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Posted March 27, 2003 By Bruce McCracken     Feedback
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Combining BI for a wider view is termed enterprise performance management (EPM) by AMR Research. In the March 2003 report, "Enterprise Applications Outlook for 2003: The Performance-Driven Enterprise," AMR Research contend that EPM (also customer fulfillment), and BI will see strong growth as indicated by the figures below.

Top 2003 Initiatives

BI/Analytics Market Growth Projections

BI/Analytics 2001 2002 2003 2004 2005 2006 CAGR
Revenue ($M) 5.6 6.1 7.5 9.3 10.9 12.2 17%
Growth 10% 8% 23% 24% 17% 12%
Source: AMR Research Group, 2003

Bob Anderson, research director of Gartner, looks ahead to see BI as imperative. "With XML as the transport, we will see analytics across the value and supply chains. It is not a matter of if; it is a matter of when. They need the information, but they do not need to be in this business. In this area we will see a very preferred paradigm using an ASP or outsourced model. It used to be one business against another, now it will be one ecosystem against another."

Howard Dresner, vice president and research director of Gartner, notes, "The whole notion of the real time enterprise is going to emerge. The benefits are going to be impressive for some organizations. This is being done today, but the organizations have had to do the heavy lifting themselves. In a lot instances, the small enterprise can now get many of the same benefits as a large enterprise would that has a large IT organization. A real benefit of the ASPs is that they can service to their customer constituents an entire menu of metrics. For the small and mid-sized market, they really don't have where with all to it themselves. It is a natural fit."

Hagerty adds, "We are seeing the reemergence of the outsourcing process, not just in the hosting but the whole shebang. With a little bit of effort, it is pretty easy for folks to dive in and really understand their business a lot better. They have to figure out which metrics really matter to the company so as to not get caught up in all of the chatter."

Dresner points out that speed impacts the value of the information. "The issue at hand is the culmination of 'perishability.' We did an extensive study last year on business intelligence with 540 organizations. One of the things we asked involved the latency associated with data. If they can improve to yesterday's data that would be more than sufficient. If we fast forward to 2006, that is a very different circumstance. Then you will see to the 35-40% level, a desire for instantaneous access to data."

Dresner also submits that the enterprise must exercise due diligence in planning and have clearly defined objectives with sound reasons for the endeavor. "They have to have a clearer business model and business justification for doing it. You just don't do this on a lark. You have to know why you are doing it and what the benefits are going to be."

Hagerty points out an obstacle and consideration for implementation, especially if the organization has been involved in mergers or acquisitions. "One of the trade-offs especially for larger companies is that people have different metrics. You have to have a common basis of understanding, or one source of the truth, to be sure that people are looking at the same information in the same way. A huge issue for a lot of organizations is the inability of people to come to a consensus on what they are actually talking about."

In considering an ASP, Dresner does caution that the service level agreement (SLA) is very important and must be designed so as to not have caveats leading to exorbitant costs for customization or non-standardized reports. The enterprise must also ensure that it has ownership of the data should it want to take its ball and go home by opting out of the relationship. "The issue with the ASPs in general is the ownership issue. The service level agreement is everything. You have to be very careful."

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