At the same time, the cost of implementing BI solutions has dropped dramatically, particularly with the advent of cloud-based computing and software-as-a-service (SaaS) applications, both of which allow companies to invest in BI technology without building their own giant data-warehousing sites. “The cost factors have come down by a factor of six or seven,” estimates Brad Peters, CEO of BI provider Birst. The result is a more level playing field for smaller and midsize companies that could never before afford the enterprise data-mining solutions of their larger brethren. “There are newer tools out there and the expenses have come way down,” adds Peters. “A smaller organization can inherently be more agile and leverage these capabilities to have access to things that previously only the big guys had. The big guys may have as much analytics as you do; but if you have a more agile way of using them, you’ll be faster—and you don’t have to spend $20 million anymore.”
Birst was the first cloud-based BI provider to win a spot on Gartner’s Magic Quadrant rating of BI providers, and its high functionality and easy-to-use interface received high marks on the 2013 review. But Gartner’s Sallam notes that cloud adoption has been slow, primarily because of security concerns related to mission-critical types of deployment, particularly for financial services firms and other highly regulated industries. “There are always some security risks when you put data outside your firewall. How much of a risk? Can the risks be mitigated to the point where the value of the cloud outweighs that risk? Those are still open questions,” she notes. That uncertainty leads some CEOs to opt against cloud-based BI. For example, although Birst did offer the less expensive cloud option, Hiperos’ Dickinson chose the on-site implementation.
That cloud resistance will likely continue in the market for a time, acknowledges, Sallam. “I’m in the risk-management business, selling to large pharmaceuticals, financial services organizations, [which are] heavily regulated industries,” she says. “They need to know their data is secure in my data center. [However,] “as the gravity of data shifts to the cloud, you will probably see some of those attitudes change.”
The question of just how to quantify BI’s ROI is also partly unanswered. Like other technology adoption, some applications easily translate to ROI while others are more challenging at drawing a direct line from investment to return. But as business users see the value of making analytics more pervasive, accessible and flexible, it’s becoming easier to make the business case.