By Telecom Lead Team: Nearly one third of organizations either already use or plan to
use cloud or software-as-a-service (SaaS) offerings to enhance their business
intelligence (BI) functions.
17 percent of organizations have replaced
or plan to replace parts of their core BI functions with cloud/SaaS offerings.
Almost 27 percent already use or plan to use cloud/SaaS options to augment
their BI capabilities for specific lines of business or subject areas in the
next 12 months.
Business users are often frustrated by the
deployment cycles, costs, complicated upgrade processes and IT infrastructures
demanded by on-premises BI solutions. SaaS- and cloud-based BI is perceived as
offering a quicker, potentially lower-cost and easier-to-deploy alternative,
though this has yet to be proven. It’s evident that, despite growing interest,
the market is confused about what cloud/SaaS BI and analytics are and what they
can deliver,” said James Richardson, research director at Gartner.
The market intelligence agency Gartner has
identified three major drivers for the adoption of cloud/SaaS offerings for BI,
analytics and performance management:
Time to value: The use of SaaS BI may lead to faster deployment, insight
and value, particularly where IT is constrained by existing work and/or limited
budget so that it cannot respond to demands for information and analysis as
quickly as the business requires.
Cost concerns: The cost dynamic differs between on-premises and SaaS
models. Software purchased as a service can usually be expensed, rather than
capitalized, on the balance sheet. Buyers often think that SaaS is cheaper, but
the reality is that this is unproven. Gartner’s cost models show SaaS can be
cheaper over the first five years, but not thereafter. The long-term benefits
lie elsewhere in terms of cash flow, reduced IT support costs, etc.
Lack of available expertise: SaaS analytic applications offer prebuilt intellectual
property that can help firms work around a lack of the skills needed to build
their own analytic solutions.
Instead of disrupting the enterprise BI
platform and corporate performance management suite market, a more likely
scenario is that SaaS and cloud-based offerings will tap into new
opportunities.
If their operational business applications
are in the cloud, organizations should consider pursuing cloud BI/analytics for
those domains. However, they must assess risks on an ongoing basis and ensure
their chosen cloud provider has appropriate business skills to provide a viable
outcome. They must also ensure their BI strategy outlines how to ensure that
data flows to and from these solutions in order not to become yet more silos of
analysis.
