Transcript Business Analytics: Measuring the Overall Opportunity in a

Bill Clough
Vice President, Software Research
IDC EMEA
Who’s Afraid of
Complexity:
Intelligent Business Intelligence
www.idc.com
The Problem with IT Today
I can’t reconcile my IT costs with the business value I’m
delivering
I have systems with spare capacity and systems that need
more resources, but I can’t shift the work from one to another
All the information I need is here somewhere, but it’s hidden,
fragmented & inconsistent
What the business sees as a minor change always turns into a
significant development project
Complex requirements take so long to implement that IT gets
further out of step with the business
I can’t justify the resources for running occasional computeintensive modelling & analysis work
I spend so much effort tackling IT issues I lose focus on the
business
I’m meeting all my IT SLAs, but users still complain of poor
performance
The Problem with IT Today
I can’t reconcile my IT costs with the business value I’m
delivering
I have systems with spare capacity and systems that need
more resources, but I can’t shift the work from one to another
All the information I need is here somewhere, but it’s hidden,
fragmented & inconsistent
What the business sees as a minor change always turns into a
significant development project
Complex requirements take so long to implement that IT gets
further out of step with the business
I can’t justify the resources for running occasional computeintensive modelling & analysis work
I spend so much effort tackling IT issues I lose focus on the
business
I’m meeting all my IT SLAs, but users still complain of poor
performance
This is another fine mess you’ve gotten me into
Two Conflicting Personalities of IT
Responsiveness to Market
Business Strategy
Automation & Execution
Agility
Vs.
Stability
End-to-End, Dynamic Management
IT Operations
Automation & Management
Operational Efficiency
Source: IDC, 2005
The Importance of Software
60%
50%
40%
30%
20%
10%
0%
61
% of n
Q: How important is software technology to your company's business success?
Please answer on a scale of 1 to 6 where 1 is “not at all important” and 6 is “very important”.
n = 625
Source: IDC – European Software Group, March 2005
The Value of Software
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
61
% of n
Q: Are you getting the expected value from your software solutions?
Please answer on a scale of 1 to 6 where 1 is "no value" and 6 is "more value than expected“.
n = 625
Source: IDC – European Software Group, March 2005
It’s All BI to Someone
Business Intelligence (BI)
Business Analytics
Analytic Applications
Business Performance Management (BPM)
Corporate Performance Management (CPM)
Enterprise Performance Management (EPM)
Business Activity Monitoring (BAM)
Production reporting
Query & Reporting
Enterprise Reporting
Data Warehousing (DW)
Ad-hoc analysis
Portals
Advanced analytics
Data Mining
Data quality
Dashboards
Statistics
ETL
Scorecards
Data visualization
The Purpose Behind BI
Speed and Accuracy
 Who are our best suppliers or most profitable customers?
 Which new prospects should we target,
 Where are our expenses growing faster than sales,
 Which products are experiencing quality problems,
Insight and Relevancy
 Should we extend credit to a particular customer?
 What will be the impact of a price change?
 How does recent customer activity trend predict future
behavior or customer attrition rates?
 How does a certain pattern in product quality data predict
future servicing costs?
2005 Investment Plans in BI / Analytics
Benelux
Nordics
Italy
European Avg
France
Germany
Spain
UK
0%
20%
40%
60%
% of n
80%
100%
Q: Does your company plan to invest in any of the following technologies in the next year?
Please answer: Active Investments, Considering Investing, or No Plans to Invest.
n = 625 (UK n = 137)
Source: IDC – European Software Group, March 2005
2005 Investment Plans in BI / Analytics
SCM
CRM
BPM/BSC
WFM
Risk Mgmt
BPRC
0%
10%
20%
30%
40%
% of n
50%
60%
Q: How important are the each of these areas for your business intelligence/analytics projects?
Please answer on a scale of 1 to 6 where 1 is “not at all important” and 6 is “very important”.
n =289 – those companies answering Yes to investing in BI Tools and ranking this question 5 or 6.
Source: IDC – European Software Group, March 2005
How the is Market Changing
 Competition, partnerships, M&As: DBMS, ERP, BI, Analytic




Applications
Long term transition from tools to applications
Analytic Apps development platforms with common
services: metadata mgmt, security, authentication, data
quality
Integration: web services standards being adopted in all
new software (building blocks)
BAM with everything – increasing the breadth of real-time
information will lead to adoption of dynamic process
modification
How the Architecture is Changing
Exec.
LOB Mgr.
Data Analyst
Bus. Analyst
Search
Application
Empl.
Govt.
Public
Supplier
Browse
Application
Application
Partner
Consumer
Query
Email
Doc Mgmt
Intra/Extranet
Portal
Text Mining
Search
Browse
GIS
Vertical
focus
Composite
applications
Web
Services
Data Mining
Advanced
analytics
DB
OLAP
DW
Reporting
Data viz
and GIS
Data federation
and virtualization
Content processing
Connectors
Scalability
Data processing
Growing data
volumes
Unstructured
Office Web Image
Email
External
files
sites
A/V
BAM
Connectors
Structured
Custom
ERP SCM CRM
External
Apps
Convergence of document
and structured data
The Value Proposition with BI
 Competitive advantage comes from the speed and
accuracy with which the closed loop can be traversed.
 Competitive advantage comes from assessing the
relevance of information to a decision and from gaining
insight in seeking and evaluating possible decision
alternatives.
 Since many types of decisions are recurring or repeatable
(such as pricing, extending credit, or allocating resources),
decision-making processes exist that are amenable to
automation.
 One benefit to decision process automation is that it
enables greater consistency in the way decisions are
made. This is important not only for competitive reasons,
but also increasingly for compliance reasons.
“Must Know” Best Practices
 Senior executive engaged as sponsor and champion (CFO,




CIO, COO) with real-world governance.
Projects with a specific application focus generated the
best results.
A staged plan is executed; successful initial project needed
to justify future steps; willingness to adjust.
Business users worked with IT in assessing and prioritizing
requirements.
The challenges in transitioning people to new roles and
responsibilities were recognized.