02:27 PM

The State of Business Intelligence

There's a transformational change going on in business intelligence. Next-generation BI promises speedier, automated decision-making, thanks to affordable computing and storage platforms and advances in business activity monitoring. We assess the changes in the market.

Let the politicians debate ad nauseam whether isolationism works in the global arena. The argument's been settled on the business-infrastructure front: No information system is an island, and he who depends on outdated data loses market share. Business intelligence vendors must release products that mesh with these realities if they expect to expand their empires.

And the territory is certainly there for the grabbing: A poll released last month by our sister publication InformationWeek showed nearly half of the 500 IT professionals surveyed plan to increase spending on software for viewing and analyzing business information from 2006 levels).

Forrester says BI platform revenues will reach $7.3 billion by 2008, and CIOs surveyed by Gartner identified BI as their No. 2 technology priority last year, up from No. 10 in 2004. Despite this, analysts have long puzzled over the relatively low penetration rate of BI tools, generally pegged at less than 20 percent of potential customers.

Why the disconnect? After all, BI suites provide the platforms from which critical data is aggregated, searched, presented and analyzed. Sure, it's a complex process. Data must be pulled from disparate sources, such as ERP, order entry and inventory management. But up-to-date information is the lifeblood of business. How can four out of five not be buying in?

The answer may be that too many BI platforms are mired in historical analysis across siloed back ends. The action is in a new, more integrated world of dynamic, real-time information that's emerging from Microsoft, Oracle and other BI vendors. These suites empower real users--not IT pros drafted into duty--and let them draw valuable data from processes, events and other sources beyond conventional data warehouses.

Their vehicle for display? Real-time dashboards that process up-to-the minute information and present it for immediate use and analysis. But that level of integration carries risks: Data sharing within BI brings up serious security, compliance and privacy concerns. And then there are the turf wars, as departments, employees and business partners scramble to protect data--their prime intellectual asset--from internal and external competitors.

Still, a new vision of real-time, networked intelligence is possible thanks to affordable computing and storage platforms. These, combined with advances in leveraging BAM (business activity monitoring) to track strategic business objectives and cost-effective data-warehousing appliances, should help vendors extend the use of BI throughout the business world. Now, will they rise to the challenge? And will IT buy in?

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