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Jorgen Heizenberg

Return on Intelligence

I am happy to be part of the BeyeNETWORK team of thought leaders. I have a great interest in all things related to business intelligence, and I hope to blog about ways I see BI providing business value. In fact, I use a term, "return on intelligence," to describe the impact of delivering the right information, gathered from myriad sources, to a wide number of people which empowers them and their decision making.

I truly believe in the value of BI, especially in this economic downturn. If you have examples of positive return on intelligence or have topics you would like me cover, please contact me via this blog or at Jorgen.Heizenberg@capgemini.com.

About the author >

Jorgen Heizenberg currently acts as the Principal Technology Officer for the Business Intelligence (BI) domain at Capgemini in the Netherlands. He actively monitors the BI market for the impact on Capgemini and its clients. He is the author of many articles and white papers on business intelligence. Jorgen is also actively advising clients on business intelligence. Over the years, he has filled many different roles - all BI related, ranging from reporting specialist to BI strategy consultant. He has more than 10 years of experience on a operational, tactical and strategic level in planning, designing and creating management information solutions for a variety of clients and industries. He is known within the Dutch BI community for his original and often humorous approach toward BI. His ambition is to create a stronger focus on BI functionality and end-user benefits rather than on technique. You may contact him at jorgen.heizenberg@capgemini.com.  

September 2009 Archives


Posted September 23, 2009 7:01 PM
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Is BI going to be a commodity?

A commodity, according to wikipedia, is a bulk product where supply and demand determines the price. What is often meant is that is something is no longer distinctive. When examining BI as a whole there are some tools that may have reached commodity such as reporting or OLAP as evidenced by the rise of the self service tools as an indication for this. As a result the commoditization of BI will certainly change the way IT is executed, and the implementations will change the paradigm so that IT is viewed as a supplier of data. Despite this change the full potential of BI is still untapped. Above and beyond the traditional factors of production such as labor and money, the most significant factor is information or knowledge (the knowledge economy), which is a critical component of the equation. As a result there is a shift in focus from technique towards added value of information. People, process and technology are all interconnected by the use of information. This is an aspect that is sometimes ignored in the world of IT, the owners of BI. Now is the time to bring the ”I” back in IT. At this juncture this is especially relevant given the unusual circumstances in the economy which have led to higher demand for information to reduce uncertainty. Companies that have traditionally survived with limited information have come to realize that a lack of intelligence can lead to a single wrong decision that has a ripple effect of magnitude that may put their business at risk. Simultaneously, IT information supply has been reduced to lower cost or as a result of lower budgets. Viewing this through a microeconomic lens this appears to be a scenario of more demand, less supply, and hence a scarcity of BI and an increase in the value of BI.

Which role will BI play for the mega vendors?

One of the trends in BI is the integration of BI with the business process, essentially that any KPI, dashboard, report is completely integrated to a decision or operational process. To accomplish an information centric organization information supply is crucial. BI is no longer limited to a specific breed of highly evolved knowledge workers but part of every day work. Terms like Pervasive BI or information democracy (BI for the masses) are often used to describe highly evolved organizations. . Integration with operational processes leads to an integration with operational systems or ERP platforms. What we have seen is that large platform vendors have started acquiring BI vendors to add them to their (operational) platform. This is likely borne out of the gap of large ERP implementations that are left with a significant gap in reporting, analytics, and information. Because both world (operational versus informational) are so different this has led to many challenges. Also as they have often bought two or more of the same flavor there are enough decisions to make a new BI suite. The result of this consolidation is the death of innovation.

Is BI getting less generic?

Customers are being very clear in their demand, and there is a very common conversation that is occurring between IT and the business.

The business is asking: ”How can I save money or create new opportunities by leveraging BI?

IT is asking: ”How can I reduce the costs of BI projects and software?”

For both the business and IT there are some answers to their questions, but to answer these questions in a way that both audiences are satisfied becomes a much trickier problem to solve. For example IT can reduce the cost of labor using outsourcing, volume deals or service models. IT can also achieve price optimization during delivery process through industrialization and using accelerators and agile development techniques. Another cost out option is through introducing new architectures (applications) or the good old rationalization of the BI tools. The answers for the business are significantly different as the value is in the use of information, such as analytics. As many projects are caught in a current focus on technology, it is inevitable that a significant shift is going to take place. As a result one can expect that BI will become increasingly more business specific and require the intersection of IT and business to provide maximum value. This will certainly transform the role that IT plays into an infrastructural hero and a supplier of data. But their business days might be numbered.

Is BI getting more vendor specific?

The consolidation of vendors into large agglomerates is not only happening in the BI domain but all over the world of business and IT. This means that many companies face a quilt of IT systems to manage. In order to easily integrate new systems in their organization there is an upcoming demand for standardization and service oriented architecture. Often there is a platform vendor specific unless policy or functionally specifically dictate another vendor is required. As both the informational and transactional systems become more tightly integrated the technical BI challenges can be limited to that one vendor. However it is an illusion to think that all data sources will be limited to that one vendor, as there will always be enough challenges within IT for BI through innovation or niche products. Certainly the most important challenge for BI will be in fast access to and insight in relevant information that is truly actionable.

What will be the role for the surviving parties?

Given the significant acquisition history it is expected that the large platform vendors will be focusing their product development efforts on the technical integration of the acquired products in their operational systems. Also their roadmap towards a new BI suite will be full of choices balancing legacy products and choosing the best of breed products for the future.

The business is asking: ”Which tool will be the new standard if you have three perfectly fine tools for the same area of expertise, say CPM or OLAP and dashboarding.

From a communication and strategic planning perspective current and new customers must be visited to inform them about the potential of this new platform. Partners, System Integrators, and shared services organizations also need to accommodate the changes as well as the integration opportunities. These all take a lot of time, effort and money that will not be focused on innovation. The remaining smaller BI vendors must find their niche and come with innovative solutions. Most obviously there are significant opportunities in the field of advanced analytics, advanced visualization, right time intelligence and sharing data. It is more than possible that these vendors or their solution will be bought up by the platform vendors in time.

What is the future of the BI market?

The use of as a service like solutions will increase as they appeal to ease of use and less cost. Conceptual solutions like cloud are still to vague to be understood by most. Not unlike SOA was or is. The current focus is still very much on technology which provides opportunities for data warehouse appliances but also modeling techniques like data vault.

On the whole the IT spend is down and BI is no different. There are fewer projects even if they have a solid business case. IT continues to pursue projects, primarily leveraging the increased demand for outsourcing. The large system integrators are the ones that profit from this as business expects a long term solid partner that have long term viability rather than small BI consultancy firm (boutiques). All of the players in the system integration ecosystem must work together or go bankrupt (so consolidation continues). An example in the Netherlands is BI United where freelancers have formed a union like entity to face the future more together than ever before.

What is the future of BI?

We see six mega trends in BI. There is an increase in the size, speed and impact of BI. There is more insight due to analytics and visualization. Integration with operational processes and systems continues as well with other types of data (like unstructured internet data). The interactivity between man and machine is on the rise. Also we see a more industrialized approach in BI delivery (build and run). Finally, BI is getting more Business and less IT. This has implications that are summarized in three major areas: increased performance (focus on speed), useful insight (focus on analytics and visualization) and information relevance (focus on business rules, filters and alerts).

The future of BI is fast access to and understanding of relevant information. This means BI will be much more part of an overall Business Information Management strategy than a standalone field of expertise.


Posted September 22, 2009 1:25 PM
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This is the mindmap that I used for the Retail Intelligence presentation that I gave at the microstrategy event. It mentions the trends in BI and Retail and how they come together. If you are interested in receiving the slides drop me an e-mail.


Posted September 21, 2009 3:53 PM
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http://www.microstrategy.com/events/symposium/detail.asp?eventid=2858

I will be presenting - tomorrow 9 september - at the microstrategy symposium in Amsterdam. The topic will be BI in retail. I will share the slides with you afterwards.


Posted September 8, 2009 8:40 PM
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