Digital Security

Where’s the ROI in your Real-Time Operational Intelligence Solution?

Where’s the ROI in your Real Time Operational Intelligence Solution?

Real-Time Operational Intelligence (OI), sometimes referred to as Real-Time Business Analytics and Business Activity Monitoring (BAM), is a segment of the Business Analytics market that focuses on the monitoring of business activities and technical events across multiple systems in real-time from the perspective of their business operations. The lifeblood of any organization is the units of work that it uses and processes in its pursuit to deliver value. Whether that’s processing purchase orders, payments, files, transactions, claims – whatever it may be – the focus of a real-time operational intelligence solution is to track the processing of the work items in real-time to ensure that it meets or exceeds the organization’s SLAs at the quality that is expected. The types of analytics associated with operational intelligence solutions are focused on providing business users with the ability to identify proactively and resolve issues before they impact the business and/or its customers.

Real-time operational intelligence

For example, say a financial institution’s wire operations team is interested in knowing if an individual transaction is at risk of missing its cut-off regardless of where its processes flow. To do this, the monitoring systems must first be able to know where the payment is. That means connecting to multiple transactional systems and identifying where it is within its flow. Next, the monitoring system must also know what time it is and whether the payment is where it should be to meet its processing SLA.

And finally, the key information associated with this object needs to be presented to the business so it can understand the context of what is going on with the payment. The latter is very important. The operations team doesn’t just need the technical details about the payment in its ecosystem, but it also wants to know whose it is (i.e. customer), the value (i.e. $ amount), and when it needs to settle (its cut-off time). Since some of these financial institutions have hundreds of thousands of transactions like this moving through their systems at any point in time, all this needs to be monitored and analyzed in real-time.

One can clearly see that being able to detect and avoid missing an SLA would add value to an organization. But that’s not the only benefit companies can see from a properly implemented real-time operational intelligence solution. Businesses have also seen returns on their investments in the following areas.

Improved customer experience

All of us have had the experience of sending money to a friend or family member and then calling him up to see if he received it. Of course, no one likes to lose money. After some reasonable period, if they haven’t received it, we become concerned prompting a call to our bank, credit union, PayPal, etc. Organizations are wising up and realizing that if a customer is calling you, then they’re likely not calling to tell you how happy they are. So banks need to be prepared to act quickly to resolve any issues and do what they can to turn an unhappy customer to a happy one again. Sometimes for the bank, this is the first time they’ve become aware of an issue.

Without a real-time operational intelligence solution in place to provide visibility, your customer service team will need to kick-off a search with the system owners to start looking through each of their systems to find the missing transaction. This requires time and energy to be spent on the simple task of poking around to see where your payment might be.

But this is reactive. Wouldn’t it be better if the bank knew about a problem with the transaction before the customer even called? Even better would be if the bank could correct the problem before it impacted the customer? A real-time operational intelligence solution would monitor each and every transaction moving through an organization, allowing business operators to see any payments that get stuck.

They could then take action to get the payment moving again and meet their SLA and completely avoid a negative customer experience. In fact, if the SLA were at risk of being breached, the business would have the opportunity to proactively call the customer and manage their expectations before they get upset.

Your best marketing comes from happy customers who can then be some of your best referrals. Good customer experience translates into improved reputation and savings in marketing.

Self-service and time savings

Another area where businesses see returns is on the time saved from having highly paid resources searching for lost files and transactions. Take the example where a client rep takes a phone call from his customer who asks “did you get my file?” Organizations without a real-time operational intelligence solution will need to rely on technical support teams and system admins to help them track down the file that could be easily answered if the business was giving visibility into its data flows. If there are multiple systems that the file must pass through, then the admins must look in all of those systems individually until they find it.

Each system can have its own method for pulling the information and sometimes the systems that need to be viewed belong to other departments—meaning that a request needs to be sent to other departments and now someone on that team needs to look for you. This can be a very time-consuming process. Organizations are becoming increasingly aware of how much time their highly skilled technical resources are spending “looking for things” for the business.

Real-time operational intelligence solutions provide the businesses with the ability to ‘self-serve’ which means that they look up files on their own non-intrusive way. This frees up time from the more technical resource giving them the opportunity to focus more on advancing the organization’s technical agenda move forward.

Some organizations have even taken this one step further and use the real-time information collected in operational intelligence systems and expose it to the customers via a secure portal. This way customers can see where their units of work are within the organization without having to call to inquire.

Improved response efficiency

The famed management consultant Peter Drucker once said, “If you can’t measure it, you can’t manage it.” The act of instrumenting and then measuring the performance of your business operations will help you manage it and make improvements to it. With real-time operational intelligence, you’ll be able to reduce the identification time of an issue and also reduce the resolution time. But it goes beyond that.

The improved visibility that comes from the addition of then business contextual information such as a client, dollar amount, time to SLA and so on, when seen with the technical information, has enabled some organizations to better categorize the severity of issues when it occurs.

Severity 1 issues require the attention and actions of a larger set of people than a Severity 2 or Severity 3 issue would. For large corporations, Severity 1 issue needs to be attended by 80-100 people from different parts of the organization which include various System Admins, Support Team Members, Subject Matter Experts and Database Administrators, etc. All need to be on a call to figure out the issue that could take hours to triage to and resolve. Any time the severity of an issue can be reduced from say a Severity 1 down to a Severity 2 would translate to significant cost savings for the organization both in the term of time spent on Sev 1 calls and the opportunity cost of tying up valuable resources that could work on more valuable things.

The real-time operational intelligence helps with rapid identification issues but also allows for the proper categorization of issues along with a more efficient response.

Revenue preservation

Improved customer service, along with improved operational efficiency, go a long way to keeping a customer happy. It’s true that a customer’s desire to remain loyal depends on many factors but the cost of losing one can be very high—especially if the lost revenue is significant. There have been studies that show that the cost of onboarding a new customer is much higher than the cost it is to keep one. Businesses are paying attention to factors that lead to customer churn but one of the primary areas where attention should be given is to the day-to-day execution of their daily operation.

Take a hypothetical example of a giant online retailer who has its choice of overnight shipping companies to choose from. Let’s also suppose its current shipping company, Company A, doesn’t have strong controls over their shipping operation and the retailer starts to receive complaints from their customers saying that they aren’t receiving their goods within 2 days as they had been promised. The retailer knows that the orders are going out the day that they are placed so that the issue in on the delivery side. So now let’s say that this giant online retailer starts looking at other alternatives, such as shipping company B and then decides starts their shipping their goods through them. The cost to Company A for losing business from the giant online retailer would be immense, so it is in Company A’s best interests to execute the delivery of packages efficiently and on-time.

Nowadays, there is little doubt that the most successful shipping companies have tight control of their shipping operation and are measuring their effectiveness continuously to ensure that they are executing well. But if you’re not a sophisticated logistics company, how would you proactively prevent the loss of current customers? A properly implemented real-time operational intelligence solution can help and depending on your business, the ROI for keeping a key customer can be very high.

Accountability and peace of mind

A well-implemented real-time operational intelligence solution also provides organizations with a trace of all transactions that are being processed through their various systems from end-to-end. This view gives the organizations a complete picture of their transaction entire lifecycle. This traceability allows them to not just see things when they go wrong but also provides confirmation when things go right. Knowing at the end of each day that every transaction being processed completed successfully and on-time will give the organization peace of mind. Confirmation of success is sometimes as important as being aware of problems when they occur.

But what happens when there’s a problem outside of the organization that is outside the controls of the organization. For example, what if you are a multi-national bank nearing the fed cut-off and have transactions still in-process but are on target to meet the cut-off deadline? Then suddenly the connection to the fed goes down. You still need to process those current dated transactions so you need to request an extension, but you don’t want the liability of having to be the one that makes that request.

You must prove to the fed that the extension is not due to anything you’ve done, but because it’s “their” connection to you that failed. Without a real-time operational intelligence monitor, it would be difficult to make the case. It’s difficult to quantify the value that this brings but being able to preserve one’s reputation is important and some would say “invaluable.”

In this article, I am touching on just a few ways that organizations are seeing a return on their investment made from their real-time operational intelligence solutions. What do you think? Are there other ways that your OI solutions are provided a return on investment for you, please let us know.

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