SaaS Makes Its Mark In Business Intelligence

Faster deployments and Web access are key selling points.
Fast, flexible, and affordable -- three words never used to describe a major business intelligence deployment. That's why BI software as a service stands to transform the market.

"Fast" applies to deployment cycles in SaaS more than to speed of analysis. With all the complexities of building data warehouses and developing reports, conventional BI is notorious for months-long implementation projects. The delays can be trying for the largest companies, and the IT burden has prevented many small and midsize firms from embracing BI.

SaaS-based BI vendors, with their multitenant data warehouses and industry- and application-specific data models, promise to get customers up and running within days or weeks. Electronics manufacturer Vicor had an aggressive eight-week schedule in mind when it decided to replace its spreadsheet-based budgeting and planning approach in late 2007. SaaS vendor Adaptive Planning customized a data model and made an online performance management application accessible to 65 employees across the United States, Japan, and various regional sales offices. Employees were able to enter, review, and approve the 2008 budget within six weeks.

"We used to be lucky if we finished budgeting within five months," says Doug Brunton, Vicor's director of financial systems. The time-savers include a uniform model that eliminates individual spreadsheets and recalculations, and easy workflow and approvals. Brunton probably could get that from an on-premises performance management app (assuming it could offer the same Web accessibility), but he says there's no way the IT staff could have deployed it within eight weeks.

Some consider SaaS a stopgap to on-premises BI software deployments, but not Ken Harris. The CIO of health and beauty products maker Shaklee taps SaaS wherever he can to stretch his small IT staff and budget--RightNow for CRM, Omniture for Web analytics, and PivotLink for BI.

The company uploads its sales and financial data into a PivotLink-hosted data warehouse each night, and employees use Web-accessible report and query tools to evaluate sales, marketing campaigns, and financial performance.

That Web access makes it easier for Harris to massively expand PivotLink access: from 50 employees to, beginning this fall, as many as 5,000 independent businesspeople who sell Shaklee products via the direct-sales model used by Amway, Avon, and Tupperware. "We want to help our customers grow their business, so we're going to expose their sales information to them and give them a limited subset of queries," Harris says.

That flexibility is one reason Harris likes SaaS. What about cost? Harris says annual subscription fees aren't much more than the annual maintenance fees for on-premises BI software. Harris knows that drill, having gone the 18-month, seven-figure BI route while at the Gap. At Shaklee, it was a 120-day effort and a low-six-figure investment.

Of course, the Gap is a $14 billion-a-year corporation with 134,000 employees, while Shaklee is a private company with estimated sales of $500 million. For SaaS-based BI, the sweet spot so far continues to be small and midsize companies that have limited IT resources.

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