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Cloud business intelligence grows, but most BI users still grounded

In a Q&A, consultant Howard Dresner discusses cloud business intelligence trends and why more user organizations have yet to embrace cloud BI services.

User adoption of cloud business intelligence tools increased "dramatically" over the past three years, according to Howard Dresner, founder, president and chief research officer at consultancy Dresner Advisory Services. He expects interest in cloud BI and analytics to continue to grow. Even so, the cloud is still pretty sparsely populated by BI users: In a survey conducted last year by Dresner's company, only 20% of the 853 respondents from user organizations said they were currently running BI applications in public clouds, and nearly 70% said they had no plans to do so.

Dresner began conducting his annual Wisdom of Crowds Cloud Business Intelligence Market Study in 2012. In an interview with SearchBusinessAnalytics, he discussed cloud BI trends, the results of the 2014 survey and why many companies remain hesitant to embrace the cloud for BI. Dresner said there are various benefits to using cloud BI services, including lower licensing, hardware and ongoing management costs. But in a lot of cases, those benefits are outweighed by lingering concerns about putting BI data in the cloud.

According to the report on the 2014 survey, nearly two-thirds of the vendors that responded consider cloud BI "critically important" to their businesses. But you wrote that among user respondents, there's still a "weak appetite" for cloud BI in all of the vertical industries you focused on, with more than half of organizations having no plans for cloud deployments. How do you explain that disparity?

Howard DresnerHoward Dresner

Howard Dresner: Well, it's not unusual in an emerging market for the vendors to lead the users rather substantially. The vendors ought to be ahead of the users -- if not, they're in trouble. The reason that the user adoption has been slow is because, quite frankly, it's controversial. There are issues that create concerns around security and privacy and availability, but a lot of that is being mitigated by education.

Can you expand on why more user organizations aren't adopting cloud BI?

Dresner:  If you're dealing with the end users, many understand the value of cloud BI and may already be adopting it. When you look at the IT side of the equation, typically IT is involved in large, top-down, enterprise-scale projects. They're a little more reluctant because of security and privacy, certainly, but also there's an issue around loss of control. If all of a sudden you're not managing the systems and the people associated with those systems, it fundamentally changes the nature of your role. That's oftentimes what's behind some of the concerns around security and privacy.

In the report, security was listed as "the greatest barrier to cloud BI adoption." Why is it the biggest issue, and what can be improved to satisfy prospective users?

Dresner: I think that some of the recent security breaches or data breaches are fresh in people's minds. However, it's worth noting that those were not cloud implementations -- they were on-premises implementations. [With] cloud-based business intelligence, because you have to, in theory, put your data in the cloud, perhaps it makes people reluctant. But the fact of the matter is there are plenty of ways to mitigate against a potential security breach. There are many technologies, as well as procedures, for ensuring that there is not a data breach.

Nearly 50% of the survey respondents from user organizations said they were running BI applications in private clouds or planned to do so by the end of this year; for both public clouds and hybrid environments, it was only about 30%. Why do you think there's such a big gap on that?

Dresner: The private cloud is easy to do -- it's not really cloud at all because it's still on-premises. A lot of folks are implementing private clouds so they can declare victory and say, "We have a cloud-based implementation." But it's still on-prem. [Fewer companies] are going to do it in the public cloud because of all the things we've discussed.

If you can do things in the cloud more quickly and more cheaply than your competitors, that gives you an edge in the marketplace.
Howard Dresnerpresident and chief research officer, Dresner Advisory Services

The report says smaller businesses are farther along on current and planned cloud BI usage than larger organizations are. What's the reason for that?

Dresner: It's easier, it's faster, it's less expensive and it levels the playing field, and that's certainly true with business intelligence. Small organizations have to be fleet of foot. You've got to be fast and work smarter than your competition, because you don't have the resources your competition has. If you can do things in the cloud more quickly and more cheaply than your competitors, that gives you an edge in the marketplace.

Based on the user feedback collected as part of your survey, what are some of the most-requested cloud BI features?

Dresner: Interestingly enough, it maps to on-premises BI, so all the things you would expect. Text analytics is probably more important in the cloud, maybe because of social media [data]. But things like end-user self-service, dashboards [and] queries map to traditional enterprise BI. What's unique about the cloud is that there's far more of an emphasis on data integration and being able to access on-premises sources.

Corlyn Voorhees is an editorial assistant for SearchBusinessAnalytics. Email her at cvoorhees@techtarget.com, and follow us on Twitter: @BizAnalyticsTT.

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This was last published in March 2015

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Does your company already use cloud business intelligence services or plan to implement them this year?
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Although our company doesn't currently use cloud BI services, we might be implementing this later in the year. We're always seeking out ways to streamline services and costs so we can pass these savings onto our clients and shareholders. We're still researching different services to determine which ones have the features that we need. We'll be seeking out something out that offers querying, statistical analysis, data mining and text mining at the outset, with the potential for additional services such as reporting and process mining.
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It would seem that hybrid cloud is a good fit for BI. Data stays on-prem, use a collection appliance of some kind, with cloud-based processing/analytics.
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Many studies show that after "cloud"-impllementation IT budget has substantially reduced. Small business can utilize this money for the further growth.
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