Manufacturers spending thousands of pounds on business intelligence in order to make better business decisions are in danger of missing the point and throwing away time, money and resources on analysing the wrong data.

For BI to be truly effective, businesses must first understand what the benefits are and how it will create real, actionable information, not just prettier displays of the old data. Only then can it be tied into a long-term information strategy tailored to specific achievable business objectives.

The crux of the problem is that if executives aren't absolutely clear on what they want to measure and why, they run the risk of creating a vicious cycle of incorrect data continually spawning ineffective actions.

A common mistake, for example, is to focus on internal metrics and measures rather than analysing data from the customers' perspective. On time delivery provides the perfect illustration. Meeting this type of demand is fundamental to maintaining the favour of customers, but it's the way its success is measured that counts.

If a company defines successful on time delivery as 'goods shipped either on the day or up to two days early' and that target is met, BI focussing on internal measures will report a success. But what if the customer's definition of on time delivery is for the goods to arrive between 2pm and 4pm, only on the specified day? If the customer sees any deviation to this as a failure on the suppliers' part and the goods are turned away, not only will the supplier be damaging vital customer relations, but the information that points to this pattern would be lost, purely because the focus is on the company's definition of success rather than the customers.

But that's not to say that internal measures are useless. The BI minefield means that it becomes ever more vital to employ experts that truly understand the data and its implications. If you peel away the traditional misconceptions about BI then it boils down to best practice - employing a rational deconstruction of metrics and measures and putting powerful information about relevant activity into the hands of the people who can actually influence those measures.