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9/27/2004
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Information Builders Exec Sees Simpler BI Integration

The vendor discusses I-Way integration software, its business intelligence tools, and trends in the BI market.

Although enterprise spending remains sluggish, the business-intelligence category continues to heat up. Information Builders in particular is reaching out to the channel to help expand its base in the market. IBI Vice President and Chief Communications Officer Michael Corcoran spoke with CRN Editor in Chief Michael Vizard in advance of a major release of its Web Focus business-intelligence software. Corcoran talked about how IBI's business-intelligence software and its I-Way application integration software units are coming together to create new VAR opportunities.

CRN: A few years back, IBI seemed to be trying to separate the business-intelligence unit from the application-integration arm. How are changing market dynamics bringing those two units back together?

CORCORAN: What once looked like a separate effort is turning into a cohesive effort. We took our integration business and spun it off about two-and-a-half years ago under a new brand called I-Way Software. We've branded I-Way separately for two reasons. No. 1, to help people understand this is a lot more than just additional structured data access. No. 2, and more important, we saw the OEM opportunity as being the primary driver of this technology to commercial ISVs.

We've been focused on separately marketing each product, but ... internally, they were always together. They worked very well hand-in-hand, but we weren't marketing them that way. And then there's a new opportunity on the horizon where [business intelligence] and integration merge under what Gartner would call business activity monitoring.

CRN: IBI has been mainframe-centric. What makes you think IBI can play in the midmarket?

CORCORAN: In terms of the product itself, there is a tremendous opportunity for a couple of reasons. No. 1, the way we've gone about rearchitecting products over the years. We've componentized it so it is much easier to use and integrate. We've done leaps and bounds with Web services over any vendor in the space. It's going to be easy for people to incorporate it, and you don't have to be enterprise-class developers to do that. Second, there is the price point and cost of ownership of the product. We don't charge people to view reports. We start at $25,000 on the single-processor Windows server. You could blow information out to thousands of people, and that's free. For a guy in a small to medium-size business who needs to deploy information on a broad scale, we're a very cost-effective offer. So from a price point, we've become much more attractive. We just don't have the mass-market awareness for the midsize market. We have to start marketing to that a little better.

CRN: What's going on in the enterprise market these days?

CORCORAN: Our business is very good. We just had the best second quarter in our history. The [general] enterprise market is in the toilet. But the enterprise [business-intelligence] market and the lower-cost integration market are both very good, so we've done really well on both sides of our business.

CRN: What's next for Web Focus?

CORCORAN: We have the next major architecture release coming up later this year. Advanced data visualization is something we've been very focused on. How do you make it easier for novice business people to use information intelligently? How do you help people get answers when they're not even sure how to ask the questions? We're moving the use of the technology beyond the more analytical, sophisticated user to the more novice operational people. I think that people don't want reports; they need simplified access to data. So we see a major architectural advantage to using Web services as an architecture.

CRN: What's creating all the interest in business intelligence?

CORCORAN: You're now looking at people who spent hundreds of millions of dollars on ERP implementations, and they're really under the gun now to start showing some real value. They're looking at this saying: 'All right, we've been doing this for four years or so. Where's all that return on investment? Where's the improvement in profits? Where is all of that?' And of course, the problem is everyone has SAP, but they also have PeopleSoft, and they also have homegrown systems, and they also have the legacy systems because SAP didn't replace that function.

CRN: At one point, there seems to be a drive to limit the number of vendors that IT organizations had to deal with.

CORCORAN: I don't think they've really achieved it on the application side. But one of the things that will help a couple of the [business-intelligence] vendors--not all, but a few of us--is that [business intelligence] is a primary target for consolidation. Vendors are consolidating, but that's driven by customer consolidation. [Business intelligence] has been deployed and bought at a business unit level for the last 12 years or so. We're hearing pretty typically of somewhere between 15 and 30 different kinds of [business-intelligence] tools in production in different areas. Of late, [business intelligence] has kind of risen to the top of the value chain for two reasons: No. 1, it is how you get more value out of the existing applications and then, No. 2, how do we consolidate all the [business-intelligence] efforts, which is also now tied to compliance.

CRN: How do compliance issues link back to business intelligence?

CORCORAN: When it comes to compliance, you have to ask how many different ways [there are to generate] answers and information. When I start taking an audit trail, how did I get from my raw data and my application data to this financial spreadsheet? When you look at most people's processes, it's like, 'We move data over here and we massage that and we put that in our data mart and then start reporting off it and then we export it out and put it into Excel.' There are so many different tools that might touch that process. People are trying to bring it down to one.

CRN: How much of a competitive threat are big companies such as SAP and Microsoft in this space?

CORCORAN: Unless there's one application and one databases that drives everything, I don't see SAP, Microsoft or IBM being the one who owns [business intelligence] because the world runs on a heterogeneous environment.

CRN: How do you think the EAI market will evolve?

CORCORAN: There will always be opportunities to hook things together, and I think there is good money in it. The whole approach to computing is changing [so] it's not about building the perfect architecture. People have realized that the only way to do this is to build an architecture on the fly. You try to put in standards where you can really make things work. And then you hook things together and you leverage what you have. I think that a lot of the VARs will always find opportunities around that.

CRN: What kind of VARs are you engaged with?

CORCORAN: We're talking to VARs who are very concerned about plugging in their sales and marketing applications for a specific vertical [market] to an environment that already has SAP. Some of the appeal for them for Information Builders is the integration piece we have on the back end. We're picking our spots and basically use players who have much more targeted vertical solutions. In some key markets, these people add content and vertical expertise that our direct-sales effort does not have.

CRN: How much revenue are you pulling through the channel?

CORCORAN: For us, it was more like 10 percent to 15 percent of our total, and now we'd like it to be more like 30 percent. We want to probably triple the number of deals brought in through the large integrators. And I think we want to round out the number of partners we have in vertical solutions--and that's going to more than double. It's probably going to be five times what we have now.

We have about 300 partners, but a lot of them are on the small, local consultant level. Our challenge now is we can't afford to directly sell to the midmarket with our direct-sales cost structure, so we've got to find partners. We know there's a market opportunity. We now have to figure out how we manage our channels operation and grow it.

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