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A Beginner’s Guide to Business Activity Monitoring (BAM) Software

Ever heard of the terms business activity moniBusiness activity monitoring software creates alerts to watch for errors and inconsistencies, saving you time and worry. toring, business alerts and email alerts? The phrases themselves are somewhat self-explanatory, but there is a lot more behind these words and the software that they were invented to describe. Through the course of selling and implementing our own business activity monitoring (BAM) software at Ei Dynamics, I’ve found that there is still much confusion and even complete ignorance on what BAM is and does.  Thus, I wanted to take the time to put together a comprehensive overview of what BAM is and how it can help companies become more efficient and profitable. My other motive is to enlighten those who have influence in this space so that they might educate themselves to better help their own customers.

Unlocking the Unknown

At Ei Dynamics we eat sleep and live automation, and sometimes when you are that close to something you forget that what might be common knowledge to you is not common to others.  It struck me recently that I might have lost touch with reality a little bit during a conversation with a prospective reseller.

I was explaining how our software can easily monitor almost any data and send triggered alerts to people when an exception was identified.  He said that it sounded neat but that he’s never had a customer ask for something like this so it’s probably not something they would be interested in. My gut reaction was that they probably aren’t asking, because they don’t know something like this even exists or is available to companies like them.

I realized from this conversation that maybe there needs to be more education on what exactly Business Activity Monitoring (BAM) is, so here it is:

A Beginner’s Guide to Business Activity Monitoring (BAM)

Definition

Wikipedia says business activity monitoring (BAM) is software that aids in the monitoring of business activities implemented in computer systems.

Here is my definition … The process of using computer software to electronically monitor business data based on user-defined business rules and the systematic electronic notification when those rules are triggered. When an exception to the rule is identified, notification events typically occur in the form of an email, text message, social networking post or desktop pop-up.

Depending on who you talk to there are also several other common terms for BAM that are also used interchangeably such as:

  • Business Alerts
  • Exception Alerts
  • Email Alerts
  • Electronic Monitoring Notifications
  • Triggered Messaging
  • Business Intelligence (Note: This term, however, is incredibly overused and has so many different meanings and connotations depending on who you talk to that it is almost unintelligible anymore…a bit like how the term “Cloud Computing” has recently become overused and diluted in meaning.)

Objectives and Benefits

The objective of BAM is to enable companies to make better informed decisions by giving them visibility across their organization in a real-time capacity.

The general paradigm followed by most organizations today—to determine if there is a problem or an actionable item—is to manually run reports, view on-screen dashboards or log in to their business systems and use some type of built-in inquiry to view actionable information. This is a largely manual exercise and leaves a tremendous amount of room for error, because a human being must remember to look in the right place and “pull” the correct information.

With BAM, rules are predefined and automatically executed by a computer, eliminating human error.  The computer simply runs its business rules at predefined intervals 24 hours a day, 7 days a week and then “pokes” or “alerts” the correct individual(s) when there is some type of actionable item.

BAM enables business users to focus on immediate important things and eliminates the need for the manual, repetitive exercise of having to remember to constantly log in to a system or run a report or check a file. The added benefit is that the more of these steps we can automate and transfer to the computer, the more time we have to focus on other things to improve the business.

Common Features

A BAM system is typically comprised of the following features.

  • Business Rules Engine — Allows users to set up business rules for the software to follow. The rules engine might be a combination of SQL, scripting language, functions and data filtering. (Note: Depending on the BAM system, some rules engines are more user friendly than others. Some are SQL query based, some are script/code based, while others are wizard driven via graphical user interface. There can be pros and cons to each.)

  • Notification Engine — Provides options to set up an email, text message or social networking post when an exception is identified.  Some products offer very basic text-based emailing, while others provide full HTML email capabilities including email personalization whereby the recipient and email content can be determined at run time. Having HTML capabilities is ideal, because it allows for more professional and aesthetically pleasing presentations of information to the end user. Types of notification options include:

    • Email
    • Text Message
    • Instant Messaging
    • Social Networking (Twitter, LinkedIn)
    • Desktop Pop-ups
  • Database connectivity — Different BAM systems will connect to data differently but in general most use an ODBC or OLEDB connection (a common database interface). More advanced systems will provide proprietary connectors to non-ODBC compliant systems or have the capability to allow you to talk to data via a web service or API. Types of connectors include:

    • ODBC
    • OLEDB
    • Text, CSV
    • XML
    • JSON
    • Web Service (SOAP or REST)
    • Proprietary
  • Logging — A BAM system should also provide some mechanism to track when an alert was sent or if any errors occurred during the processing. Without being able to track alerts, it’s difficult to gauge trends, larger issues, etc.

Practical Applications

There are many practical and useful applications for a BAM system. BAM systems allow us to automate things that we may otherwise be required to do manually.  A properly implemented BAM system can be like having a thousand set of eyes looking and watching for things on our behalf and always ready to let us know if there is an issue or reason to be notified.

Think of how much more productive and content you would be if you didn’t have to remember to do all the things you’re supposed to do or take care of. Wouldn’t it be great if you had a personal assistant that did all the remembering for you and simply reminded you when something needed to be done or taken care of? That’s the benefit of BAM!

There is virtually an unlimited number of applications for a BAM system. With that said, here are some examples of how a typical company might use BAM within each of their departments:

Accounting:BAM software can generate alerts for a variety of needs throughout your business.

  • Monitor account balances and send an alert if a balance meets or exceeds threshold.
  • Notify someone in the accounting department when and if a new GL account is added to the accounting system.
  • Notify customers when their accounts receivable balance becomes aged beyond a specified number of days.
  • Send an email to an AP vendor when their invoice has been identified as paid in the accounting system.

Operations:

  • Monitor budgets and notify project managers when a line item in the budget come within threshold or exceeds budget.
  • Monitor inventory levels and notify warehouse manager when an item comes within or below specified stocking limits.
  • Monitor vendor/customer/employee setup and notify appropriate individuals when information is not entered or is entered incorrectly.
  • Monitor compliance fields such as project due dates or insurance expiration dates and notify someone on or before said deadlines are passed.

Sales and Marketing:

  • Automatically notify customers when an order has been fulfilled or shipped from warehouse.
  • Match customer profiles with goods and services and notify customers when new goods or services are available that they might benefit from.
  • Automatically send customer statement or invoice upon completion of work.
  • Auto respond to customer inquiries via website feedback form.

Human Resources:

  • Monitor payroll and time and alert managers if an employee exceeds maximum hours allowed or falls below minimum requirements.
  • Monitor vacation and other employee benefits SHR  and notify employee when vacation or sick time benefits are about to expire or when thresholds are about to be met.
  • Automatically notify employees of key company events such as holidays or open enrollment periods.
  • Monitor employee setup and notify HR manager is information is missing or inconsistent with company policy and procedures

Availability/Commercial Solutions

narrowMany commercial software vendors are slowly incorporating more and more BAM functionality directly into their own products. However, these solutions are typically very narrow in focus and flexibility. For example, they might have a feature to notify you or a customer if an invoice becomes aged over a certain number of days, but if you wanted to change the email text or how many people get notified or modify the notification conditions to something custom you might not be able to do any of it. You get what the vendor built and how they perceived it should work.

A good analogy along these lines might be in the area of report writing whereby many software vendors over the years built their own report writers directly into their own products. However, because these vendors are not experts in report writing, their products typically are not as robust or feature rich as a commercial report writer like Crystal Reports or Microsoft SQL Reporting Services. Depending on your company’s needs and requirements this may or may not be a factor.

If you want a robust, highly customizable BAM specific solution there are commercially available solutions from vendors like Ei Dynamics all the way up to vendors like IBM. Unfortunately, there are not a lot of vendors in this space that focus on just BAM and many of the solutions tend to be geared toward the higher end of the market, incorporating more advanced functionality such as Work Flow, EDI and ETL. Therefore, the costs can swing wildly from just under $1,000 to well over $100,000.

If you are interested in BAM technology, I encourage you to explore the many benefits it has to offer. You can find more information on the Ei Dynamics website. Also, feel free to send me a note by posting a comment below, and I’ll either reach out privately or respond online.

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photo credit: http://www.eidynamics.com/ProductInfo/DynamicAlerts.aspx
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