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Business activity monitoring stands to penetrate the market psyche to the same extent as customer relationship management, wireless and other world-moving concepts.
Business activity monitoring (BAM) is a Gartner term that defines the concept of providing real-time access to critical business performance indicators to improve the speed and effectiveness of business operations. At its broadest level, BAM is the convergence of operational business intelligence (BI) and real-time application integration aimed at business goals but enabled through advances in IT.
BAM, a target of the zero-latency enterprise (ZLE), will likely make heavy use of business process management (BPM) and network and systems management (NSM) investments, among other technologies. Unlike traditional
real-time monitoring, BAM draws its information from multiple
application systems and other internal and external (interenterprise) sources, enabling a broader and richer view of business activities. Although BAM depends heavily on advanced infrastructures, technology is just the required pipeline to move business-level information to the decision-makers.
The real potential for BAM is at the business level: enablement of new business strategies, reduced operating costs, improved process performance and other tangible areas of management attention. Early BAM ventures in transportation (e.g., airlines operations) and logistics (e.g., package shipment) are showing the benefits of reduced latency on decision-making.
BAM has the potential to provide businesses with new power to improve many (but not all) business decisions through real-time information. BAM is not a panacea. The term "business decisions" is too vague by itself. Deciding to ship extra product because inventory levels are getting dangerously low is a business decision, but deciding to acquire your major competitor is also a business decision. BAM can help with the former as it involves business operations; it will have little relevance to the latter. However, there is no shortage of appropriate business decisions that can benefit from BAM and, for many, the promise of BAM will become reality.
By 2004, BAM will be pushed to center-stage in many industries as a consequence of industry efforts to build the ZLE (0.8 probability); however, BAM is not easy to implement, is not a product and requires significant organizational and architectural planning.
Enterprises must realize that BAM is early on the market maturity curve; market hype, vendor overselling, management over-expectation and all the other classic issues associated with a hot new topic must be expected.
The Business End of BAM
BAM may have its strongest initial support from senior management tired of making decisions with poor information sources, but BAM is not just for executives or management. BAM analysis will often be delivered via graphical displays ("dashboards") customized for use in different parts of the enterprise and optimized for different audiences (e.g., pie charts for some needs, complex visualization for others). BAM will be an important part of the end result of better analysis, but it cannot deliver everything on its own.
BAM's potential users include:
BAM – A Realistic Goal?
While the benefits of real-time reaction through faster decisions will be available to many for the first time via BAM, the concept of BAM is not new. The industry has been driving toward real-time decision support for 30 years. The historical precedents for real-time monitoring of large-scale, complex systems include:
The link from goal to reality remains a challenge. Enterprises should begin assessments to determine potential benefits of BAM. Before any money is spent on BAM, a reality check is needed. Just a few of the issues facing a BAM-related project include:
Technology Underpinnings
BAM aims to reduce information float (the time between when new information is captured in one place and when it becomes available and usable elsewhere). In a prototypical BAM scenario, software agents evaluate events as they occur in the context of a set of rules to determine what actions to invoke. BPM tools can assist here as part of the BAM architecture for making interactions "process sensitive" (e.g., marrying process "state" data with other real-time data). If BAM's recipient (listener) is a person, these agents convey the information through a graphical display, an e-mail message, a page, a fax, an icon or panel change on a browser or other screen, or through some other application program. Through adaptive profiling, BAM can try to understand how the user typically responds to types of messages, so it can be more precise. Adaptive profiling is potentially risky (a profile might not recognize something really important), but is a real consideration for the future. Some listeners may be devices or applications that take actions without human intervention based on notifications from the BAM infrastructure. BAM usually leverages an ODS or a message warehouse to maintain state data and a record
of events, respectively.
BAM will draw on many technology families to deliver its benefits, each offering unique aspects of the BAM puzzle: BI, BPM, application integration, NSM and data warehouses. Application integration vendors are helping enable BAM by making it easier to build real-time application integration links among heterogeneous application systems. BAM, the analysis aspect of a ZLE, is attracting BI providers that offer the analytical engines, BPM vendors who are marrying process status with real-time analysis and NSM vendors who are turning their real-time, data-probing approach toward a BAM vision. Data warehouses are extending the power of the ZLE. BAM will enable sweeping changes in enterprise business strategy. BAM-related software vendors will begin a merger and acquisition phase as the market matures; however, through 2004, a successful BAM approach must blend best-of-breed methodology and products on an as-needed basis.
Bottom Line: BAM is enabled by the concerted efforts of many technologies, but BAM's real impact will be at the managerial and operational levels. IS departments that have successfully implemented application integration and BAM's other underlying technologies will have an advantage in deployment. BAM will have the most impact where real-time analysis and immediate feedback give new power to the "management-by-exception" models of the past. BAM is a leading-edge architectural and cultural change, and enterprises should target specific applications of BAM as opposed to blanket approaches. In 2001, BAM remains an investment for Type A enterprises (i.e., enterprises that thrive on high risk/high return). By 2004, in enterprises where faster reaction is key to operational effectiveness, BAM will be one of the top four initiatives
driving IT investment and strategy (0.8 probability).
Gartner's Marketing Knowledge and Technology Commentary COM-13-9992,
11 July 2001.
Global Manufacturing Solutions Webletter is published by Rockwell Automation. Additional editorial material supplied by Gartner, Inc. © 2002. Editorial supplied by Rockwell Automation is independent of Gartner analysis and in no way should this information be construed as a Gartner endorsement of Rockwell Automation's products and services. Entire contents © 2002 by Gartner, Inc. All rights reserved. Reproduction of this publication in any form without prior written permission is forbidden. The information contained herein has been obtained from sources believed to be reliable. Gartner disclaims all warranties as to the accuracy, completeness or adequacy of such information. Gartner shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof. The reader assumes sole responsibility for the selection of these materials to achieve its intended results. The opinions expressed herein are subject to change without notice.
BAM spans the gamut of business needs. An enterprise that needs faster reaction time on a business issue can use BAM, but must realize it is but one of the "moving parts" in a complex business system. Since BAM leverages the application integration world (BAM may require data from many systems in the process chain) and the BI world, some BAM efforts will stress one side more than the other. For instance, for the controller who wants to view real-time cash flow and working capital metrics, the BI side may be heavily stressed. Enterprises can only calculate cash flow by taking a sales order and applying the customer's payment history to forecast the expected cash flow (the same is true on the payment side, except the payment terms from the accounts payable system are used). This requires a powerful BI model, and much data for the calculation will likely not be in BAM's control – e.g., in the operational data store (ODS) – because it is not transactional data being pumped into the ODS by the integration infrastructure. The watchword for enterprises is that the real-time data must be blended with models, data and processes that may exist outside of BAM and are all part of a holistic view of the business mandate. BAM is the real-time element of model-based decisions.
The majority of these real-time decision environments are hardly the business applications found in the typical enterprise. BAM is timely because it is becoming possible to envision BAM architectures for a wide variety of mainstream commercial activities. To many, BAM is now a realistic goal to consider.
The complexity of BAM will mean that the majority of upcoming BAM implementations will be outside of the mainstream (Type B) market, until return on investment, vendor stability and architectural ease become manageable.
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