Monday, December 1, 2014

Corporate Performance Management vs. Business Intelligence

Corporation Performance Management is all about managing performance by that data (KPIs) which really matters.

Corporate Performance Management (CPM) is a set of management and analytic processes that enable the management of an organization's performance to achieve one or more pre-selected goals. Business intelligence (BI) is the set of techniques and tools for the transformation of raw data into meaningful and useful information for business analysis purposes. (Wiki).

Business Intelligence is about managing data. Corporate Performance Management is all about managing performance by that data. Corporate Performance Management deals with the overall performance of a company which relies on a few KPIs, reflecting the good or poor execution of a strategy. Although CPM and BI are different, they should have overlaps. CPM is an objective served by BI in which overall aim is improving an organization’s performance.

Modern systems tend to integrate with both BI and CPM features to satisfy customers. These KPIs in Corporate Performance Management depend on many factors (activity, industry, capital, market...) and performance measurement requires the management of large amounts of data. BI complemented by Big Data plays an even larger role every year when in such domains as marketing have the right information before competitors is often crucial. 

CPM & BI are the two sides of one coin. CPM is ideally spoken - top down initiated and consistently implemented over all management layers and meant to monitor the "alignment" with the overall strategy. BI can be bottom up and is much broader in a sense that it also covers areas which are not directly of interest for the overall strategy, but more of an "operational hygiene" perspective. And of course what is getting more attention is the improvement of the "intelligence" and "effectiveness" of the execution of operational/transactional processes.

It is a matter of which perspective the analysis is being performed. There is also a customer interest to combine BI/CPM with workflows for advanced budgeting & prognosis processing as well as planning, periodical reports, risk analysis and so on.  Perhaps it is just a matter of from whose perspective the analysis is being performed, different perspectives might need to adapt to the changing expectations.
Finance Professional = CPM 
IT/Information Professional = BI 

There are still many diverging definitions of what both CPM and BI are. In the end, it is not so much about concepts and definitions, but more about what you want to achieve and how you do it.


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