The need for business intelligence (BI) is real for all enterprise software users. It is rare to find a user who feels they get the information they need from their enterprise software system and even those who do want more. The need is not just reporting; they need business monitoring, analysis, an understanding of why things are happening. They need diagnostic tools.
Enterprise software systems are designed as transaction processing tools and job one is to optimize for this need. For most enterprise software systems, reporting is a secondary objective and not usually a driving force when the system was originally designed. BI is designed with the objectives of reporting and analysis. BI has the power to significantly increase the value of enterprise software by turning the information captured in the system into knowledge and guidance about the business.
Today, the majority of enterprise software vendors sees this need and are proactively addressing it. However, their strategies different as do the impact of these strategies on their customers.
Enterprise Software Vendor Approaches
The enterprise software vendor community has delivered or is working on BI solutions. Their strategy options have included
1. Develop its own system
2. Partner with large "horizontal" BI vendor
3. Partner with small "boutique" BI vendor
4. Remain "BI agnostic" encouraging customers to choose their own
Enterprise Software Vendor Develops Its Own
Large enterprise software vendors have the resources and the business motivation to invest in their own solutions. This includes the underlying technology and the analytical applications. For example, Oracle and SAP have built and are marketing in-house developed solutions.
Large enterprises choose this strategy because they
* Have the internal resources to build and maintain their own solution
* Can leverage their product knowledge
* Feel they have a better understanding of their customers needs
* Have total control over the development direction (enhancements, fixes, etc.)
* Find it more profitable (they control pricing and don't have to share license, support, and services revenues)
* Have a mindset of products should "be invented here"
What is the impact on their customers? For most customers, this is probably a good choice for many of the reasons stated above. The possible exceptions to this include
* Price is too high (often, the vendor expects a premium over alternative options for the reasons stated above); and
* The need to integrate other data sources into the BI solution and the enterprise software vendor's solution is weak in this area.
Enterprise Software Vendor Partners With Large "Horizontal" BI Vendor
Both first and second tier vendors partner with large "horizontal" BI vendors. Examples of these vendors include SSA GT (Cognos) and I2 (Business Objects). The large horizontal vendors they partner with include Cognos, Business Objects, and Brio (now Hyperion).
They choose this strategy because they
* Realize they don't have the resources to develop and support
* They see a recognizable (BI) name as a marketing advantage
* Attach the BI vendor's large size to the image of stability
* See the BI vendor's reference customers as an assist in selling efforts
* See a very broad BI product line from the horizontal BI vendor
What is the impact on their customers? Many customers certainly see benefits in the relationship with a large horizontal BI vendor. Stability and a broad product line are important. These vendors also enable the connection of other data sources to the BI solution. What issues should customers investigate if their enterprise software vendor follows this strategy?
* These BI vendors tend to offer product suites that are broad but lack deep industry specific needs. Are your industry specific needs provided by the solution?
* The horizontal BI vendor may have a large customer base, but limited customers in your specific industry. Does this make a difference to you?
* As both the enterprise and BI products evolve, who is responsible for keeping the two in synch? Who is responsible for the integration?
* A solution based upon a BI product from a horizontal may be overkill in terms of function, support requirements, and cost.
* Can you support the hardware and software required for a solution based upon a horizontal BI vendor?
Enterprise software systems are designed as transaction processing tools and job one is to optimize for this need. For most enterprise software systems, reporting is a secondary objective and not usually a driving force when the system was originally designed. BI is designed with the objectives of reporting and analysis. BI has the power to significantly increase the value of enterprise software by turning the information captured in the system into knowledge and guidance about the business.
Today, the majority of enterprise software vendors sees this need and are proactively addressing it. However, their strategies different as do the impact of these strategies on their customers.
Enterprise Software Vendor Approaches
The enterprise software vendor community has delivered or is working on BI solutions. Their strategy options have included
1. Develop its own system
2. Partner with large "horizontal" BI vendor
3. Partner with small "boutique" BI vendor
4. Remain "BI agnostic" encouraging customers to choose their own
Enterprise Software Vendor Develops Its Own
Large enterprise software vendors have the resources and the business motivation to invest in their own solutions. This includes the underlying technology and the analytical applications. For example, Oracle and SAP have built and are marketing in-house developed solutions.
Large enterprises choose this strategy because they
* Have the internal resources to build and maintain their own solution
* Can leverage their product knowledge
* Feel they have a better understanding of their customers needs
* Have total control over the development direction (enhancements, fixes, etc.)
* Find it more profitable (they control pricing and don't have to share license, support, and services revenues)
* Have a mindset of products should "be invented here"
What is the impact on their customers? For most customers, this is probably a good choice for many of the reasons stated above. The possible exceptions to this include
* Price is too high (often, the vendor expects a premium over alternative options for the reasons stated above); and
* The need to integrate other data sources into the BI solution and the enterprise software vendor's solution is weak in this area.
Enterprise Software Vendor Partners With Large "Horizontal" BI Vendor
Both first and second tier vendors partner with large "horizontal" BI vendors. Examples of these vendors include SSA GT (Cognos) and I2 (Business Objects). The large horizontal vendors they partner with include Cognos, Business Objects, and Brio (now Hyperion).
They choose this strategy because they
* Realize they don't have the resources to develop and support
* They see a recognizable (BI) name as a marketing advantage
* Attach the BI vendor's large size to the image of stability
* See the BI vendor's reference customers as an assist in selling efforts
* See a very broad BI product line from the horizontal BI vendor
What is the impact on their customers? Many customers certainly see benefits in the relationship with a large horizontal BI vendor. Stability and a broad product line are important. These vendors also enable the connection of other data sources to the BI solution. What issues should customers investigate if their enterprise software vendor follows this strategy?
* These BI vendors tend to offer product suites that are broad but lack deep industry specific needs. Are your industry specific needs provided by the solution?
* The horizontal BI vendor may have a large customer base, but limited customers in your specific industry. Does this make a difference to you?
* As both the enterprise and BI products evolve, who is responsible for keeping the two in synch? Who is responsible for the integration?
* A solution based upon a BI product from a horizontal may be overkill in terms of function, support requirements, and cost.
* Can you support the hardware and software required for a solution based upon a horizontal BI vendor?
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