The case for independent BI, PM vendors

The recent or proposed acquisitions of performance management players - such as Hyperion by ERP vendor Oracle, and OutlookSoft by SAP - has intensified the debate around the relative merits of independent versus 'bundled' business intelligence (BI) and performance management (PM) solutions.

This is prompting users to carefully study the technology development roadmaps of vendors and assess the short versus long-term benefits of their technology purchase decisions.

Says David McWilliam, Managing Director of Cognos South Africa: "At the high end, only three pure-play BI vendors - Cognos, Business Objects and SAS -- remain to lead industry R&D and drive innovation. Of these, Cognos is currently the only independent provider of a proven PM suite, although Business Objects has recently announced its intention to acquire French PM vendor Cartesis.

"In South Africa, almost 70% of businesses have yet to make a strategic decision around BI, while those that have already advanced down this path must now take the step to performance management and all it entails, eg, the introduction of forecasting, score-carding and other performance measures.

"Driven by increasing competitiveness, the need for better reporting and legislative compliance, demand for BI and PM at a strategic level within organisations is growing.

"These solutions are important investments in the well-being of an organisation. It is thus critical that decision-makers choose carefully between merely obtaining visibility into their data by making use of an add-on BI infrastructure, and enhancing business performance through the implementation of an advanced BI and PM solution built on open systems that can be leveraged by the entire organisation. "

Current trends show organisations moving toward consolidation and standardisation of their BI solutions to create a single layer of management information (a single version of the truth), and the roll-out of BI functionality across the organisation to increase informed decision-making.

Performance management is a relatively new companion to BI, prized for its enablement of greater predictability and better management. While BI systems offer a historic view of information, PM launches itself off the BI platform to offer organisations sophisticated, forward-looking functionality like planning, budgeting and forecasting.

Says Christo Nel, Solution Manager of Cognos South Africa: "The selection of a BI and PM solution is as important as an organisation's choice of operational systems. A BI/PM initiative needs to be driven from a strategic level - it cannot be a quick-fix solution. Companies that are serious about BI will look at both ERP BI/PM solutions and independent BI/PM solutions, and assess the benefits these provide for their organisation over the long and short term."

ERP vendors compete on functionality, and the inclusion of BI and PM to their suite of integrated solutions increases their competitiveness. A common challenge is, however, the integration of the newly-acquired solution into the ERP suite. With different architectures and front-ends, development and testing take time.

Once integrated, the BI/PM technology enables ease of reporting directly from the ERP solution's transactional and CRM systems. However, since ERP vendors must focus on the development of their entire suite, the advancement of BI and PM capabilities may not be high on their agenda.

In addition, this newly-integrated functionality may be (or become) limited to use within the ERP suite. Since organisations today rarely have a single data source, selecting these BI and PM options as the organisations information management cornerstones could prove to be short sighted.

Existing customers of the BI solution may also need to ask questions about support and future development of the solution - they certainly did not bargain on an ERP vendor determining the product's technology roadmap.

Notes Nel: "For some, the all-in-one ERP, BI and PM option may seem a less expensive, simpler route to take. However, it may well only deliver a short-term tactical advantage, as without independence, a PM solution just evolves into one more silo.

"Organisations may have multiple ERP systems and warehouses like SAP, Oracle, Siebel, Peoplesoft, Microsoft, IBM and Teradata, as well as make use of other data sources such as XML, Excel and blogs. They may also have a mixed bag of infrastructure like portals, security systems and application servers, and as they acquire and/or merge with other companies, these scenarios get even more complex.

"An independent performance layer that plugs into enterprise infrastructure, and sits on top of all of a company's applications and data sources, without forcing the CIO to migrate, change, or modify the company's existing investments just to access the information they already own, is clearly an advantage."

Independent standalone BI/PM solutions offer a specialist focus, their broad customer-base in diverse industries and markets ensuring greater depth of knowledge and experience. Competing against other focused specialist vendors, they are driven to continually apply these expertises to increase and enhance functionality.

Cognos, for example, recognised the need for a single, open architecture years ago, and made the necessary changes to its technology and business processes. Since its latest version, Cognos 8, is based on SOA, the software is able to snap into any environment.

Says McWilliam: "The future of BI/PM sees the integration of structured and unstructured data and the enablement of search and analysis functions for both. Business activity monitoring will also become important. In this scenario, mission-critical activities are monitored in real-time. The third step will be the use of the same solution on different operating systems and architectures.

"Pure play vendors are leading these advancements. Organisations that want to implement BI and PM to learn and understand their organisations, should ask the questions and weigh the tactical and strategic benefits of their investments."