ANALYSIS
Intelligence test Despite tightened IT budgets, business intelligence remains a key industry priority, says Helena Schwenk.
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T budgets are currently coming under increased scrutiny and pressure. But, while a recession might well be forcing companies to pull back on some IT investments, Ovum believes that any new initiatives will address specific business pain-points and offer quick and visible payback. BI fits into this category – focusing on key issues like securing and increasing revenue from profitable customers, rationalising and reducing operational costs, providing greater visibility into cross-selling opportunities and improving customer satisfaction. Hence, Ovum believes that BI will continue to rank among the top three priorities for CIOs.
Recession busting technology While many companies will instinctively use BI as a cost-cutting tool, smart companies will continue to invest in BI solutions to intelligently scale back operations and maximise efficiencies from business processes they already have in place. In a recession, BI allows companies to take a more calculated and informed approach to tightening their belts, making sure that any cost cutting measures don’t cut across their top business priorities or cut out the valuable Brazilian rosewood with the deadwood. Moreover, they will increasingly focus on using BI to maximise revenues, optimise operations and grasp new and lucrative business opportunities
“BI allows companies to take a more calculated and informed approach to tightening their belts, making sure that any cost cutting measures don’t cut across their top business priorities” before their competitors do. While a recession might well force companies to pull back on some IT investments, there’s rarely any question of a BI project being pulled or cancelled due to a cut in costs. If anything, an economic downturn could in fact speed up its deployment from a piecemeal departmental deployment to deployment across the wider enterprise. Ovum expects the risk-averse fi nancial services sector to lead the charge in new BI projects over the coming year as they realise the need to analyse their businesses and the market in order to boost revenue performance and to segment (profitable) customers more clearly. However, BI customers are also becoming increasingly cost-conscious. Companies are insisting they do more and more sophisticated types of BI with less money and IT staff. Ovum believes that’s a good thing – it will make BI more focused and efficient, which in turn has a better chance of returning tangible benefits. It will also continue to force BI vendors away from their traditional premium pricing models, resulting in broader adop-
tion of BI beyond an elite group of executives and analysts to front-line business users.
New models As a result of the economic downturn, customers are becoming more risk averse and are looking for more cost-effective ways of implementing BI. Th is will challenge traditional BI and data warehousing implementation approaches and put new development, deployment and packaging models like open source, soft ware-asa-service (SaaS) and pre-packaged appliances on the radar screens of more BI customers, particularly SMBs. Additionally Microsoft’s market entry and BI strategy aim to make BI a commodity technology that customers will expect to implement more easily and for a lot less than complex, premium-priced solutions of the past. These are some of the key BI technology trends that are developing: Open source: Open source BI is still a fledgling market and its evolution is still a far cry from its evolution to free solutions that are advanced by the developer community around the globe. However, it is no coincidence that Linux is now the fastest growing platform for new BI projects. The continued interest in open source BI is a clear counter-reaction against the market dominance of a few vendors due to consolidation. Open source BI pioneers like JasperSoft and Pentaho, which were once considered temporary illegal aliens in the BI market, are establishing themselves as permanent residents, getting funding, issuing new code releases and starting to win over larger non-traditional enterprise customers. Economic forces are also playing directly to open source, particularly for fi rst-time BI buyers. These companies are looking for a cost-effective way to deploy BI without having to fork out a heft y upfront fee for a packaged commercial offering. First-time open source implementations will always be prototypes. But if successful they will evolve into fully productive BI systems that are backed by commercially licensed support services from open source BI vendors. SaaS BI: Providing BI as a hosted online service – is gaining increased market acceptance, especially among smaller, cost-conscious businesses. This will be a decisive make-or-break year for SaaS BI adoption, especially as seemingly similar cloud infrastructure models start to take root. Most of the early adoption thus far has been among SMBs or
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