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Home > Data management / BI News > BI software adoption remains strong despite economic downturn |
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Despite the worst recession since World War II, enterprises and small and medium-sized businesses (SMBs) alike show no signs of pulling back on business intelligence (BI) software adoption and investments, according to a new survey by Forrester Research. In further good news for BI vendors, the survey found that nearly a third of organizations currently lack any BI software, marking a large pool of potential new customers. Of the more than 1,000 North American and European companies surveyed, 68% said they have or are in the process of piloting, implementing or expanding BI software deployments. Just 1% said they were decreasing the amount of BI software in use, and none plans to remove BI software altogether. Companies as varied as Subway, Wawanesa Mutual Insurance, LinkedIn, Haskell Company, Bliss Spas, and U.S. Lumber have implemented new BI deployments or upgraded existing ones in recent months. In terms of adoption by company size, the largest untapped segment is midsized businesses that are neither extremely small nor toward the larger end of the SMB spectrum, said Boris Evelson, an analyst with Cambridge, Mass.-based Forrester, who analyzed the survey results. "The market is far from mature, and it's not [as if vendors] don't have any new customers to go after," Evelson said. "We know these companies. If they are not using BI today, they are going to be using it in the future because it's such a major competitive differentiator for everyone right now."
Smaller companies that grow through acquisition or expand from a single product line "are the companies that really have the worst time," Evelson said. "On the one hand, now they are big enough to get a consolidated BI solution, but they're not big enough to hire their own IT staff that is dedicated to data integration and data warehousing and building reports." Companies in this segment are the ones best suited to BI in the cloud, or SaaS-based BI, he said. They are probably using packaged applications with little customization, which are exactly the types of applications SaaS BI vendors are good at integrating data and creating reports from, he added. "[SaaS BI vendors] just plug into those standard packaged apps like Salesforce.com or any standard HR application, upload the data, and in the cloud is where you'd get your reports and dashboards," Evelson said. Another cost-effective option for mid-tier SMBs, he said, is to outsource BI reporting and dashboarding to a systems integrator or managed services provider, especially those in the Far East that have cheaper labor and real-estate costs. The survey also found that basic reporting tools are by far the most widely used BI applications. Of respondents, 69% said they have or are in the process of piloting, implementing or expanding the use of BI reporting tools. Evelson said that although more complex ad hoc analysis capabilities are important, they are usually applicable to only a small number of power users in any given company. BI reports, on the other hand, are helpful to almost all workers. "Pretty much every single office worker needs to either at some point create a report that is usually distributed to someone else or look at a report somebody else created," Evelson said. "It's a basic staple of BI." He also broke down the survey results to understand demand for BI software by industry. While demand was fairly evenly spread throughout industries, he did identify healthcare providers as a potential area of increased BI adoption in the next two years or so. "They probably have the biggest challenges because traditionally in the healthcare industry ERP applications have not been standard applications," Evelson said. Hospitals and healthcare organizations often use proprietary applications from specialized vendors, he said, and integrating data from those applications for BI purposes is a difficult job -- one that many have yet to tackle. Financing from the federal government's stimulus program for the transition to electronic medical records should also provide a boost to BI deployments at healthcare organizations. Evelson said: "A combination of that low level of maturity and the fact that the [healthcare] industry is getting a ton of money from the stimulus package for electronic medical records means that in the next couple of years there's going to be a lot of activity there."
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