Original URL: http://www.theregister.co.uk/2007/08/13/business_intelligence_changes/

Next generation business intelligence

From power user to user power

By Louella Fernandes

Posted in Developer, 13th August 2007 10:21 GMT

Various research projects have shown that business intelligence (BI) continues to be one of the top investment priorities for CIOs. But what is changing is its shift in focus from complex tools for a few users to more flexible, affordable and accessible tools for a larger audience.

As such, BI is moving away from being an exclusive tool for power users, or "information producers", to empowering the "information consumers" in accessing, analysing, and sharing data.

There are a number of factors driving the need for more advanced business intelligence solutions which can offer faster and more accessible insight into business operations.

Firstly, the unprecedented data growth evident within every enterprise. Not only is the volume of data growing at an exponential rate, but the diversity of data is also increasing. Organisations are capturing and storing data from a multitude of sources, such as enterprise resource planning (ERP) and customer relationship management (CRM) systems, and are also seeing a proliferation in unstructured formats such as text, images, voice and video.

Meanwhile, new technologies are being deployed such as radio frequency identification (RFID) which are generating still more data. Regulatory and compliance issues are also contributing to the amount of data that needs to be stored and analysed for accurate reporting. In short, data growth shows no signs of abating.

Secondly, increased collaboration is driving the need to make BI more accessible. Businesses are becoming highly collaborative, sharing their data and resources with external partners. This means there is a far more diverse range of data sources for all employees to consult when making business decisions.

These factors are made more complex by the shorter decision cycles that businesses have to respond to, which drives a requirement for more immediate insight into business performance. This means BI can no longer be confined to just the power users in an enterprise and must now be brought to a new and wider audience - the operational workers who can access and act upon business data from the desktop applications they are familiar with.

To date, the implementation of business intelligence has suffered from fragmentation and sprawl as a result of organisations deploying solutions on a tactical, departmental basis. The penetration rate for business intelligence is generally pegged at around 20 per cent or less of potential users. The main reason for this is that solutions have traditionally been complicated to use by anyone other than the power user.

However, the broader end user community has become more and more involved in data analysis through the use of basic analytic tools.

The most notable is Microsoft's Excel spreadsheet which continues to be the most popular application for working with data due to its familiar interface and ubiquitous presence on desktops. The downside to this has been the proliferation of multiple spreadsheets being used within an enterprise, all with their own version of "the truth".

In response to this, a new generation of BI products has emerged to address the issues of cost and complexity. Probably the most decisive mover in the market has been Microsoft, with its message of "BI for the masses".

Microsoft has capitalised on the opportunity presented by the dominance of Excel while addressing its shortcomings as a business intelligence tool. Its suite of business intelligence products not only includes Excel 2007 and Excel services (offering collaborative, security and versioning features) but also SQL Integration, analysis and reporting services and PerformancePoint Server 2007 - giving Microsoft a very comprehensive set of business intelligence technologies, from data integration to analysis and performance management.

Microsoft's strategy of making BI more pervasive should not be underestimated, as its ubiquity on the desktop and enhanced range of business intelligence solutions gives it a very strong proposition to realise this vision, particularly for small and mid-sized businesses (SMBs). The challenge for other BI vendors lies in convincing SMBs that they need more than Microsoft's BI tools for reporting and analysis.

In contrast, the enterprise market has long been dominated by established BI players such as Business Objects, Cognos and SAS. Undeniably, Microsoft poses a threat to these vendors who are recognising the need to simplify their solutions for a broader audience, and are broadening their portfolio through acquisition.

In acknowledgement of Microsoft's dominance of data analysis for the masses, these vendors are offering tighter integration with Excel. At the same time, they are pursuing an enterprise standardisation strategy by offering a range of solutions - from complete, sophisticated BI platforms to simple self-service operational dashboards. They are also offering lower cost of deployment options such as Cognos Now!, which is available either as a hardware appliance or a software as a service model (SaaS).

While Microsoft challenges the dominance of the pure-play BI vendors, enterprise vendors such as Oracle and SAP are extending their business intelligence capabilities through acquisition, and up-and-comers such as Information Builders, QlikTech, Spotfire (recently acquired by TIBCO) and Tableau are driving innovation in areas such as user driven and collaborative analytics, data visualisation and in-memory data analysis.

This new class of vendors is certainly creating added value for business users who can now quickly discover and explore new insights in a visual environment. Although this user-driven, self-service capability is superior to the tabular analysis associated with traditional business intelligence tools, the sophistication of some of the best of breed data visualisation tools mean it is more likely to be used by the expert users, offering them a new way to explore data.

While some of the larger business intelligence vendors are offering data visualisation, it generally is not on a par with what is available from Spotfire or Tableau, and is more often just a dashboard visualisation of an Excel spreadsheet without sophisticated visual analysis capabilities. Data visualisation is a key requirement to enhancing data analysis, so we can expect these capabilities to become more widespread in BI solutions.

BI is no longer the exclusive domain of a few users in large enterprises that have had the budgets to spend on complex and expensive traditional tools. These enterprises can now benefit from consolidating and standardising their BI solutions to address their requirements while opening them up to more users.

Meanwhile, Microsoft's continued investment in the market also opens up BI to SMBs, which can look to both Microsoft and the small, innovative vendors for capabilities that enable them to better measure performance and improve business efficiencies, in the same way as their large enterprise counterparts.

Copyright © 2007, Quocirca