Enterprise applications Toolkit

The business of intelligence

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Business Intelligence

Andrew Donoghue ZDNet.co.uk

Published: 17 Jan 2005 14:05 GMT

Business Intelligence (BI) is one of the few bright spots in the otherwise flat enterprise software market, fuelled by the claim that a company can boost productivity by investing in BI reporting tools.

This is an tempting concept for today's businesses, and the potential growth of this sector is attracting several large IT vendors.

Microsoft recently entered the space with applications aimed mainly at small to medium-sized companies. IBM also announced that it is planning several initiatives this year to grab a bigger slice of the action including a new version of its main BI product, Data Warehouse Edition.

But despite the competition, Business Objects -- one of the two or three frontrunners in the market -- is attempting to set itself up as the de facto choice when it comes to BI applications. The vendor claims that the returns for those companies that opt to invest in its technology can average around 400 percent.

Following the launch of the latest version of its flagship product, Business Objects Extreme Insight (XI) ZDNet UK caught up with the company's chief executive and founder Bernard Liautaud to discuss competing with Microsoft and the impact of regulations such as Sarbanes-Oxley.

Are you happy with the term business intelligence -- do you think it describes what you do adequately?
Yes, I like the term. At the end of the day, I think what we are doing is enabling intelligent businesses. It's about building intelligence into a company by using information better. To me, an intelligent enterprise does three things: it practices the concept of information democracy which is everyone should have access to information. Not all the information, but everyone should be informed. The second piece is driving performance through the use of metrics, and score-cards and goals. The third piece is sharing information with external constituencies and partners and suppliers. If you do these three things well then I think you improve the performance of the enterprise and you are an intelligent business.

You have claimed that the market for BI applications is pretty untapped so far. But if the software is so useful why haven't more companies rolled it out? What is the major inhibitor to adoption?
I think sometimes there is a problem with the philosophy of the company. Sometimes they don't see the strategic value of BI. Sometimes BI is viewed as a small, tactical reporting tool -- 'Yeah, you need reporting but it's not that important.' But I think those companies that get it, really get a lot of value out of it. I believe the high-performance organisations are those that take BI seriously, who think that by deploying information to a large number of users, they are improving the effectiveness of the decision making process.

Do most companies have their internal systems in a good enough state to take real advantage of a sophisticated BI platform? Is integration of systems the real mountain that has to be climbed here?
I don't think it's a huge mountain. I think that a lot of companies that have BI implementations may have done them in a fairly tactical way. They may have a little bit of Business Objects here, a little bit of something else there. As they finish up their transaction systems, they are saying 'Are we really able to take advantage of all that data with lots of small systems or is it time to standardise on one across the advantage?' I'd say about half of them have got the point where they have the infrastructure to get to the point where they are thinking about standardisation.

What effect have regulations such as Sarbanes-Oxley had on your business? Has it been a real shot in the arm for BI vendors or has it just been another factor shaping the market?
Sarbanes-Oxley has added a lot of costs into the IT operation but it hasn't necessarily translated into a huge amount of software sold. I think a lot of people thought they were going to sell a lot of software off the back of it but I think the IT departments have realised that they have a lot to do just to document their procedures and to secure what they are doing. I think the reaction has been a lot of strengthening the existing processes in the organisation as opposed to buying a lot of new software.