BI Competency Centers: Enablers of Better Decisions
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Presentation on theme: "BI Competency Centers: Enablers of Better Decisions"— Presentation transcript:
0 Welcome! Thank you for joining us on today’s Gartner webinar. Placeholder for text (substitute your own text; delete when not used)Thank you for joining us on today’s Gartner webinar.70% ofFortune 100080% ofGlobal 50055Conferences4,000CIOs750 Analysts Serving Clients in 85Countries100,000IT End-UserInquiries10,000Media2.7 MillionIT End-User Searches60,000Clients10,800ClientEnterprises5,500Benchmarks
2 Key Issues What is the role and value of the BICC? What are cores skills and competencies for a BICC?What are the lessons learned from leaders of BICCs?
3 IT Perspective: The top business drivers for investments in Business Intelligence Speed up and improve the organization's decision making abilityRespond to user needs for data on a timely basisBetter align with and track against corporate strategy and objectivesBetter manage a specific operational process in a more timely fashionDecrease business costs and improve operational efficiencyTo move users toward a self service model of information delivery3
4 Source: 2011 Gartner FEI Technology Study – To Be Published, N=334 CFO’s Perspective: Analysis and Decisions Making will Drive IT InvestmentsSource: 2011 Gartner FEI Technology Study – To Be Published, N=3344
5 Business Intelligence: Use of Information And Analysis to Make Better Decisions Skill LevelsRequiredPredictive AnalyticsPrescriptive AnalyticsWhat Will Happen?Descriptive AnalyticsWhy Did it Happen?ModelWhat Is Happening?SeekAdaptInformationData mining and predictive analytics is not data warehousing, reporting, ad hoc queries or online analytical processing (OLAP) analysis. However, these methods and tools are often complementary to data mining and predictive analytic, because the more you already understand your data, the more effective the data mining and predictive analysis process will be.Although an enterprise data warehouse is not a requirement for doing data mining and/or predictive analytics, many of the same competencies apply and are required. These competencies include the data access, data integration, data quality and data management of large datasets.Often, the data to be mined is best extracted from an enterprise data warehouse because many of the issues of data consolidation, quality and maintenance have already been put in place. Also, the problems of data cleansing for data warehouses and data mining are very similar, so that, if the data has already been cleansed for a data warehouse, then it most likely is not in need of further cleaning for data-mining applications.Data mining and predictive analytics provide another means to further extend the value of your business intelligence (BI) infrastructure and competencies and get more insight in return.Level of Business Impact
6 Agree/Disagree With the Following Statements: Multiple Choice What is Your Organizations Level Of Information and Analytical Competency?Agree/Disagree With the Following Statements: Multiple ChoiceWe are competent at answering: “What is happening?”We are competent at answering: “Why did it happen?”We are competent at answering: “What will happen?”6
7 A different organizational model is needed! The "White Space" in Organizations is Where Business Intelligence Succeeds or Fails!Business SkillsDecisionsAnalytic ProcessesBusiness ProcessesAnalytical SkillsTools and ApplicationsIT SkillsIT ProcessesInformation InfrastructureA different organizational model is needed!Roles, Controls and Rewards need to be defined.
8 Gartner's Business Intelligence/Analytics/ Performance Management Framework Business Strategy and Enterprise Metrics Framework(Strategic, Financial, Operational Objectives and Measures)'Consumers' (Users)Business and Decision ProcessesBusiness Process Applications(Performance Management and Transaction Processing)Analytic Applications(Stand-Alone and Embedded in Business Process Application)'Producers' (Analysts)Analytic ProcessesBI Capabilities(Platform/Tools and Embedded in Analytic Application)Program ManagementMetadata and Services Repositories'Enablers' (IT)Information Infrastructure ProcessesInformation Infrastructure(Application Data Mart, EDW,ETL, Data Federation, Data Quality)Key Issue: What is the role and scope of the BICC?The BI, analytics and performance management framework defines the different views (people, process and tools/applications) and the possible combination of components needed for implementing BI, analytics and performance management solutions.A solution is an implemented system that solves a business problem. Each solution has a solution architecture — the description of how it is built and the capabilities it provides. Solution types include application solutions, shared infrastructure solutions and SOA solutions. The framework is descriptive rather than prescriptive. It provides the set of components for defining a solution rather than the specific pattern or solution architecture.(See "Gartner's Business Intelligence, Analytics and Performance Management Framework," G )
9 Integrate Essential Competencies and Skills With a “BI Competency Center” Business SkillsDecisions & MetricsBusiness Strategy, Plan, Processes & ResourcesAnalytic SkillsAnalytic and Process ExpertiseBusiness Rules & ModelsIT SkillsTools and ApplicationsData Management and IntegrationAnalytical and Information SupportDevelop User & Analytical SkillsObtain & Control FundingDefine BI Vision and StrategyManage ProgramsDefine Leadership & GovernanceBuild Technology BlueprintEstablish Standards and MethodsBICCProgram ManagementKey Issue: What is the role and scope of the BICC?Organizations that do not include business users as an engaged and integral part of their BICC will double their long-term costs of supporting BI because of the need to go back and redefine, redesign and refine their BI strategy to reflect the needs of the business users.Business users, IT leaders and analysts must have a solid understanding of the value of BI and its critical role in helping the company achieve its business objectives. In addition, business-user members of the BICC need a unique mix of basic and advanced business skills, as well as shrewdness in communications. Depending on the particular business skills found in your company, you may be able to "mix and match" basic and advanced business skills to recruit individuals who are able to meet the current needs of the BICC. They should also be able to meet more-advanced business needs — particularly the ability to deliver return on investment (ROI) — as the BICC gains momentum and becomes more firmly established in the company.Action Item: Business-user representatives may not have a strong or deep understanding of "BI technologies," but they should play a critical role in bringing forward the business and user requirements, helping prioritize projects, and helping to promote BI efforts among business users.
10 Investments in Information and Analysis: Driving Business Performance — Cause or Effect? Through 2015, organizations integrating high-value, diverse, new information types and sources into a coherent information management infrastructure and use that information to make better decisions will outperform their industry peers financially by more than 20%.Through 2015, more than 35% of top 5,000 global companies will fail to adapt to significant changes in their business and markets due to underinvestment in their information intelligence infrastructure and analytic competenciesThe economic crisis will reveal which enterprises have a sound information infrastructure. Business managers and knowledge workers are the thinkers and deciders in an organization that are tasked with using data for running, growing and transforming the business. Their productivity and creativity is one of the most important and valuable assets a company has for achieving its strategic performance initiatives. The right strategic combination of people's abilities (business managers' and knowledge workers' competencies and executive sponsorship/engagement) and IT processes abilities (business, applications of technology and information) have been shown to have a high positive correlation to business advantage and achieving superior returns on investments (ROIs). See related research:"IT Assets, Organizational Capabilities and Firm Performance: Do Resource Allocations and Organizational Differences Explain Performance Variation?", Sinan Aral and Peter Weill, July 2007, MIT Sloan Research Paper No CISR Working Paper No. 360."Information, Technology and Information Worker Productivity", Sinan Aral, NYU – Stern School of Business; Erik Brynjolfsson, Massachusetts Institute of Technology (MIT) - Sloan School of Management; and Marshall W. Van Alstyne, Boston University – Department of Management Information Systems.In the Gartner 2007 Survey "Gartner EXP CIO report Creating Enterprise Leverage: The 2007 CIO Agenda", most CIOs responded that the managers in their organization do not have the right information that they need to run the business. We expect this trend will continue through 2012 and will ultimately be the cause of the failure of strategic performance initiatives.Action Item: Adjust resource planning to mitigate risk from faulty data, security challenges or other risks.
11 Why Have Only 27% Established a BICC? Those with BICCs report:More users34% vs. 25%More spendingBudgets significantly higherMore expansiveIn-memory, SaaS and open source plans higherMore holisticBusiness process improvement/management attention is 50% more prevalentAttendees at the 2010 Gartner business intelligence (BI) summits (Europe, Asia/Pacific and North America) voluntarily participated in a BI, Analytics and Performance Management survey. Slightly more than one in four respondents (27%) indicated that their companies had already established a BI competency center (BICC).Another 41% disclosed they planned to implement a BICC within 12 months.The premise: If BICC is a benefit to the business, why have only 27% of companies established this structure? Those with BICCs report more users, higher budgets, increased use of alternative technologies, and a broader view of how BI, analytics and performance management plugs into the broader story of business process management and improvement.Source: 2010 Gartner BI Summit Attendees
12 Key Issues What is the role and value of the BICC? What are cores skills and competencies for a BICC?What are the lessons learned from leaders of BICCs?
13 Business Skills for a BICC Strategic Planning Assumption: Organizations that do not include business users as an engaged and integral part of their BICC will double their long-term costs of supporting BI.Credibility and cloutEngaged in the management of business processesAbility to define business decisions in the scope of overall business objectivesDefines performance metrics in context of performance frameworkAppreciation of cross-LOB/functional issuesCommunicating and persuading at executive levelPrioritize projects/requirements with a link to business impactUnderstanding what possible improvements can be supported by better data and analysisDeveloping a selling business caseOngoing stewardship/evangelism to drive standardization, adoption and acceptanceKey Issue: What are the core skills and competencies needed to support a BICC?Organizations that do not include business users as an engaged and integral part of their BICC will double their long-term costs of supporting BI because of the need to go back and redefine, redesign and refine their BI strategy to reflect the needs of the business users.Business users, IT leaders and analysts must have a solid understanding of the value of BI and its critical role in helping the company achieve its business objectives. In addition, business-user members of the BICC need a unique mix of basic and advanced business skills, as well as shrewdness in communications. Depending on the particular business skills found in your company, you may be able to "mix and match" basic and advanced business skills to recruit individuals that are able to meet the current needs of the BICC. They should also be able to meet more-advanced business needs — particularly the ability to deliver return on investment (ROI) — as the BICC gains momentum and becomes more firmly established in the company.Action Item: Business user representatives may not have a strong or deep understanding of "BI technologies," but they should play a critical role in bringing forward the business and user requirements, helping prioritize projects, and helping to promote BI efforts among business users.
14 Analytical Skills for a BICC Tactical Planning Guideline: When considering candidates for analytical positions, look for individuals who can view "the big picture," but are also able to "think out of the box" and be creative enough to ask different questions.Fluent in business processes.Can articulate how data and analysis relates to key performance indicators and managing businessNavigate, extract, explore, qualify and analyze data related to business operations and processes.Build multidimensional analysis modelsExperience using a palette of analytical techniques, (from simple data aggregation via statistical analysis to complex data mining)Validation (during modeling and deployment): Validate the analysis against historical or other data and modelsHaving the capacity to distill the relevant parts and produce sound business recommendationsKey Issue: What are the core skills and competencies needed to support a BICC?In the BICC, data and information analysts must be able to call on creativity, common sense and a combination of investigative and interpretive skills to transform data into a body of knowledge — particularly in the brainstorming and initial data-analysis phases of their BI and performance management efforts (see "Findings From the Chicago BI Summit: Apply Creative Thinking to BI Initiatives" G ). In addition, data and information analysts need to be able to work with business people and have an insight into business needs. They must also have demonstrated skills using tools and technologies for accessing and analyzing information. It will become increasingly important to effectively communicate and present the results of analysis to a business audience that does not understand the analytical methodology or standard formats of analytical reporting.In many cases, organizations will find that analyst involvement in a BICC is not a full-time job. Instead, the analyst role and skills may be tapped into on a regular basis, according to market, organizational and business dynamics. At any time, the role of a specific person in the BICC should be based on the strategic and business focus of the BICC. Clients should expect membership, structure and projects in the BICC to be dynamic (within reason), based on the objectives of the organization and the BICC.
15 IT Skills for a BICC Business savvy Program management Tactical Planning Guideline: IT members must also be able to understand, support and champion business-driven strategies, as well as provide technology-specific knowledge and insights.Business savvyProgram managementUnderstanding of architectural patterns and standardsModeling for analytical applicationsRequirements gatheringReport writing (and cube building)BI application development, administration including securityData integration, including data quality, master data and MDMData management and warehousingKey Issue: What are the core skills and competencies needed to support a BICC?IT members of the BICC need to possess a depth of architectural and technical skills, and be able to work and communicate with a number of different constituents. IT organizations can play a key role in cultural change management, particularly in terms of promoting BI within and across IT. This role may include:Communicating to the rest of the IT organization the role and opportunities of supporting BI applications as part of a BI strategy, as well as helping to build communication across lines of business and ITHelping people (users and IT) understand that a BI initiative needs a robust BI architecture to be successfulGetting the IT organization to realize that business users will need multiple BI technologies to meet their varied analytical needsEnsuring that business users support the IT organization's need to provide a platform that can handle changing business requirementsWorking with the business to measure the use, effectiveness and value of the BICCAction Item: Look for IT representatives that have a balance of technical, business and people skills.
16 Program Management Skills: Focus on Agile Development and Deployment 5. Access, Monitor and Analyze1. Requirements and Prototyping2. Data ID and Preparation6. Discovery and ExplorationBICCDeployDevelop3. Tool Evaluation and Selection7. Develop Decision8. Share and Collaborate4. Develop, Implement and Train9. Effect ChangeImplementing BI requires highly developed program management skills, including:Integrating complex technologies.Using the technologies skillfully to gain the insight needed to make better decisions.Addressing the complex organizational dynamics associated with competing BI priorities.To implement BI, most organizations need to address a host of significant business drivers. In many cases, there are multiple buying centers for BI, each of which has its own priorities and initiatives. Additional requirements may exist, such as a need to reduce the cost of the infrastructure, to improve data quality and to achieve a "single version of the truth." Many vendors have started to sell BI functionality. Meanwhile, many organizations have many plans and priorities that are competing for the same funding. The means for deciding on priorities and processes varies from organization to organization, and the decision-making process tends to be rooted deeply in each organization's culture, leadership, skills and management methodologies.As a result, the greatest challenges to implementing BI are not in the complex technologies, but in having the necessary program management skills and user skills to employ those BI technologies to their maximum advantage and in overcoming the challenges of complex organizational dynamics.Note: Highly iterative development and deployment process; 70% of requirements change within the first year of deployment
17 Key Issues What is the role and scope of the BICC? What are the organization and funding models for the BICC?What are the lessons learned from leaders of BICCs?
18 Varied BICC Organization Models StructureDescriptionDepartmentalPhysical department within IT or operations, reports to CIO, COO or CFO organization.DecentralizedSeveral BICCs across the organization by line of business, function and geography. Each is responsible for its part of the organization/function.VirtualStaffed with existing resources across the organization. Resources retain their original reporting structure, allocated to BICC responsibilities.HybridA combination of styles. For example: departmental with some virtual attributes.Key Issue: What are the organization and funding models for the BICC?There are four distinct models for BICCs. Companies report they morph over time to accommodate organization needs:Departmental: Physical organization within IT or operations, reporting within CIO, COO or CFO structures, with singular focus and direct accountability for BI, analytics and performance management programs. The potential cons to this model include additional staff and related costs, resources "drafted" from across firm — potentially not their preference — and possible disconnect from business, especially if its approach is IT-centric.Decentralized: Several BICCs or affiliated organizations across the enterprise by line of business, function (IT infrastructure versus front- end tools is the most common) or geography, each responsible for its part of the BI agenda. Benefits of this model include autonomy of each unit, buy-in from operations as the team is tightly aligned with its agenda, coupled with direct accountability for success/failure of their teams. Negatives can include differing standards — especially if groups take different approaches to solving similar problems and lack an enterprise perspective.Virtual: To pull the right skills and people into a BICC, a virtual model is staffed with existing resources across the organization. Resources retain their original reporting structure and are allocated to BICC responsibilities. A rotation program can keep skills and business acumen fresh. Some benefits of this matrix approach include no additional organization structure, more business involvement and enhanced skills development. But there are potential negatives: Priorities will compete with other responsibilities, accountability can be muted and staff may feel overburdened by too many tasks to manage simultaneously.Hybrid: A hybrid model combines a combination of styles. For example: a company may take a departmental approach as the primary model and pair it with some virtual attributes to rope in necessary skills and perspectives. Most companies settle into this type of organizational model. It chooses the best attributes of other models, and matrix-manage team members not physically assigned to the team. Companies also report this is less disruptive over time.
19 How Are BICCs Funded? Model Description Centralized Funded from corporate or IT budget. Gets buy-in from business without potential cost pushback.AllocationMethod ensures 100% allocation of costs back to business. Not always considered 'fair.'Pay As You GoBased on groups' use of BICC services. Fair-share distribution, but cost model may inhibit growth.SubscriptionBased on projected use of BICC or number of users. Requires negotiation process between business and BICC.HybridAny combination of models.Key Issue: What are the organization and funding models for the BICC?There are several BICC funding models. Companies we interviewed used various mechanisms.The Centralized model was most common, and funding came from either IT or a centralized fund. A financial services company remarked, "The BICC is funded by IT, but business funds IT." A retailer indicated that it was funded centrally from within business operations. They indicated that, "It's a service to the business. We're trying to spread analysts across all business lines."Some firms used the Allocation method to spread expenses across all organizations that use the BICC. A public sector organization said, "The BICC is sponsored by the state, with each authority getting billed for BICC services based on agreed-to metrics."We only found one company that employed a Pay-As-You-Go model, and this firm was doing sophisticated analytics within the BICC. Its point of view: "Complex analysis can't be done for nothing." Anyone who wanted to use the analytic or other services of the BICC would pay for them as they used them.Sophisticated deployments of BICC often use a Hybrid model. A global manufacturer said that BICC was paid for within their organization in a variety of ways. They said, "Funding comes from corporate overhead and direct bill to projects. But upgrades cause the biggest expense." They also indicated that getting the funding model right at the outset was important as it could act as a deterrent to broader business use.
20 Define the Scope of Applications, Governance and Funding of BICC Degree of Governance andFunding Models for BICC0%100%Special-purpose BI applicationsDepartmental BIapplications'Framework and standards'Cross-functional BI applicationsMultiple departments and data sourcesCorporate BI applicationsKey Issue: What are the organization and funding models for the BICC?The BICC has several tasks and user groups to serve, including itself. The user groups' requirements may conflict. Setting up standard reports might satisfy "rank-and-file" data consumers' needs, but would not suffice for the BICC because the CC consists of analysts who need greater control and depth. When examining user profiles, executives' BI requirements are not strategic. However, this makes sense, because the analysts' added value is to apply that strategic focus to corporate data.The BICC must understand the needs of different user groups. It should have 100% governance in support of corporate BI applications that set the analytic framework (for example, around customer segmentation). Uniform definitions, visualization and distribution are crucial. The BICC should have a reference role in departmental applications, and should assess the extent to which departmental plans fit into the overall BI framework. (There may be specialist applications over which the BICC has no governance.) Finally, the BICC may be involved as a consultant, where the most it can do is seek leverage with the rest of the organization.See "Create a Business Intelligence Competency Center Built for Self-Service" (G ).
21 There Is No Magic Formula for Staffing Three BICC resources for 100-plus users100+ BICC resources for 5,000-plus users21 BICC resources for 12,000 usersNumbers are all over the mapTalking to companies, they ask, 'We're a €10 billion company, how many people should we have in our BICC?' That is an irrelevant question ManufacturingKey Issue: What are the organization and funding models for the BICC?There is no formula that can be used to determine how many resources are necessary for each company's BICC deployment. Our research indicates that there is little consistency between firms on how the BICC uses its resources. Although roles are similar, staffing levels are not. One client said it best: "Talking to companies, they ask, 'We're a €10 billion (US$14.1 billion) company, how many people should we have in our BICC?' That is an irrelevant question."
22 Define and Evolve Your Sponsor Best Practice: Recruit a senior executive sponsor, and enable that sponsorship to change as your business objectives and goals evolve.CIOCFODepartmentBICCICCFinanceBICCCOOLOBBICCDivision 1Division 2Division 3FinanceBICCKey Issue: What are the organizational and funding models for a BICC?Support for BI and performance management is heavily driven by business objectives and, often, by corporate-level goals and metrics. It is vital to have a corporate-level (or equivalent) sponsor for your BICC, who's actively involved in the process by providing guidance, direction, requirements and management. It's important that sponsors understand and are committed to their responsibilities. A senior executive should not only guide the BICC, but should also promote the BICC's efforts and work with other senior executives to adopt and further develop your BI and performance management efforts.In many cases, a BICC is first created by the CIO within the IT organization. Although this is understandable — because the IT organization most often feels the direct impact of a lack of clear vision and direction — in reality, the BICC should reflect the business objectives that drive your BI and performance management strategies. For example, if your organization primarily focuses on measuring and monitoring financial performance, the BICC may report to the CFO. Or, if your organization is focused on operational efficiencies, it may report to the COO.Action: Finding and engaging a senior executive sponsor is crucial for the success of a BICC, but it is also vital that your sponsorship changes as your BI and performance strategies change. As you monitor and respond to changes in your business objectives, monitor and adjust sponsorship accordingly to reflect these objectives.
23 Realizing Value From BI Investments Operational EfficiencyStrategic Business TransformationLower Total Cost of OwnershipHigher Business Agility and ScaleInformationValue to CIO/ITTechnologyKey Issue: What are the organization and funding models for the BICC?There are different ways of measuring business value of BI and information management (IM) investments. And the business value definition depends on whether it is being evaluated by IT or the business organizations. To the business organizations, information and technology are contributors to delivering business value. They are necessary but not the end measure of value. The measure of BI and IM value is stated in business terms, such as contributing to agility, efficiency and scale, or the level of business transformation enabled.The four ways that organizations realize value from BI investments include:• Operational efficiency — More-effective support and use of information. More-relevant, accurate, consistent and timely information.• Strategic transformation — Use information to transform enterprise performance.• Lower Total Cost of Ownership (TCO) — More-efficient use of technology. Remove technical and operational obstacles and redundancies.• Higher agility and scale — Embedded into products, services and operations.EnablingContributingValue to Business
24 Metrics for BICC Success Strategic OutcomesTactical MeasuresFeedbackPerformance: Product line, sales channels, sales generatorsBusiness value of better insight (qualitative)Enterprise alignmentIncreased productivity for analysts, IT and business usersTurnaround time on enhancement requestsSatisfaction from support callsSystem uptime, hardware utilizationData sources supportedUsageLicense management360-degree assessmentUser satisfaction ratings e.g TRACK surveyExternal inputIf these guys are taking the time to actually use the BI system provided by the BICC, it is probably because there is something they want in there. ManufacturerKey Issue: What are the barriers, benefits and lessons learned from leaders of BICCs?There are all manner of metrics that companies use to measure BICC success. One thing stuck out from our conversations: customers did not always know what metrics they should be reviewing, so they had some quantitative items — time to solve problems, system uptime and license utilization. Monitoring actual usage was determined to be the most logical metric of success. As one past BI Excellence Award winner put it, "If these guys are taking the time to actually use the BI system provided by the BICC, it's probably because there's something they want in there."Gartner also recommends another methodology: a TRACK survey. TRACK is the information that is being created and shared via the BI initiative. Respondents are asked to provide their opinions on whether they have what they need to do their jobs, to make decisions and take action. The responses to the survey should be in the range of "0 (completely disagree)" to "10 (completely agree)."Timeliness: The information available to me for analyzing and making decisions to measure and manage the performance objectives that I am responsible for is timely.Relevance: The information is relevant to performance management and decision processes I support and to take the actions I need to take.Accuracy: Information and its analysis is accurate and the lineage reflects the state of the business and performance measures I am responsible for.Consistency: The information and analysis that I have is consistent enough with others who share similar information and analysis.Knowledge: I am knowledgeable enough about how to use the analysis and information.
25 Seven Lessons Learned From Practitioners 'Get the business owner as sponsor.' 'Bring in more senior people from the start.' 'Get funding model right!' 'Establish a more-detailed contract/SLA.' 'It's not 'do it, you're done.' There's a lot of ongoing evolution.''It's not a tool but a portfolio of tools. Make sure you have what you need in your toolbox.' 'You need a consistent evaluation system to ensure everyone judges the BICC performance on the same basis.'
26 Recommendations: Start Small, Think Large Take inventory of your organization's BI initiatives and skills, and their locations.Define the business objectives that the BICC will meet, and the appropriate executives to report to.Identify the appropriate funding and organizational strategy.Market results! 'Sell' BICC for new BI programs.Expand scope and sponsorship.Consider ways to turn BI into a revenue stream.The BICC is not the only CC, and should collaborate and share resources with your other CCs.
27 Related Gartner Research Business Intelligence Competency Center Key Initiative Overview for CIOs (G )ITScore for Business Intelligence and Performance Management (G )Q&A: Create a Business Intelligence Competency Center That Fosters a Performance-Driven Culture (G )The BI(G) Discrepancy: Theory and Practice of Business Intelligence (G )For more information, stop by Gartner Solution Central or us at
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