Performance management should involve every knowledge worker within an organisation but behavioural hurdles still need to be overcome. John Stokdyk, technology editor of sister site AccountingWEB.co.uk, explores the territorial imperatives with Microsoft BI strategist Bruno Aziz.

Millions of words - mostly impenetrable jargon - have been written about business intelligence and performance management, and Microsoft BI global strategy honcho Bruno Aziz has added 50,000 or so more with a new book.But on the way to meet him in London recently, the thought occurred that if you set aside the underlying technology for a minute, what we're really talking about is organisational culture.

For example, BI and CPM tools feature twice in our Software Satisfaction Awards, once in the sales and marketing category and once in the accounting and finance section. The territorial divide reflects life on the corporate frontline, where sales and marketing people want fast, responsive business intelligence and will go out and get it for themselves if finance can't come up with the goods.

Finance managers, meanwhile, are more at home with Excel, Crystal Reports and all the other devices of data analysis. More often than not, they'll look down their noses at DIY reporting by other departments and cast doubt on the accuracy of the numbers. And if we're being pedantic, poor old HR didn't even get a look in, even though good people information can be invaluable for reducing costs and planning resource deployments more efficiently.

The most effective benchmarking projects will accelerate an organisation’s rate of change and help to overcome complacency. There’s always another company or another division that has figured out a better way of doing some of the things you do. Although the majority of firms tend to focus on keeping up with the competition, most breakthrough improvement opportunities are found outside of a company’s specific industrial sector.

“We constantly try to pick up new ideas,” Mehmood Khan, Unilever’s global leader for innovation process development, confirmed. “We are a fast-moving consumer goods company but we compare ourselves to IT and other high-tech industries. Within our own industry, we have to see how we compare to peers. Benchmarking tells us where we stand with respect to our competitors and other industries across the world.”

That knowledge becomes the basis for action, which is the intent of knowledge management initiatives.

More than financial reports

Conceptually, BI is simple: data produced by an organisation's transactional processing and operational IT systems can be collected and summarised into totals and reports that give managers an immediate view of how they're doing. IT initially made its presence felt within finance to speed production of management and statutory accounts, so the evolution towards BI has traditionally started within that department.

Microsoft's BI point man and author of Drive Business Performance agrees that performance management is about people and culture, and argues it should involve every knowledge worker within an organisation. But he also admits that some behavioural hurdles still need to be overcome.

"Performance management is more than financial reports for finance managers. If it stays in finance, it doesn't empower the rest of the organisation," says Aziz. "Often the driver will be when sales, marketing, operations and HR ask for reports that finance can't answer. Operations want real-time answers when finance is 2-4 weeks behind.

"You can't roll out BI and expect everyone to be the same. Roles are different and so are the needs and metrics of different departments. You've got to understand the interdependencies. You're not trying to deliver all the information to everybody and make people be like the CFO. You want to get relevant information to each."

Aziz describes performance management as an "interdependency", where the organisational models tie into sales models and forecasts. This nirvana was achieved at battery company Energizer, one of the cases studied in Aziz's book, where BI originated in operations. It now matches its production plans to sales forecasts that are closely aligned with the company's financial goals.

Performance management may have worked for Energizer but real life isn't always that smooth for less focused and well-motivated organisations. In a precursor to this article, last year AccountingWEB investigated the territorial dispute between finance and IT over business intelligence. In the view of consulting editor David Carter, BI implementations were failing to deliver because the technologists who invented and managed them had no appreciation for what the numbers meant. Accountants are trained to test the validity of their numbers and have the ability to explain what they mean, added accountant-turned-technologist Jim Johnson. But often, many accountants shy away from the technological frontline of BI and performance management.

Data accessibility and accuracy

The realities of daily business life also throw up a lot of practical difficulties. As Carter explains, a sales department seeking daily or weekly feedback on revenues and volumes will look for the information from the sales order module of its accounts program. But orders are usually handled by sales admin or other customer-facing staff, which means finance is often left out of the loop.

The front office team is concerned about serving the customer. Creating an accurate database for management reporting comes much lower down their list of priorities, so sales invoice data can often be riddled with errors. The sales prices are going to be accurate because customers will query any that aren't, but cost prices and analysis codes can go awry, which is where the arguments begin.

Getting sales and finance to agree on gross margin figures on a computer sales report is notoriously difficult. There are so many different data sources that perfectly legitimate numbers in the sales daybook, summary reports and P&L won't tie up. But if these sales reports all show different figures, managers will lose confidence them.

More often than not, the finance department will wash its hands of reports that are created outside its immediate control. Like Johnson, Carter called on accountants to abandon their passive role and monthly reporting cycles to get involved down on the front line, where their analytical and interpretive skills could make a difference.

But how willing are sales and marketing teams to embrace the partnering approach that is growing in popularity in some finance teams? Is the eager-faced management accountant a welcome figure or mistrusted as a finance department spy?

Carter credits Microsoft with having created a marvellous environment for creating and distributing management information. But he still thinks the company's software and consultants haven't cracked the conundrum of performance management, which still resides in the patterns laid down by 200 years of management tradition.

BI is still a work in progress - software tools are available which could deliver the IT industry's long promised results, but they are only going to work if organisations get their strategy management and business models aligned. Aziz and his co-author Joey Fitts attempt to fill the gap between heavyweight theory and marketing-driven slogans but end up falling into the motherhood and apple pie trap.

Six case studies and their suggested model for implementation may alter perceptions a fraction. However, kind, supportive words on their own won't crack this nut. We've seen that there's a war out there on the BI front line. Which side are you on and who's going to win?