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11/19/2010
08:42 AM
Bob Evans
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Global CIO: The Rise Of Analytics Triggers The Fall Of The Tactical CIO

The Year's Top Tech Stories: Top-priority analytics projects are accelerating the need for CIOs to drop the "alignment" anchor and begin driving strategy, revenue, and profit. (#5 on our Top 10 list.)

"These are all 20th-century companies grasping at the question of 'How do we become 21st-century companies?' " he said. 'How do we change and enhance our core competencies? How do we marry the three great trends of today: event-driven models, cloud computing, and mobility—how do we marry those without destroying our legacy?' "

"On top of that, Ranadive said, those big companies with vast rosters of legacy products and entrenched business units find it hard to embrace questions such as 'What does the customer of the 21st century look like, or what does the Facebook phenomenon mean to my company, my products, and my customers?'

"As a result, he says, 'The odds are stacked against them—for example, why couldn't Accenture become the next Infosys? Because they would have had to cannibalize their own existing business—that's a terribly hard thing to do.

" 'And it's the same in the cases of Oracle and SAP and IBM: to become a 21st-century company, they would have to eat their own children. That is true for all 21st-century players. Oh, they'll still be around and they'll still make some noise, but mostly they'll just live on maintenance.' "

SAP co-CEO Bill McDermott said in a recent earnings call that his company's analytics business is growing 50% faster than Oracle's, which we analyzed in a recent column called Global CIO: SAP: 10 Reasons We'll Beat Oracle In Applications. Here's McDermott from that column:

"Similarly, in business analytics, we saw continued double-digit growth is this segment, and strong growth in demand throughout all the regions. SAP's business analytics business in Q3 is twice the size of Oracle's equivalent business, and we are growing at least 50% faster than them, taking share from Oracle Hyperion in every geography, with 38 replacements year to date. Enterprise information management and enterprise performance management are clearly leading the way."

On top of that, in about two weeks, SAP will release its new optimized system for high-end analytics, called Hana, that will deploy in-memory technology that SAP says will provide customers with truly real-time analysis of vast volumes of data.

Not to be outdone, Oracle's also riding the optimized-systems wave and says its Exadata system has generated a $1.5-billion annual revenue run rate because customers want and need dedicated and blazingly fast machines that can handle both data warehousing as well as OLTP processes. You can read all about that in Global CIO: Larry Ellison's IBM Slayer Is Oracle Exadata Machine.

And as wrote about in Global CIO: As IBM Accelerates Analytics Business, Can Anyone Keep Up?, IBM continues to invest many billions of dollars as it makes analytics the core of its long-term strategy and the ultimate enabler of its Smarter Planet message.

For CIOs, the choice is clear: eagerly embrace and focus on the business value and customer-engagement benefits of analytics, or continue to see it as just another complex application that has to be jammed into the infrastructure and babysat.

RECOMMENDED READING:

Global CIO: Microsoft Pushes BI For The Masses: 500 Million Prospects

Global CIO: Microsoft BI Wins Raves From Giant Shipping Company

Global CIO: The Golden Age Of IT Has Begun: 6 Reasons Why

Global CIO: Larry Ellison's IBM Slayer Is Oracle Exadata Machine

Global CIO: Oracle's Fowler Says Systems Performance About To Explode

Global CIO: IBM Top Product Exec Discusses Strategy, Systems, & Oracle

Global CIO: IBM's Brilliant Trojan Horse Strategy Transcends Technology

Global CIO: SAP Confronts The Real-Time Culture Wars

Global CIO: Larry Ellison's Acquisition List: Who's #1?

Global CIO: Tibco Surges And CEO Flips Off IBM, Oracle, & SAP

Global CIO: EMC Taking Plunge Into Red-Hot Optimized Systems Market

Global CIO: As IBM Accelerates Analytics Business, Can Anyone Keep Up?

Global CIO: SAP: The Top 10 Reasons We'll Beat Oracle In Applications

GlobalCIO Bob Evans is senior VP and director of InformationWeek's Global CIO unit.

To find out more about Bob Evans, please visit his page.

For more Global CIO perspectives, check out Global CIO,
or write to Bob at bevans@techweb.com.

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