During the last decade, data visualization has been integrated with decision support
tools and applications, and into intelligent visualization which includes data (informa-
tion) interpretation. A number of software applications are discussed here.

• Interactive graphs and models that let users drill-down into the underlying data to
reorganize and compare data so that their meaning is clearer. Visualization tools
can be useful in three areas: (1) statistical analysis, (2) graphical presentation
tools, and (3) analytics applications.
• WatchMark Corporation (watchmark.com), a subsidiary of Lucent Technologies,
uses a sophisticated data visualization tool for wireless network operators.
WatchMark Pilot Release 1.3, which incorporates an innovative video replay
engine with VCR-like controls, enables network operators to quickly review the
events that preceded a network problem, much like viewing an instant replay of a
televised sporting event.
• Identitech, Inc. (identitech.com), has developed Graphical Interface for
Information Cognition, a data visualization tool designed to support business
decision making. This software can be programmed to map data to sets of
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◆ W3-4 Online File W3.4: Virtual Reality Visualization

rectangles whose colors symbolize different levels of conditions, such as normal,

high, and low.
• Analogous to a visual spreadsheet, Visual Insights ADVIZOR (advizor.com)
allows users to find and understand patterns and trends hidden in complex data.
It combines ease of use, industry-standard data access, and the power of interac-
tive data visualization to create the next-generation user interface for business
decision making.
• There is an emerging new category of enterprise data visualization applications,
called online visualization for an enterprise (OLIVE) applications. OLIVE sys-
tems are chart-centric applications that deliver visual BI to the enterprise. There
are 12 attributes that an enterprise charting application tool should have to qual-
ify as an OLIVE tool, including chart definition language and a lifecycle process.
• Visual software to reduce fraud and mitigate risk, especially in law enforcement,
is an area of major development. ChoicePoint (choicepoint.com) provides such
software and services. Many organizations developing tools for the Department
of Homeland Security are producing BI spin-offs in law enforcement.
• Developments in virtual reality (VR) have wide-ranging impacts in business as
well as other fields. In addition, ChoicePoint’s age-progression software, a form of
predictive visualization, helps find missing children. By early 2003, ChoicePoint
had assisted in recovering 782 missing children. See its Web site to see the results
of age progression software.

On the hardware side, new developments are continually being made in visualiza-
tion. Some involve special headgear or eyeglasses, and some use holographic projection.
Typically, these hardware platforms involve VR representations of data as landscapes.
Others are television based. (see actuality-systems.com).

ONLINE FILE W3.4: VIRTUAL REALITY VISUALIZATION

Visual applications include the latest developments in VR, which of course include
more than just seeing images. VR representations have enabled advances in medicine,
especially in training. VR simulations provide a way to train doctors and dentists on
the look and feel of real surgical procedures. Three-dimensional images of organs
(e.g., gall bladders, hearts) have enabled robotic surgery. VR can be used to treat
phobias (e.g., fear of flying, fear of thunderstorms).
Haptics (i.e., virtual-touch technology) is being used in conjunction with VR to
accelerate applications. The Harvard School of Dental Medicine is working on a facil-
ity to enable dental training via haptics. Surgical applications are under development
to accurately provide the texture, weight, and fragility of real body parts. Ortho
Biotech, Inc., has developed a mobile VR simulator to help doctors understand how
chemotherapy patients feel physically. Most doctors who try the simulator change how
they talk about and treat cancer-related fatigue.
In Calgary, Alberta, the Cave Automated Virtual Environment is housed in a
10-by-10–foot room (possibly a forerunner of the holodeck of Star Trek fame). The
Cave project runs single-cell simulations, cancer-cell simulations, and a model human
simulation, using a Java-based three-dimensional language. The project is at the fore-
front of bioinformatics. Eventually, Cave plans to develop three-dimensional models of
diseases progressing through the human body.
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Online File W3.5: Competitive Intelligence on the Internet W3-5 ◆

VR has been used for flight training for years. Pilots can learn manual and techni-
cal skills through VR-based simulations before assuming real flight responsibilities.
Automobile manufacturers use VR with simulations to help solve design problems and
reduce costs. MathWorks, Inc., provides the Virtual Reality Toolbox as part of its MAT-
LAB and Simulink products. The toolbox gives engineers an in-depth animated look at
dynamic models.
Finally, VR is making major headway through Web applications, especially through
Virtual Reality Markup Language (VRML). For example, Lands’ End uses Web three-
dimensional technology (My Virtual Model by Public Technologies Multimedia,
Montreal) to help shoppers evaluate garments on lifelike models. Three-dimensional
Web technology includes products such as MetaCreations’ MetaStream three-dimen-
sional streaming format, Flatland Online’s 3DML (markup language), Play Inc.’s
Amorphium graphics engine, Oz.Com’s Fluid3D plug-in for RealNetworks’
RealPlayer G2, and Cycore’s Cult3D modeling application.
Sources: Adapted from C.T. Heun, “Virtual Landscape: A Fantastic Human Voyage,”
InformationWeek, April 15, 2002, K. McMasters, “Almost There,” PC Magazine, November 13, 2001,
“Virtual Reality Doctors Empathize with Cancer Patients,” Business Wire, November 1998, and
J. Edwards, “3-D Finally Gets Serious,” CIO, March 1, 2000.

ONLINE FILE W3.5: COMPETITIVE INTELLIGENCE ON THE INTERNET

A company can use the Internet to conduct competitive intelligence easily, quickly, and
relatively inexpensively, in the following ways:

• Review competitors’ Web sites. Such visits can reveal information about new prod-
ucts or projects, trends in budgeting, advertising strategies, financial strength, and
much more. Potential customers and business partners can be found by use of the
Link: URL command in search engines to reveal what companies link to competi-
tors’ Web sites.
• Analyze related electronic discussion groups. Internet newsgroups and Web site
discussion boards can assist in finding out what people think about a company
and its products. For example, newsgroup participants state what they like or dis-
like about products provided by a company and its competitors. (For example, see
obo.co.nz for a discussion board about field hockey equipment.) A company can
also examine potential customers’ reactions to a new idea by posting a question
about it.
• Examine publicly available financial documents. This can be accomplished by
entering a number of databases, most of which charge nominal fees. The most
notable database of financial documents is the Securities and Exchange
Commission’s EDGAR database (sec.gov/edgar.shtml).
• Do market research at the company’s own Web site. A company can conduct sur-
veys or pose questions to visitors at its site. It can even give prizes to visitors who
best describe the strengths and weaknesses of competitors’ products.
• Use an information delivery service to gather news on competitors. Information
delivery services (e.g., Info Wizard, My Yahoo!) can find what is published on the
Internet, including newsgroup correspondence about competitors and their prod-
ucts, and send it to a company. Known as push technologies, these services provide
any desired information, including news, some in real-time, for free or for a
nominal fee.
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◆ W3-6 Online File W3.6: Cabela’s

• Use corporate research companies. Corporate research and ratings companies

such as Dun & Bradstreet (dnb.com) and Standard & Poor’s (standardandpoors
.com) provide, for a fee, information ranging from risk analysis to stock market
analysts’ reports about a company’s competitors.
• Dig up the dirt on competitors. Individual and business background checks are
available from knowx.com. Credit report services such as the Red Book Credit
Service (thepacker.com) can provide a credit history of a competitor. “Actionable
intelligence” on competitors (e.g., determine competitors’ strategies in pricing,
assortment, promotions and channel management—so you can be proactive
rather than reactive) is available from rivalwatch.com.
• Find out the “going rates” for employee pay. Try wageweb.com for a free analysis
of compensation rates.
• Find corporation credit history. Dun & Bradstreet (dnb.com) offers credit histo-
ries for some companies. Other places to look are court records, banks, annual
reports, and credit bureaus.

ONLINE FILE W3.6: CABELA'S

Application Case W3.1

Data Warehousing and OLAP at Cabela’s

Cabela’s, “the world’s foremost outfitter,” is the
world’s largest mail-order distributor of products
for outdoor enthusiasts. Cabela’s has 6,000 employ-
ees. Every year Cabela’s mails more than 120 mil-
lion catalogs in 60 editions to customers across the
entire United States and in more than 120 other
countries. Cabela’s also owns eight physical stores,
an e-commerce Web site, and four telemarketing
centers in the United States.
In the mid-1990s, executives needed to develop
a greater understanding of their customers’ behav-
iors, individual tastes, and purchase preferences.
They needed to characterize the different segments
of the company’s customer base. Essentially, they
needed a way to cluster or group their customers to
understand them and to target market-specific
advertisement of products to the members of each
cluster (i.e., segment). At the time, Cabela’s relied
on outsourced BI and in-house packaged solutions
to build a unique mailing list for each catalog and
promotion. This process was costly and slow. In addi-
tion, the data’s integrity was questionable.
Cabela’s adopted IBM’s DB2 Universal Data
Enterprise Edition and IBM DB2 Warehouse
Manager as its platform. Query response times are
now 80 percent faster than before; maintenance
time and costs have been cut in half. The knowledge
gleaned from analyzing data in the data warehouse
has enabled the firm’s marketing team to improve
catalog hit rates and has led to far-reaching
improvements to printed catalogs and the e-com-
merce Web site, enhancing the customer experience
and boosting customer loyalty.
Dozens of users (including four full-time statis-
ticians and their staff, as well as senior managers)
access the data warehouse by using Hyperion
Explorer as the front-end querying and reporting
tool and SAS as the statistical analysis tool. In addi-
tion, Cabela’s uses a decision tree-based data mining
tool called CART from Salford Systems (salford-
systems.com). The data warehouse initially con-
tained 11 years’ worth of information, which
required about 700 gigabytes, and it is growing
rapidly.
Within a few months of the system’s deploy-
ment, sales in most market segments rose signifi-
cantly. Because it has succeeded, improvements
are already under way on the business analytics
side to help better understand the crucial relation-
ships among customers, markets, products, prices,
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Online File W3.6: Cabela’s W3-7 ◆

and geography and the key factors that drive the
business.
By leveraging data assets with additional
data management and BI technologies, Cabela’s
achieves deeper and more powerful insights that
bring added value to its customers—and to the
bottom line.
Sources: Adapted from J. Rivkind, “Cabela’s Data Warehouse
Satisfies Hunt for Business Insight.” What Works: Best
Practices in Business Intelligence and Data Warehousing, Vol.
15, The Data Warehousing Institute, Chatsworth, CA, June,
2003, pp. 8–9; and Phil Science, Cabela’s Stabilizes Catalog
Mail Model Segments With CART Data Mining Software,
2006, philscience.com/economics/ salford/appstories.html
(accessed February 2006).

CASE QUESTIONS
1. Describe how Cabela’s ran its marketing process before the BI system was developed.
2. Why is it important for a firm such as Cabela’s to segment its customers? What benefits can
the firm obtain? Are there any disadvantages? Explain.
3. Why was it important for Cabela’s to have kept 11 years’ worth of sales data on hand?
Could the firm have used more?
4. How have business analytics tools helped Cabela’s improve the performance of the
business?
5. Describe how data mining tools could help Cabela’s do even better than it is with the system
described.
6. Describe the competitive advantage provided by the Cabela’s system.