Since our society has become reliant on technology, it has also become important for organizations to endow themselves with the knowledge of information technology or IT and switch existing systems to technological innovations, reorganizing and improving their management in the process. Toyota, as one of the leading motor sales company, also took advantage of the IT system in order to improve its management. The business intelligence system was introduced to Toyota, and with significant results, the organization was able to gain advantage over its competitors because of its ability to accomplish tasks more efficiently.
In the late 1990s, Toyota faced severe problems in its supply chain and operations. The situation had caused the company to lose about $144–$160 million dollars annually. Financial projection based on the situation signaled a possible disaster if the company will not be able to find and implement a solution immediately. Apparently, the crisis of Toyota was caused by incompetent internal IT management. The company analysis determined the following problems:
- Excessive directionless data that was full of errors and fraudulent;
- Strong competition in the automotive industry, primarily represented by Honda;
- Problems in communication and coordination along the supply chain;
- Departments’ inability to share data in a timely manner, and
- Management’s inability to get information they needed for decision making.
As a solution, Toyota hired Barbara Cooper in 1997 as a CIO to assist the company in resolving the problems. After the company analysis, Cooper decided to implement business intelligence (BI) as a new system. The first experiment with BI, however, was a failure. After three years of fixing the flaws of BI, it was once again introduced to the company. In 2000, BI was used again but along with a better technology. This time, the results of BI to the company were highly significant. The new system included:
- A data warehouse storing historical data;
- Tools for conducting analysis and data manipulation; and
- A visualized user interface (a dashboard), primarily intended for top managers.
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The concept of BI is a really powerful business management tool in any field of industry, especially when marketed by reputable vendors and integrated in appropriate software material. As in Toyota, BI is also one important strategy to the successes of other organizations. Many large organizations such as Nissan, BMW, and Sprint also chose BI system to solve their problems (Capgemini, 2008).
These organizations experienced situations similarly experienced by Toyota – they could not gather data they needed for decision making, or communications and data sharing between divisions took a long time. After implementing the BI system, most of them were able to resolve the problems they were facing resulting to the growth of each company.
In our university, it is quite obvious that BI also plays a vital role within the management system. Data warehousing, as provided by the BI system, is useful in keeping student and staff information, with the user interface allowing ease of use and convenience in inputting and accessing information. Massive university data, such as student information, class enrollment, and all financial-related concerns, should be organized, stored, and managed properly for easy retrieval. The BI system allows the university to accomplish these grueling tasks. Although each department might have limited access to the database and can only request for information they are allowed to see, it strictly imposes security and privacy of personal information.
In conclusion, Business Intelligence (BI) system is a powerful management tool when used with appropriate and compatible software and applications traded by authorized marketers and vendors. At present, the BI system is being used in various large organizations including universities, and its results obviously reveal the benefits and advantages of the system and prove its worth as a type of investment.