XM Versus BI: No Real Comparison

When I was at the SAP Select event in Berlin last week, I was asked a great question… Isn’t Experience Management (XM) just like business intelligence (BI)?

First of all, they’re nothing alike. However, I understand why they may appear similar at a surface level. That’s why I really like this question; it gives me the chance to provide additional clarity around XM.

Here’s why XM is nothing like BI:

  • BI is a technology, XM is a discipline. BI is a tool that takes streams of data and transforms them into presentable formats. XM is a discipline that helps organizations deliver differentiated experiences by continuously learning, propagating insights, and rapidly adapting. Organizations adopt XM by mastering a set of six competencies that are enabled by technology and nurtured by culture.
  • BI focuses on O-data, XM adds X-data to O-data. BI collects operational data (O-data) from a number of internal systems, looking at how operations are performing. While O-data provides some insights, it lacks the deep understanding that comes from people (customers, employees, partners, etc.) who can explain why things are happening, with information about what they are thinking and feeling. That’s why XM collects this experience data (X-data) and drives insights by combining it with O-data.
  • BI enables analysis, XM embeds analytics. BI provides a platform that analysts can use to manipulate data, often connecting it with other analytical tools. A strong XM platform uses analytics at the core of its data processing engine, so that all types of users can gain instant access to deep insights. The Qualtrics XM Platform includes Qualtrics iQ, which makes it easy for novices to tap into the power of powerful capabilities such as text analytics, predictive analytics, and voice analytics.
  • BI is about reporting, XM is about acting. The output from BI is typically a set of dashboards to be reviewed by a limited group of people across an organization. An XM effort may provide dashboards, but only when that format is part of driving smarter actions across an organization. That’s why the Qualtrics XM Platform supports a robust set of workflows based on insights that drive action across an organization and can integrate into process flows within systems such as CRM and HRM.

The bottom line: XM is a capability that is woven throughout your operating fabric.

Written by 

I am an experience management transformist, helping organizations improve business results by engaging the hearts and minds of their customers, employees, and partners. My "job" is Head of the Qualtrics XM Institute. The Institute is still being established, but our goal is to help organizations around the world thrive by mastering Experience Management (XM). As part of this focus, I examine strategy, culture, interaction design, customer service, branding and leadership practices. And, as many people know, I love to speak about these topics in almost any forum. Prior to joining Qualtrics, I was managing partner of Temkin Group (leading CX research, advisory, and training firm), co-founder and chair of the Customer Experience Professionals Association (CXPA.org), and a VP at Forrester Research. I'm a fanatical student of business, so this blog provides an outlet for sharing insights from my ongoing educational journey. Check out my LinkedIn profile: www.linkedin.com/in/brucetemkin

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