Comparing Corporate Performance Management and Business Intelligence
The difference between Business intelligence (BI) and Corporate Performance Management (CPM) can often become muddled and confusing for businesses looking to choose the right solution for their reporting. While both are very closely intertwined, understanding the differences and similarities between the two is important to choosing the correct option for your business.
In this blog, we will help to clear up the confusion between BI and CPM by addressing the similarities and differences between these two systems.
Business Intelligence describes the technology used to gather and analyze data relevant to an enterprise in order to improve business decision making. This includes ad-hoc queries, OLAP (on-line analytical processing), scorecards and searches. BI can also be used for many types of visualizations such as dashboards, scorecards, and KPIs.
While BI is graphically-oriented, it goes beyond just displaying data. BI can also allow users to drill down into a chart or report for more details or even allow the users to select what they see without using a menu bar type of interface. With the analysis and range of data that BI provides, making informed decisions becomes much easier.
BI can be used on its own, apart from a CPM solution, to provide key metrics needed to measure a company’s performance -it simply needs a data source. Using BI to understand what metrics and KPIs are important to your business can provide a better understanding of what additional tools and processes may be needed to manage your company.
BI offers a less structured way of displaying data, allowing users to decide what they want to see and how they want it presented. CPM, on the other hand, is more structured in how it presents its components such as scorecards and dashboards and only allows the users to see what is specified by the company.
Skipping BI and going straight to CPM can result in a solution that is not suited to the needs of your company.
CPM includes not only the BI technology, but also the processes, methodologies, metrics, and systems used for managing the performance of your business. These components can be used with customer relationship management, supply chain management, sales, finance, marketing, profitability modelling and optimization, and many more areas.
CPM can be used for specific areas such as financial processes (budgets, forecasting, planning) or supply chain management (SCM) to aid retailers in planning for manufacturing and merchandising. Some companies base their CPM around their business methodologies, such as Activity-Based Management, Economic Value-Added, and Six Sigma. In the US, the most common use of CPM is the Balanced Scorecard (BSC) process.
BI software is always included as part of a CPM solution in order to support the data analysis and reporting needs. In a sense, BI “feeds” CPM the data it needs.
What’s best for my business?
Regardless of the industry, using BI and/or CPM can assist in the decision-making process and help to manage your business better! If you’re still confused about the differences between BI and CPM or need help deciding which is right for your business, contact us using the form below. We’d be happy to answer any questions you have on this topic.