Business Intelligence at Canadian Tire

Business Intelligence at Canadian Tire The overall purpose of Business Intelligence systems and software is to manage and analyze data in a manner that would support effective decision making. The BI initiative could help Canadian Tire to manage and analyze its data in a way that would allow the company to consolidate and integrate some of its information systems. The information provided in the case indicates that CTC is operating and supporting many different operation systems, mainframes, hardware platforms, database management systems, production applications and desktop-based application and tools.

Consolidating and integrating some of these systems would assist CTC not only in managing data more effectively, but also in cutting costs on the maintenance and management of its information systems. This is true of any information system that has room for consolidation and integration improvements. For instance, in the reading “The Quest for Customer Focus”, Continental Airlines was able consolidate its previous 85 to 90 database systems into just a 2 database systems.

Merging the databases helped Continental improve its information system by creating a consensus between the data analysis with regard to matters such as who the most valued customers are. Integrating their information systems also helped Continental to eliminate costly problems such as customers being able to get more than one flight voucher for bumped flights, because gate agents and telephone agents were unable to determine if the customer had already been compensated using the previous system.

The case mentioned 10 common challenges of business information implementation: “budget constraints, data quality, understanding and managing user expectations, culture change, time required to implement, data integration, education and training, ROI justification, business rules analysis, and management sponsorship” (Haggety &Meister, Pg. 6). In the case of CTC, we believe that most important challenges that Eubank and Wnek had to consider were budget constraints, data integration and time required to implement.

Implementing a new BI system can be costly and the information in the case indicates that CTC was spending a great deal of money on the systems that it currently has in place. One of the goals of implementing a BI system is to become more cost-effective, however implementing the system itself will be costly. According to the case, only 30% of the BI systems that are launched are actually successful. With larger organizations requiring more complex BI systems, the chances of successfully launching a BI system on time and within the budget are considerably lower.

Data integration will also be an important factor to consider. As mentioned earlier, CTC had been using multiple different operating systems, hardware platforms, etc. In order to meet the goal of managing data more efficiently and cut costs, many of these systems will likely need to be consolidated and integrated. Lastly, Eubank and Wnek must keep in mind the amount time required to implement the business information system, as they had quick win requests that were currently pending.

When considering the challenge of budget constraints, it should be considered that resources invested in the business information system now could lead to costs of maintenance and management of the information systems being cut in the future. Consolidating and integrating the existing system would significantly reduce costs for CTC in the future. It is also worth mentioning that if the BI system is successful it could improve business operations, which could in turn increase profits.

When making decisions regarding the BI system, Eubank and Wnek had to bear in mind the goals of implementing the system and make their decisions with these goals in mind. When facing the challenge of data integration, we would also keep in mind the goals of managing data more effectively and cutting costs. We would carefully analyze the existing systems to determine what is working and what is not and try to go from there. We would also try to recognize any opportunity to consolidate systems, as it is often not efficient to have multiple different systems operating within the same organization.

When facing the challenge of implementation time for the new system, we would first want to come up with a timeline that would efficiently meet the needs of CTC. As the reading “The Quest for Customer Focus” mentioned, implementing new systems and using the data that is collected in a way that is beneficial and meaningful to the organization can take a long time—sometimes even years. For example, it took Continental Airlines more than four years just to reach the communal coordination stage. In the long run, however, the investment of time and resources will pay off if the system is successful.

In looking at the quick win requests, however, we would likely want respond to the requests that seemed to be the most in line with business goals simply because it the amount of time doing so may take away from the BI system being ready. Canadian Tire Corporation’s organizational structure can be divided into five main parts: Canadian Tire Retail (CTR), Canadian Financial Services (CTFS), Canadian Tire Petroleum (CTP), PartSource, and Mark’s Work Wearhouse. Each of these five components of CTC can then be broken down a step further.

CTR operates 430 stores, with an automotive, sports and leisure, and home products “mini store” in each. This sector was a retail store, but CTC’s retail division was very unconventional and did not even look “retail”. In addition to managing the Canadian Tire Options MasterCard program, CTFS “managed the auto club, offered a variety of insurance and warranty products to more than six million customers, and provided integrated support to CTC stores, automotive service center and online and telephone shopping businesses” (Haggerty & Meister, Pg. 2). CTP managed a variety of gas bars, car washes, and Pit Stops.

PartSource sold automotive parts to home mechanics as well as professionals. Mark’s Work Warehouse offered causal as well as work wear to men and woman (Haggerty & Meister, Pg. 2). Each of these five components of Canadian Tire Corporation was originally operating under their own IT system in order to fulfill their own needs. CTR used the IBM AS/400 system and a point-of-sale system that networked back to the CTR data centre. IMB RS6000 was used at CTFS. Point-of-sale systems were also used at PartSource and CTP. Finally, Mark’s Work Wearhouse operated on a totally independent system (Haggerty & Meister, Pg. 3).

It is clear that Canadian Tire Corporation was a very complex organization with many facets. The five components of CTC; CTR, CTFS, CTP, PartSource, and Mark’s Work Wearhouse, all serve different industries and different target markets. Within each of these components, again, a wide variety of products are being sold to groups of people with different needs. The breadth of products and services offered by CTC had a huge effect on the implementation of the business intelligence initiative. The IT department, like the business intelligence efforts in general, had become very disjointed at Canadian Tire Corporation.

While there was an information warehouse (IW) used at CTC, other departments, such as finance, had their own information source, the Finance Retail Analytics Group (FRAG). The IW was quickly becoming obsolete and it produced different answers to many of the same questions, and did not provide any information at all at times (Haggerty & Meister, Pg. 7). With the inability to obtain the data needed from the IW, Shadow IT groups formed. These can be defined as IT groups within the business units that catered to the individual needs of that group (Haggerty & Meister, Pg. 4).

The spending of these groups was not monitored, and they posed an unknown security risk to CTC (Haggerty & Meister, Pg. 8). These Shadow IT groups surely became comfortable working with little to no supervision and an apparently unlimited budget. It is hard to tell if the Shadow IT groups were actually helping the company because without any semblance of a budget, it is difficult to see how cost effective they really were. Making changes to such a working environment may be a difficult task. Prior to the new BI strategy, the Shadow IT groups were a very important part of each group’s IT needs.

With a more defined BI strategy in place, members of the Shadow IT groups may resist the changes set forth in the BI strategy. For example, cost control was one of the initiatives set forth in the BI strategy. Prior to the new BI strategy, the Shadow IT groups were working with essentially no budget. With a budget in place, Shadow IT group members may begin to feel the strain. Standardization and risk management were also mentioned. The Shadow IT groups were providing information solely to the group or department they were working for.

Generally, none of the information used or obtained was uniform or even shared across departments; the information was also not be monitored. New rules and restrictions may hit some in these groups the wrong way. Shadow IT group members may be unwilling to share data with other groups, and may see the increased scrutiny on their activities as intrusive. It is unknown whether the Shadow IT groups would pick up the work set forth in the new BI strategy. When the new BI strategy is up and running, these Shadow IT groups would most likely integrate into the new BI strategy and essentially disappear.

Their services will not be needed, as the IT system as a whole will become more streamlined and centralized. Each division of Canadian Tire Corporation will no longer need its own little IT department serving only interior needs. One of the biggest differences that can be seen from the exhibits is the elimination of the “independent data sources” within the previous BI environment, and folded into the “source systems” function. Previously, “Shadow IT” groups were providing data that was not a part of the BI environment officially. In the new environment, they will be brought into the fold.

Another difference was the introduction of the data mart. A data mart is a subset of an organization where data is stored. Typically it is oriented towards a specific purpose or a major data subject that may be distributed to support business needs. These are analytical data sources designed to focus on specific business functions for a specific community within the organization. Data marts tend to be tactical and aimed at meeting an immediate need. The new model had multiple data marts—each one relevant to one or more units for which it was assigned.

Each department was assigned its own data mart for which it can solely control its hardware, software, and data. This enabled each department to use, manipulate, and develop the data anyway as sees fit. The final difference between the current and desired BI infrastructure was the intranet presentation layer. This mainly dealt with the function of translation and encryption. CTC had a large number of mainframes, servers, operating systems, and hardware platforms which had distinct characteristics and represent data in many ways—the presentation layers managed the job of handling these differences between machines.

The challenges of implementing the new system were the same that many organizations face. Creating organizational and cultural change across the business is an extremely challenging force to overcome, but one that ultimately shows a tremendous return for an organization. The BI implementation at CTC is a tremendous example of just that. The first step in the plan was the creation of a data warehouse that will contain data marts which can hold data from the five different business groups within the organization.

This data warehouse will supply vital information to all of CTC's managers throughout the entire organization. These data marts will create a standardization process for organizing the data within the entire CTC organization, which accomplishes one of the long term BI goals of CTC. The second step is to coordinate with the various departments and Shadow IT groups within this organization. This could involve reorganizing of the Shadow IT staff members, specifically the employees which need to be involved in the entire process of the IT restructuring from start to finish.

Placing them in roles that fit into the long term strategic plans would also help. The third step is to implement training that can help create better BI implementation process. A better workforce can lead to a better outcome. The final step would be to create a web portal for end users to access the new data marts. This portal will allow end users to query data that is relevant to their own business unit needs but deny access to information that is not needed for their specific job function. Following these steps should lead to a smooth restructuring of the entire IT infrastructure.

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