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The
Real Deal on BI Suites
This
month's article on BI suites was originally published
in DM Review's Extended Edition, August
2006. In case you missed it when they published
the PDF file, they have graciously allowed me
to republish it here.
In
addition to the article, you may want to see some
of my recent blog posts:
 Your
feeback
and questions are always welcome.
Rick
Sherman, Athena IT Solutions
BI
Suites: Enabler or Inhibitor to Pervasive BI?
Business
intelligence is evolving in a way that will empower
more people in an organization with tools they
can use every day. What role do BI product suites
play in this evolution – enabler or inhibitor?
The answer depends on who you are.
In
the ancient days of the PC (when some of my readers
were glued to their Atari game systems, perhaps)
people used to evaluate and debate about which
word processor, spreadsheet and presentation software
they would buy. Back then you chose the best product,
not just the one that said “Microsoft”
on the box.
In
fact, Microsoft’s products were not considered
to have the best features. But then Microsoft
decided to bundle their versions of these applications
together, and even throw in a desktop database.
In a brilliant move they priced the package cheaper
than the à la carte price of the better
products. Next thing you know, everyone was using
the suite of Microsoft Word, Excel, PowerPoint
and Access.
Years
later business intelligence vendors provided best-of-breed
software specializing in different categories
of BI: reporting, ad-hoc query, and online analytical
processing (OLAP). Then history repeated itself
as the vendors decided that they, like Microsoft,
should expand their product offerings to include
the full range of business intelligence capabilities.
Hence, each of the major vendors now offers a
BI suite.
Great
idea. Companies can go to one vendor for their
entire BI needs. It improves productivity for
both business users and IT. On the surface, this
appears to be analogous to Microsoft’s Office
product bundling. There are two significant differences,
however.
- Complexity
-- BI suites make BI implementation
more complex because there are more working
parts. Further complicating matters are the
upgrades and transitions required because these
suites were either filled through acquisitions
or major product introductions.
- Cost
-- BI suites increase the cost of implementation.
The most obvious cost is licensing. If you need
all the parts of a suite it’s more cost-effective
than the sum of the parts. But there are hidden
costs: the resource costs to learn the how to
design, develop and deploy the suite. If you
don’t need all the portions of the suite
you end up paying more for licensing and resources.
So,
for whom are BI suites the right choice? They
work well for large corporations with IT personnel
dedicated to BI implementations and who specialize
in this software. BI vendors and industry
analysts all suggest BI competency centers for
this very reason. Several of my clients have deployed
BI suites to consolidate separate BI offerings
from multiple vendors. The choice enabled their
business and IT groups to be more productive when
using BI tools.
But
suites are a difficult choice when you consider
small and medium businesses (SMB) with less than
$1 billion in sales. Quite a few firms
fit in that category. Their IT staff performs
many roles and cannot afford to be dedicated to
anything resembling a BI Competency Center, which
many large firms are deploying. For these firms,
the cost of the BI suites in terms of licensing
fees, the infrastructure to develop and deploy,
and to staff are prohibitive.
Some
of my SMB clients are no longer using software
from two of the largest BI pure-play vendors and
have switched to Microsoft and its partners’
platforms. Their goal is to avoid the higher cost
and complexity (in their eyes) from their previous
vendor’s movement to BI suites.
Each
client had successfully implemented a particular
BI tool from one of these vendors, but as these
vendors expanded into BI suites, the costs for
licensing and resources became more than they
were willing to pay. They felt they were paying
for a lot of functionality and complexity they
were not going to use. Their previous vendors
may have the best products on the market in term
of feature evaluation, but the clients did not
perceive the value to them.
The
SMB customers’ need has created a terrific
opportunity for small BI vendors that specialize
and make their products more cost- and resource-effective.
There are many BI software vendors who offer BI
tools for reporting, ad-hoc query or OLAP (just
as the major vendors used to do) and have loyal
customers, but are relatively unknown (never making
any industry analysts’ lists).
In
addition, and probably more of a long-term trend,
are Microsoft’s offerings bundled with SQL
Server 2005, and the Microsoft Partners who are
building on that SQL Server bandwagon. These small
firms, along with Microsoft (who bought their
former BI partner ProClarity) fit the need for
small and medium firms.
BI
is becoming pervasive; however, two different
landscapes are emerging. Major vendors’
BI suites are the answer for large corporations,
but Microsoft and many small software vendors
are seizing the opportunity to provide pervasive
BI solutions to small and medium firms.
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