Small and mid-sized businesses are constantly being bombarded with marketing messages about the plethora of solutions available to them. The ability to understand what solutions are within reach of small and medium-sized organizations and how each differs from one another is a job of its own.
Consequently, many SMBs require assistance to help them select the right solutions for their organizations without resorting to guess work. With the hundreds of solutions available, how do organizations make sure to select the right solution for their particular needs? How can SMBs sift through the market hype and make sure that BI offerings fit their business and technical requirements, without being watered down versions of enterprise BI solutions?
This article looks at some of the essential considerations for small and mid-sized organizations in relation to business intelligence. Understanding what to be aware of and how to select the best software while sifting through the marketing buzz of BI trends and SMB targeted solutions can make or break the success of any BI implementation. Solutions may work, but broad adoption, interactivity, and the ability to maintain and expand applications will differ based on an organization’s software selection and how closely aligned these are with the company’s strategic goals.
What to Know About Solution Offerings
Many considerations exist when trying to identify the right solution for any SMB. The five areas identified below are key considerations to keep in mind when developing short lists and speaking with BI solution providers. They provide a good starting point for SMBs evaluating a variety of solution choices.
- Most vendors have their own definition of self-service and ease of use. The term self-service is very popular today. Generally, traditional BI offerings target users familiar with data manipulation, statistical models, the creation of customized calculations and the origins of data locations. The goal of self-service BI is to expand BI use and bring analytics to all users within the organization, without having to rely on IT for delivery and development. Therefore, many of the BI solutions targeting SMBs are easier to interact with than traditional offerings. The challenge is identifying which solutions have the ease of use and self-service capabilities that match employee skill sets. Vendors may say they offer self-service BI, but that doesn’t mean much if the level of self-service isn’t easy or interactive enough for business users to access.
- Understand pricing and licensing fees. Subscription models will differ based on number of users, amount of data stored and number of data sources. Many SMBs like the idea of having BI as a fixed cost. Depending on the model chosen, fixed costs can grow exorbitantly due to capturing higher data volumes, expansion of use or the application of more complex analytics. This means that original expected costs might only represent a subset of what is actually required for analytics. Looking at the way additional data sources, end users and expansion of use will affect costs over time may lead you to select a BI offering that is more expensive initially but has more potential to scale. The market is transitioning away from traditional licensing models that block organizations from expanding end user involvement without increasing costs.
- Consider the integration of disparate data sources. Some industry research suggests that 80 percent of BI efforts are placed on data integration activities. Each vendor has different ways of loading, cleansing and maintaining data sources. In addition, certain vendors have connectors to integrate a wider variety of information. Understanding how this works in advance will help plan for the effort involved relative to developer and solution provider involvement and what sources are supported natively. In addition, this knowledge can help narrow the playing field by identify which solution offerings will be the quickest to develop.
- Know the details of software as a service, sending BI to the cloud and relevant subscription models. The promise of fixed costs, less upfront costs and easier maintenance makes SaaS appealing to many SMBs. When looking at the long-term costs and expansion of use, the picture changes. In many cases, long-term expenditures end up being larger than with traditional implementations and costing structures. Even though subscription models are becoming more popular, their costs over time will probably be greater than spending higher fees to implement a BI offering up front and spending the 20 percent (on average) support and maintenance fees. Software as a service on its own is becoming more popular, but businesses need to make sure they can access and remove their data if they choose to change platforms. Also, organizations should identify what challenges exist with having their data hosted externally versus developing their own data warehouse. Although many of these considerations overlap with general licensing discussed above, hosting data external to the organization is an extra service that may be worth the extra costs.
- Look at best of breed solution availability. Dashboards are becoming the popular way to access metrics and analyses. They are seen as an easy way to interact with data. The reality is that dashboards only represent one component of business intelligence. Organizations need to identify their needs and what tools they can use to access and interact with the relevant data. This requires an understanding of the benefits of reporting, multidimensional analysis and data warehousing options. In some cases, the best option may be a piecemeal approach that requires separate BI components, in others, companies should look at full BI offerings, such as those provided by some of the larger vendors.
Overall, the considerations required by SMBs to select the right BI software are multifaceted. Organizations need to select the key criteria and make sure that vendors can prove they meet these requirements through in-depth demos and proof of concepts using business data. Looking at levels of interactivity, licensing models, data and types of solutions are a good first step to ensuring a good software fit. These areas, however, do not limit the need for a full evaluation of available market offerings, and it is vital to gather business requirements and match what vendors can offer to those identified needs. Understanding how BI solutions meet the needs of SMBs empowers decision-makers and enables them to ask the right questions before investing heavily on a strategic software offering that can greatly benefit their business.
Click here to watch a video discussion with Lyndsay Wise and Information Management Editorial Director Jim Ericson on open source BI software.
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