BUSINESS INTELLIGENCE

ASSIGNMENT

MONICA.B

CSE-B

III-YEAR

1516102072
Methodology of building BI System for
Insurance

There are three necessary conditions for successful managerial information system implementation:

 experience and knowledge of the designing and implementation team,

 intensive cooperation between designers and users in the whole design and implementation
period,

 use of proper implementation methodology, which includes the process break down into smaller
projects.

According to the managerial information system design methodology should consist of six stages divided
into particular steps.
Stage 1 – Justification

Step 1 – Business case assessment

Managerial information system is an extremely complex project, which needs to be carefully prepared
and managed. Business Intelligence is not only an IT tool, but also a collection of techniques, business
solutions and a number of processes, which should be properly implemented. It is connected with
organizational changes, management system and serious IT system structure and architecture changes.
This leads to high financial resources consumption and, similar to other major IT implementations, huge
investment risk. Therefore a detailed goal definition and indication of measurable and immeasurable
profits of such implementation is necessary.

Questions that need to be asked and issues that need to be solved at this stage are :

1. information access:

 what is the origin of information necessary for decision making?

 what information is accessible and what information is missing?

 what is the quality and is the information up-to-date?

2. business and finical project aims:

 what are the business aims for the managerial information system realization? are there
Business Intelligence applications functioning in the company and can they help in the
realization of established business aims?

 what financial resources are designated for this endeavour?

 who is responsible for financing of Business Intelligence projects in the company?

 evaluation of the company readiness for the Business Intelligence system implementation:

 is the company ready for Business Intelligence implementation?

 was the readiness evaluation performed and what results did it provide?

 what is missing for the better implementation preparation: purchasing hardware and
software,standard implementation or maybe hire new employees?

3. risk evaluation:

 what is the risk connected with the construction of managerial information system?

 what negative impact will be brought by the cancelling of managerial information system
implementation?

4. cost evaluation:

 are the predicted profits exceeding the estimated costs of the project?

 is the total cost of BI implementation known?

 does the new hardware need to be purchased?

 does the computer network need to be modernized?

  are any new software tools necessary?

 is a Business Intelligence advisor necessary?

5. return of investment – calculation of the ROI indicator on the basis of:

 influence of the implemented system on customer service department performance,

 influence of the implemented system on customer satisfaction,

 influence of the implemented system on increase of company’s profits,

 influence of the implemented system on strategic decisions effectiveness,

 influence of the implemented system on cost reduction,

 influence of the implemented system on market share increase.

The list above should be treated as an analysis plan, which needs to be performed in the company
before the final decision about the implementation of the managerial information system in the
company is made. Broad scope of questions allows to determine the readiness of the company for the
implementation and the possibility of the realization of such investment.

Stage 2 – Planning
Step 2 – Infrastructure design

Whole infrastructure of the enterprise needs to be adjusted to the realization of the project, because
managerial information system includes the whole organization. Some of the infrastructure elements re-
main intact but some of the elements need to be adjusted to the project specification.Infrastructure
includes two types of components:

1. technical infrastructure: hardware, software, network cables, peripherals, database systems,

operational systems, network components, metadata repository, user applications etc.,

2. non-technical infrastructure: metadata standards, data mining standards, logical database

model, methods, textbooks, testing procedures, change control procedures, change
management procedures etc.

Step 3 – System design

It is crucial that the project is dynamic and adjusted to the organizational, personal, budget,
technological, production with sales and cooperation possibilities of the company. The design needs to
be detailed, complete and updates in relation to current changes that emerge in the enterprise.

Stage 3 – Business Analysis

Step 4 – Business requirements analysis

Adjustment of the project, on one hand to the needs and on the other to the organizational and financial
possibilities of the company, is one of the most difficult steps in the implementation of managerial
information system. It is difficult to limit the natural strive of the user to creation of the system, which
would include all necessary information at once and on the other hand, what results from previous
experience, such complex implementation are usually unsuccessful.

It is important to divide the managerial information system implementation project into smaller stages,

which will service particular subject areas and simultaneously each successive stage of implementation
will become a scientific element for both designers and system users.

Step 5 – Source data analysis

Quality of source data is a major challenge for every managerial information system implementation
project. Poor quality of data, difficulties with data integration, problems with access to source databases
– all of it contributes to the extension of time scheduled for the design stage and usually means the
increase of project cost. Some data, which supply the managerial information system decide about its
effectiveness and usefulness for the user, therefore proper amount of time and attention needs to be put
into this stage by the design and implementation team.

Step 6 – Application prototype

Analytical system, which will function as a part of the project, can be successfully constructed with the

method of prototyping, because it is a combination of applications and IT tools. The prototype allows
better communication for designers and users as well as speed up to determine the final form and
functionality of the analytical system.

Step 7 – Metadata repository analysis

Increase of the number of IT tools used in the system means the increase of technical data amount in
relation to business metadata, which is supported with these tools. Technical metadata need to be
mapped on business metadata and next transferred into metadata repository. All metadata, which is
introduced and stored in the repository, needs to be documented in logical metadata model.
Additionally all metadata requirements need to be accessible to the user through online help function.
Stage 4 – Design

Step 8 – Database design

Source bases for the managerial information system can have various structures, not include
multidimensional character and not be adjusted to real informational needs of the system users.
Database structure design of the warehouse must include present source data resources, organize it in a
manner that fulfills the informational needs of all analytical and reporting modules of the designed
system.

Step 9 – ETL process design

Extract-Transform-Load process, also known as data integration process, is the most difficult element of
the whole project. It also decides about the success of implementation and business usefulness of the
whole project. The following elements influence the complexity level of the process:

 number and quality of data sources supplying the system base,

 source data access,

 informational scope included in the designed system,

 number and complexity degree of prepared reports,

 requirements of system users (number and complexity degree of “ad-hoc” report).

Properly designed and realized ETL process can reveal the previously unknown informational power of
the data gathered by the enterprise

Step 10 – Metadata repository design

If one decides to purchase a ready product the metadata repository design includes only the
consideration of these logical features of the model, which are necessary for the realization of designed
system, and were not included by the license provider.

In case of dedicated metadata repository, the design must meet the requirements of the logical meta-
model, which is based on the relational structure or the object structure.

Stage 5 – Construction

Step 11 – ETL process construction

Many tools available in the market are designed to implement the ETL process. According to the degree
of complexity of the cleanup and transformation of data (see Step 5) and the data analysis (see Step 9)
different tools can be more or less useful in particular cases. Realization complexity of mentioned
processes and determination of specific requirements is necessary in order to select a proper ETL
solution.

Step 12 – Application construction

Whenever the application prototype, created in Step 6, fulfills functional system requirements, it is
possible to start the work on the development of access and analysis environment development.
Constructed application can be only a simple transformation of the prototype into a fully functional
system or a much more complex new project based on different IT tools. However in both cases this
stage runs simultaneously to the ETL process implementation.
Step 13 – Data mining

Many enterprises, which use the managerial information system, do not fully use the possibilities of their
analytical environment and limits the use only to the collection of redefined reports that are most
frequently used by the users. Meanwhile the true power of the system and maximal return on
investment lies in the hidden data of the enterprise. These are not visible in the standard report group
but are possible to gather if one uses such methods of multidimensional analysis like data mining. It is
connected with the need to purchase and application of tools dedicated to mining analyses.

Step 14 – Metadata repository construction

If the metadata repository is created for the system, instead of purchase of a ready product, separate
taskforce team needs to be established. It is justified, because the repository development project is
usually a broad subproject, which needs to consider: strategic goals, development strategy, business and
market conditionings, predicted competition activities and many other aspects of enterprise
development, which trigger the development of managerial information system, thus developing the
metadata repository.

Stage 6 – Deployment

Step 15 – Testing

When the managerial information system application tests are finished it is necessary to start intensive
training for all the people involved, which will use the application or metadata system. Trainings include:

 user application servicing,

  maintenance and development of the database,

 scheduling and ETL process start-up,

 database scaling planning and control.

Step 16 – Implementation evaluation

It is crucial to draw conclusions and use the experience gathered in previous stages of its application, in
the following stages of the system realization. If a considerable infringement of the budget or the project
realization deadline took place, the root-cause should be closely researched so that such mistakes can be
avoided in the following stages. Any kind of tools, methods and practices, which were not useful or
disturbed the proper realization of the project, should be eliminated before the start of next
implementations.

Many stages of the implementation can be performed in parallel, which allows shortening the entire
time necessary for the realization of the project. Project realization time is also decreased due to the
increasing experience of the design and implementation team. Success and effectiveness of future
implementations can be built upon such bases.

Summing up three necessary conditions of successful managerial information system implementation

can be listed:

 experience and knowledge of the design and implementation team,

 intensive cooperation of designers and users during the whole period of design and
implementation of the project,

 division of the project into smaller subprojects.

Apart from that the managerial information system design needs to be developed during the whole
period of its exploitation and in order to successfully support the enterprise management process it
should:

 include the information life cycle: gathering, storing, cleanup, integration and analysis,

 use not only the information management technology, but also the information management
policy,

 maintain the high quality of data, safe access to data and clear responsibility rules.

Example of implementations BI in the insurance industry

Samsung Life Insurance - example from the experience of Sybase
Samsung Life is the branch leader in South Korea. Company sells individual and group life insurance
through a gigantic network of agencies and over 30 thousand salesmen.

Samsung Life Insurance was in need of an integrated view of its IT system – enterprise was using 10 data
storages, which were usually non-compatible and extra data was placed in different locations. The
company launched a data warehouse construction project in order to integrate current databases.

Main task was the elaboration of quick, reliable process, which would allow the field users a common
data view as well as integration of ten independent collective databases. Samsung Life had three targets
of the project:

 increase of the field-workers competences, allowing them to perform their own analyses,

 providing access to highly compatible data with a common viewer,

 shortening of report generation time.

Products from various providers were simultaneously tested, including: NCR, Oracle, IBM and Sybase.
Sybase IQ, database designed for data warehouses, was awarded first place due to the speed of inquiry
processing and compression ratio. Higher compression ratio results in more disk space and lower cost of
mass memory, what in terms of few TB is of significant meaning. If the corporate database was built on
the basis of other database type, perhaps a hard drive if 3 – 4 times greater capacity would be required.

With the use of Sybase IQ system the enterprise integrated 8 out of 10 different collective databases and
created corporate data warehouse. The company limited the need for disk space and lowered the cost of
mass memory due to Sybase IQ system functions — advanced data compression and unique row
indexing mechanism.

Sybase solution assures quick data access and minimizes disk space required to record huge data
collections. Moreover Samsung Life is prepared for the increase of the amount of data – high efficiency
of Sybase IQ system – provides room for development.

Analytical responsibility in the scope of contract status, customer characteristics and people who
prepare financial plans etc. was moved from the IT team to particular business teams, which allowed
saving resources and increasing the general operational capacity. Field workers in need of greater
amounts of data can gain easy access to the data warehouse in order to download current and reliable
information from an accessible and usable environment. After the implementation the new system did
not cause any business processes delays.

Main benefits reached through the project were:

 considerable increase of the operational capacity of the enterprise,

 easy access to strategic data,

 25% reduction of disk space in comparison with other data warehouses.