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BI better bought than built, study says

A study finds that many companies prefer to buy business intelligence applications rather than build them. Have IT and business users finally found one thing they agree on?

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Business users and IT are uniting over vendor-developed business intelligence (BI) tools, according to a recent study.

The streamlined implementation, reduced custom development costs and simplified data integration of vendor tools appeals to IT, while business users appreciate the shorter "time to first use" and functions like self-service reporting. This is all contributing to a growing trend toward vendor-developed BI tools, said the study by San Mateo-Calif.-based Ventana Research.

Ventana interviewed employees at 437 companies with over $100 million in revenue, with 73% of the respondents coming from IT and 26% from business departments. Most were already supporters of vendor-developed BI, with 90% of those surveyed reported having already implemented "one or more" tools. Siebel Systems Inc., a CRM and analytics vendor based in San Mateo, Calif., was one of the study's sponsors. Eric Rogge, vice president and research director with Ventana, said the study and its conclusions were determined independently.

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While BI initiatives in the past were often custom, in-house development projects, trends like organization-wide BI deployments, more mature products from BI vendors, tighter integration with other business applications and smaller budgets for custom development are driving companies to invest in commercial products.

"With custom development, best practices are earned the hard way," Rogge said. "We're midway through a trend to off the rack BI. CIOs are realizing that they can't do everything."

Custom development may still be necessary for more sophisticated BI needs, but companies are finding that vendor-developed applications are a benefit for more "commoditized" customer-facing processes, Rogge said. The study found that 45% of respondents would be further investing in commercial BI applications, while only 15% said they would not.

Respondents reported that these applications have become a key tool for many companies, with catchy names like "STRIKE" or "PEAK," and prominent places on the desktop. Everyone was a fan of functions like self-service reporting, providing business users with the information they need without having to call on IT. Business users listed the primary information benefit of the tools as "access to previously inaccessible data," while the second most important benefit was "timely access to data." Not surprisingly, the desire for near real-time reporting is driving businesses to customize the commercial applications. Respondents reported that enhancements frequently included replacing static reports with parameterized reporting, creating reusable report templates and creating ad-hoc reporting environments.

IT groups said a key advantage of vendor-developed tools is simplified data integration across applications, noting features like master data management. But despite a more streamlined integration process enabled by vendor-developed tools, data integration is time consuming no matter how you do it, Rogge said.

While the vendor's tools may be comparatively faster to implement, respondents said their No. 1 gripe was deployment time, reporting that the "time to first use" often took longer than one year. Other areas of dissatisfaction were insufficient interactivity, slow queries and data integration difficulties.

These complaints support one of Ventana's recommendations to standardize BI applications, not just platforms. Different BI applications can have different metric definitions, metadata and report structures, which can complicate BI implementations. Standardizing BI applications will mitigate that problem, while standardizing on a platform alone will not, Rogge said.

Another one of Rogge's recommendations is to go for the "low-hanging fruit," when deploying BI applications, starting with finance, sales and customer support.

"There's a lot more precedence and experience in these areas," Rogge said. "BI applications are all about improving front-line efficiencies … it's all about the customer and enabling daily decisions about how to make service better."

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