Today we started with the keynote from Ben Klein. Some people might remember him as the teacher from Ferris Buelers Day off (Great movie btw). His speech was funny but very American. His basic theme was that the American Youth is getting more stupid by the hour. The focus is on material things, money i.s.o. taking care of eachother. This was folowed by a plantinum sponsor panel discussion with guys from accenture, Dell, HP, Hitachi and profit base. First take aways are. BI in the next 10 years is going to be more about social networking, instant information, even more data, integration, visibility of data, 90% on 3 or 4 platforms, role driven and less adhoc. There will be a gap between BI solutions and its users due to cultural differences, skills and so on. Perhaps this will create a new role of the information architect (iso the data architect) with more focus on business than on SQL. Understanding then underlying model is key for enduser buy in. There will be an ERP world (with focus on capturing the information) and an IRP world (with focus on delivering the information). Right now they are going into commercials so it is time for a cup of coffee.

2008 has been quite a year for Business Intelligence. We have seen large platform vendors buying well known BI companies. The result is that the BI market will be dominated by three maybe four players. This market, some predict, will grow with another 10% this coming year. Some analysts have stated that small independent BI software vendors will profit most from this all. They will grow faster and will be more innovative than their large competitors. It can be expected that this will give way to a renewed interest in Open Source Business Intelligence (OSBI). OSBI vendors are able to present themselves as an alternative. One of their strong arguments is that they can so help prevent a vendor lock in. Another aspect is status. Early adaptors can make good cheer with their choice for OSBI. They consider themselves winners as they have chosen to step outside the trampled down roads. Finally, this also fits in the increased interest for open source software. But are the OSBI vendors ready for the fight? Can they compete with the four mega vendors? To do so they need to have a complete BI solution (breadth) or a terrific niche solution (depth). One of the competing differentiators is the claim that OSBI is cheaper. By making the code public the vendor can lower their cost for research and development. At the same time it creates a form of shared ownership. Another advantage is that OSBI vendors do not charge you for the software (licenses). Their profit model is based on delivery of services and support. The bottom line is that the total cost of ownership (TCO) for OSBI is often lower. But the game is not won on costs alone. The fit between the user requirements and the BI solution will be just as much a deciding factor. The general impression in the market is that the functionality of OSBI runs behind. They offer some nice (additional) solutions for reporting and analysis but that’s it. They are no real alternative for their commercial counterparts. But is this true? Let’s take a short look at what the OSBI vendors came up with last year. Pentaho brought BI to the iPhone, added a meta data layer to their BI suite v1.6 and made their product compatible with Sun Solaris 10 (two OS products, 1 solution, low TCO),  Also Pentaho and Ingres have agreed on a strategic partnership for OSBI. This means shared sales and marketing activities but also an integration of their products (Pentaho is certified for the Ingres Dbase).  Pentaho also agreed on a partnership with Infobright for data integration and ETL for all MySQL customers. They have also been actively expanding in Europe. Jaspersoft came with v3.0 which includes interactive web 2.0 interfaces, drag and drop technology, a new metadata layer and improved security. They have also been cooperating with Microsoft to optimize their BI suite for windows and office. MsExcel can now fully be used as a front end tool for their JasperAnalysis data analysis server. Ingres – as mentioned before – closely work with Pentaho but also with salesforce.com offering a CRM SAAS product (Icebreaker). It is safe to conclude that OSBI vendors are strengthening their position with partnerships within the OS community and by adding new functionality or technology to their BI proposition. They are also rapidly closing the gap with the commercial BI vendors (who are often halting as they face product integration). If they can keep this pace they will have their BI products at the same level as the commercial vendors within three or four years. OSBI has the potential to become a serious alternative for the commercial solutions. (This article has been written together with Leo Cardinaals. Leo also works for Capgemini BI and is an active member of the open source community.).

In a move that turns the heat up on Microsoft Excel, Google is partnering with business intelligence firm Panorama Software to develop a software-as-a-service (SaaS) analytics, reporting and data visualization tool for its free online Google Docs applications suite. The BI firm that handed Microsoft the original OLAP technology that’s now included in SQL Server database management system, is working with Google to push BI and data visualisation capabilities into Google’s Docs applications suite which mimics Microsoft Office with free online word processing, spreadsheet and presentation applications. At the same time rumors are surfacing that Microsoft in experimenting with an online office suite with codename Albany. This in an attempt to fend off competition like Google docs. The Panorama software, which has been released as a beta version this week, is offered as a free desktop gadget that works with Google Spreadsheets. It draws on analysis, reporting, dashboard, visualisation (charting) and data modelling tools that are part of Panorama’s NovaView BI suite. These elements combine to create Panorama Pivot Tables that can be embedded and manipulated in applications like Google Spreadsheets. This Google initiative perfectly fits into one of the BI megatrends for 2008: Integration. We have seen that Business Intelligence continues to integrate with operational processes. The preferred tool of choice in operations is still the spreadsheet (Excel). Microsofts ‘BI for the masses approach’ also boosts excel as their BI frontend. If Google wants to compete with Microsoft (in the BI area) then targeting the spreadsheet sounds like a well thought strategy. But if you compare the installed base of MS Office and Google Docs there is still a long way to go before somebody in Redmond looses sleep over this. Also we have seen a consolidation of BI vendors in 2007. This means that small(er) BI vendors will be looking for partners to survive (or create niche solutions). Again also sound strategy thinking by the guys and girls at Panorama. That they have been in bed with Microsoft before makes it even more exciting.  Finally the Vendor consolidation has created an renewed interest in open source software. Clients are afraid to be ‘owned’ by one mega vendor. Google may be perceived as a alternative. In conclusion, we could argue that the BI vendor consolidation has made the BI market more volatile by creating new chances for innovative parties even from a non traditional BI background.

Times they are changing. Last year has been tumultuous for BI at best. We have seen the BI market consolidate into a few remaining mega vendors. But there was also room for niche players especially the ones focusing on speed, visualization or collaboration. So what will 2008 bring? To quote from Star Wars: “Impossible to see the future is”. But let’s give a try anyway. There are five mega trends that I foresee. Some have been around for quite some time and some are new. The first one is called: (1) Increase: Business Intelligence must be able to cope with considerable increase in both data (size) and speed (real time). The second one is (2) Integration: Business Intelligence will continue to integrate with operational processes but will also be more aligned with strategy. The integration of (un)structured data will increase. Finally, Business Intelligence will integrate with other business applications or ERP systems. Third, and my personal favorite, is (3) Insight: Business Intelligence will continue to become more intuitive (less end user involvement) showing an increase in advanced visualizations but also more analytic (more end user involvement).The fourth is (4) Interactive: Business Intelligence will be more reciprocal by nature; creating a dialogue between system and end users as well as sharing information and collaborating within performance networks. Finally, number five will be (5) Industrialization: Business Intelligence development will be characterized by a more industrialized approach using standard development frameworks opening up the possibility to outsource.  Increase will be mostly characterized by the need for real time information (partly due to the fact that BI becomes more operational). This will be supported by tools like Netezza and Teradata. They can also support the growing process of data retrieval from vast amounts of data. Integration of unstructured data (text, search, documents, agents) for example in a document warehouse (using tags) sitting next to the data warehouse will be the wave of the future. I expect Google or Attunity to take the lead here but the original BI vendors (Cognos, BusinessObjects) have also been investing in this. Although the market is more or less divided among a few remaining vendors it is still possible that we will see some more integration. This will be partly triggered by the fact that BI will be used on all levels: strategic, tactical and operational. This means BI tooling must support strategy development as well as pervasive BI (it’s everywhere). The renewed interest in open source Business Intelligence (Pentaho, Jaspersoft) is a clear counter reaction against the market domination due to vendor consolidation. Creating Insight today will be the one mega trend where I expect the most innovation to come from. It is a hot topic and fun to watch evolve. Here you will find things like intuitive intelligence (Strategy companion) or decision engines supporting your daily work (Fair Isaac). Also advanced visualization will help the end user get more grip (fractal edge) on things. Triggered by the success of “competing on analytics” or “super crunchers” we will see an rise in the use of analytics, strongly combining informatics, statistics and business knowledge. Perhaps here lies the opportunity for the long awaited promise of data mining? A clear and much appraised trend is the sharing of information with other people either inside or outside your own company to create mutual benefit. But it is more than just sharing the information it is also about sharing the reasoning behind it. How have we come to this conclusion and do you agree? It is asking feedback or contributions to your problem solving by your stake holders. All the characteristics of the web 2.0 can also apply here. This can also be done by using a trusted third party to solve your BI wishes by providing BI as a service. As BI is getting more mature by the minute I expect that we will see a standardization of best practices resulting in an industrialized approach in (standard) BI development. BI factories, often based in typical outsourcing countries, can provide high quality, low cost ready-to-use BI solutions. Some people say that after all the consolidating this will be a boring year for Business Intelligence. But if I look at these five mega trends I can’t wait. Happy new Year.   

Take a look at this post on the Eweek website:

http://www.eweek.com/article2/0,1895,2227695,00.asp

Reuters wrote on December 4th: ´Shares in software maker SAP extended gains and hit the day’s high on Monday as traders cited market talk of bid interest from Microsoft. SAP declined comment”. If this is true it would be an interesting wave in the latest developments in the BI vendor consolidation tsunami. I asked Ron Torrico, the Microsoft BI Guru Online within Capgemini, for his opinion. Here are his two cents. He expects there will be a clash of cultures, therefore he suggests operating the companies as two separate entities. In his opinion SAP can benefit from the technology know how within Microsoft. But SAP has been investing in integration with IBM Websphere, which is not the core-competence of the guys in Redmond.On the business side, positioning Dynamics for the small, medium business and SAP for the Enterprise level sounds like a good plan. You can be sure that Larry (Oracle) will be pissed off. It may also encourage SAP to be more open. So again, as many of the recent acquisitions, it seems that market share is again the major driver behind this and not so much the technology.

Alles is BI [Click to open pdf]

Everything is BI, but what is BI and what is happening in the BI world with all the vendor consilidation?

In this pdf file you can find an article (I was interviewed for this) published in channelworld about the subject.

ARTICLE IS IN DUTCH

It has taken much more time than expected – but finally IBM has announced that they are buying Cognos for 58 USD per share – making this a five billion dollar transaction. IBM and Cognos have had a strategic alliance dating back to early 2006. However it looked like IBM was slow in reacting to takeovers such as Business Objects by SAP. So slow indeed, that new names came to the surface: Microsoft and Informatica. But now it is final: IBM it stays. Therefore it is safe to say that this is not a big surprise. But is this a logical step by IBM? They themselves state that this fits perfectly with their information on demand strategy - opening up information to business users. IBM traditionally had a focus on hardware and data integration – the techy stuff of datawarehousing – lacking business interaction tools like Cognos. Therefore this acquisition of front end technology for business users - Business Intelligence and Corporate Performance Management - is very compatible with the hard- and software they already had. It has made their BI portfolio more complete without a doubt. So am I 100% enthusiastic? No, is the answer. The main reason for this is that the whole “Information on demand strategy” implies having data in the first place. Where other vendors like Oracle, Microsoft or SAP have transactional platforms or CRM solutions creating transactional data – IBM starts at the point of data integration – missing the essential first step of business applications. This way they can not get their claws into the much valued business processes. They will position themselves as being independent of any database, platform or application, which off course is true from an IT point of view. However, they will very often not be a first ‘automatic’ choice (like BO will be for SAP users) for business user, meaning that they have to put a lot of energy into marketing and sales. In summary: IBM & Cognos offer a powerful, complete and compatible Business Intelligence solution which will make the IT department very happy but will the business people give a hoot?

[Click on image to enlarge]

With great thanks to my collegue Ron Torrico, the outcome of a small internal poll. No big suprises here (IBM), although the number #2 Microsoft ? Time will tell.

My prediction? Although IBM and Microsoft are most likely a strategic partnership with Informatica sounds great. It plays the independence card and also completes the Cognos BI platform which lacks a robust ETL tool.

In order to adapt to faster changing circumstances, organizations are more and more in need of a (near) real time supply of information within the decision making process. This means gathering transactional data from inside the organizations processes (often structured data) or on the outside edge (often unstructured data).  The true business value of business intelligence (BI) can be found in the ability to efficiently gather useful information from a diversity of both internal as well as external information sources and by sharing or interacting the intelligence with the ecosystems partners and customers to improve mutual performance.  This information centric approach is also reflected in the BI or Corporate Performance Management (CPM) suite of various vendors: integrating both organizations processes such as planning, consolidation and forecasting and search / knowledge management solutions. This makes sense as the most productive fields within the BI/CPM market are at this point in time: financial consolidation, BI platform, budgeting, planning and forecasting. This makes BI/CPM suite vendors a tasty bite. BI/CPM vendors often have similar products build upon the same type of technology. Therefore there are little distinguishing characteristics between the various vendors. It is therefore more than likely that technology is not the driving force behind the recent storm of BI/CPM consolidation. Keeping or gaining market share is their main goal. From a technology standpoint there is a case to be made that the innovation will come from small companies focusing on niches, such as: strategy & implementation tools, meta- and master data, advanced visualization, text mining, search or business activity monitoring. These will be likely candidates for a content driven acquisition. A strong trend in the BI/CPM market is the integration between hard- and software. The main push for this is the focus on real time transactional data for the decision making process. This will result in a merge between (transactional) platforms/databases and (interactive) BI/CPM solutions. A dominant position for platform/database vendors such as SAP, Oracle, IBM and Microsoft is to be expected.  These BI/CPM platform vendors will end up with a large number of duplicate tools. They will have at least two or more tools fit for the same solution. They must choose if they want a technical integration (complex, time consuming) or to thin out or rationalize their stack (kill your own darlings). Over time this heated BI/CPM consolidation will result in new product stacks, making recent tool selections obsolete and future ones a challenge.  Recent BI/CPM acquisitions Some of the most striking BI/CPM acquisitions so far have been:

• SAP acquiring Pilot Software, Outlooksoft and Business Objects;
• Oracle acquiring Peopleosoft, Siebel and Hyperion;
• Microsoft acquiring Proclarity (and the release of their Performance Point Sever);
• SAS announced a strategic partnership with Teradata (just separated from NCR);
• Cognos acquiring Adaytum, Frango, Celequest, Applix.

SAP acquires Business Objects SAP has announced that it intends to acquire Business Objects in friendly takeover. They will pay 4.8 billion Euros for this deal. Business Objects will operate as a stand alone business but part of the SAP group. SAP is an established ERP vendor and market leader in Enterprise or business applications. They have a strong transactional platform which includes BI (Netweaver) and CPM (Outlooksoft) capability. SAP has had limited success with their own BI solutions. The main reasons for this are their weak front end capabilities and problems with unlocking data from non SAP sources.  Business Objects is a pure BI player with very strong reporting, analytics and CPM capabilities with many industry models available, focusing on the mid market. They have been the market leader in Business Intelligence. Business Objects has entered the CPM arena late in the game, some say maybe too late. They have made up for this by buying SRC, ALG and Cartesis, allowing them better access to the finance and CFO office. However as they are still busy with the XI integration this must be quite an extra burden. With SAP being strong in enterprise applications but falling behind in BI, this acquisition of the Business Objects makes up for this. Not only can Business Objects help them with their front end solutions or metadata, they can also give them the much wanted business user access and mid market expansion. Business Objects can also help with Non SAP data integration.  Does that mean that everything is like hand and glove between them? Some analysts question the robustness of the Business Objects ETL tool, especially in complex SAP environments. But the main challenge will be the integration of the all the (previously) acquired companies and their solutions. Having more than one solution for planning, reporting, consolidation, analysis or score carding will also create much confusion with their clients on which will survive the cut.  In summary, this acquisition allows SAP to have the transactional platform and the interactive Business Intelligence (Business Objects) and Corporate Performance Management (Outlooksoft) solutions. However they will face a large product overlap in the CPM area: planning, budgeting, financial consolidation. Having said this, technology probably has never been the main driver for this acquisition. This can purely be considered as a strategic reaction against the Oracle / Siebel /Hyperion merger.

Yesterday SAP announced that they have agreed on a friendly take over with Business Objects. As they have already acquired Outlooksoft they can now work on integrating these seperate environments to create a complete DWH/BI/CPM platform. That means that SAS (privately owned), Teradata (just seperated from NCR) and Cognos are the last 3 men standing. So when will IBM annouce that they have bought Cognos? Or wil Microsoft swoop them away first? Fun times!See also my previous blogs: BOBJ for sale & kiss of death (vendor consolidation)

PARIS (Reuters) - Business Objects (BOBJ.PA: Quote, Profile, Research) (BOBJ.O: Quote, Profile, Research), a French-American business intelligence software maker, is looking for a buyer and has appointed Goldman Sachs to find an investor, Le Figaro newspaper said.
At current market prices, Business Object is valued at 2.9 billion euros ($4.03 billion).

The consolidation of BI tools is entering a new round. Will be this the one where the final knock out will be given? An article in the French paper le Figaro mentions that Business Objects (BOBJ) has hired Goldman to sell the company! This is sure to reignite the acquisition speculation again.

Until recently BOBJ official position was that they were not for sale. On the contrary they were on the acquisition path themselves and their ambition was to remain an independent BI software firm.

Although this is the official stand point rumor has it that they have been contemplating this move for quite a while. Unable to make the much needed growth as an independent software - fighting their opponent Cognos - they need a large platform vendor to make the difference.

Which of the usual suspects would be in the market for BOBJ?

1) Oracle does not seem like a logical choice. With all their recent acquisitions their BI portfolio seems to be complete enough. Also Fusion will have to be their main focus for now.

2) The SAP BI solution (SAPBW) has never won any prices. It was considered to be not very user friendly and limited in its possibilities. I had many clients inquiring on alternatives. They could use a good BI environment maybe more than any of the competition. With they recent acquisition of Outlooksoft they have the possibility to finally go for a complete BI/CPM platform: leveraging the power of the underlying SAP data.

3) Another good possibility are they guys and girls from HP. They have bought Knight bridge - a BI consulting firm - and have a comprehensive data warehouse solution/infrastructure. However they are still missing a BI tool or environment to go with this. This might be a great possibility to really enter the arena.

4) IBM always comes up in these kind of list - but somehow they never seem to bite. But they have they same starting point as HP with strong data warehouse infrastructure and consulting in place. But an American - French marriage often leads to many problems (although in real life I have a good friend who has fought the odds). I keep hearing rumors about Cognos and IBM. If HP decides to buy BOBJ then IBM must follow. Start calling your stoke broker.

Although there are more candidates out there - such as Microsoft (don’t think so), Cognos (that would be so funny but impossible), Teradata (a possibility after the split from NCR) or even the real outsiders as Google Aps (hmmm, have to think about that one) - my guess it will be one of the above.

Do you agree or have I missed something or someone? Please react and share your opinions.

I hate to say I told you so - but I am going to do it anyway! I wrote in my blog about vendor consolidation that the innovation would come from small companies and that the larger (BI) vendors would acquire them. Well yesterday Cognos annouced they acquired Applix - a 200 person company specialized in performance Analytics.

See what cognos writes about this on their own website:

Cognos to Acquire Applix
Cognos has announced the execution of a definitive agreement to acquire Applix, Inc., a publicly held company based in Westborough, Massachusetts and an industry leader in analytics. With this acquisition, Cognos expects to further extend its position as a leading independent provider of financial performance management.

Applix will complement Cognos flagship products—Cognos 8 Planning, Cognos 8 Controller, and Cognos 8 Business Intelligence —specifically in the area of financial performance management. Applix performance analytics will give customers new capabilities to analyze and optimize financial performance. This will include improved control and leverage of large, complex financial performance data; strong finance self-service capabilities for “what-if” business modeling and scenario management; new solution areas including profitability analysis; and innovative technology, including a patented, 64-bit, in-memory multidimensional OLAP server

For as long as I can remember, the market for Business Intelligence tools has been more or less stable. Sure, sometimes a new player entered or another disappeared. But on the whole, the market was dominated by a couple of vendors. The most exiting news came from new versions, upgrades or a technological breakthroughs. To put it bluntly: you could choose either Cognos or BusinessObjects or if you were running SAP you could go with BW. Than things slowly started changing. Instead of Business Intelligence we suddenly found ourselves talking about things like Corporate Performance Management, financial consolidation, budgeting, planning, dashboards and scorecards. And we embraced the tools that came with it. Our work was no longer limited to reporting and analysis. We were proud that after so many years finally the strategic value of Business Intelligence was recognized. Thus changing the playing field completely. The focus in BI was shifting from a technical toward a business solution.

The BI and platform vendors quickly recognized this also and have been embracing these tools as well. They bought up companies that had tools specializing in this specific area and integrated them – as best as they could – in their own product portfolio. SAP for example acquired Outlooksoft (Consolidation) and Pilot Software (Strategy Management). Oracle acquired Hyperion (after they bought Peoplesoft and Siebel) – the market leader in planning, budgeting and financial consolidation. Microsoft acquired ProClarity (Analytics) and made a firm entry to the BI/CPM marketplace when they launched their Performance Point Server. Cognos – a pure BI player – acquired Adaytum and Frango and created a complete CPM solution. Finally BusinessObjects- still busy with integrating Crystal – bought Cartesis (consolidation) to complete their CPM offering that they already started building on when they acquired SRC and ALG Software. However is this buying up – this consolidation – not the kiss of death? Where is this going to end? Why this focus on applications rather than information?

Business Intelligence has come a long way. It is now closer tied with the business processes as ever before making the basic data (quality) that comes from this also more and more important. BI still can be an aggregated report of last month sales on a highly accumulated level but it can also be operational dashboards monitoring key business processes on a real time level supporting split second decisions. This makes a strong case for the platform vendors. They have the applications to support the business processes, capture the data and report on them. An integration of software and hardware therefore seems to be unavoidable. Cognos is one of the fist BI pure players to understand this. Their launch of Cognos Now! – which integrates a hardware server and dashboard for realtime monitoring – is proof of that. They might well be the first BI platform vendor.

But basically all BI/CPM vendors have more or less the same products and use the same technology. Even the corporate take over strategies are being copied resulting into a concentration of BI vendors. The real innovation still has to come from small companies that specialize in a niche of business intelligence such as: strategy implementation, meta- and masterdata, advanced visualization, text mining, search and business activity monitoring. These small companies will probably at some point in time be bought by one of the large BI vendors. After all, Cognos Now! was Celquest before. The real challenge for the large BI vendors will than be the technical integration of all these tools. It is easy to make a Ms Powerpoint presentation of where this new application fits in your product portfolio – but making it work with these other tools is a far more difficult thing to do.

Finally, will we end up with one or two BI vendors with a standard set of Business Intelligence tools? No, I don’t think so. The BI tool set will always be dynamic. Remember? After DDS (Decision Support Sytems) and EIS (Executive Information Systems) came Enterprise Reporting and OLAP (Analytics). Than came the consolidation, planning, dashboard and scorecarding tools. Nowadays, the streaming servers and realtime monitoring tools are being wheeled into the business. There will always be something new. The platform vendors will take a dominant position in the BI market but there will always be room for vendors with a focus on BI only. It is almost like the Olympics. Sometimes you need the decathlete to jump, run and throw the javelin and sometimes you just need a 100 meter specialist.

But I am not sure that the real innovation will come from these companies, though they may well acquire the innovators to embed them into their enterprise solutions. Like a thousand points of light, there are individuals and small companies out there already thinking in a really innovative manner about what Business Intelligence could be given new capabilities and technologies.

Who are they? I can’t wait to find out! Let me know what you have seen or are thinking, and that also means the big players too.