5: The LOFT Effect
The author speaks of successful BI operations is somewhat mystical terms: an "alignment of the stars" or a "perfect storm" to describe the convergence of factors that led to success. Her own acronym is "LOFT" - Luck, Opportunity, Frustration, and Threat.
(EN: At the onset, I felt that this introduction did not bode well, and after reading through the chapter, I'd have to say that it's not very well done. The author's core point - that an unusual situation makes a company more ready to embrace BI - is worth noting, and what follows are largely extended case-studies of unusual situations, and a reassurance that BI is not an emergency-only solution, merely that change is often more palatable under extenuating circumstances.)
Luck
The author speaks of luck as being "fortuitous timing" as BI was introduced into companies that were undergoing a radical cultural change, organizational change, or information systems change that enabled BI to be introduced into a climate where change was accepted and expected, rather than being introduced to an otherwise static organization as a single new element.
An extended case study is given of Dow chemical, which was seeking to "globalize" fifteen business units, such that the company was in the midst of a sweeping change and employees across the company were open to the idea of phasing out the existing information systems for something "new," such that BI could be built into the business requirements and the very core of the new systems.
Opportunity
There is another extended case study of FlightStats, a company that recognized a widespread problem (a lack of reliable information about the availability of air freight services on commercial airlines and the poor on-time performance of the airlines for passengers) and recognized that nobody was collecting the data necessary to enable shipping customers to take advantage of its availability. This was an opportunity to provide a BI solution that would fill this need.
This (and a few other instances) demonstrates an instance where those familiar with the capabilities of information technology were able to step forward and provide a solution to business in an instance where the business recognized a problem, but did not have sufficient insight to derive the requirements for a solution.
It also indicates that BI, in itself, is not always a solution to a problem, but a mechanism by which data about a known problem can be collected and analyzed to enable business to discover a solution, or even to discover the causal relationships among factors of a problem that is recognized, but whose root cause is not known.
Frustration
Frustration is another common theme in successful BI deployments. The author refers to the case of 1-800-CONTACTS, in which there was widespread frustration among customer service representatives who were pressured to improve performance, but who felt that they were not getting adequate information in a timely manner to take meaningful action. Employee turnover was high, and the most common theme in exit interviews was frustration over being held accountable for things they could not control due to the lack of information.
Threat
The author examines the case of Continental Airlines, a company that was under threat of bankruptcy and ranked worst among major airlines in a number of problems (on-time arrival, baggage handling, customer complaints, and overbooking of flights). Faced with the threat of extinction, top management implemented widespread BI practices to gather and analyze data to determine the root causes of the problems, and continued to utilize these systems on an ongoing basis as a way to detect potential problems in real time.
Is The LOFT Effect a Prerequisite to Success?
In the case studies presented in this chapter, companies found themselves in an unusual or precarious position, which facilitated the implementation of BI - but in the absence of these conditions, can BI still be successful?
The author suggests that there is insufficient evidence to suggest that the presence or absence of BI has a corresponding effect on BI deployments, though it does stand to reason that these are situations in which a company is more likely to embrace the changes that BI will require of an organization.