He put plans for a three-year migration to a common ERP system lower on his priority list. "In reality, an ERP system is not very clever," he says. "If we hadn’t put in the capability of business analytics tools for the data warehouse, we couldn’t operate globally. Because suddenly, a global manager responsible for sales and product results literally would have had to go to 14 sources for information."

Besides making data accessible, BI software can give companies more leverage during negotiations by making it easier to quantify the value of relationships with key suppliers and customers. Given a corporate directive to cut purchasing costs by $2 billion in 2002, Motorola needed a consolidated view of its global supplier network. It used Informatica’s PowerAnalyzer to analyze purchasing data to ensure that buyers around the world were taking advantage of negotiated deals. The tool automatically alerts buyers when they exceed spending thresholds that entitle the company to discounts. "It should jump out at you that the next $10,000 worth of spend with this vendor should be 5 percent less," says Chet Phillips, a director of IT at Motorola. "When you’ve got tens of thousands of vendors, that’s an issue. You want that information to be pushed to you." Motorola surpassed its goal of saving $2 billion last year, and Phillips says its BI tool was directly responsible for as much as $140 million of those savings. Motorola has now begun collecting procurement data from its manufacturing outsourcers. The idea is to ask suppliers to extend all negotiated deals to those business partners, who are then expected to pass along some of those savings to Motorola.

Discover Opportunities, Drive Decisions

Within the walls of the enterprise, there are plenty of opportunities to save money by optimizing business processes and focusing decisions. BI yields significant ROI when it sheds light on business bloopers, ¿a TruServ’s gophers. Employees of the city of Albuquerque, N.M, for example, used Cognos to identify opportunities to cut cell phone usage, overtime and other operating expenses, saving the city $2 million during three years. Likewise, using Brio’s BI software, Toyota realized it had been double-paying its shippers to the tune of $812,000 in 2000.

Companies are also using BI to justify or disprove the wisdom of what would otherwise be gut business decisions. "Too often, evaluations of opportunities for growth are based on gut feelings, estimations and assumptions because it would be too expensive and time-consuming to get hard data," says Nucleus’s Wettemann. "BI can let you run some quick numbers to justify that gut."