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BI boom in recessionary times

BI boom in recessionary times

The seeds of certain pine trees germinate best after a forest fire, because the heat enables them to open. The recession has been like a forest fire, with many businesses and ordinary sales opportunities endangered by the flames. But some opportunities, like the pine seeds, actually perform best in a tough economic climate.

In IT, this includes anything that can improve results with a relatively small investment and reuse of existing technology. Business Intelligence (BI) is one of these areas. BI solutions have been evolving steadily in recent years and, more importantly, they have come down in price to a level that makes them viable for smaller customers.

BI solutions range from simple spreadsheet-driven analysis using current data, to sophisticated analytic engines backed by data warehousing infrastructure and dashboard presentation. The base requirement is to enable sophisticated analysis of trends in data, in an accessible manner, with a clear and immediate display. It is frequently used to determine customer characteristics, tracking sales, evaluating performance and for charting financial trends.

SAS is a leader in the analytics sector, with customers at more than 45,000 sites around the world. “We don’t use the term business intelligence,” says country manager Geoff Beynon. “Business analytics” better describes our products. We provide a wide range of solutions from reporting and analysis to advanced analytic tools for organisations of any size.”

New Zealand has a high concentration of small businesses that face the same problems as enterprise customers. Both need to understand the business and analyse revenues, receipts and customer churn. However, small businesses don’t have the extensive IT infrastructure available to the enterprise. For small businesses, it is important to solve business problems at a price that makes sense.

“Historically, BI has been about looking backwards,” says Beynon. “SAS is using analytics to look forward. This provides possibilities for optimisation, prediction and taking action. There’s still a lot of reporting on what happens in the past but, in time, the move will be towards a more forward-looking approach. While the need for a predictive approach has existed before, the global financial crisis has brought it to the fore. Forecasting has become easier and in the past two to three years SAS has invested heavily in this area, and the technology has constantly improved.

“In the current climate, everyone is sensitive to price and wants to see an ROI,” says Beynon. “For smaller companies to scale is different, but the business pain is the same. SMBs have fewer skills, so they need a roadmap of where to start with this technology. Analytics is not yet seen as mission-critical, so resellers need to show customers that, if they are not making decisions based on good analysis of data, they could be putting the organisation at risk. Analytics needs to come forward and say [this is] “must-have technology.”

IBM offers its SME and SMB customers a full suite of IBM Cognos BI solutions. “Many of these customers want the full capability of an enterprise solution,” says BI and performance management specialist, Matthew Bartley. “The solution just needs to be easy to install, simple to support and meet the needs of the business. So, rather than restricting the capabilities of our solutions to this sector, we place other limitations such as the size of server it is able to be used on. We are seeing a great deal of interest from the SME/SMB space in our IBM Cognos TM1 offering. The solution is ideally suited for organisations with limited IT or technical resources. In many organisations, implementation is driven by finance departments that find the analytical, planning and budgeting capabilities important.”

Customers today are looking for solutions that are faster to implement and deliver return on investment in as short a time as possible. Many organisations are making quicker decisions on technology if they see it can make a difference to their business. Key drivers for a BI solution typically involve a need to understand what is going on across the business, scenario planning around different financial models, as well as being able to make business decisions faster based on accurate, reliable data. People are looking to do more with less, but with confidence that business decisions are based on accurate, reliable data.

“New usage areas include increasing use of financial modelling, and ‘what if’ scenario planning using historical data to forecast, based on trends,” says Bartley. “Rolling forecasts are also being used as a way to better control inventory and asset utilisation. Utilising sophisticated Performance Management and Business Intelligence solutions allows an SME business to compete with large multinational organisations. In many cases, an SME business can have an advantage, since it is far easier to locate the real decision-makers within their business and provide them with the right information for making critical business decisions faster and with a greater degree of accuracy.”

Microsoft’s basic involvement in the BI sphere is in the ubiquitous Excel spreadsheets that form the core of many company planning solutions. But Microsoft also promotes its SQL Server and SharePoint products, as components of a BI solution. “For end users, we are investing heavily in the Office Suite, particularly Excel 2007,” says local product manager, Darryl Burling. “There has been a lot of investment in the upcoming version, giving the end-user rich visualisations and powerful data manipulation.”

Companies can use SQL Server reports and share them with SharePoint. Reports can be built by specialist IT users with the aid of templates. Individual users can easily develop their own view of the data according to their requirements.

“Surfacing the data in a way that is predictable and manageable is important for any business intelligence approach,” says Burling. “Having a standard report at a central depository is also important. A lot of customers have the technology, it is just a matter of helping them understand how these products can be used. There are a lot of training opportunities.”

For resellers, Burling notes that customers are likely to have varying levels of maturity. “Some have a lot of experience, but they are relatively few. Most have either nothing, or only basic operational reports built by the IT department, stored centrally and accessed through the web. The exciting trend is toward having end-users able to work directly with the data, using SQL Report Manager for example. “

“There are some really interesting things happening in the BI territory,” says Burling. “One development is location intelligence, where you combine a map with data to determine for example, how and where customers are drawn from. In predictive intelligence, we are beginning to look at some areas for financial prediction within the Microsoft Dynamics product range. For SAAS, we are beginning to use SQL Server data services in the new Microsoft Azure cloud services platform.”

SAP is a leading provider of ERP solutions, and it is also an important player in the Business Intelligence/Analytics areas for organisations of all sizes, through SAP BusinessObjects and SAP Crystal Reports. “Over a year ago, SAP acquired BusinessObjects,” says SAP ANZ BusinessObjects general manager Rajeev Mitroo. “It is now incorporated as a division. With business objects, we take an SAP solution to market as a portfolio of solutions.”

SAP provides four base product areas:

• Business Intelligence (BI), including ad-hoc querying and reporting.

• Enterprise information management, including data integration, metadata management and data quality management.

• Enterprise Performance Management, including business planning and consolidation, financial information management and the like.

• Governance, Risk, and Compliance, including risk management, process control, access control, and compliance.”

In the business intelligence and analytics area SAP has divisions that cater to the enterprise, and also to the SMB/SME market. Solutions for the SMB/SME market are inherently similar to those offered in the enterprise space, but providing a lighter and less expensive solution. However, the solution must still be integrated, feature-rich and enable them to meet the same requirements that are met by larger organisations.

“The market in New Zealand is feeling the pain of economic conditions,” says Mitroo. “The world has fundamentally changed since last September, and caution and conservativism in spending reign. Organisations are focusing on how to drive more efficiency out of what they have. They need tools that provide insight to ensure they are capturing the information needed to make decisions. The drive for dashboards and other displays comes from the top, but it brings pressure to ensure that the content reported to these mechanisms is accurate, and represents a single version of the truth.”

Infor is one of the world’s largest business software vendors, with a broad vertical market focus. It provides BI solutions across a range of offerings. “Infor’s primary BI solution is Infor Performance Management,” says principal business consultant, Anthea Himpoo.

“Infor PM offers ad-hoc query and analysis, multi-dimensional analysis, modelling and reporting with dashboard and scorecard visualisations, and financial solutions such as budgeting, planning, forecasting, financial consolidations, financial reporting and strategy management. Infor also offers Infor MyDay and Infor Decisions, which are new software components being offered to ERP customers.”

Infor has seen strong growth in this sector over the past year. “New Zealand organisations are showing serious interest in implementing BI solutions, especially in the past 12 months,” says Himpoo. “We have definitely seen increased sales activity for Infor PM. BI solutions and products have always been an important solution area for CIOs. In the past six months, interest and activity both globally and in Australia and New Zealand has rocketed. Everyone is talking about the need for visibility and transparency of organisational performance. The major driver is the global financial downturn. This is especially true for SME organisations, where it is no longer feasible to improve the bottom line by simply selling more.”

Strategis Solutions supplies and supports the Strategix OneOffice ERP solution in New Zealand and Australia. OneOffice provides a strong BI component. “ERP software is tending to integrate BI much more into its core product,” says Australia/New Zealand country manager Mike Carroll. “The information is then delivered into dashboards, reports and report archives for users to access on demand. SMEs should now expect to be able to gain a high degree of business intelligence in their base implementation.”

Selling smaller businesses on BI solutions can be difficult, as they may not know their core requirements until the system is implemented. This requires flexibility in implementation approach. “However, we have found that when BI data is integrated into real time decision making, the users make better decisions and the business benefits,” says Carroll.

“In the past, the SMB/SME area has largely been underrated. In good times, people worry about sales, not performance; but in tough times, being able to analyse what part of the business is performing or not performing becomes more important.

“Current conditions favour the BI market. We’re finding a bit more interest this year than last year.”


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