Business intelligence is one of today's hottest enterprise applications, and the cloud is receiving much buzz as enterprises look to cut the cost and hassle of software implementations. So it's no surprise that these two "cool kids" will likely become a power couple at many companies. More often than not, however, the role of matchmaker is being played by business units rather than IT departments.
As with many emerging cloud apps, hype still leads reality at this point. Saugatuck Technology research (free registration required) found that just 13 percent of global enterprises said they were using cloud BI or analytics in 2011. But the same research indicates BI will be one of the fastest-growing cloud apps through 2013. Saugatuck forecasts a compound annual growth rate (CAGR) of 84 percent for cloud business intelligence from 2011-2013.
In contrast, during the same time period Saugatuck predicts CAGR rates of 44 percent for cloud CRM/salesforce automation, 54 percent for cloud human resources/talent management and 61 percent for customer service/support.
Cloud Speeds BI's Benefits
Bruce Guptill, Sauguatuck's head of research, said interest in business intelligence software continues to grow because of its promised business benefits.
"When adequately developed and implemented, the software tends to deliver immediate, real and recognizable business benefits to its users. Those benefits may be as simple as providing awareness of specific business process and resource costs; they may be as complex as economic models for market change and opportunity shifts. But they provide real-time or near-real-time business data in contexts that were otherwise too difficult or expensive to derive using previous methods," he said.
Cloud BI is especially appealing, Guptill said, because it can be adopted and used more quickly and inexpensively across more operational areas, processes and functions than can on-premise solutions.
Some business intelligence providers offer integrated suites of cloud BI software and analytic tools, while others focus on more targeted solutions for specific vertical markets, said Guptill, noting that in many cases the latter category can make the business benefits of cloud BI more tangible for buyers. He mentioned PivotLink as an example, saying the vendor has shifted gears over the past 12 to 24 months and now concentrates on solutions for the retail sector, including products that integrate data from social sites with enterprise data.
Business Leads on Cloud BI
Howard Dresner, the president of Dresner Advisory Services, said cloud business intelligence is definitely benefiting from increased interest among business users. In his latest research, Dresner found that 54 percent of BI deployments are primarily under the purview of lines of business rather than IT departments, a number he expects will continue to grow.
"There’s a notion of a 'new BI,' driven by line of business and not IT," Dresner said. "Business increasingly has the budget for BI and they want it to be mobile, collaborative, social and cloud-based."
Dresner’s survey found business units are more likely than IT organizations to express interest in cloud BI. Eighty percent of respondents in sales and marketing functions tapped cloud-based BI as an important priority for business intelligence initiatives, vs. 65 percent of IT departments.
Business users are "looking for immediacy. They don’t have nine, 12, 16 months to get it done," Dresner said. "They can go to the cloud and get BI up and running in short order."
IT's Role in Cloud BI
Still, IT should play a key role in cloud BI deployments. Barry Cousins, a senior research analyst at Info-Tech Research Group, said the most useful deployments will allow companies to transition parts of the business intelligence solution between on-premises and on-demand, in either direction at any time. That kind of architectural planning and implementation is best left to IT organizations.
To ensure cloud business intelligence success, companies should consider data quality issues, staff training and methods to distribute BI to end users, with integration into CRM/ERP systems, rich email distribution and mobile device support, Cousins said.
"Organizations should not make this decision simply to avoid an overburdened IT department because the governance and process employed by IT is critical to the result,” Cousins said. “Instead, view cloud-based BI as a potential improvement to a purely on-premises model."
Ann All is editor of Enterprise Apps Today. Follow Enterprise Apps Today on Twitter @EntApps2Day.