Business Intelligence and Analytics - Challenges and Trends
In this post, I am planning to address the Business Issues and Customer challenges in today’s dynamic environment of Business Intelligence and Analytics. I will also cover the trends which are emerging and re-shaping the way corporate and organizations are doing their Business Analytics. As a consequence of recession during 2009, and the downturn, industry has seen the differentiators between organizations would be the strategies they are adopting especially on the line of alignment between IT and Businesses.
Gartner view on strategies for alignment between IT and Business primarily focuses on following aspects:
• How well the enterprises calculate their risk appetite – country of operations, verticals etc
• Business decision makers focusing on IT strategy and integrating it with their business strategy
• IT increasingly will be used by organizations to ‘grow’ and ‘transform’ the organization – compared to old view of IT as a tool for running the organization
• IT investment to be planned based on the values provided by investment in immediate past
Challenges faced by the Industry post recession
• Shrinking IT departments – manpower and infrastructure downsizing, despite the growing needs to build BI and Analytical platforms is becoming increasingly difficult to manage
• Reduced software spending and budgets – CIO’s are constantly being faced with challenges to manage cost on licensing hardware and software, added with outsourcing deals. Spending in BI/Analytics hence is getting tougher, and a much needed aid of free software
• Tolerance level on project acceptance – Business expectations on analytics are rising and expectations are to have minimal to no tolerance on errors, turn-around time cycles are reduced to add to challenges
• Business Dynamics – Organizations needs to understand constantly changing business environments, and the need two reduce IT costs while achieving new sales targets. This became even more evident during the recent recession and downturn witnessed by the industry across globe
• Faster ROI – Traditional BI and Analytics implementations typically required 12-24 months, and these are bigger bottlenecks for organizations to operate effectively and respond to fast changing market situations
• Scalability, Flexibility – Longer cycles of budget approvals for scaling hardware and infrastructure for movement from small scale to enterprise level solutions. Adaption to the changing business dynamics and needs is a huge challenges for enterprises, as changes to existing BI infrastructure requires weeks to months
• Unstructured Integration – 70-80% of Information in mid-large sized organizations is lying untapped in the form of unstructured sources of data like text based documents, emails, online blogs, PDF’s, Wiki’s, Images etc. No single solution in market today addresses tapping those unstructured sources of information, and integrating with the structured piece to get a holistic view Information and perform analysis
Top Trends shaping the BI/Analytics World
1. Cloud Computing – The definition, as with Web2.0, is varied basically Virtual servers available over internet to a broader definition of consuming anything outside the firewall of organization is “in the cloud”. The cloud computing attempts to address the always existing IT need: a way to increase capabilities on the fly without investing in infrastructure, training resources, or licensing software. Core technologies supporting cloud computing are virtualization, automation, web-based computing, real-time, open standards.
2. Predictive Analytics – The value of predictive analytics is the discovery of unknown facts and relationships, and leverage those relationships for effective decision making. Predictive analytics is the data mining solution focused on predicting future trends and probabilities, involving various disciplines such as statistical algorithms using probability & statistics, artificial intelligence, machine learning algorithms to solve business problems. The new step is to provide simulation, prediction, optimization and other analytics, not simply information, to empower even more decision flexibility at the time and place of every business process action. The new step looks into the future, predicting what can or will happen.
3. Open Source BI/Analytics – There no single technology conference, technology magazine, webinars/seminars or BI/Data Warehousing online search which doesn’t talk about open source BI/Analytics. Few facts to share on progress of open source:
a. According to Aberdeen, 25% of their survey respondents will adopt open source BI in next 12 – 24 months
b. Open Source CEO’s agree that open source is a worldwide growth story
c. First 9 months of 2007 saw open source deals doubled each quarter
4. Recognizing the value of Un-structured Information – Marrying of structured and un-structured data assets will continue to evolve, and effective ways to un-cover the secrets hidden in the unstructured sources of information will shape in coming months and years. The information sources could range from customer emails, chats, blogs, telephonic conversations or help desk calls, RSS feeds, documents like text or PDF’s are all relevant and immensely informational rich content to be brought into analytics for effective decision making.
5. Green Computing – Today organizations are sensitive and more aware of reducing their carbon footprint via different methods like reducing paper consumption, reduced power usage, cooling costs, reducing travel etc. BI has been well positioned on reducing paper consumption by pushing majority of reporting needs, and information availability online thru various channels like internet, mobile, desktops. Linking BI with the mainframe systems for monitoring, performance analysis and reporting the power consumption can be targeted for transaction processing instead of just keeping the server lights on.
6. Data Visualization – is all about effective way of visualizing & communicating the information value of the data. BI has been on the forefront on the various data visualization offerings that let organizations create advanced data visualizations for their dashboards ranging from interactive charting to visualization capabilities found today across modern BI reporting, score carding, what-if analysis and dash boarding capabilities. The trend towards exploration of highly effective & interactive presentations through visualization will continue in the field of Analytics.
7. Mobile – Mobile is used to indicate applications that extend outside of the traditional office environment on devices other than traditional desktop or laptop computers. According to Gartner research, by year-end 2010, approximately 1.2-billion people will carry handsets capable of rich, mobile commerce providing a rich environment for the convergence of mobility and the web. The message-focused approach of mobile solutions lets short, smart messages be delivered through BI event notification technology to mobile clients. The fairly recent intersection of wireless devices and BI lets mobile business users and executives more easily view and interact with the same analytics they would find on their desktop via their mobile device for efficient decision-making. By drawing and combining information from GPS devices, demographics, maps and a customer’s database, location intelligence tools augment traditional BI analytics with important location-centric information. Beyond the mobility of people, the mobility of other assets tracked using RFID sensors, will become increasingly important. As these devices evolve and begin interacting with things like road or department store sensors, new business applications for analytics over mobile devices are possible
8. Composite Applications (a fallout of Web2.0) – The term Mashups loosely integrates and combines content from disparate applications, e.g. RSS feeds, exposed API’s, online resources, other unstructured web resources. Today’s BI reporting is moving towards a well knit integration of those mashups into the BI reports, dashboards and portals. This trend is to continue with the evolution of Web2.0 and growing awareness of integrated applications and content needs.
• “10 Red Hot BI Trends” – by Don Campbell. http://www.information-management.com/specialreports/2009_148/business_intelligence_data_vizualization_social_networking_analytics-10015628-1.html
• “Market Trends 2010: The Gartner View” – by Abhishek Raval. http://biztech2.in.com/india/news/people/market-trends-2010-the-gartner-view/68942/0
• “Open Sesame: Why Open Source BI, Data Integration, and Data Warehousing Solutions are Gaining in Acceptance” – by Claudia Imhoff. Intelligence Solutions, Inc.