Like Enterprise Resource Planning (ERP), Business Intelligence (BI) has become an essential part of the IT armoury of any organisation that hopes to survive in the fast moving global economy. However, significant changes in the BI market have redrawn the BI landscape in a way that impacts both end-users and the norms that have thus far defined the BI market.
Says Jan Moolman, Practice Manager, BI: Reporting & Executive Dashboards at e.com institute, a business solutions provider: "BI lets organisations more easily access, analyse and interpret information. It is a critical component of any business because it not only improves decision making but assists to enhance business performance and agility, and maintain competitiveness. However, until recently, only larger companies could afford it. Now, two factors - BI market consolidation and the introduction of `BI for the masses` - have turned this market segment on its head, marking a new phase in the solution`s evolution and possibly signalling a renewal."
BI was previously regarded as an independent technology with a handful of vendors (led by Hyperion, Cognos, Business Objects and Crystal Reports) vying for enterprise clients. However, as it became clear that the ERP solutions lacked executive reporting capabilities, these vendors snapped up BI software suites. Two years of market consolidation was followed by Microsoft`s introduction of BI into its MS Office 2007 suite and its SQL Server 2008 product. This, in effect, launched `BI for the masses`.
Notes Moolman: "While the Microsoft BI functionality is still lacking some of the advanced or sophisticated functionality, as that of the more specialist BI solutions, it has opened the door for smaller companies, allowing them to begin leveraging this technology to better manage and grow their businesses without having to pay the R20 000 to R40 000 entry fee basic BI once commanded. Commoditisation is a double-edged sword, however, because it is usually attended by a drop in standards. In fact, builders of Excel 2007 reports who have little idea of the deeper complexities of BI are already beginning to call themselves `BI specialists`. Meanwhile, larger organisations that purchased and implemented specialised BI solutions prior to their acquisition by the big ERP players are left wondering what will become of their investments."
The ERP companies have made clear their intent to continue to develop their newly acquired BI software suites. "But its early days yet," says Moolman.
"Most will need time to integrate the BI solution into their ERP suites. Oracle`s integration of Hyperion is possibly the most advanced of these integration initiatives. What the company has done is splitting it into a reporting module which has been integrated into the Oracle ERP suite as the BI reporting product, and a financial modelling tool which will be sold as a stand alone module/solution."
This highlights another issue: will the ERP companies lock users in by forcing them to use the new BI tools? Says Moolman: "It makes business sense for the ERP vendors to ensure that some BI functionality is only available through the ERP suite. This creates an advantage for the ERP vendor and its users. However, it remains to be seen whether the ERP vendors will lavish the same amount of R&D money on the BI suites that the stand-alone vendors (who faced stiffer competition) did. This may leave, for example, Hyperion users that don`t also use Oracle, in a bit of a quandary."
While very large organisations such as banks may well continue to run more than one BI solution, so ensuring they spread their risk, it`s unlikely that other organisations can afford to do so. The question thus begs: is there still a place for independent BI solutions?
Says Moolman: "There are certainly a few promising, new, independent BI solutions, such as the Australian company Space-Time Research`s SuperSTAR tabulation and dissemination software, that can fill the niche, perhaps leading the BI market in a new direction. However, in light of Microsoft`s new moves we also need to ask ourselves if BI has become a commodity. If so, at what point in its evolution is BI and can we begin to look forward to `free` BI software with open system architectures that will be advanced by the developer community around the globe?"
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