Johannesburg, 04 Mar 2009
The business intelligence (BI) market has probably been the most volatile in the IT world over the last two years. Most of the focus has been on mergers and acquisitions and the activity of the main global software houses. The market focus, rightly, is coming back to where it belongs: on delivering business value.
What just happened?
The market has been focused on the activities of Microsoft, IBM, SAP and Oracle. Microsoft led the charge, looked set to lead the way and then had a sudden change of direction.
The volte face does certainly play to its strengths, but it has left a number of customers more than a little irritated. The other players have yet to offer the market a convincing story about their roadmaps and vision. There is no doubt the digestion of these businesses will be slow and messy, as this is the history and track record.
The current economic climate will also ensure development and integration plans are delayed or shelved, and these offerings fall further and further behind the curve. All of this has been a massive distraction; the focus of the market is to deliver solutions to business users. None of this activity has helped progress any offerings to the business communities.
Where we are now?
The main market driver now is people, the shortage of good skills. The current and future economic outlook is a driver, but the effects on the market are the same.
The focus has moved from the big technology players to delivery. The current market is all about getting quick, low-risk deployments done. Quick BI gives a quick ROI and removes the risk of the deployment. This allows us to do more with less, in less time.
Where to from here?
What does the future hold? There is a lot of talk about software as a service (SaaS), hosted BI and computing in the cloud. Cloud computing is gaining traction, and hosted models are getting a lot of coverage and offering low-cost solutions with low barriers to entry. The reaction of most people is that this will not be a market driver in South Africa due to bandwidth limitations and costs. The sector needs to be clarified to see where the drive will be.
The goal of BI is to drive operational efficiencies, and as a basic business driver that will not change, now, or any time in the future. The focus of the majority of BI implementations has been in-house, to gain a better understanding of their own business.
The next focus will shift to the economic value chain as this is where the next savings are to be had: sharing of information upstream with suppliers and downstream with clients. In the retail B2C market, the downstream pull will be minimal and will probably result in improved client reporting. In the B2B market and supplier communications the demand will be significant.
Collaborating, sharing information
As each business gains a better understanding of their own operations, they realise they only have half the picture. Their businesses are inextricably tied to their suppliers and clients. They can drive internal operational efficiencies as much as they want to, but a chain is as strong as its weakest link.
If supply of incoming goods does not improve or client service is negatively impacted, the internal saving will be finite and limited. The next BI wave will be all about collaborating and sharing information outside the firewall.
This is not a massive shift: in many cases it is happening already, albeit inefficiently and usually manually. There are no standards and data is not clean, so the companies receiving it cannot digest and use it easily. The shift will be about how we share the information and collaborate, as this will be the next value driver.
There will be some challenges in sharing the information, due to the bandwidth issues we have, but it needs to be done and is already happening in either a limited way, manually or with enough of a delay to make the data useless. So it is not a new need or a new driver; it needs to be done and in a way that is useful.
Hosted BI will be a major driver, but the hosting will be between businesses. Information will be prepared in an agreed format, structured and then made available outside the firewall to people in the economic value chain, where it will be used to gain a better insight of their business. This will lead to a complete picture of the business, the dependencies and where the next efficiencies can be found.
The goal will be the same as always: driving operational efficiencies. The reason it is likely to succeed is that it is nothing new, it needs to be done, and improving the process can lead to significant insight and, as a result, savings in the business. The business drivers stack up and it is a business-driven, not technology-driven, need.
* Harvey Jones is launching Panorama on 11 March 2009 in Johannesburg. For further information, please contact Harvey Jones on 011 234-0947, events@harveyjones.co.za or visit http://www.harveyjones.co.za.
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