Business Intelligence: Turmoil and Change Loom
June 18, 2008
Fern Halper, a member of Hurwitz & Associates team, wrote “Text Analytics and the Predictive Enterprise” on June 13, 2008. The story appeared on IT Analyses, and I just saw it.
Ms. Halper makes two point about text analysis. She is talking about analytics vendor SPSS, but her comments apply across the business intelligence spectrum.
First, she makes it clear that text contributes to business intelligence. Structured data and text yield useful insights. The idea is that mining both is more meaningful.
Second, she asserts that analysis of Web logs and other social information can add value to traditional business intelligence activities.
SPSS, SAS Institute, Business Objects (now part of SAP), Clarabridge, and other vendors share somewhat similar views.
My hunch is that market friction is going to become more evident as IBM, Microsoft, and Oracle increase their analytics efforts. Business intelligence, like search, is moving downmarket and to some extent becoming a utility functions.
My research into frustration with enterprise search shined a light into a formerly dark corner of an increasingly important function. Business intelligence also has annoyed users with its complexity, hard-to-understand reports, and lack of “average manager” interfaces.
What’s this mean?
My thought is that head-to-head competition will increase. Business intelligence vendors will find themselves pressured to keep their clients from drifting toward analytics solutions bundled with other enterprise applications from the likes of IBM, Microsoft, and Oracle. In addition, traditional business intelligence vendors have to figure out how to keep newcomers like Attensity (deep extraction) and Aster Data (data management) from making sales in organizations where there once was a traditional business intelligence monopoly.
For many years, competition among the SAS Institute and SPSS was governed by the type of rules that once governed duels with pistols. Business Objects brought more Madison Avenue sizzle to business intelligence. Now lines are blurring between high-end, specialist business intelligence and what I call “baked in BI” from IBM, Microsoft, and Oracle. Add to this the upstarts arriving with zippier technology and a hunger for making sales. The result is an uptick in competitiveness.
Companies today need to find ways to keep customers and squeeze meaning from available data. Search on its own does not deliver what an organization needs. Crunching numbers does not deliver. Text analytics does not deliver. Organizations need all three functions to be available and usable by the average manager.
With this problem getting more attention, a hybrid solution is needed. With a lucrative pay off for the company that cracks this problem, accelerating change is not just likely, significant disruption awaits us in business intelligence. Who could profit from this increased turmoil? I think Google may be a factor going forward. Hosted crunching, customers wanting ease of use, canned analytics and APIs, and social data–are ingredients for a new enterprise recipe from the GOOG?
Stephen Arnold, June 17, 2008
Comments
6 Responses to “Business Intelligence: Turmoil and Change Loom”
-
- Subscribe to Beyond Search
Feature archive
News archive
-
Great article and hits the nail on the head when it comes to the need for a “hybrid solution”. We at Attivio would certainly agree since this is our vision. And we are “cracking the problem” right now.
Great post, Stephen. I especially agree with your comments about end-users being frustrated with complex tools as BI moves “down stream”. Having spent 6 years at Business Objects, I can vouch that part of this frustration is also because of the underlying database being queried is often slow to respond when a use asks an ad-hoc query which has not been cached (and the BI tool gets blamed).
As a point of clarification, speeding up data analysis is where Aster Data is focused. We are a high performance analytic database. We do NOT compete with BI vendors, but give them a better platform for fast queries, reporting, and analysis. We are in fact good partners with BOBJ, Pentaho, MSTR, and more. Check out more at http://www.asterdata.com
My wording was sloppy. Aster enables some interesting business intelligence analyses. Thanks for taking the time to call this to my attention. Haste and a 64 year old brain makes for an untrustworthy essayist.
Stephen Arnold, June 18, 2008
Andrew, thanks for writing. Keep me informed of Attivio’s success.
Stephen Arnold, June 18, 2008
Hi Stephen, I think the biggest turmoil and change will come from:
1) The shift from business analytics as an IT problem to solve to a business mandate (see the recent article by David Wells on Analytic Culture: http://www.b-eye-network.com/view/7572
2) The shift to SaaS / Cloud Computing (read The Big Switch by Nick Carr)
The business models of traditional enterprise software vendors – whether they are BI or application solutions providers, will have a very hard time addressing these shifts. For one, they’ll have to wean themselves off of maintenance fees and the consulting dollars that come from complex upgrades. This typically results in an internal civil war.
Meanwhile, newer SaaS vendors are focusing on end-user and set-up simplicity, delivering built-in domain expertise, and ultimately broader adoption and customer success thanks to the ability to track usage and share best-practices.
It’s an exciting time for analytic innovation right now, but don’t just look to the usual suspects and traditional approaches.
Hello, dcunningham,
Thank you for your post. Excellent points, Please, feel free to revisit the squawking goose’s Beyond Search Web log. Glad you liked Mr. Carr’s study. Former Harvard Business Review wizards know how to nail a trend early and clearly.
Stephen Arnold, June 19, 2008 9 18 pm Eastern