INTRODUCTION

This chapter gives a general overview of the topic at hand, its constituents, and importance of
the topic, problem statement, barriers, purpose, significance, the research questions and
research objectives.

Howard Dresner, who is presumed to be the father of Business Intelligence in his interview
with Hannah Smalltree, a News Writer from SearchBusinessAnalytics in 2006 laid down
Business Intelligence as simply the methodology of aligning people and process with
purpose. He further went on that the next high ground is business performance management
(BPM) [also called corporate performance management], which is what Business Intelligence
becomes when it grows up or as he calls it, Business Intelligence with a purpose.

Business Intelligence is getting the right information to the right people at the right time to
support better decision making and gain competitive advantages (Waite, 2006).

Wikitionary defines Business intelligence as any information that pertains to the history,
current status or future projections of a business organization and any information that can be
of strategic use to an organization.

Business Intelligence enables the comprehension, understanding and profit from experience.
Business data and information is the soil that grows Business Intelligence, which provides the
capability to reason, plan, solve problems, think abstractly, comprehend ideas and language,
and learn from business data and information. Business intelligence is fueled from the
utilization of information aligned with business performance. Business intelligence is
constructed on the identification and modeling of focused business information. Asking the
right questions is the precursor to making intelligent decisions (Annie, 2007).

1.1 Elements of Business Intelligence

Wordweb dictionary defines “Elements” as “An abstract part of something”, "a component or
constituent element of a system". So basically, elements of Business Intelligence are the
component parts that make the whole Business Intelligence system. Business Intelligence can
be classified into two components as below.

Hard Business Intelligence: is that aspect of Business intelligence that is seeable and not just
an abstract matter. It is that part that includes hardware, software, tools e.t.c and mostly used
by IT side of business.

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Soft Business Intelligence: Evolves from the 4-step process of how we get knowledge
(Knowledge Management), how we analyze (Business Analysis &Analytics), how we store
(Data warehouse), how we retrieve and use information (Data Mining). Business intelligence
(BI) uses Knowledge Management, data warehouse, data mining and business analysis to
identify, track and improve key business processes and data, as well as identify and monitor
trends in corporate, competitor and market performance(Jayanthi, 2008;Dataflux,2009).

1.1.1 Knowledge Management

Knowledge is the most paramount asset any organization will be willing to have at their
disposal and the way it is gotten and used actually help maintain a higher competitive edge.
This can be seen from the way they improvise creation of knowledge, sharing of knowledge,
usage of knowledge and management of knowledge into their business processes.
(ExecutiveBrief, 2009).Knowledge is a fluid mix of framed experiences, values, contextual
information, and expert insight that provides a framework for evaluating and incorporating
new experiences and information. It originates and is applied in the minds of professionals in
the field. In organizations, it often becomes embedded not only in documents or repositories
but also in organizational routines, processes and norms (Davenport and Prusak, 1998). In
addition, Gartner Group defines Knowledge Management as a discipline that promotes an
integrated approach to identifying, managing and sharing all of an enterprise's information
assets. It is the discipline applied to manage intellectual capital."

1.1.2 Business Analysis and Analytics

Analysis as defined by Webster’s dictionary is the separation of a whole into its components
parts”. It is also defined as a process of inspecting, cleaning, transforming, and modeling data
with the goal of highlighting useful information, suggesting conclusions, and supporting
decision making.”(Wikipedia) On the other hand, defines business analysis as : “The
discipline of identifying business needs and determining solutions to business problems.
Solutions often include a systems development component, but may also consist of process
improvement or organizational change or strategic planning and policy development.” These
two definitions may explain why the IT and business views of analysis sometimes differ. IT
often defines data analysis as covering the complete information life cycle from cleaning and
transforming source data making it ready for analysis, to analyzing the transformed data and
creating analytics. Business users, on the other hand, view business analysis as a set of
techniques for defining analyses and creating analytics on the transformed data.

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Analytics can also be known as metrics, measurements, and indicators which could also be
defined in different forms. It is Note-worthy that analytics is more often defined as “the
science of analysis” rather than the “results of analytical processing.” Since business
intelligence is about providing business users with intelligence about the business, Business
analysis can be said to be the process of analyzing trusted data with the goal of highlighting
useful information, supporting decision making, suggesting solutions to business problems,
and improving business processes. (Hass et.al, 2008)

1.1.3 Data Warehousing

Different people have different definitions for a data warehouse. The most popular definition
came from Bill Inmon, who provided the following:

A data warehouse is a subject-oriented, integrated, time-variant and non-volatile collection of

data in support of management's decision making process.

Subject-Oriented: A data warehouse can be used to analyze a particular subject area. For
example, "sales" can be a particular subject.

Integrated: A data warehouse integrates data from multiple data sources. For example, source
A and source B may have different ways of identifying a product, but in a data warehouse,
there will be only a single way of identifying a product.

Time-Variant: Historical data is kept in a data warehouse. For example, one can retrieve data
from 3 months, 6 months, 12 months, or even older data from a data warehouse. This
contrasts with a transactions system, where often only the most recent data is kept. For
example, a transaction system may hold the most recent address of a customer, where a data
warehouse can hold all addresses associated with a customer.

Non-volatile: Once data is in the data warehouse, it will not change. So, historical data in a
data warehouse should never be altered.

Data warehousing is a foundational practice that supports enterprise reporting, business

intelligence and decision support. Data warehouses and data marts are created across levels of
sophistication and different philosophical approaches, but typically involve extracting and
transforming data from operational/transactional databases and loading it to a repository for
shared use and analysis. (1keydata.com, 2001)

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1.1.4 Data Mining
Data mining is the process of extracting hidden knowledge from large volumes of raw data. It
can also be defined as the process of extracting hidden predictive information from large
databases. Data mining is not an “intelligence” tool or framework. Business intelligence,
typically drawn from an enterprise data warehouse, is used to analyze and uncover
information about past performance on an aggregate level. Data warehousing and business
intelligence provide a method for users to anticipate future trends from analyzing past
patterns in organizational data. Data mining is more intuitive, allowing for increased insight
beyond data warehousing. An implementation of data mining in an organization will serve as
a guide to uncovering inherent trends and tendencies in historical information. It will also
allow for statistical predictions, groupings and classifications of data. (Mladenic et. al, 2003)

Most companies collect, refine and deduce massive quantities of data. Data mining
techniques can be implemented rapidly on existing software and hardware platforms to
enhance the value of existing information resources, and can be integrated with new products
and systems as they become part of the system. When implemented on high performance
client/server or parallel processing computers, data mining tools can analyze massive
databases to deliver answers to many different types of predictive questions.

1.2 The Importance of Business Intelligence

The instability of Business conditions is in a constant state of flux. Sales patterns change
from place to place and from time to time. Currency valuations shift and alter profit margins
based on economic conditions. Suppliers change their delivery schedules and their prices.
Advent and progression of the internet have made customers more aware of market trends
and therefore more demanding. Balancing on this shifting terrain, business managers are
expected to deliver steady earnings growth. Somehow, they must smooth out the bumps and
anticipate the changes (Chee et.al, 2009).

The importance of Business Intelligence is to enable organizations understand change, to

identify causal factors through analysis of data by region, currency, customer or other
relevant dimensions. As the CIO of a large chemical company said recently, “If you rely on
averages, it’s easy to be misled, but if you slice through the data, it’s possible to see exactly
what’s affecting costs.” For example WalMart captures point-of-sale transactions from over
2,500 stores in six countries in its tera-scale data warehouse. The information gotten is used
to ask questions like “which stores and for which months was a particular product in high

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demand but short supply?” The answer gotten from that can be used to optimize inventory
and capitalize on pricing opportunities that exist transiently at any one local store. The
importance of BI is not limited to retailers. Telecommunications carriers also use it to
identify and mitigate fraud. A delivery service might predict which vehicles are most likely to
break down and its location using GPS and Business intelligence (Olszak, 2002).

A bank might use Business intelligence to identify customers who, based on their recent
activity, are likely to transfer their account to another financial institution. The possibilities
and opportunities are enormous and limitless.

Business Intelligence makes enterprise data actionable. It is the spice for any successful
business. It uncovers trends and patterns that might otherwise go undetected. Managing a
business on intuition, educated guesses or averages isn’t good enough anymore. To be
successful, a company needs a foundation of accurate, current and complete information and
only Business intelligence can get this to work (Netezza, 2004).

1.3 Problem Statement

Daniel (2007) analyzes the three weaknesses of Business Intelligence in this era. They are
that “Business Intelligence tools provide out of date information, Business intelligence tools
fail to identify process problems, Business intelligence tools can’t be used as predictors”.
From the above, we can see that it all had to do with tools. This is a glaring instance that not
just tools are enough for successful implementation of business intelligence in an
organization. For many years, people have debated about the need for Business Intelligence.
But the assumption has been that Business Intelligence is rather a tool than a set of
components or methodologies. This initial perception fails to take into account those tools
without methodologies or practices will have an adverse effect on business. People have
failed to realize the essence of these components and only focus on what they call the big
picture (Turban et al., 2007). If this continues, business will not reap bountifully. By
rethinking our approach to what Business Intelligence actually is, we can make essence of
and maximize business processes. My urge to do this topic is to challenge the status quo of
the ground meaning of Business intelligence and help understand the subject matter.

1.4 Barriers to Business Intelligence implementation

Business Intelligence Guide (2009), an aggregation of all accumulated research papers on
Business intelligence, points out that even though Business Intelligence it is the most highly

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desired technology spanning a $10 billion a year market and growing at 10% a year, it still
suffers from a ‘relative inability to prove its value’( Agha et.al,2009)

Economist Intelligence Unit Study (2007) lists the following barriers or problems quoted
below:

 Departmental silos remain the biggest barrier to data sharing with 63% of executives
agreeing.

 New obstacles such as data access and clean data are also causing problems with 41%
respondents agreeing.

 Employee resistance to adoption of new technology, fear of misinterpretation of data

with 78% still using old spreadsheet technology.

 Lack of CIO participation in decision making process with only 22% companies who
allow CIO involvement.

1.5 Failure of Business Intelligence

Business intelligence failure can be attributed to a lot of factors. But a few of them as below
are based on the final output of what business intelligence is supposed to be like;

 Inadequate management support.

 Inadequate monitoring.

 Reliant on non Real-time data.

 Reactive rather than proactive.

 Summarizing past rather than looking forward.

 Esoteric nature of organizations.

 Employees with necessary business and technical skills are rare.

1.6 Sectors that use Business Intelligence

Business Intelligence can be used in all walks of life. Basically it can be used by both the
Public sector, private sector and non-governmental or charity organizations.

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1.7 Purpose of Research
The purpose of this research is to challenge the status quo and bring out a new reasoning on
what Business Intelligence really is.

1.8 Significance of Research

The significance of this research is to show that Business Intelligence is more than just a tool
but also involves methodologies. Everyone included in the business chain will benefit from
this. The organization can make better decisions based on accurate data, the suppliers also
can know when to supply, while customers will gain customized offerings and will be better
served.

1.9 Research Questions

To what extent will the implementation of BI impact the success of an organization.

1.10 Research Objectives

 To identify the Critical Success Factors for implementation of Business Intelligence.

 To evaluate the benefit and impact of BI on organizations.

 To develop a theoretical framework to test the underlying factors.

 To empirically test and validate the framework created.

 To propose recommendation.

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LITERATURE REVIEW
This chapter critically evaluates past literature in the attempt to amassing wealth of
knowledge critically analyze past literatures. It then moves into the critical factors
responsible to make it successful, and it also sees the relationship or fusion of each of the
success factors to the topic and finally a framework is created based on the factors.

Pattron (2009) describes literature review as a Systematic review of available resources

which involves;

 Theoretical and conceptual concepts

 Identification of independent and dependent variables

 Measurement and operational definitions

 Selection of appropriate research technique

 Sampling strategy

 Statistical technique

 Findings and conclusions of similar studies studied

The rapid pace of today’s business environment has made Business Intelligence
indispensable to any organization’s success. Even though the term is not used explicitly, the
way and manner organizations analyze and make decisions all wrap around business
intelligence. Business Intelligence systems turn a company's raw data into useable
information that can help management identify important trends, analyze customer behavior,
and make intelligent business decisions quickly. Over the past few years, business
intelligence has been used to understand and address back office needs such as efficiency and
productivity. Now organizations are increasingly using Business Intelligence to analyze
customer behavior, understand market trends, and search for new opportunities. So they see it

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 as a tool rather than a set of components coming together to achieve the main purpose of
business (Sun, 2005).

The current trend in which most people and even practitioners see Business Intelligence is as
a tool which helps them get insights into data and business processes. Past literature shows
that this thought about business intelligence started out from its founder. According to Gibson
et.al (2004), the term Business Intelligence and its key concepts originated with Gartner
Research in 1989. Howard Dresner of Gartner Research, who is also widely recognized as the
father of Business Intelligence, first coined the term as “a broad category of software and
solutions for gathering, consolidating, analyzing and providing access to data in a way that
lets enterprise users make better business decisions”. Since then, leading vendors,
practitioners and prominent authors have used various other definitions to capture the essence
of Business Intelligence.

These definitions are summarized in Table 1. A comparison of the definitions reveals that
they generally fall into three main categories, namely the management (a.k.a. process) aspect,
the technological aspect, and the product aspect. The management and the technological
aspects recognize the traditional separation between technical and managerial approaches and
are in line with Petrini and Pozzebon’s observation(Petrini and Pozzebon,2002). Following
Chang’s suggestion, the third aspect (i.e., product) is added to capture the view of those who
see BI from a solution’s perspective(Chang,2006). Table 2 categorizes existing definitions of
Business Intelligence using the three categories found here.

Table 2.0: Summary of varied Business Intelligence definitions (Source: Developed for this
thesis, adapted from Chee et.al, 2009)

Author Own definition of Business Intelligence

Gartner Research(Hostmann An umbrella term that includes the analytic applications, the infrastructure
2007) and platforms, as well as the best practices.

Dresner (1989) broad category of software and solutions for gathering, consolidating,
analyzing and providing access to data in a way that lets enterprise users
make better business decisions

Business Objects The use of an organization’s disparate data to provide meaningful

information and analysis to employees, customers, suppliers, and partners

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(Business Objects 2007) for more effective decision making.

SAS Institute (Ing 2007) Delivering the right information to the right people at the right time to
support better decision making and to gain competitive advantage.

Oracle (Oracle 2007) A portfolio of technology and applications that provides an integrated, end-
to end Enterprise Performance Management System, including financial
performance management applications, operational BI applications, BI
foundation and tools, and data warehousing.

Turban et al. (2007) An umbrella term that encompasses tools, architectures, databases, data
warehouses, performance management, methodologies, and so forth, all of
which are integrated into a unified software suite.

Pirttimäki et.al,(2007) Business intelligence (BI) is a managerial concept and tool that is used to
help organizations to manage business information and to make effective
decisions

Adelman and Moss A term encompasses a broad range of analytical software and solutions for
gathering, consolidating, analyzing and providing access to information in
(2000)
a way that is supposed to let an enterprise’s users make better business
decision.

Wikitionary (accessed 7th Any information that pertains to the history, current status or future
May 2010) projections of a business organization and any information that can be of
strategic use to an organization.

Annie(2007) Provides the capability to reason, plan, solve problems, think abstractly,
comprehend ideas and language, and learn from business data and
information. Business intelligence is fueled from the utilization of
information aligned with business performance

Olszak (2002) Set of concepts, methods and processes that aim at not only improving
business decisions but also at supporting realization of an enterprise’s
strategy.

Chase(2001) Acquisition and utilization of fact based knowledge to improve a business’s

strategic and tactical advantage in the marketplace.

Moss(2003) It is an architecture and a collection of integrated operational as well as

decision-support applications and databases that provide the business
community easy access to business data.

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Azvine(2006) how to capture, access, understand, analyze and turn one of the most
valuable assets of an enterprise – raw data – into actionable information in
order to improve business performance

Table 2.1: Three approaches to the definition of Business Intelligence (Source: Adapted from
(Petrini and Pozzebon, 2004), (Chang, 2006)).

Approach Managerial/Process Technological Product

Definition Focus on the process of gathering Focus on the tools and Describe BI as the
data from internal and external technologies that allow emerging result/product
sources and of analyzing them in the recording, recovery, of in-depth Analysis of
order to generate relevant manipulation and analysis detailed business data as
information for improved of Information. well as analysis practices
decision making. using BI tools.
Author Whitehorn & Whitehorn (1999); Moss & Atre (2003); Chang (2006);
Business Objects (2007); Cognos Moss & Hoberman Gangadharan &Swami
(2004); SAS Institute (2007); (2004); Adelman & (2004); Kulkarni &
Moss & Hoberman (2005); Moss (2000);Turban et al. King, (1997); Turban et
Hostmann (2007); Oracle (2007); (2007); Oracle al. (2007)
Turban et al. (2007); Markarian, 2007);Hostmann (2007) * Note: The definition of
Brobst & Bedell * Note: The definition of Turban et al. (2007)
(2007),wikitionary(en.wiktionary Hostmann (2007) and spans across all three
.org/wiki/business_intelligence, Moss & approaches.
accessed 7th May 2010) Hoberman (2005) spans
across
both process and
technological
approaches.

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 Business Intelligence Definition(s) Variable(s) Definition(s) References
Critical Success Factors
Knowledge Management fluid mix of framed Leadership Process of social influence in
experiences, values, contextual which one person can enlist the Chemers (2002)
information, and expert insight aid and support of others in the
that provides a framework for accomplishment of a common
evaluating and incorporating task.
new experiences and Culture Combination of shared history, Hasanali(2002)

information (Davenport and expectations, unwritten rules,

Prusak, 1998) and social customs that compel

behaviors. It is the set of
underlying beliefs that, while
rarely exactly articulated, are
always there to influence the
perception of actions and
communications of all
employees
Structure, Roles and different ways and manners Hasanali(2002)
responsibilities organizations structure the
governance of their Knowledge
Management initiatives
IT infrastructure The use of IT in any Hasanali(2002)
organization is to facilitate
better work environment and
conditions

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 Measurements any process by which a value is Lord Kelvin(1929)
assigned to the level or state of
some quality of an object of
study
process of inspecting, cleaning, Hass et. Al(2008)
Business Analysis and transforming, and modeling
Analytics data with the goal of
highlighting useful information,
suggesting conclusions, and
supporting decision making
Data Warehousing foundational practice that (1keydata.com,
supports enterprise reporting, accessed 20th May
business intelligence and 2010)
decision support
Data Mining Process of extracting hidden Mladenic et. al,
predictive information from (2003)
large databases. Data mining is
not an “intelligence” tool or
framework
Table 2.2

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 Business Intelligence Performance Outcomes
Outcome

Business Performance ROI A measure of a corporation's

profitability, equal to a fiscal
year's income divided
Business Performance is the bycommon stock and preferred
stock equity plus long-term
ability of an organization to debt. ROI measures how
achieve the maximum level of effectively
the firm uses its capitalto
profitability possible given the generate profit; the higher the
human, financial, capital, and ROI, the better(carmel,2001).
other resources it possesses.
Turnover the ratio of annual sales to inv
(Luftig, 1998) entory; or equivalently,
the fraction of a year that
1.11 an average item remains in
inventory. Low turnover is
a sign of inefficiency, since
inventory usually has a rate of
return of zero. here also
called inventory turnover. For
a mutual fund, the number
oftimes per year that an
average dollar of assets is
reinvested(Bodieet.al, 2004).

Market portion or percentage of sales

Share of a particular product or
service in a given region that
are controlled by a
company(carnammie,2007)

Sales Quantity or number

Volume o
f goods sold or services render
ed in the normal operations of
a firm in a
specified period(danny
et.al,2007)
Competitive A competitive advantage is an
advantage advantage over competitors gained by
offering consumers greater value,

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 either by means of lower prices or by
providing greater benefits and service
that justifies higher prices (Porter,
1998).

Reputation of a company is its

important and valuable asset. A
Company positive one may bring many benefits
reputation to a company, when a negative one
may significantly harm it. A company
reputation is closely tied up with its
stakeholders' emotional beliefs about
it. In this article you will find out
about some key factors of the
reputation, its relation to the
company's stakeholders and its
consequences of an organization
(Chang, 2006).

1.12 Business Intelligence and its Critical Success Factors

Mind tools (accessed 12th June 2010), simply explains critical success factors as Identifying the
things that really matter for success. It further went on to explain CSFs as the essential areas of
activity that must be performed well if a business is to achieve the mission, objectives or goals
set by it. As stated out in the table above, The critical success factors for successful
implementation of Business Intelligence cuts through aspects of the 4-step process in chapter one
of this thesis on how we get knowledge (Knowledge Management), how we analyze (Business
Analysis &Analytics), how we store (Data warehouse) and finally, how we retrieve and use
information (Data Mining) (Jayanthi, 2008;Dataflux,2009).

1.12.1 Knowledge Management

Knowledge is the most paramount aspect of any organization aspiring success or already
successful and the way it is gotten and used actually help them maintain a higher competitive
edge. This can be seen from the way they improvise creation of knowledge, sharing of
knowledge, usage of knowledge and management of knowledge into their business processes.
(Executive Brief, [Accessed 25th May 2010]).Knowledge is a fluid mix of framed experiences,

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values, contextual information, and expert insight that provides a framework for evaluating and
incorporating new experiences and information. It originates and is applied in the minds of
professionals in the field. In organizations, it often becomes embedded not only in documents or
repositories but also in organizational routines, processes, and norms (Davenport and Prusak,
1998). In addition, Gartner Group defines Knowledge Management as a discipline that promotes
an integrated approach to identifying, managing and sharing all of an enterprise's information
assets. It is the discipline applied to manage intellectual capital."

Bailey and Clarke (2008) describes Knowledge Management as ``how managers can generate,
communicate and exploit knowledge (usable ideas) for personal and organizational benefit'' and
highlights not only the organizational importance of Knowledge Management, but also its
relevance for individual managerial action. ``Organization benefit'' means improving the
effectiveness of organization strategy, operational processes, and change management, thus
ensuring that the Knowledge Management focus is currentmnjh. ``Personal benefit'' means that
the individual manager is able to identify ``what's in it for me to adopt a Knowledge
Management perspective?'', thus capturing the personal motivation for adopting a KM frame of
reference, the importance of which has been largely omitted from discussions on the subject
(Hackett, 1999; McAdam and McCreedy, 1999). Finally, the words ``how managers can'' are
important here too. For managers to do anything with ideas that are personally relevant and
organizationally important, they need to be able to see Knowledge Management as within the
range of actions available to them within their role, level, power etc.

Some inherent critical success factors are built into this definition because without them,
knowledge will not be able to be gotten, refined or kept for further use. Knowledge Management
is a set of strategies and approaches, which denotes a definite structure or a way to do things.
Another critical piece of this definition is that this approach enables the flow of information to
the right person at the right time; otherwise, an organization would be managing its knowledge
just for the sake of managing it and not to create value. That brings us to the most critical aspect
of Knowledge Management: creating more value for the organization. The most elaborate
knowledge-sharing procedures will not help if the knowledge shared within an organization does
not enable its recipient(s) to create value, be it through increased revenue or time or cost savings
(Hasanali, 2002)

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The successful implementation of Knowledge Management initiative depends on many factors,
some within the organization’s control, others not. Typically, some factors have effects on
Knowledge Management and can be grouped into five primary categories as below:

 Leadership:

Organizational viability depends in part on effective leadership. Effective leaders engage in both
professional leadership behaviors (e.g. setting a mission, creating a process for achieving goals,
aligning processes and procedures) and personal leadership behaviors (e.g. building trust, caring
for people, acting morally). Interestingly, most of what we know about leadership comes from
the examination of how employees relate to their immediate supervisors. However, examining
individual perceptions of “leadership” at the organizational level is an interesting proposition
(Bailey and Clarke, 2008). At first glance, it may seem that professional leadership behaviors
such as aligning processes and procedures may be more easily conceptualized at the
organizational level than personal leadership behaviors such as acting morally. However, recent
events such as Enron and WorldCom suggest the important impact of personal leadership. In
these cases, negative personal leadership behaviors were present throughout the organization and
the consequences were dramatic (Hill and Knowlton, 2007).

Ideal leaders do not exist in practice. Thus, we can relate to leadership as a progressive
development only. Since we humans cannot be fully conscious of our emotions, a posteriori, we
cannot fully mobilize them in order to understand and attain our life goals and purpose. Because
our purpose remains opaque at best, it follows that leaders will act unethically even when they do
so unwillingly or unconsciously. The only way for leaders to improve their ethical position is to
interact with others in society to help them reveal their hidden agenda over time (Kotter, 1990).
The particular worldview, in turn, shapes these agendas, either Theta or Lambda that a person
embodies in his search for greater self-awareness and contextualization with his external
environment. Both the behavioral perspective as well as the economic model examines
leadership as a role whose purpose is to assist an organization to adapt. That is how an individual
practicing leadership can help an organization to affect adaptive change (Heifetz, 1998; Nanus,
1995)

– The theory of leadership

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Adding to Kurt Lewin’s (1945) observation that “there is nothing as practical as a good theory”,
Whetten (2002) suggests that only a good theory is practical. Hence, we have two successive
goals:

 we should understand the components that comprise theory; and

 we should incorporate this knowledge into the theory of leadership.

Like any theory, leadership theory has to answer to three key questions – what, why and how
(Whetten, 2002). “What” refers to the constructs analyzed, or the target of theorizing; “how”
explains the methods we use to create interrelationships between constructs of the theory; and
“why” represents the conceptual assumptions behind these relationships. Thus, in leadership
theory the “what” represents the goal that the leader looks to attain, the “how” explains the way
the leader reaches the goal, and the “why” explains the reasons behind selecting this particular
method for attaining the goal. However, we contend that while the literature into leadership deals
with what leaders do or how they do it, it is silent about the reasons for why leaders are
motivated to pursue such activities.

Chemers (2002) describes leadership as the process of social influence in which one person can
enlist the aid and support of others in the accomplishment of a common task. Leadership plays a
key role in ensuring success in almost any initiative within an organization. Its impact on
Knowledge Management is even more pronounced because the more experienced a leader is, the
more he or she can make meaning out of Knowledge available. Nothing makes greater impact on
an organization than when leaders model the behavior they are trying to promote among
employees. The CEO at Buckman Laboratories, a chemicals company, orchestrates the
Knowledge Management initiative within the organization and personally reviews submissions
to its knowledge bank. When he notices that a particular employee has not had been active
within the system, he sends a message that reads: "Dear associate, you haven't been sharing
knowledge. How can we help you? All the best, Bob." (Hasanali, 2002)

Several other best-practice organizations have demonstrated this commitment to Knowledge

Management. At the World Bank, the president's support led to the creation of an infrastructure
that promoted and supported the growth of communities of practice (CoPs) not only throughout
the organization, but also around the globe. Today, the World Bank has sustained its Knowledge

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Management initiative through its CoPs. Its knowledge managers constantly search for new
approaches to knowledge sharing.

Although leadership plays a critical role in the success of the Knowledge Management initiative,
the "culture" factor can be even more important to the success of Knowledge Management. This
moves us into the next section.

 Culture:

From the Corporate perspective, culture helps explain why some companies are more successful
than others. Kotter and Heskett(1992) investigated the relationship of culture to corporate
performance, they summarized their research by means of four conclusions as below

 Corporate culture can have a significant impact on a firm’s long-term economic

performance.

 Corporate culture will be an even more important factor in determining the success or
failure of firms.

 Cultures that inhibit strong long-term financial performance are common, and they
develop easily even when employees are reasonable and intelligent people

 Although tough to change, corporate cultures can be made more performance enhancing

The effects of culture on the performance of an organization depend, not on the strength of the
overall culture, but on the mix and weightings of the components of that culture. An example is
the component of conflict, which may be a healthy incentive for action and competition when
present in some forms and degrees, but can be damaging when it becomes the culture’s dominant
feature and its existence is not acknowledged. Research theory in the management of non-profits
emphasizes the need for consonance and deplores the existence of conflict; however, research
shows that some community organizations do not fit the model presented in the literature and
that conflict does exist in these organizations and can cripple their ability to function in goal-
setting, staffing, the conduct of meetings, problem solving and decision making, the
identification and utilization of individual skills, and writing submissions for government
funding(Heskett,1999).

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The concept of organizational culture has been well documented in the literature, though there is
still inconsistency in definitions and therefore uncertainty in the meaning of the term. While
some authors see culture as basic assumptions held by organization members (Sathe, 1983;
Schein, 1984; Lewis, 1992), most authors prefer to view it as a combination of assumptions,
feelings, beliefs, values and behaviour. Lewis (1996) believes that this preference could be either
a result of the culture model’s basing itself on the organizational development model, which
takes this broad view of culture; or a result of the important influence of the books of Peters and
Waterman (1982) and Deal and Kennedy (1982), who also propounded the “combination”
theory. Whichever view of culture is taken, culture itself is a contributing factor to what makes
one organization different from another. It is the essence of an organization – its character, its
personality. It is therefore long-term and very difficult to change. Some researchers (Uttal, 1983)
argue it is almost impossible to change. Also according to the literature, culture can have a
significant impact on the effectiveness and competitive advantage of an organization (Bettinger,
1989; Brown, 1992; Fiol, 1991; Kilmann, 1989; Petrock, 1990; Sherwood, 1988; Whipp,
Rosenfeld and Pettigrew, 1989).

Culture is the combination of shared history, expectations, unwritten rules, and social customs
that compel behaviors. It is the set of underlying beliefs that, while rarely exactly articulated, are
always there to influence the perception of actions and communications of all employees.
(Hasanali, 2002)

Cultural issues concerning Knowledge Management initiatives usually arise due to the following
factors:

 Lack of time :

Life is time the meaning of life is to enrich the lives of others. The way you manage your time is
the way in which you manage your life. Infact, time cannot be managed. However, you can
manage the activities in your life. (Dobbins and Pettman1998).Dobbins and Pettman(1998), also
identifies most common time waster which are as below.

They say that managers attribute their time wasting to the following causes:

 Telephone calls

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  Unexpected visitors

 Poor delegation

 Ineffective, prolonged, unnecessary meeting

 No clarity of objectives, planning

 Fire fighting, being reactive rather than proactive

 Trying to juggle too many balls at the same time

 Inability to make decisions, delayed decisions

 Failing to say “NO”

 Poor communications, unclear instructions

 Unavailable, inaccurate information

 Poor self discipline

 Incompetent staff

 Social “business”

According to Drucker (1967), executives do not manage their time well. We assume that this
issue applies to all professions (e.g. Dahl, 1990). Currently there is a major shift of the workforce
from manual work to knowledge and service work. According to Drucker, we have since
Scientific Management been concerned with the most effective use of time where it matters least
– manual work. Here the difference between time-use and time-waste is primarily efficiency and
cost. “But we have not applied it to the work that matters increasingly, and that particularly has
to cope with time: the work of the knowledge worker and especially of the executive. Here the
difference between time-use and time-waste is effectiveness and results” (Drucker, 1967, p. 35).
Hence, with an increasing number of knowledge workers, it becomes more and more vital to
make time effective.

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We forget that our preoccupation with time as measured by the hands of a clock is a relatively
modern phenomenon. In Western Europe most cities and market towns had public clocks only by
the seventeenth century, and even then ones that had to be frequently reset using a sundial, such
was their inaccuracy. Timekeeping was imprecise, but this changed with the advent of the
industrial revolution which “required worker discipline if machine and man were to be
integrated” (Thrift, 1990). The industrial revolution enabled the mass manufacture of watches –
portable, personal timekeeping devices, which became at once both a status symbol to own and a
source of enslavement that served to entrap all future generations within a chronological
paradigm of time: time is duration that can be, indeed must be, timed.

Over the centuries precision in timekeeping has increased not only because watches and clocks
have become more reliable but also because the integration of modern society has demanded it.
Topik (1992) suggested, for example, that precision in timekeeping in modern China began only
when transport and travel became more rapid and the need to integrate such systems increased.
The study of the content of the advertising in one American magazine led Gross and Sheth(1989)
to infer that consumers became more concerned with clocktime as society became more
industrialized and urbanized.

The goal is not to encourage the employees to work more, but to work more effectively. The
processes, technologies, and roles designed during a Knowledge Management initiative must
save employees' time, not burden them with more work. This can only be accomplished if the
employees' work patterns are accounted for during the initial design and planning phase of the
initiative.

 Unconnected reward systems:

There is a substantial body of theoretical literature that links organizational strategy, human
resource (HR) practices, and performance (Balkin and Gomez- Mejia, 1987; Hambrick and
Snow, 1989; Lawler, 1986a; Lawler, 1986b; Ulrich and Lake, 1990; Waldman, 1994). This
literature typically suggests that human resource practices should be selected which complement
and support an organizational strategy. More specifically, the reward system should be aligned to
motivate employee performance that is consistent with the firm's strategy, attract and retain
people with the knowledge, skills and abilities required to realize the firm's strategic goals, and

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create a supportive culture and structure (Galbraith, 1973; Kilmann, 1989; Nadler and Tushman,
1988). Furthermore, the literature argues that alignment of the reward system with organizational
strategy helps to determine organizational effectiveness.

A review of the literature which links organizational strategy and human resource practices by
Becker and Gerhart (1996) suggests that the human resource system can be a unique source of
competitive advantage, especially when its components have a high degree of internal and
external fit. Another review by Gomez-Mejia and Balkin (1992) contends that the old model of
compensation (with pay structures based on job analyses, descriptions, specifications, and
classifications) is no longer effective in today's business environment. They conclude that
modern organizations must align their reward system practices with their organizational strategy
in order to achieve higher levels of performance at both the individual and organizational level.
At this point, the literature has remained mostly at the conceptual level in discussing the link
between organizational strategy, the reward system and firm performance. These propositions
have remained largely untested and there is a recognized need for empirical work in this area
(Lawler and Jenkins, 1994; Ledford, 1995; Waldman, 1994).

Reward and recognition for individual employees remains one of the controversial areas of
quality management. Notable authors such as Deming (1986) believed that fair ratings in such
systems were impossible due to supervisor biases, worker competition and organizational
politics. More recently, Scholtes (1995) has listed five reasons to explain why reward,
recognition and incentive systems do not work:

 no data to show long term benefits;

 they set up internal competition;

 reward systems undermine teamwork and co-operation;

 they often reward those who are lucky and pass by those who are unlucky; and

 they create cynics and losers.

Organizations have to maintain a balance between intrinsic and explicit rewards in order to
encourage employee behavior. The most effective use of explicit rewards has been to encourage

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sharing at the onset of a Knowledge Management initiative. If the attendees don't find value in
either the meetings or the information on the system, providing incentives will not sustain their
participation. People share because they want to, they like to see their expertise being used, and
they like being respected by their peers.

 Lack of common perspectives - Sharing must be inspired by a common vision. The

people affected by the new process or technology must all buy in to this vision and
believe it will work. This usually happens when those in charge are from different work
background, so they have different beliefs and different attitudes to work.

 No formal communication - Internal communication has for many years been the
stepchild of public relations and communication management. Clutterbuck and James
(2001) quote a survey by Business Intelligence that two thirds of businesses in the UK
formed internal communication departments only within the past few years. The internal
communication discipline has, however, begun to compensate for its Cinderella image. In
a Hill and Knowlton survey among more than 250 senior corporate communications
officers 90 per cent of the participants list building support among employees and other
key stakeholders as critical to their programme(Hill and Knowlton ,1997) . Employee
communication is rated second, after addressing company changes, as an issue facing
corporations in five years.

When designing and implementing Knowledge Management initiatives, the Knowledge

Management charter should ensure that employees and customers know about the changes
occurring in the organization. It has been hypothesized that a person needs to hear the same
message at least three times before it registers in the brain. Hence, communication should be
pervasive and reiterative from time to time. When an organization designs Knowledge
Management initiatives around its culture, it will be able to initiate a cultural change.

Most material dealing with effective organizational communication assumes that one individual
is the sole receiver of that communication. In actual practice, much organizational
communication involves communication aimed at groups. This communication often takes place
in meetings. Therefore, organizational communication directed toward groups and transmitted
within meetings needs study and attention (Spinks and Wells, 2006). Implication for

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organizational communication is that communication must not be directed towards individuals
alone, but must be directed towards groups, formal and informal, which exist in the organization.
Herein lies a serious problem. The power to influence the success or failure of organizational
activities that is wielded by informal groups is so great that those groups cannot be ignored, but
must be recognized and dealt with as real entities. However, in so doing, leaders must be careful
not to usurp the legitimate and rightful role of the formal organization and its formal groups.
Striking a balance – a happy medium between these two factors – is a hallmark of a good
organizational leader (Spinks, 2007).

 Structure, Roles and Responsibilities:

Staniforth (1994) explains that some 72 per cent of manufacturing firms in a survey, report
significant changes in their organization structures in the last two years. Structure is seen by
many as a powerful tool in mobilizing resources in both an efficient and effective manner. The
desire for change is clearly present, but whether positive outcomes will result is another matter.
What is the role of structure? What factors affect structure? Which structural types work best?
These are some of the key questions many senior managers have to grapple with. Organization
structure is the formal presentation of systems of positions and relationships within the firm. It
should be an operational statement of the firm’s goals.

It specifies formal communication channels, who does what and who is responsible for
whom/what. Structure may be seen as a statement from senior management as to how they wish
the firm to work (Leavitt, 1978). In essence the structure of the firm should reflect the activities
of the firm. As trends towards team working, empowerment, total quality management, etc.
gather pace, structure needs to facilitate these initiatives. While many firms are now much better
at displaying mission statements, quality definitions and other corporate data, many people inside
the firm remain unaware of the organization chart and its true significance.

In any group there is differentiation between the group members in terms of the functions they
perform (Hare, 1994).These different functions constitute the roles of the group members
whether they be formal (such as chairperson or secretary) or informal (such as facilitator or
joker). Although a great deal has been written about social roles (Biddle, 1979; Mills, 1984),
little research of an empirical nature has been carried out into the different types of roles in small

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groups. Most research on roles has come either from sociologically-oriented psychologists
(Heiss, 1981; Stryker and Statham, 1985) who focus on theoretical accounts of roles or from
management psychologists who tend to rely on descriptive case studies (Adair, 1986; Handy,
1985).Even social psychologists have tended to concentrate almost exclusively on just one role
in the group – the leader.

Although the leader is the single most influential member of a group, the collective influence of
the remaining members can easily exceed the leader’s influence (Hare and Kent, 1994). One
exception to this is work based on Belbin’s team-role model (Fisher et al., 1998, 2000, 2002).
Belbin (1981, 1993) argued that an individual member of a group usually adopts a specific way
of interacting with other members. Some behaviours are either favoured or resisted by
individuals, who choose particular roles according to their natural disposition. Individuals find it
easier to play a role that fits their personality characteristics and this result in effective
participation within a group. According to Belbin, the useful people to have in teams are those
who possess the strengths or characteristics which serve a particular need without duplicating
those already there. What is needed for effective teams is not well-balanced individuals but
individuals who balance well with one another. In this way, weaknesses can be compensated and
strengths used to full advantage.

Governance of Knowledge Management initiatives differ within different organizations. A

steering committee should be put in place to oversee the general success and progress of the
knowledge Pool. The steering committee usually consists of executives at the top level. They
promote the concept and provide guidance, direction, and support. The central Knowledge
Management group is typically made up of three to four people who provide the initial support
for projects or initiatives, which are usually handed over to the business owners once they are
implemented.

The central group usually consists of people with advanced project management, facilitation, and
communication skills. The stewards, or owners, are responsible for knowledge sharing and
acquisition within the business units. Like the core Knowledge Management group, the stewards
are change agents for the organization. They model and teach employees the principles of
knowledge sharing using a common vocabulary. All of these participants work as a team to

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prevent a silo mentality and incorporate resistant employees in the process (Hill and Knowlton,
2007).

Although the structure is put in place to establish ownership and accountability, if there is no
overall ownership of knowledge and learning within the organization and the leadership does not
"walk the talk," it will be difficult to sustain any sharing behavior.

 IT infrastructure

As the global business environment has become more dynamic and complex, competition among
companies has become increasingly intense amid ever tighter budget constraints. This tension
has forced organizations to make the management of all its resources a priority. The
improvement of productivity, cycle times, customer service and responsiveness has become ever
more critical. At the same time, business executives are expected to make quick but careful
decisions that will take advantage of emerging opportunities. Therefore, they are beginning to
realize the importance of information technology (IT) and understand its role in changing and
improving the way businesses operate.

Although IT is an important tool in attaining the desired growth and competitiveness of today’s
businesses, it may also constitute a major portion of an organization’s capital investment
(Alshawi et al., 2003; Kumar, 2004; Huang et al., 2006). As reported by Cuneo (2005), average
IT spending among the companies in InformationWeek 500 during 2001-2005 was
approximately US$ 300 million per year. Moreover, IT spending in the US economy has
increased by more than 200 per cent since 1970 (Mistry, 2006). IT investment and its payoffs
have always been important to executives but now there is another issue which is increasingly
concerned under ever-changing business environments. The question is, with a large investment,
how can IT infrastructure be managed to best achieve today’s business goals as well as future
demand? The simple answer is that IT infrastructure must be flexible enough to handle changes.
However, there are two questions that must be answered first: what is ‘‘IT infrastructure
flexibility’’ and what characteristics of IT infrastructure are considered ‘‘flexible’’?

Firstly, IT is constantly evolving and change happens very quickly. Improved IT products and
services are released every day. In most cases, it is difficult for organizations to implement new
IT systems without a large re-investment and without affecting regular business operations.

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Secondly, IT infrastructure is a long-term asset, a long-term shareholder value and it represents
the long-term options of an organization (Weill and Broadbent, 1998). Since IT infrastructure
involves a large investment and affects the entire organization, it is difficult to change in a short
period of time. Therefore, it must be able to support change without having to start from scratch
every time a new development is introduced because that costs too much and takes too long to
implement (Robertson and Sribar, 2002; Schalken et al., 2005). Thirdly, although some research
has been conducted concerning IT infrastructure flexibility, the concept itself is still vaguely
understood and not fully developed.

The use of IT in any organization is to facilitate better work environment and conditions.
Without a solid IT infrastructure, an organization cannot enable its employees to share
information on a large scale. Yet the trap that most organizations fall into is not a lack of IT, but
rather too much focus on IT. A Knowledge Management initiative is not a software application;
having a platform to share information and to communicate is only part of a Knowledge
Management initiative. Following are some Knowledge Management success factors related to
IT.

 Approach – Has to do with the ideas or actions intended to deal with a problem or
situation. The people who are charged with implementing Knowledge Management must
take the time to understand their users' needs. Matching the Knowledge Management
system with the Knowledge Management objectives is essential.

 Content - With a similar focus on users' needs, establishing great content involves having
processes in place to acquire, manage, validate, and deliver relevant information, when
and where it is needed.

 Common platforms - Standard companywide architecture ensures the sustainability and

scalability of Knowledge Management efforts. By understanding the organization's
infrastructure at a high level, the steering committee can guide the Knowledge
Management team in picking the appropriate technology. This is mostly done with IT
people. It is best to have as part of the top Management an IT person with knowledge of
business. This easily comes if the individual comes from an IT background and went
further to study business or management. Sometimes organizations realize that they need

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 a complete overhaul of their IT infrastructure before they can expect their employees to
share knowledge. Many organizations have eliminated or are in the process of phasing
out customized legacy systems and replacing them with market-standard operating
systems. This enables organizations to build on the existing architecture by using off-the-
shelf software that was written to support these platforms, thus avoiding costly
customized packages.

 Simple technology – The effectiveness of GOMS comes with usability of IT systems,

GOMS an acronym for Goals, Operators, Methods, And Selection Rules is a kind of
specialized human information process or model for human computer interaction
observation. GOMS reduces a user's interaction with a computer to its elementary actions
(these actions can be physical, cognitive or perceptual) (Stuart et.al 1983). If it takes
more than three clicks to find knowledge on your system, users will get frustrated. That
also has to be tempered with the amount of information being delivered and the
complexity of information demanded by the user. Another common mistake made in
information delivery is the emphasis on explicit knowledge. Although technology is
primarily used to deliver explicit knowledge, placing too much emphasis on it causes the
user to lose the context in which the information was shared and leads to
misunderstanding on how to interpret the knowledge.

 Adequate training - Knowledge Management is enabled by adequate technology and

people who know how to use it. Best-practice examples reveal that the central
Knowledge Management group should spend most of its time (after deployment)
teaching, guiding, and coaching users how to use the system to interact, communicate,
and share information and knowledge with one another.

 Measurements

Lord Kelvin, way back as 1906 explains measurement to be any process by which a value is
assigned to the level or state of some quality of an object of study. Most people fear
measurement because they see it as synonymous with ROI, and they are not sure how to link
Knowledge Management efforts to ROI (Compton, 1992). Although the ultimate goal of

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measuring the effectiveness of a Knowledge Management initiative is to determine some type of
ROI, there are many intervening variables that also affect the outcomes.

In order for companies to ensure achievement of their goals and objectives, performance
measures are used to evaluate, control and improve production processes. Performance measures
are also used to compare the performance of different organizations, plants, departments, teams
and individuals, and to assess employees. Heim and Compton(1992) quoted the following words
of Lord Kelvin (1824-1907): ”When you can measure what you are speaking about and express
it in numbers, you know something about it … (otherwise) your knowledge is a meager and
unsatisfactory kind; it may be the beginning of knowledge, but you have scarcely in thought
advanced to the stage of science.” In fact, the importance of performance measures was clearly
emphasized by the Foundation of Manufacturing Committee of the National Academy of
Engineering where one of the ten foundations of world-class practices states: “World-class
manufacturers recognize the importance of metrics in helping to define the goals and
performance expectations for the organization. They adopt or develop appropriate metrics to
interpret and describe quantitatively the criteria used to measure the effectiveness of the
manufacturing system and its many interrelated components (Edosomwan, 1990).

Companies will lose market share to overseas competitors who are able to provide higher-quality
products with lower costs and more variety. To regain a competitive edge companies will not
only shift their strategic priorities from low-cost production to quality, flexibility, short lead time
and dependable delivery, but also implemented new technologies and philosophies of production
management (i.e. computer integrated manufacturing (CIM), flexible manufacturing systems
(FMS), just in time (JIT), optimized production technology (OPT) and total quality management
(TQM)). The implementation of these changes revealed that traditional performance measures
have many limitations and the development of new performance measurement systems is
required for success (Ghalayini and Noble, 1996).

Because many variables may affect an outcome, it is important to correlate Knowledge

Management activities with business outcomes, while not claiming a pure cause-and-effect
relationship. Increased sales may be a result not only of the sales representatives having more
information, but also of the market turning, a competitor closing down, or prices dropping 10

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percent. Due to the inability to completely isolate knowledge-sharing results, tracking the
correlations over time is important (Hasanali, 2002).

1.12.2 Business Analysis and Analytics

Analysis as defined by Webster’s dictionary is the separation of a whole into its components
parts”. It is also defined as a process of inspecting, cleaning, transforming, and modeling data
with the goal of highlighting useful information, suggesting conclusions, and supporting decision
making”(Wikipedia [assessed 20th May 2010]). On the other hand, business analysis is defined
as: “The discipline of identifying business needs and determining solutions to business problems.
Solutions often include a systems development component, but may also consist of process
improvement or organizational change or strategic planning and policy development.” These two
definitions may explain why the IT and business views of analysis sometimes differ. IT often
defines data analysis as covering the complete information life cycle from cleaning and
transforming source data making it ready for analysis, to analyzing the transformed data and
creating analytics. Business users, on the other hand, view business analysis as a set of
techniques for defining analyses and creating analytics on the transformed data.

Analytics can also be known as metrics, measurements, and indicators which could also be
defined in different forms. It is Note-worthy that analytics is more often defined as “the science
of analysis” rather than the “results of analytical processing.” Since business intelligence is about
providing business users with intelligence about the business, Business analysis can be said to be
the process of analyzing trusted data with the goal of highlighting useful information, supporting
decision making, suggesting solutions to business problems, and improving business processes
(Hass et. al, 2008).

1.12.3 Data Warehousing

Data warehousing enables each user not only to share a common, widely distributed, diverse
database but also to analytically explore, discover, and better comprehend fundamental trends
and relationships using all of the available data quickly and correctly. The data warehouse, which
is applications transparent, allows users to take full advantage of cheaper storage, faster
computing speeds, heterogeneous interfaces, and ever-burgeoning networks. The data warehouse
architecture consists of a consolidated, consistent relational database and san information

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management system server which is the focal point of all end user queries, as well as, the data
access mechanism for analytical and quantitative studies. Raw data are extracted, scrubbed, and
integrated into the warehouse from a variety of external sources. Metadata, information
concerning data describing the warehouse, are also an integral part of the system. The warehouse
architecture must manage standard information delivery systems and data queries, interfaces with
applications development platforms and executive information systems (EISs), and online
analytical processing (OLAP), in addition to advanced information technology data mining tools.
By employing an interactive prototyping methodology and ensuring both scalability and
flexibility, the data warehouse will continually evolve and grow rapidly from a relatively small
repository of data, information, and knowledge to a very large one (Berson and Smith, 1997).

Different people have different definitions for a data warehouse. The most popular definition
came from Bill Inmon, who provided the following:

A data warehouse is a subject-oriented, integrated, time-variant and non-volatile collection of

data in support of management's decision making process.

Subject-Oriented: A data warehouse can be used to analyze a particular subject area. For
example, "sales" can be a particular subject.

Integrated: A data warehouse integrates data from multiple data sources. For example, source A
and source B may have different ways of identifying a product, but in a data warehouse, there
will be only a single way of identifying a product.

Time-Variant: Historical data is kept in a data warehouse. For example, one can retrieve data
from 3 months, 6 months, 12 months, or even older data from a data warehouse. This contrasts
with a transactions system, where often only the most recent data is kept. For example, a
transaction system may hold the most recent address of a customer, where a data warehouse can
hold all addresses associated with a customer.

Non-volatile: Once data is in the data warehouse, it will not change. So, historical data in a data
warehouse should never be altered.

Data warehousing is a foundational practice that supports enterprise reporting, business

intelligence and decision support. Data warehouses and data marts are created across levels of

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sophistication and different philosophical approaches, but typically involve extracting and
transforming data from operational/transactional databases and loading it to a repository for
shared use and analysis. (1keydata.com [Accessed 21st May 2010]).

Data warehousing is a methodology that combines and coordinates many sets of diversified data
into a unified and consistent body of useful information. In larger organizations, many different
types of users with varied needs must utilize the same massive data warehouse to retrieve those
pieces of information which best suit their unique requirements (Gargano and Raggad ,1999)

1.12.4 Data Mining

Data mining is concerned with discovering new, meaningful information, so that decision makers
can learn as much as they can from their valuable data assets. Using advanced information
technologies, knowledge discovery in databases (KDD) can uncover veins of surprising and
golden insights in a mountain of factual data. Data mining searches for hidden relationships,
patterns, correlations, and interdependencies in large databases that traditional information
gathering methods (e.g. report creation, pie and bar graph generation, user querying, decision
support systems (DSSs), etc.) might overlook. Data mining uses a motley toolkit of novel
algorithmic models that help to automatically solve user defined questions. Each model in this
panoply of powerful tools is intuitive, easy to explain, understandable, and simple to use. These
tools include artificial intelligence methods (e.g. expert systems, fuzzy logic, etc.), decision trees,
rule induction methods, genetic algorithms and genetic programming, neural networks (e.g.
backpropagation, associative memories, etc.), and clustering techniques. Data visualization is
also used as an important ancillary aid in the development, creation, and interpretation of data
driven knowledge discovery (Gargano and Raggad ,1999).

Data mining is a term used to describe a range of activities in the extraction and transformation
of data sets, and presentation of the results in a useful form. It is a form of information retrieval
in which the user seeks a manageable yet pertinent number of returns from search terminology,
though unlike most information retrieval techniques, data mining is focused on data stored in
structured form with fixed format fields of numeric values, character codes, or short strings.
More recently data mining practitioners have commenced trying to extract data from materials as
images, with the objective of turning such data into a structured format. In particular, data
mining is targeted at large legacy databases that often hold huge quantities of data that are never

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utilized (Calvert, 2005). Often, data mining attempts to discover underlying patterns, trends and
relationships in the original data sets. The techniques of data mining can be extended to examine
very large enterprise or scientific databases, whether they are located in a single location or
distributed globally. This is also the case with the World Wide Web, considered in this context as
a massive database (Scarecrow, 2005).

It is also the process of extracting hidden knowledge from large volumes of raw data. It can also
be defined as the process of extracting hidden predictive information from large databases. Data
mining is not an “intelligence” tool or framework. Business intelligence, typically drawn from an
enterprise data warehouse, is used to analyze and uncover information about past performance on
an aggregate level. Data warehousing and business intelligence provide a method for users to
anticipate future trends from analyzing past patterns in organizational data. Data mining is more
intuitive, allowing for increased insight beyond data warehousing. An implementation of data
mining in an organization will serve as a guide to uncovering inherent trends and tendencies in
historical information. It will also allow for statistical predictions, groupings and classifications
of data (Mladenic et. al, 2003).

Most companies collect, refine and deduce massive quantities of data. Data mining techniques
can be implemented rapidly on existing software and hardware platforms to enhance the value of
existing information resources, and can be integrated with new products and systems as they
become part of the system. When implemented on high performance client/server or parallel
processing computers, data mining tools can analyze massive databases to deliver answers to
many different types of predictive questions.

Data mining software allows users to analyze large databases to solve business decision-making
problems. Data mining tools predict future trends and behaviors, allowing businesses to make
proactive, knowledge-driven decisions. Data mining tools can answer business questions that
traditionally were too time-consuming to resolve. Data mining is, in some ways, an extension of
statistics, with a few artificial intelligence and machine learning twists thrown in. Like statistics,
data mining is not a business solution, it is just a technology. (Mladenic et. al, 2003)

Since our objective is to show that the above components are factors that influence Business
Intelligence, it is necessary to relate each of the components to business intelligence as below.

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1.13 Business Intelligence and Knowledge Management
Business Intelligence and Knowledge Management have the same significant objective which is
to focus on improving business performance. Knowledge Management aims at achieving a
higher degree of understanding of an organization’s working environment that can either help
them move forward or keep wallowing in retardation if it is not successfully implemented.
Business Intelligence has almost similar workability, Since it is comprised of customer,
competitor and market intelligence and since the main purpose of implementing Business
Intelligence in an organization is to support strategic-decision making, grow business and
monitor competitors, then we recognize that these are definite similarities with Knowledge
Management. (McCarthy, 2009).Even though Business Intelligence and Knowledge
Management share a common high level objective, there are some fundamental differences.
These differences are to be found in the manner in which they are applied and implemented
towards achieving that goal. The value of Business Intelligence and its product, opportunity
analysis, is found in its usefulness as a decision making tool; the value of Knowledge
Management lies in the ability of the organization to identify, capture and reuse knowledge and
in particular best practices in such a manner that it saves the organization time, effort and
resources -translated and measured in cost (Cody et al., 2002).

Marco (2002) contends that a ‘‘true’’ enterprise-wide Knowledge Management solution cannot
exist without a BI-based meta data repository. In fact, a metadata repository is the backbone of a
Knowledge Management solution. That is, the BI meta data repository implements a technical
solution that gathers, retains, analyses, and disseminates corporate ‘‘knowledge’’ to generate a
competitive advantage in the market. This intellectual capital (data, information and knowledge)
is both technical and business-related. Marco says that most magazines that discuss Knowledge
Management fail to mention a meta data repository. He believes this ‘‘glaring oversight’’ exists
because most Knowledge Management professionals focus on a limited portion of the
Knowledge Management equation. However, implementers, he asserts, realize that a meta data
repository is the technical solution for Knowledge Management.

Cook and Cook (2000) note that many people forget that the concepts of KM and BI are both
rooted in pre-software business management theories and practices. They claim that technology
has served to cloud the definitions. Defining the role of technology in KM and BI – rather than

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defining technology as KM and BI – is seen by Cook and Cook as a way to clarify their
distinction.

1.14 Business Intelligence and Business Analysis and Analytics(couldn’t find

materials)
A business intelligence environment helps organizations and business users move from manual
to automated business analysis. Important results from business analysis include historical,
current and predictive metrics, and indicators of business performance. These results are often
called analytics. (Hass et. al, 2008)

1.15 Business Intelligence and Data Warehouse

One vehicle to deliver business intelligence is data warehousing. In other words, data
warehousing is a subcomponent of and a vehicle for delivering business intelligence. Since
Business intelligence refers to the use of existing data/information/knowledge within an
enterprise and refers to systems and technologies that provide the business with the means for
decision-makers to extract personalized meaningful information about their business and
industry, not typically available from internal systems alone. This includes advanced decision
support tools and back-room systems and databases to support those tools. The data warehouse is
that back-room database. Combine that with the support tools required to build and maintain the
data warehouse, such as data cleansing and extract, transform and load tools and you have what
many call data warehousing. Data warehousing and business intelligence provide a method for
users to anticipate future trends from analyzing past patterns in organizational data

We can think of the data warehouse as the back office and business intelligence as the entire
business including the back office. The business needs the back office on which to function, but
the back office without a business to support, makes no sense (Tannenbaum, 2001).

1.16 Business Intelligence and Data Mining(same with this)

Data mining allows users to sift through the enormous amount of information available in data
warehouses; it is from this sifting process that business intelligence gems may be found. Data
mining systems can discover various types of knowledge including but not limited to association
rules, characteristic rules, classification rules, clustering evolution, and deviation analysis. The

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knowledge may be classified into general knowledge, primitive-level knowledge, and multiple
level knowledge.

1.17 Business Intelligence Outcomes

Before the critical evaluation of the success factors of business intelligence, we already know
what output we are testing these factors on. These are the benefits the organization will acquire
by the success of these above factors which is Business Performance. Here performance could be
positive or negative. A better insight into Business Performance is given below.

1.17.1 Business Performance

Business Performance is the ability of an organization to achieve the maximum level of
profitability possible given the human, financial, capital, and other resources it possesses.
(Luftig, 1998)

1.17.2 Performance Measurement

The selection of performance measures that reflect the true situation of businesses with some
degree of certainty and reliability is indeed a crucial process (Murphy, Trailer, and Hill, 1996).
The lack of universally accepted standard business performance measures left the door open to
business organizations to decide and choose its own performance measure that might not truly
reflect its performance. Such performance measures include but not limited to: market share,
sales volume, company reputation, return-on-investment (ROI), profitability, and established
corporate identity. These could be seen as Tangible and Intangible. In all cases, regardless of
what measure should be used, this thesis will be using multiple business performance indicators
to test out the variables as above (Corchran and Wood, 1984; Hall, 1982; and Ibrahim and Rue,
1998).The diverse range of measures that can be adopted to define success can lead to a false
judgment on the actual performance.

For example, a business with declining profits or market share could be seen as failing when in
fact its owners/managers are satisfied with the overall business performance. Turnover growth is
an objective measure that is relatively easy to get due to data availability and common use and is
also a good indicator of firm size and a proxy for overall business growth. In this respect,
Barkham (1996) concluded that an analysis of a company’s growth should, at least in part, be
based on changes in turnover. Business success can be defined in many different ways. A study

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by Beaver and Jenning (1995) stated that the most commonly adopted definition of success is
financial growth with adequate profits. The study concluded that being able to define success,
whether generally or specifically, is not the same as explaining success. Other definitions of
success are equally applicable. For example, some entrepreneurs regard success as the job
satisfaction they derive from achieving desired goals. However, financial growth due to
increasing profits has been widely (Murphy, Trailer, and Hill, 1996).

1.18 Research Framework

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Research Methodology
Introduction

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This chapter aims to provide a synopsis of the methodological approaches, strategy and research
design for the successful implementation of Business Intelligence. In its exploration of the
critical success factors, this thesis shall investigate how the impact of the factors that affect
Business Intelligence leads to an improved Business Performance. Lastly, following the analysis
of primary data collected through a set of web survey administered online with CIO’s and top
managers, the thesis shall critique on the outcome of the survey.

In order to plan and carry out research, it is necessary to know what we mean by research-in
general, as well as in the specialized fields of language teaching and language acquisition. The
word research is derived from the French word recherché. Its literal meaning being:

The systematic process of collecting and analyzing information (data) in order to discover of new
knowledge or expand and verify of the existing one (e.g. theory - law) (Al-Mishri, 2005).

Research is an organized and systematic way of finding answers to questions

Systematic because there is a definite set of procedures and steps required to be followed. There
are certain things in the research process which are always done in order to get the most accurate
results.

Organized in the sense that there is a structure or method for undertaking a research. It is a
planned procedure, not a spontaneous one. It is focused and limited to a specific scope.

Finding Answers is the ultimate goal of all research. Whether it is the answer to a hypothesis or
even a simple question, research is successful when answers can be deduced. Sometimes the
answer is no, but it is still an answer.

Questions are central to research. If there is no question, then there is no answer and then
anything inferred is of no use. Research is focused on relevant, useful, and important questions.
Without a question, research has no focus, drive, or purpose (Al-Mishri, 2005).

Research involves finding something new. ‘New’ may simply mean ‘new to everyone’, or it may
simply mean ‘new to the researcher’. The first of these meanings, ‘new to everyone’, is usually
known as primary research. The second, ‘new to researcher but not to everyone’, is usually
known as secondary research. So, for example, if you check the timetable to find out the time of

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the last train home at the subway on a Sunday evening, that’s secondary research. If you count
the number of types of bird at your bird table on Sunday morning, that’s a modest piece of
primary research. They’re different things, and they both have their uses. Secondary research is
also very important when you’re doing the preparatory work before some primary research, since
it vastly reduces the risk that the researcher will simply reinvent the wheel through not knowing
what has been done before.

Again, the importance of the secondary research is pretty specific to the one doing the
preparatory work, and the secondary research doesn’t take on wider importance until the primary
research is realized. Although secondary research is very useful for numerous purposes, it
doesn’t usually lead to breakthroughs in human knowledge (for instance, discovering the cause
of diabetes, or finding a better way of teaching people with dyslexia). So, although secondary
research is useful, it’s usually primary research that answers the important questions, the ones
that other people also want answered. Breakthroughs usually come through primary research,
which is why primary research is so highly valued in academia and in fields tackling big
unsolved problems. (Rugg and Petre, 2007)

1.19 STYLES OF RESEARCH

Muhammad (2006) stated out that there are basically three styles of research as below;

 Applied Research
 Pure/Basic Research
 Business Research

1.19.1 Applied Research

Most research driven or technological organizations engages in applied research. Applied
research can be defined as any fact gathering project that is conducted with the aim of acquiring
and applying knowledge that will address a specific problem or meet a specific need within the
scope of the entity. Any organization can benefit from engaging in applied research. (Tatum,
2010)

Applied research is designed to solve practical problems of the modern world, rather than to
acquire knowledge for knowledge's sake. One might say that the goal of the applied scientist is to
improve the human condition.

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For example, applied researchers may investigate ways to:

 improve agricultural crop production

 treat or cure a specific disease
 improve the energy efficiency of homes, offices, or modes of transportation
(Smoot, 2007).

1.19.2 Basic Research

Basic research also known as fundamental or pure research is driven by a researcher’s curiosity
or interest in a research context. The main ideology is to expand man's knowledge, not to create
or invent anything new. There is no obvious commercial value to the discoveries that result from
basic research (Muhammad, 2006).

For example, basic science investigations probe for answers to questions such as:

 How did the universe begin?

 What are protons, neutrons, and electrons composed of?
 How do slime molds reproduce?
 What is the specific genetic code of the fruit fly?
Most scientists believe that a basic, fundamental understanding of all branches of science is
needed in order for progress to take place. In other words, basic research lays down the
foundation for the applied science that follows. If basic work is done first, then applied spin-offs
often eventually result from this research. Smoot (2007) says, "People cannot foresee the future
well enough to predict what's going to develop from basic research. If we only did applied
research, we would still be making better spears."

1.19.3 Business Research

In a general viewpoint, business research has to do with any type of researching done when a
business is about to be started or when there is need for it while running any kind of business. As
a general notion, starting any type of business requires research into the target customer,
competition, industry and market to create a business plan. Conducting business market research
in existing businesses is helpful in keeping in touch with consumer demand. Small business
research begins with researching an idea and a name and continues with research based on

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customer demand and other businesses offering similar products or services. All business
research is done to learn information that could make the company more successful and become
more competitive (Cyprus, 2010).

The two main types of business research conducted are business market research and advertising
research, other than that, researching is done to provide information for investors. Business
people aren't likely to invest in a company or organization without adequate research and
statistics to show them that their investment is likely to pay off. Large or small business research
can also help a company analyze its strengths and weaknesses by learning what customers are
looking for in terms of products or services the business is offering. Then a company can use the
business research information to adjust itself to better serve customers, gain over the competition
and have a better chance of staying in business (Cyprus, 2010).

For the sake of this research project, I will be conducting a Basic research based on its definition
because I am trying to “expand man's knowledge” (Muhammad, 2006).

1.20 Types of Research Studies

Research studies also known as Research design can be classified into four major groups. These
include observational research, correlation research, true experiments, and quasi-experiments.

(Woolf, 2010).Each of these will be discussed further below;

1.20.1 Observational research

A lot of studies could be defined or tagged as observational research. They include but not
limited to case studies, ethnographic studies, ethological studies, just to mention a few. The
major viewpoint or characteristic of each of these types of studies is that processes are being
observed and recorded. Often times, the studies are qualitative in nature. For example, a
psychological case study of how employees work under pressure would entail extensive notes
based on observations of and interviews with the workers. A detailed report with analysis would
be written and reported constituting the study of this individual case. These studies may also be
qualitative in nature or include qualitative components in the research. For example, an
ethological study of primate behavior in the wild may include measures of behavior durations ie.

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the amount of time an animal engaged in a specified behavior. This measure of time would be
qualitative. Surveys are often classified as a type of observational research.

1.20.2 Correlation research

In general, a correlation research is conducted to examine the covariation of two or more
variables. A candid example will be, the early research on cigarette smoking examines the
covariation of cigarette smoking and a variety of lung diseases. These two variables, smoking
and lung disease were found to covary together. Correlational research can be accomplished by a
variety of techniques which include the collection of empirical data. Often times, correlational
research is considered type of observational research as nothing is manipulated by the
experimenter or individual conducting the research. For example, the early studies on cigarette
smoking did not manipulate how many cigarettes were smoked. The researcher only collected
the data on the two variables. Nothing was controlled by the researchers. It is important to note
that correlational research is not causal research. In other words, we cannot make statements
concerning cause and effect on the basis of this type of research. There are two major reasons
why we cannot make cause and effect statements. First, we dont know the direction of the cause.
Second, a third variable may be involved of which we are not aware. To reiterate, it is
inappropriate in correlationional research to make statements concerning cause and effect.
Correlation research is often conducted as exploratory or beginning research. Once variables
have been identified and defined, experiments are conductible.

1.20.3 True Experiments

Before now, true experiments have been mistaken for only laboratory studies. However, this is
not always the case. A true experiment is defined as an experiment conducted where an effort is
made to impose control over all other variables except the one under study. It is often easier to
impose this sort of control in a laboratory setting. Thus, true experiments have often been
erroneously identified as laboratory studies. To understand the nature of the experiment, a few
terms need to be defined as below:

Experimental or treatment group - this is the group that receives the experimental treatment,
manipulation, or is different from the control group on the variable under study.

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1. Control group - this group is used to produce comparisons. The treatment of interest is
deliberately withheld or manipulated to provide a baseline performance with which to compare
the experimental or treatment group's performance.

2. Independent variable - this is the variable that the experimenter manipulates in a study. It can
be any aspect of the environment that is empirically investigated for the purpose of examining its
influence on the dependent variable.

3. Dependent variable - the variable that is measured in a study. The experimenter does not
control this variable.

4. Random assignment - in a study, each subject has an equal probability of being elected for
either the treatment or control group.

5. Double blind - neither the subject nor the experimenter knows whether the subject is in the
treatment of the control condition.

6. Now that we have these terms defined, we can examine further the structure of the true
experiment.

First, every experiment must have at least two groups: an experimental and a control group. Each
group will receive a level of the independent variable. The dependent variable will be measured
to determine if the independent variable has an effect. As stated previously, the control group
will provide us with a baseline for comparison. All subjects should be randomly assigned to
groups, be tested as simultaneously as possible, and the experiment should be conducted double
blind. Perhaps an example will help clarify these points.

1.20.4 Quasi-Experiments
Quasi-experiments are very similar to true experiments but use naturally formed or pre-existing
groups. For example, if we wanted to compare young and old subjects on lung capacity, it is
impossible to randomly assign subjects to either the young or old group (naturally formed
groups). Therefore, this can not be a true experiment. When one has naturally formed groups, the
variable under study is a subject variable (in this case - age) as opposed to an independent
variable. As such, it also limits the conclusions we can draw from such a research study. If we
were to conduct the quasi-experiment, we would find that the older group had less lung capacity

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as compared to the younger group. We might conclude that old age thus results in less lung
capacity. But other variables might also account for this result. It might be that repeated exposure
to pollutants as opposed to age has caused the difference in lung capacity. It could also be a
generational factor. Perhaps more of the older group smoked in their early years as compared to
the younger group due to increased awareness of the hazards of cigarettes. The point is that there
are many differences between the groups that we can not control that could account for
differences in our dependent measures. Thus, we must be careful concerning making statement
of causality with quasi-experimental designs. Quasi-experiments may result from studying the
differences between naturally formed groups (ie. young & old; men & women).

However, there are also instances when a researcher designs a study as a traditional experiment
only to discover that random assignment to groups is restricted by outside factors. The researcher
is forced to divide groups according to some pre-existing criteria. For example, if a corporation
wanted to test the effectiveness of a new wellness program, they might decide to implement their
program at one site and use a comparable site (no wellness program) as a control. As the
employees are not shuffled and randomly assigned to work at each site, the study has pre-
existing groups. After a few months of study, the researchers could then see if the wellness site
had less absenteeism and lower health costs than the non-wellness site. The results are again
restricted due to the quasi-correlational nature of the study. As the study has pre-existing groups,
there may be other differences between those groups than just the presence or absence of a
wellness program. For example, the wellness program may be in a significantly newer, more
attractive building, or the manager from hell may work at the non-wellness program site. Either
way, it a difference is found between the two sites it may or may not be due to the
presence/absence of the wellness program.

To summarize, quasi-experiments may result from either studying naturally formed groups or
use of pre-existing groups. When the study includes naturally formed groups, the variable under
study is a subject variable. When a study uses pre-existing groups that are not naturally formed,
the variable that is manipulated between the two groups is an independent variable (With the
exception of no random assignment, the study looks similar in form to a true experiment). As no
random assignment exists in a quasi-experiment, no causal statements can be made based on the
results of the study.

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1.21 RESEARCH BACKGROUND
1.21.1 Research Question
To what extent will the implementation of BI impact the success of an organization.

1.21.2 Research Objectives

The main objective of this research is to analyze the factors that help in making Business
Intelligence Successful in an organization. The following objectives ad below is stated.

 To identify the Critical Success Factors for implementation of Business Intelligence.

 To evaluate the benefit and impact of BI on organizations.
 To develop a theoretical framework to test the underlying factors.
 To empirically test and validate the framework created.
 To propose recommendation.

1.21.3 Research Design and Methodology

To understand the use of statistics, one needs to know a little bit about experimental design or
how a researcher conducts investigations. A little knowledge about methodology will provide us
with a place to hang our statistics. In other words, statistics are not numbers that just appear out
of nowhere. Rather, the numbers (data) are generated out of research. Statistics are merely a tool
to help us answer research questions. As such, an understanding of methodology will facilitate
our understanding of basic statistics (Aicha 2007).Design is needed to because it facilitates
smoothing moving of research therefore making research more efficient yielding maximum
information with minimum money and time. (Kothari 2004)

Memo (2006) describes Research methodology as the analysis of principles of methods, rules
and techniques which involves the systematic study of methods which are applied to analyze a
specific project or study. He further explains that, In order to make research organized and to
increase its reliability, different methodologies are adopted.

It can also be said to be the system of collecting data for research projects. The data may be
collected for either theoretical or practical research for example management research may be
strategically conceptualized along with operational planning methods and change management.
Some important factors in research methodology include validity of research data, Ethics and the

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reliability of measures most of the work is finished by the time the final data is
analyzed(Aicha,2007).

1.22 Research Purpose

Saunders et al (2003), Patton (1990) identifies four main rationales behind research studies or
activities. These are the exploratory, the descriptive, explanatory and prescriptive purposes. It is
necessary to identify the purpose of a research study by correlating the research questions to the
research objectives. They are all outlined below.

1.22.1 Exploratory
Robson (2002) explains, exploratory research investigates a specified problem/phenomenon for
the purpose of shedding new light upon it and, consequently, uncovering new knowledge. The
research objectives directly tie in with, and complement one another. They additionally correlate
to research objectives 1-4 and are fundamentally explorative in nature.

1.22.2 Explanatory
This is the amplification of relationship between variables and the componential elements of the
research problem. Explanatory research, in other words, functions to highlight the complex
interrelationships existent within, and around, a particular phenomenon and contained within the
research problem (Miles and Huberman, 1994).

1.22.3 Prescriptive
is not a very familiar word to many people because prescription researches are not so common
among academic assessments. For this type of research, the researcher gives a suggestion for the
improvement or correction of a given topic. Since the research paper of this nature is based on
logical or creative thinking and circumstantial evidence, it is not easy to handle such an
assignment successfully (Patton, 1990)

1.22.4 Descriptive
Descriptive research entails the thorough examination of the research problem, for the specified
purpose of describing the phenomenon, as in defining, measuring and clarifying it (Dane, 1990).
Jackson (1994) contends that all research is partly descriptive in nature. The descriptive aspect of
a research is, simply stated based on the ‘who’, ‘what’, ‘when’, ‘where’, ‘why’, and ‘how’ of the
study.

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The proposed research is descriptive in nature rather than experimental. Descriptive research,
according to Best (1981), can be distinguished from other forms of research on the basis of the
following characteristics:

 Descriptive research is non-experimental in that it deals with relationships between non-

manipulated variables in a natural rather than artificial setting. Since the events or
conditions have already occurred or exist, relevant variables are merely selected for an
analysis of their relationships.
 Descriptive research involves hypothesis formulation and testing.
 Descriptive research uses logical methods of inductive and deductive reasoning in order
to arrive at generalizations.
 All of the variables and procedures used in descriptive studies are described as
completely and accurately as possible so as to permit future replication.
 Descriptive research often employs methods of randomization so that error can be
estimated when inferring population characteristics from observations of samples.
Because the study is not experimental, it is technically inappropriate to refer to the variables of
interest as dependent or independent factors (Kiess and Bloomquist, 1985).

1.23 Research Approach

Research Approach refers to the approach or the methodology that has been adopted to conduct a
particular research work. It basically involves the selection of research questions, the conceptual
framework that has to be adopted, the selection of appropriate research method such as primary
research, secondary research etc (Aicha, 2007).

Selection of a suitable research approach is a critically important decision. It gives the researcher
the opportunity to critically consider how each of the various approaches may contribute to, or
limit, his study, allow him/her to satisfy the articulated objectives and design an approach which
best satisfies the research’s requirements (Creswell, 2003). According to Hair et al. (2003),
research approach has its ideology around the quantitative comparison to the qualitative and the
deductive comparison to the inductive. Each set of approaches is commonly perceived of as
referring to polar opposites (Hair et al., 2003). Jackson (1994) takes issue with this perception
and contends that a researcher should not limit himself to a particular approach but, instead

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should use a variety of approaches, if and when required by his study. When one starts to think
about research methodology, it is needed to think about the differences between qualitative and
quantitative research.

1.23.1 Qualitative research

It explores attitudes, behavior and experiences through such methods as interviews or focus
groups. It attempts to get an in-depth opinion from participants. As it is attitudes, behavior and
experiences which are important, fewer people take part in the research, but the contact with
these people tends to last a lot longer. Under the umbrella of qualitative research there are many
different methodologies (Denzin and Lincoln, 1994).

1.23.2 Quantitative research

It generates statistics through the use of large-scale survey research, using methods such as
questionnaires or structured interviews. If a market researcher has stopped you on the streets, or
you have filled in a questionnaire which has arrived through the post, this falls under the
umbrella of quantitative research. This type of research reaches many more people, but the
contact with those people is much quicker than it is in qualitative research (Creswell, 2003).

1.23.3 Qualitative versus quantitative inquiry

Over the years there has been a large amount of complex discussion and argument surrounding
the topic of research methodology and the theory of how inquiry should proceed. Much of this
debate has centred on the issue of qualitative versus quantitative inquiry – which might be the
best and which is more ‘scientific’. Different methodologies become popular at different social,
political, historical and cultural times in our development, and as it generally is, all
methodologies have their specific strengths and weaknesses. These should be acknowledged and
addressed by the researcher. Certainly, this helps the researcher think about his or her research
methodology in considerable depth.

. Table 3 Differences between Qualitative and Quantitative Research Methods cdcynergy

(2008)

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 Qualitative Methods Quantitative Methods

Methods include focus groups, in-depth Surveys

interviews, and reviews

Primarily inductive process used to Primarily deductive process used to test pre-
formulate theory specified concepts, constructs, and hypotheses
that make up a theory

More subjective: describes a problem or More objective: provides observed effects

condition from the point of view of those (interpreted by researchers) of a program on a
experiencing it problem or condition

Text-based Number-based

More in-depth information on a few cases Less in-depth but more breadth of information
across a large number of cases

Unstructured or semi-structured response Fixed response options

options

No statistical tests Statistical tests are used for analysis

Can be valid and reliable: largely depends Can be valid and reliable: largely depends on
on skill and rigor of the researcher the measurement device or instrument used

Time expenditure lighter on the planning Time expenditure heavier on the planning phase
end and heavier during the analysis phase and lighter on the analysis phase

Less generalizable More generalizable

1.24 Deciding which methodology is right

One major mistake many researchers do is thinking that quantitative research is ‘better’ than
qualitative research. Neither is one better than the other – they are just different and both have
their strengths and weaknesses. What matters most is justifying a chosen methodology (sanchez,
2006). From the differences between the two approaches above, it can be justified that

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quantitative method is the right method for this thesis. Based on what Quantitative method is
defined as above (Creswell, 2003).

1.24.1 Deductive and Inductive

Alternatively, there are two types of reasoning or approaches a researcher can take while doing a
research, they are Inductive and Deductive approaches (Burney, 2008)

(By author)

 Deductive Research Approach: This type of reasoning works from the more general to
more specific instances of research. Sometimes it is informally called the “Top-Down
Approach”. The conclusion of a deductive research approach follows logically from
premises which are available facts.

 Inductive Research Approach: The Inductive reasoning is the inverse or directly

opposite of deductive reasoning. It works the other way,, moving from specific

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 observations to broader generalizations and theories. Informally, it is sometimes called
the “Bottom-up approach”. In contrast to deductive approach; its conclusion is likely
based on premise and involves a higher degree of uncertainty.

 Deductive Vs Inductive

 Induction is usually described as moving from the specific to the general,, while
deduction begins with the general and ends with the specific.
 Arguments based on laws,, rules and accepted principles are generally used for Deductive
reasoning. Observations tend to be used for Inductive Arguments.
In this research author will use both approaches. The reason being that some theories will be
tested (deduction) and there are new factors (induction) which will be analyzed to discover
relation on variables.

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1.24.2 Justification of Methods
The method that was chosen was based on the research objectives specified at the start of the
research process. Quantitative method and mixed method (deductive and inductive) were chosen
to meet following objective:

 To identify the Critical Success Factors for implementation of BI

 To evaluate the benefit and impact of BI on organizations
 To develop a theoretical framework to test the underlying factors
 To empirically test and validate the framework created
 To propose recommendation
The researcher has chosen these methods to answer research question and to meet research
objectives. Based on secondary data there are several theories concerning research question, for
testing theory, researchers usually use deductive method and quantitative data. However the
researcher will propose new independent variables which can impact on dependent variables.

1.25 Instrumentation
This section has to do with the way data is collected. When describing instruments to be used,
some issues such as the number of questions, length of administration, readability and scoring
need to be reviewed. After describing the instrument, then there is the need to review the
reliability (e.g. alpha coefficients, inter-rater reliability, test retest reliability, split half reliability)
and validity of the instrument (content validity, external validity and discriminant validity).

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The theoretical constructs that the survey is attempting to measure is the viability of business
intelligence.

1.25.1 Quantitative Sample

The questionnaire for this survey is designed to determine the viability and usability of Business
Intelligence and its impact on organizations. It is majorly design to do quantitative survey of both
sample size of Nigeria and Malaysia managers.

 Part 1: Demographic Data of Organization

 Part 2: measure the respondent’s view on various variables/factors considered for successful
implementation of Business Intelligence. The ‘Likert Scale’ will be used throughout the
questionnaire. The 'Likert scale' is a common interval-based multiple-choice style of question
used in questionnaires.The ‘Likert’ scale measurement of 1 to 5, with 1 as strongly disagree,
disagree, neutral, agree and 5 as strongly agree will be used.
 Part 3: This will finalize the questionnaire by allowing the respondents suggestionsin order to
get their own viewpoint of the subject matter which was not covered within the questionnaire.

1.26 POPULATION AND SAMPLING

The basic research paradigm is to:

 Define the population

 Draw a representative sample from the population
 Do the research on the sample
 Infer your results from the sample back to the population
When conducting a research, the researcher must often use a sample of the population as
opposed to using the entire population. Before we go further into the reasons why, let us first
discuss what differentiates between a population and a sample. A population can be defined as
any set of persons/subjects having a common observable characteristic. For example, all
individuals who reside in the United States make up a population. Also, all pregnant women
make up a population. The characteristics of a population are called a parameter. A statistic can
be defined as any subset of the population. The characteristics of a sample are called a statistic.

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As it can be seen from above, it all begins with a precise definition of the population. The whole
idea of inferential research (using a sample to represent the entire population) depends upon an
accurate description of the population. After completion of the research, statements are made
based on the results (Walonick, 2005).

The population for this study is based on companies in Malaysia and Nigeria who use business
intelligence in one way or the other or potential business intelligence users. There are numerous
sampling methods from which to choose. There are several ways to get the population sample
and a few methods are outlined below.

1.26.1 Why Sample?

This brings us to the question of why sample. Why should we not use the population as the focus
of study? There are at least four major reasons to sample. First, it is usually too costly to test the
entire population. The United States government spends millions of dollars to conduct the U.S.
Census every ten years. While the U.S. government may have that kind of money, most
researchers do not. The second reason to sample is that it may be impossible to test the entire
population. For example, let us say that we wanted to test the 5-HIAA (a serotonergic
metabolite) levels in the cerebrospinal fluid (CSF) of depressed individuals. There are far too
many individuals who do not make it into the mental health system to even be identified as
depressed, let alone to test their CSF. The third reason to sample is that testing the entire
population often produces error. Thus, sampling may be more accurate. Perhaps an example will
help clarify this point. Say researchers wanted to examine the effectiveness of a new drug on
cancer. One dependent variable that could be used is an Activities of Daily Living Checklist. In
other words, it is a measure of functioning o a day to day basis. In this experiment, it would
make sense to have as few of people rating the patients as possible.

If one individual rates the entire sample, there will be some measure of consistency from one
patient to the next. If many raters are used, this introduces a source of error. These raters may all
use slightly different criteria for judging Activities of Daily Living. Thus, as in this example, it
would be problematic to study an entire population. The final reason to sample is that testing
may be destructive. It makes no sense to lesion the lateral hypothalamus of all rats to determine
if it has an effect on food intake. We can get that information from operating on a small sample
of rats. Also, you probably would not want to buy a car that had the door slammed five hundred

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thousand time or had been crash tested. Rather, you probably would want to purchase the car that
did not make it into either of those samples.

1.26.2 Sampling Methods

As stated above, a sample consists of a subset of the population. Any member of the defined
population can be included in a sample. A theoretical list (an actual list may not exist) of
individuals or elements who make up a population is called a sampling frame. There are five
major sampling procedures. There are two main ways sampling can be represented. They are
non-probability sampling and probability sampling. Probability sampling involves setting up
processes that ensure that every unit in the population has an equal probability of being chosen.
This involves some random sampling. The major difference between probability sampling and
non probability sampling is that non probability does not use random sampling. Although most
researchers prefer probabilistic sampling, non probability sampling is of use when the
circumstances are not practical or theoretically enough to use random sampling. Non
probabilistic sampling can be divided into two: accidental and purposive sampling. Purposive
sampling is the most commonly used type of non probability sampling. It is sampling with a
purpose in mind.

It is based on the researcher’s discretion to clearly define the target population. There are no
strict rules to follow; all that is needed is for the researcher to rely on logic and judgment. The
population is defined in keeping with the objectives of the study. Sometimes, the entire
population will be sufficiently small, and the researcher can include the entire population in the
study. This type of research is called a census study because data is gathered on every member of
the population. Usually, the population is too large for the researcher to attempt to survey all of
its members. A small, but carefully chosen sample can be used to represent the population. The
sample reflects the characteristics of the population from which it is drawn (Westfall, 2008).

1.26.3 Justification of sampling method chosen

A purposive, non-probabilistic method is chosen to select respondents from Malaysia and

Nigeria. This is because the researcher is not sure of the population and will only draw from
samples chosen. This then moves us to the type of non probabilistic method chosen again. The

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researcher will be using a combination of expert and quota sampling. There are two forms of
quota sampling as below;

 Quota Sampling

With proportional quota sampling the aim is trying to get a sample that represents each of two or
more subgroups in the same proportions that they are represented in the population, but the
researcher doesn’t need to be bothered with stratified random sampling. Suppose your
population is undergraduate students at UCSI University. We assume that 40% are new intakes
while 60% are returning students. So if a researcher wants 50, so he or she needs need 20 new
intakes and 30 returning students. Once the researcher has the predetermined number of subjects
in any category, he or she no longer accept participation by any additional persons in that
category. With non-proportional quota sampling, the researcher specifies the minimum number
of subjects he or she wants in each subgroup and then just keep gathering data until he or she
has at least that many in each subgroup(Wuensch, 2003).

Expert sampling is further explained below

 Expert Sampling

Here the researcher gathers a group of persons known to be expert with respect to the
information being sought after. For example, suppose a researcher is constructing a
questionnaire that is designed to measure how social networking affects productivity. The
researcher writes a large number of potential items and now he or she wants some help in
determining which items would be most appropriate to include on such a questionnaire. The
researcher then gathers a group of psychologists with expertise in constructing questionnaires
like this and asks their opinions about the items (Wuensch, 2003).

Both methods employed are a little less restrictive compared to other non probability techniques.
In both methods, the primary concern is to obtain a sufficient target sample size in the population
and not concerned with having numbers that match the whole population. It typically ensures
that smaller groups are adequately represented in the sample (Hair et al., 2003).

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1.27 Target Sample
The target sample will include small, medium and large business corporations in Malaysia and
Nigeria. The research will focus on managers, CEO’s and decision makers. The purpose of
having this focus is that since some of the success factors are IT terms and just these people
might have the understanding on this and since they know how Business Intelligence is
implemented in their organizations. The sample size will be about 450 respondents with 200 of
these in Nigeria and the remainder 250 in Malaysia. This size will not be biased and will include
both male and female decision makers.

The sample size will be calculated with sample size formula as below to get the appropriate
number of questionnaires to be distributed. The determination of sample size is a common task
for many organizational researchers. The accuracy of research is influenced by the
appropriateness, adequateness, and inexcessive sample size (Cochran, 1977). The formula used
to determine the number of respondents is describe below.

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1.28 Questionnaire distribution
The questionnaires will be distributed and administered mainly online. This is because of the
nature of the jobs of the target sample. So a web link will be emailed to the respondents in both
in Nigeria and Malaysia. The paper questionnaires will be collected within four days of
distribution while those on the internet will be collected within a week and a half of distribution.
The web based questionnaires are used because the respondents cannot be approached in person
by the researcher.

 Part 1: Demographic Data of Organization

 Part 2: measure the respondent’s view on various variables/factors considered for successful
implementation of Business Intelligence. The ‘Likert Scale’ will be used throughout the
questionnaire. The 'Likert scale' is a common interval-based multiple-choice style of question
used in questionnaires.The Likert scale measurement of 1 to 5, with 1 as strongly disagree,
disagree, neutral, agree and 5 as strongly agree will be used.
 Part 3: This will finalize the questionnaire by allowing the respondents suggestions in order to
get their own viewpoint of the subject matter which was not covered within the questionnaire.

1.29 Limitations of the questionnaire

Like any form and part of research, questionnaires also has some limitation due to the fact that
most of the web-survey, I will be using might not truly reflect the right opinion of the respondent
given the fact that the respondent might not understand some of the questions and I am not there
to guide them. And finally, the questionnaire only gives small sample size of the target
population and might not truly reflect the actual opinion of entire population.

1.30 Administering the questionnaire

1.30.1 Web based survey
This survey will be administered through a website that host questionnaires and a link will be
sent out to the respondents through email especially to all respondents.

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1.30.2 Data Coding
Coding in computer terms may refer to the particular language software understands or can relate
to (Fischer, 2003). Here in research, it is the development of a language that will be used to
transfer data from the research instrument into the computer. In other words, it is representing
the data collected from the questionnaire in a way that the SPSS software can easily understand,
manipulate and output results successfully. Since computers only understand ones and zeros(1,0)
or bits, it is best to represent the responses received from the administered questionnaires in
numbers and the best way to do this is to create a codebook, otherwise known as a data
descriptor which shows how each question is represented. Below is a table showing the various
variables and how they will be coded in SPSS.

Table for Coding of Data in SPSS

Section1: Company Demographics

What is the name of your organization?

Which of the following best describes your organization's industry or function?

How long has your company existed?

How many people are employed in your entire organization including all branches, divisions, and
subsidiaries?

What is your primary job function within your organization?

What is your primary job title? (SENIOR IT MANAGEMENT: CORPORATE

MANAGEMENT:

Are you involved in setting the direction for your Company's IT Budget or Strategy?

Which technologies are currently implemented in your organization?

a) Internet [ ] b) Data warehousing [ ]

c) Intranet [ ] d) Knowledge Management software [ ]

e) Extranet [ ] f) Decision support system [ ]

g) Groupware [ ] h) Data management system [ ]

i) E Commerce [ ] j) Automated Manufacturing

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Section 2: Measurement of CSF of BI

Knowledge Management Q1: My organization has a well written

Knowledge Management policy or
strategy.

Q2: My organization has a values

system or culture intended to promote
knowledge sharing.

Q3: My organization captures and uses

knowledge obtained from public
research institutions including
universities and government laboratories
and other industry sources such as
industrial associations, competitors,
clients and suppliers.

Q4: My organization provides formal

and informal training related to
Knowledge Management and uses
formal mentoring practices, including
apprenticeships and internships.

Q5: My organization encourages

experienced workers to transfer their
knowledge to new or less experienced
workers.

Q6: encourages workers to continue

their education by reimbursing tuition
fees for successfully completed work-
related courses and offers off-site
training to workers in order to keep
skills current.

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Business Analysis and Analytics Q1: Business goals are clearly
communicated and understood, and we
know how success is measured.

Q2: My organization is doing very good

now as compared with last year and three
years ago

Q3: My organization is moving in with

current business trends and developments

Q4: My organization utilizes cost-saving

measures effectively without
compromising the quality of its products
or services.

Q5: My organization selects technology

to help the business achieve its mission
and goals.

Q6: My organization has established

realistic business goals

Data Warehousing Q1: We have a formal data warehouse

development methodology.

Q2: the business role of the data

warehouse is understood

Q3: We understand the role of the data

warehouse in changing business
processes.

Q4: Data is integrated throughout the

organization

Q5: Our organization can ensure the

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 quality of data warehouse deliverables.

Data Mining Q1: there is a well written Policy for

data retrieval organization-wide
Data Mining is the process of
finding new and potentially useful Q2: Critical business information needs
knowledge are easily met with access to operational
databases.

Q3: We understand the role of business

processes in producing information.

Q4: The business units openly share

information across organizational lines

Q5: Data is easily retrieved in a timely

manner and fashion

Section 3: Open Ended Questions Q1: DO you agree that with the correct
Knowledge Management practices and
business analysis and analytics
methodology and the efficacy of a data
warehouse and the correct data retrieval
methods makes up better business
intelligence.

Q2: Can you summarize business

intelligence as; how we get knowledge
(Knowledge Management), how we
analyze (Business Analysis &Analytics),
how we store (Data warehouse), how we
retrieve and use information (Data
Mining).

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1.30.3 Procedure and time frame
The research will run for two semesters which is the May-August Semester and September-
December Semester. It is fully depicted in the gannt chart.

1.30.4 Data Analysis Procedures

The analysis plan has to do with each research question being analyzed thoroughly. Thus, the
research questions will be addressed one at a time followed by a description of the type of
statistical tests that will be performed to answer that research question. Also, variables that will
be included in the analyses and identify the dependent and independent variables if such a

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relationship exists. Decision making criteria (e.g., the critical alpha level) will also be stated, as
well as the computer software that will be used. Ultimately, the data collected is used to inform
the research findings. If the data is not verifiable, the implication is that the findings are
potentially suspected. Accordingly, it is incumbent upon the researcher to validate his/her
findings (Sekaran, 2003). Beyond that, Miles and Huberman (1984) contend that it is equally
important for the researcher to evaluate the quality of his/her data prior to its exploitation.

Fig 3. Processing of data from analysis to synthesis (Hirsjarvi and Hurme, 2000)

1.31 Statistical Analysis and Hypothesis Testing

For a researcher to know if a hypothesis is correct or not, he or she needs to determine this using
statistics. Using statistics in research involves a lot more than making use of statistical formulas
or getting to know statistical software.

Making use of statistics in research basically involves

1. learning basic statistics

2. understanding the relationship between probability and statistics

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 3. Comprehension of the two major branches in statistics, descriptive statistics and
inferential statistics.
4. Knowledge of how statistics relates to the scientific method.

Statistics in research is not just about formulas and calculation. (Many wrong conclusions have
been conducted from not understanding basic statistical concepts)

Statistics inference helps us to draw conclusions from samples of a population.

Hypothesis testing is conducted by formulating an alternative hypothesis which is tested against

the null hypothesis, the common view. The hypotheses are tested statistically against each
other.The researcher can work out a confidence interval, which defines the limits when he or she
will regard a result as supporting the null hypothesis and when the alternative research
hypothesis is supported (Experiment Resources,2009).

The survey data will be analyzed using SPSS statistical package. SPSS is an acronym for
Statistical Package for the Social Sciences which is a computer program or software used
for statistical analysis.It gives a higher output on analytical data which will increase the
quality and reliability to the research depending on the data input in the system.
Alternatively, STATSPAC could be used instead of SPSS. They function same way, but
STATSPAC is easier and simpler to use and administer.

1.31.1 Descriptive statistics

Descriptive statistics are used to describe the basic features of the data in a study. They provide
simple summaries about the sample and the measures. Together with simple graphics analysis,
they form the basis of virtually every quantitative analysis of data. With descriptive statistics you
are simply describing what is or what the data shows (Trochim, 2006).The descriptive statistics
will be used to explore the data and to summarize and describe the observations. Prior to
performing in-depth analysis on data gathered, descriptive analysis will be performed to
understand profile of respondents and their organization.

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1.32 STATISTICAL TESTS
1.32.1 Correlation (Linear Relationship)
According to Choudhury (2009), statistical correlation is a statistical technique which tells us if
two variables are related. Aldrich (1995),further stressed that correlation is one of the most
common and most useful statistics. A correlation is a single number that describes the degree of
relationship between two variables. Correlations are useful because they can indicate a predictive
relationship that can be exploited in practice. In general statistical usage, correlation or co-
relation can refer to any departure of two or more random variables from independence, but most
commonly refers to a more specialized type of relationship between mean values. There are
several correlation coefficients, often denoted ρ or r, measuring the degree of correlation. The
most common of these is the Pearson correlation coefficient, which is mainly sensitive to a linear
relationship between two variables. Therefore the sample correlation coefficient, can be used to
estimate the population Pearson correlation between X and Y. The sample correlation coefficient
is written as

Where, x and y are the sample means of X and Y, sx and sy are the sample standard
deviations of X and Y.

1.33 Validity and Reliability test

According to Mertler & Charles (2005), validity and reliability are not two distinct concepts, but
in fact they are sharing an important relationship in that It is possible for research’s data to be
reliable (consistent) but not valid (measures something that is not intended to measure).
Reliability is a necessary factor, but not sufficient as quoted from Mertler & Charles (2005):

“A valid test is always reliable, but reliable test is not necessarily valid”.

Here the researcher will be describing the steps taken to validate and measure reliability of the
survey. Validity refers to the accuracy or truthfulness of a measurement. There are no statistical

69 | P a g e
tests to measure validity. All assessments of validity are subjective opinions based on the
judgment of the researcher. Nevertheless, there are at least three types of validity that should be
addressed and stated what steps taken to assess validity. Face validity refers to the likelihood that
a question will be misunderstood or misinterpreted. Pre-testing a survey is a good way to
increase the likelihood of face validity.

1.33.1 Reliability test

According to Mertler (2006), reliability refers to the consistency of collected data . There are a
number of different reliability coefficient but the most commonly used is Cronbach’s alpha
which is based on the average correlation of item within the test if the items standardised
(Coakes & Steed, 1999). Cronbach's (alpha) is a statistical formula which has an important use
as a measure of the reliability of a psychometric instrument. It was first named as alpha by
Cronbach (1951), as he had intended to continue with further instruments The Cronbach’s alpha
for this research will be calculated with SPSS 13.0. Variable can be said as good in reliability if
the cronbach’s alpha is higher than 0.7 (Kirkpatrick & Feeney, 2006).

Cronbach's is defined as

where is the number of components (items or testlets), is the variance of the observed total

test scores, and is the variance of component i.

Alternatively, the standardized Cronbach's can also be defined as

where N is the number of components (items or testlets), equals the average variance and is the
average of all covariance’s between the components.

1.34 FACTOR ANALYSIS

Factor analysis is a statistical approach that can be used to analyze large number of interrelated
variables and to categorize these variables using their common aspects The approach involves
finding a way of representing correlated variables together to form a new smaller set of derived
variables with minimum loss of information. It helps in reducing data and also helps to remove

70 | P a g e
redundancy or duplication from a set of correlated variables. Also, factors are formed that are
relatively independent of one another. But since it require the data to be correlated, so all
assumptions that apply to correlation are relevant here (Choudhury, 2009).

1.34.1 MAIN TYPES

The two main types of factor analysis are described below.

 Principal component analysis: provides a unique solution so that the original data can be
reconstructed from the results. Thus, this method not only provides a solution but also
works the other way round, i.e., provides data from the solution. The solution generated
includes as many factors as there are variables.
 Common factor analysis: uses an estimate of common difference or variance among the
original variables to generate the solution. Due to this, the number of factors will always
be less than the number of original factors. So, factor analysis actually refers to common
factor analysis.

1.34.2 MAIN USES

Though Factor Analysis can be used in plethora of ways, but its main uses can be summarized as
below.

 Identification of underlying factors: the aspects common to many variables can be

identified and the variables can be clustered into homogeneous sets. Thus, new sets of
variables can be created. This allows us to gain insight to categories.
 Screening of variables: helps to identify groupings so that we can select one variable to
represent many.

1.34.3 EXAMPLE
An example to understand the use of factor analysis is given below.

Suppose a researcher wants to know certain aspects such as “Knowledge

Management” ,”Business Analysis and Analytics”, “Data Warehousing” and “Data Mining”
attribute to the “Business Intelligence” which later increases “Business Performance and
Productivity”. The researcher could prepare a questionnaire with 20 items, 5 each pertaining to

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“Knowledge Management” ,”Business Analysis and Analytics”, “Data Warehousing” and “Data
Mining”.

Before using the questionnaire on the sample, the researcher could use it on a small group of
people, who are like those in the survey. When the researcher analyzes the data, he or she tries to
see if there are really these above outlined factors and if those factors represent the aspects of
“Knowledge Management” ,”Business Analysis and Analytics”, “Data Warehousing” and “Data
Mining”. In this way, factors can be found to represent variables with similar aspects.

1.35 Assumptions
All research studies make assumptions. The most obvious is that the sample represents the
population. Another common assumption is that an instrument has validity and is measuring the
desired constructs. Still another is that respondents will answer a survey truthfully. The
important point is for the researcher to state specifically what assumptions are being made.

1.36 Scope and limitations

All research studies also have limitations and a finite scope. Limitations are often imposed by
time and budget constraints. They are outlined below

 Time constraints

 Financial consideration

 Anticipating and avoiding problems

 Equipment limitations

 Human resource limitations

 “Out of the box” thinking

 “In the box” thinking

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QUESTIONNAIRES

Dear All,

I am a student at the UCSI University, Kuala Lumpur, Malaysia and I am conducting a Masters
in Business Administration (MBA) thesis on critical success factors for Business Intelligence. I
am now gathering data to be able to analyze and adjudge if the factors would lead to the
successful implementation of Business Intelligence which finally yields tangible and intangible
benefits and it would be a great help if you could take the time to fill out my online
questionnaire.

73 | P a g e
http://www.xxxxxxxxxx.com

All responses will be treated in confidence and the survey should take only a few minutes. The
questions are simple and basic and not too probing!

Business users should answer from their personal experience while consultants should take one
(or more if they can) situation(s) and answer from that perspective.

This will be of great benefit to my thesis and I thank you all in advance.

Many Thanks,

Fabiyi Olawale Adefisayo

Note: If anyone has any queries regarding the validity of this survey, please do not hesitate to
contact :

Dr Keoy Kay Hooi BSc PhD CSSBB CSSGB CProjMgmtE

Head

Centre of Excellence for Research, Value Innovation and Entepreneurship (CERVIE)

UCSI University, Kuala Lumpur Campus

Tel: 03 91018880 Ext-3355

E-mail: keoykh@ucsi.edu.my

Section1: Company Demographics

Q1: What is the name of your organization?

Q2: Which of the following best describes your organization's industry or function?

Q3: How long has your company existed?

Q4: How many people are employed in your entire organization including all branches,
divisions, and subsidiaries?

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Q5: What is your primary job function within your organization?

Q6: What is your primary job title? (SENIOR IT MANAGEMENT: CORPORATE

MANAGEMENT:

Q7: Are you involved in setting the direction for your Company's IT Budget or Strategy?

Q8: Which technologies are currently implemented in your organization?

a) Internet [ ] b) Data warehousing [ ]

c) Intranet [ ] d) Knowledge Management software [ ]

e) Extranet [ ] f) Decision support system [ ]

g) Groupware [ ] h) Data management system [ ]

i) E Commerce [ ] j) Automated Manufacturing

Section 2: Measurement of CSF of BI

disagree

agree

strongly agree
strongly

neutral

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 disagree
My organization has a well written Knowledge 1 2 3 4 5
1 Management policy or strategy.

My organization has a values system or culture

2 intended to promote knowledge sharing. 1 2 3 4 5

has policies or programs intended to improve

3 1 2 3 4 5
worker retention

My organization Captures and uses knowledge

obtained from public research institutions
including universities and government
4 laboratories and other industry sources such as 1 2 3 4 5

industrial associations, competitors, clients and

suppliers.

My organization Provides formal and informal

training related to Knowledge Management and
5 uses formal mentoring practices, including 1 2 3 4 5

apprenticeships and internships.

My organization encourages experienced

6 1 2 3 4 5
workers to transfer their knowledge to new or
less experienced workers
My organization encourages workers to continue
their education by reimbursing tuition fees for
7 successfully completed work-related courses and 1 2 3 4 5

offers off-site training to workers in order to keep

skills current

Business goals are clearly communicated and

8 understood, and we know how success is 1 2 3 4 5

measured.

9 1 2 3 4 5
My organization is doing very good now as

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 compared with last year and three years ago

My organization is moving in with current

10 1 2 3 4 5
business trends and developments

My organization utilizes cost-saving measures

11 1 2 3 4 5
effectively without compromising the quality of
its products or services.
12 My organization selects technology to help the 1 2 3 4 5

business achieve its mission and goals.

My organization has established realistic
13 1 2 3 4 5
business goals

My organization has a formal data warehouse

14 1 2 3 4 5
development methodology.

15 the business role of the data warehouse is 1 2 3 4 5

understood
We understand the role of the data warehouse in

16 changing business processes. 1 2 3 4 5

17 Data is integrated throughout the organization 1 2 3 4 5

My organization ensures the quality of data

18 1 2 3 4 5

warehouse deliverables.

there is a well written Policy for data retrieval

19 1 2 3 4 5
organization-wide

Critical business information needs are easily

20 met with access to operational databases. 1 2 3 4 5

We understand the role of business processes in

21 1 2 3 4 5

producing information.
1 2 3 4 5
22 The business units openly share information

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 across organizational lines

Data is easily retrieved in a timely manner and

23 1 2 3 4 5

fashion

Section 3: Open Ended Questions

Q1: DO you agree that with the correct Knowledge Management practices and business analysis
and analytics methodology and the efficay of a data warehouse and the correct data retrieval
methods makes up a better business intelligence and why?

Q2: Can you summarize business intelligence as; how we get knowledge (Knowledge
Management), how we analyze (Business Analysis &Analytics), how we store (Data warehouse),
how we retrieve and use information (Data Mining) and why?

Q3: Anyother matter not covered within the questionnaire

References

Shaun McCarthy (2009) 'Business Intelligence versus Knowledge Management-Inside

Knowledge'. InsideKnowledge. 23rd May 2010, pp. 2-6.

wikitionary.org (2009) Business Intelligence [Online]. Los Angeles, United States: Wild

West Domains, Inc.. Retrieved from: http://en.wiktionary.org/wiki/business_intelligence

78 | P a g e
[Accessed 23rd May 2010].

Annie Green (2007) 'KNOWLEDGE VALUATION', Business information – a natural path to

business intelligence: knowing what to capture, Vol. 1, No. 10, pp.

Dataflux (2009) Business Intelligence [Online]. NC 27513-2414, USA : SAS Institute Inc.

Retrieved from: http://www.bettermanagement.com/topic/default.aspx?f=10 [Accessed 21st May

2010].

Thomas H. Davenport ,Laurence Prusak (1998) ,Working Knowledge: How Organisations

Manage What They Know, (Harvard Business School Press,Boston, Massachussettes, 1998),
page 5.

ExecutiveBrief (2009) Success Factors in Knowledge Management [Online]. USA: Project

Team Blog. Retrieved from: http://www.projectteamblog.com/?p=169 [Accessed 25th May
2010].

Kathleen B Hass, Richard Vander Horst, Kimi Ziemski (2008). From Analyst to Leader:

Elevating the Role of the Business Analyst Management Concepts, 2008. ISBN 1567262139.

p94: "As the discipline of business analysis becomes professionalized"

1keydata.com (2001) Datawarehousing [Online]. USA: 1keydata.com. Retrieved from:

http://www.1keydata.com/datawarehousing/datawarehouse.html [Accessed 21th May 2010].

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Farida Hasanali (2002) 'Critical Success Factors of Knowledge Management', Knowledge

Management, Lessons Learned, Vol. 1, No. 1, pp. 1-4.

Card, Stuart; Thomas P. Moran and Allen Newell (1983). The Psychology of Human Computer
Interaction. Lawrence Erlbaum Associates. ISBN 0-89859-859-1.

Adrienne Tannenbaum (2001) 'Metadata Solutions: Using Metamodels, Repositories, XML, and
Enterprise Portals to Generate Information on Demand '. USA: Addison-Wesley Professional.

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