Business intelligence (BI) is one of the key trends set to change the face of the global as well as local enterprise application marketplace in 2004.
More and more we`re seeing the proliferation of BI analytics into vendor software, the increasing independency of businesses when it comes to decisions on BI and the ongoing practice of many BI vendors to add functionality to broaden their market niches.
However, despite the obvious influence of BI, the market is going through a bit of a slump, with IDC recently forecasting that the market will increase to $4.5 billion in 2007, at an annual compound growth rate of 4.1%, which is still lower than pervious years` growth.
In saying this, the analytical abilities that come with deploying BI can no longer be ignored by analyst groups or end-users.
The benefits
By combining analytics with software applications, companies can enjoy a number of key advantages. For one - despite the complexities of enterprise applications` data stores - companies can now benefit from ETL (extract, transform and load) and dimensional structure for analysis and queries.
This is particularly effective when integrated with powerful enterprise applications such as ERP (enterprise resource planning).
Importantly, embedded analytics simplify the process for utilising and analysing the data used in the application, which in turn saves on valuable time, productivity and costs.
The drawbacks
Unfortunately, integrating analytics into applications also has its disadvantages. The cost and productivity gains are in many cases based on vendors` believe that the application will be used and delivered without any modifications, which is rarely the case.
The reality is that modifications and customisations drastically alter cost and subsequent productivity advantages.
Also, as analytical modules become an integral part of the enterprise application, vendors are increasingly using analytical processes to trigger transaction events.
Although closed-loop analytics - or turning information into action - is a leading practice for BI, vendors are making this part of the applications process, either as bridge between modules or an initiator of transaction, thus limiting flexibility of analytical structure and activities.
The challenge
Despite these drawbacks, it still does not diminish the impact and power of analytics on critical enterprise applications or business functional areas.
In order to truly benefit from integrated analytics and before deploying it, companies must ensure they have enough skills, knowledge and competency.
So, what does his competence in BI entail? In a nutshell, it consists of three important factors: the ability to effectively use the analytical tool integrated into the application; the effective use of data in the analytical environment; and the ability to adapt the tool and data to answer new, unanticipated questions.
Looking at the third - and most important - factor, new unanticipated questions, present a formidable problem when the available data is insufficient to provide some light on it.
For instance, if the CRM data is not consistent with ERP or financial data, companies are in for a rough ride. Therefore, in order to deal with these real-life inconsistencies, companies have to integrate and analyse this data with a minimal impact on the predefined ETL - a task that it difficult but definitely not unachievable.
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