At the end of last year, I wrote a white paper on implementing business intelligence standards – here’s a blog post that adapts the context (the full white paper is available as a download at the bottom of the post)

Executive Summary: Business Intelligence, Essential in a Tough Economic Climate

Citing business intelligence (BI) as a strategic technology, analyst firm Gartner observes, “BI can have a direct positive impact on a company’s business performance, dramatically improving its ability to accomplish its mission by making smarter decisions at every level of the business from corporate strategy to operational processes.”

BI continues to be one of the top tech­nology spending priorities in today’s tough economic conditions. Why? Because BI projects:

• Leverage existing information investments
• Are relatively low cost and low risk
• Deliver proven high return on invest­ment (ROI)

However, few organizations today have a comprehensive enterprise BI strategy or clearly defined BI standards. They face a patchwork of disparate BI tech­nologies, which can lead to:

• Redundant costs in deployment, maintenance, and training
• Increased information inconsistencies
• Frustrated employees who cannot get timely answers to their business questions

Rationalizing the number of BI stan­dards in your organization can result in significant cost savings, greater control over information, and better alignment with your business users. This all leads to increased competitive advantage by fully exploiting the benefits of enterprise BI, and laying the foundations for enter­prise performance optimization.

But implementing BI standards requires a pragmatic, phased approach that takes into account the organizational realities of large organizations, and the business value of existing BI applica­tions.This post gives an overview of the advantages of implementing BI standards, and takes a look at some of the real-life, best practice techniques used by industry leaders. Read on to learn how successful organizations have standardized on business intelligence – and why you should join them.

A Business Intelligence Strategy is Key to Success

Despite the importance of BI, Gartner predicts, “Through 2012, more than 35% of the top 5,000 global companies will regularly fail to make insightful deci­sions about significant changes in their business and markets.”

For BI to be successful, information and analysis must be actionable. Your associated decisions must have an effect on performance that is in line with the objectives and strategic plans for your organization. To turn informa­tion into real business change, your enterprise BI strategy must answers questions such as:

• What performance metrics have the highest impact on your business strategy and objectives?
• Which people and processes have the highest impact on achieving your business objectives?
• What applications and BI technolo­gies do these people need to deliver the highest impact on your business objectives?
• What information has the highest impact on your business objectives?

In order to succeed in enterprise BI, you need to consider all facets of your information environment for a holistic view.

Information Strategy

For starters, your BI strategy should take into account all sources of data used for business decisions: operational systems, departmental data marts, key spreadsheets, and unstructured data stored in text files, Web pages, and other corporate systems. Data sources should include not only internal systems, but also information stored in the systems of your customers, part­ners, and suppliers, and in the greater “cloud” of data that is accessible through the Internet.

An enterprise data warehouse is a central pillar of any BI strategy. You must constantly strive to integrate information from your diverse opera­tional systems, make it consistent, and optimize it for analysis. Your enter­prise data warehouse should be a key active part of operational processes, helping deliver the information you need to optimize every action of your daily business.

Still, an enterprise data warehouse can never store all the information that people may need; you also need a flexible BI solution. Your BI solution should enable people to access and integrate information as needed, from multiple different data sources.

User Strategy

Information is irrelevant until people use it to change something in the way the business operates. Your BI strategy should examine who needs which infor­mation, from which systems, and how they need to interact with it. The goal is to ensure that all people and processes have the information they need, when they need it, in order to fulfill their roles.

Each person will typically have multiple different “information use profiles.” For example, a sales manager may need to review high-level strategy, track key performance indicators, analyze sales data, and review information from oper­ational systems. Each of these interac­tions will require a different interface and approach. The key to successful BI is to bring information to the users as seamlessly as possible, as part of their daily business.

You should plan to embed information access into every standard process, especially in areas that rely heavily on data analysis and evaluation, such as financial budgeting and planning, and governance, risk, and compliance systems.

Organizational Strategy

Your strategy should also consider the organization and processes that are required to ensure information is managed as a corporate asset. For example, you must determine which group will be responsible for realizing the value of an information asset. How should the group be staffed and financed? And what governance is required to set priorities and align infor­mation use with the overall strategy of the organization?

The Importance of BI Rationalization

Having multiple, disparate data ware­housing and BI solutions clearly makes it much harder to take a strategic approach to corporate information use. An essential part of a successful BI strategy involves implementing BI stan­dards and rationalizing your existing BI tools. Since most large organizations have already implemented standards for their business application environ­ments, BI rationalization is the next big opportunity for organizations to stream­line costs and get a greater return on their information assets.

Standardizing on BI software delivers the same economies of scale as other standardization efforts. In addition, a cross-organization BI infrastructure can provide exponential returns through better business insights that traverse your entire organization.

Rather than focusing on redundant skill sets, integration points, and project requirement analyses, implementing BI standards allows your organization to focus its energy on how to better use information and capture best practices. The results are new revenue opportuni­ties, improved cost visibility, and better risk management.

Lower Costs

Reducing the number of supported BI tools in your organization can result in:

• Lower software costs through more coordinated purchasing and contracts
• Lower support and administration costs
• Less time and money spent on BI evaluations
• Lower user training costs
• Faster ROI for BI projects

More Control and Better Quality Data

With fewer standard systems for accessing business information, your organization can obtain:

• More reliable data for decision makers
• Easier comparison of information across different departments, for one version of the truth
• Easier sharing of consistent informa­tion between different user groups, and with customers, partners, and suppliers
• More coordinated security, to mini­mize unauthorized data access

Better Alignment with Business Needs

BI is often an area of friction between IT (who provides information) and busi­ness people (who need the information to do their jobs). By allowing you to connect goals, metrics, and people across the enterprise, an enterprise BI strategy can help your organization to manage and optimize information flows like other business processes, leading to improved alignment, transparency, and performance.

In particular, a standard interface for information access gives:

• More timely answers to business questions
• Easier cross-data analysis to reveal new revenue opportunities
• Improved cost visibility
• Better risk management
• Increased competitive advantage by better exploitation of the benefits of enterprise BI

A Foundation for Performance Optimization

An organization-wide infrastructure provides a foundation that helps you ensure all users have the data they need to make decisions. You can then leverage that foundation to optimize your business processes within your organization and across your extended ecosystem of customers, partners, and suppliers, in areas such as:

• Financial performance management
• Operational performance management
• Strategy management
• Governance, risk, and compliance

The Practical Implementation of BI Standards

Although many organizations are already convinced of the benefits of standardization, they are unsure how to turn that conviction into reality. Simply declaring a particular set of products as “the standard” or signing an enterprise agreement won’t deliver all the benefits that you’re looking for. Based on the collective wisdom of customer and ana­lyst research, there are a number of recommended steps you can take to introduce a BI strategy and effective BI standards within your organization.

Review the Current Environment

• Perform an audit of existing BI proj­ects. Spend time with business peo­ple to understand what information and systems they are using today, and why it is important to the busi­ness goals. You are almost certain to find examples of areas that could benefit from a more strategic approach to BI. In the case of large organizations with decentralized sys­tems, your vendors may be a useful resource to help you find existing deployments around the globe.
• Based on your research, and in conjunction with your new business contacts, create a written BI strategy document that lays out the costs and benefits, and outlines concrete steps towards a more strategic approach.

Rationalize BI Deployments

Your BI strategy should include prag­matic steps to reduce the costs of BI fragmentation:

• Define a standard set of non-overlap­ping tools for the BI needs of the organization. The criteria used to make the choices should be explicit, firmly grounded in the business needs of the organization, and agreed upon by the key business users of BI.
• Start enforcing the standard. It is essential that the BI strategy include mechanisms such as veto rights over nonstandard projects and budget incentives to use approved products.

Build a Long-Term Business Intelligence Strategy

To ensure that you receive the full ben­efit of BI, and to avoid the degeneration of your chosen standards, it is essen­tial to have a long-term BI strategy – including a BI competency center (BICC) and BI governance.

Regardless of which functional area it reports to, your BICC should be con­sidered primarily a business initiative, working closely with the infrastructure teams and other departments. The BICC is responsible for:

• Optimizing the value of your informa­tion assets, by developing and sharing BI best practices throughout an organization.
• Aligning BI initiatives around a frame­work: how BI should map to the tech­nical, functional, organizational, and business needs of the organization.
• Implementing a formal BI methodology to ensure that BI projects bring the promised benefits. It should detail the roles of different groups (IT, business users, technical support, and so on), and cover both the technical and user-oriented phases of the project.
• Creating an acquisition and deploy­ment process for new projects. The competency center must be financed. Care should be taken so that it does so in a way that does not reduce the incentives to business use of BI.

Managing Change

Failure to manage and take responsibility for the business changes that result from BI implementations is the biggest cause of failure of strategic BI plans. This can be avoided with the following steps:

• Monitor and communicate the strate­gic plan. Organizations should con­stantly evangelize the benefits of BI and of having BI standards.
• Avoid common BI project challenges. Many project problems can be pre­dicted in advance, and can instead be turned into communication opportunities.
• Implement BI governance. Bring together key executives, project champions, and other stakeholders from different business units for reg­ular meetings. Use the meetings to align the work of the BICC with the overall strategy of the organization, and overcome any organizational barriers to change.

BI Standardization Case Studies

The following organizations are selected examples of companies in various industries that have implemented stra­tegic BI plans.

Insurance

One of the largest U.S. insurance orga­nizations, with over 40,000 employees, had grown through acquisitions, and each business unit had retained responsibility for BI projects within its area. The decentralized operations made it hard for senior management to get a global overview of operations. To position for the future, the company decided to standardize its information systems at a corporate level and to implement a new enterprise data ware­house. In addition, the com­pany established a BICC to manage its overall BI strategy, to rationalize sys­tems, eliminate duplicate information, and have more control over metadata.

The BICC was staffed using resources from the previously fragmented man­agement reporting systems. Charged with consolidating existing BI software deployments, the BICC chose the a single platform for both operational and analyt­ical projects across the company. The BICC has focused on simplification, compliance and security, and BI gover­nance. The group spends time ensuring that different business units, with many different points of view, all understand and buy into the high-level BI strategy.

The company believes that it has reduced the cost of purchasing and deploying BI applications by up to 25%, resulting in annual savings of several million dollars. In addition, the IT organi­zation is more easily able to support the rising demand for access and analysis of data from the company’s applications from various different vendors. A common set of business rules and metadata definitions are now used across the organization.

Key success factors for this insurance company’s BI initiative included execu­tive sponsorship, the ability to enforce central standards, and knowledge of the businesses served. By standardizing their BI solutions, the company has reduced the risk of data quality and integrity issues, con­flicting reports, and inaccurate mea­surements of critical business metrics.

Pharmaceuticals

A large European pharmaceutical com­pany faced widespread dissatisfaction with its existing performance reporting capabilities. Reporting systems were specific to each functional area, and functions were unwilling to share data. It took too long to generate an integrated set of numbers. A reliance on spreadsheets had led to errors and risk exposure. New functional systems were being proposed that would increase BI fragmentation and complexity.

The company decided to develop a new system to support a strategic initiative of improving business effectiveness and efficiency. The aim was to improve productivity by standardizing data access across the organization, reduc­ing the risk of wrong decisions, and supporting faster decision-making.

Sponsored by executives from the company’s finance group, the project was overseen by a BI competency cen­ter. A shared IT service provided the underlying technical infrastructure. The solution consists of a central enterprise data warehouse with different “report­ing suites,” which are made available to different functional and operational areas. A “design authority” team provides governance for the solution. Chaired by the executive sponsor, the design authority brings together busi­ness and technical leaders every two weeks to review projects at critical design points and sponsor improve­ment projects.

The new system replaced over 12 different legacy systems, resulting in considerable cost savings. In addi­tion, confidence in the data increased, performance management is more effective because there is now one set of numbers, risk is reduced, and there is more agility to start up new projects quickly.

Key success factors included business leadership of the project, keeping the design flexible in response to evolving needs, and an emphasis on good infor­mation management to provide a stable foundation for more advanced systems.

Railway Network

The 35,000 employees in this organization are responsible for a railway network that carries over 1 billion passengers a year. Historically, the organization took a very fragment­ed approach to management reporting. As part of a long-term project to improve efficiency and lower costs, the company created a new team to help implement an information architecture across the organization.

The team carried out a detailed audit of business information use that revealed dozens of homegrown, fragmented, spreadsheet-based, manually operated systems, and suboptimal use of system resources. This information was used to create a formal BI strategy document that outlined the long-term vision and processes to be put in place.

The BI strategy included the implemen­tation of standard processes and tools, and the consoli­dation of duplicated resources; for example, a reduction in the number of data warehouses within the organization.

A carrot-and-stick approach was taken to encourage cooperation with the new strategy: the team retained veto rights over new BI implementations, and finan­cial incentives were given for projects that used the corporate standards, backed by enterprise agreements negotiated with major suppliers.

Like all other organizations, data quality is an ongoing challenge, especially because some source systems are owned by other organiza­tions; information must be shared with customers and partners; and because the data is subject to regulatory compli­ance. Cross-functional data specialist teams have been created to ensure a coordinated technical and business process response.

Projects are currently governed by a project coordination group called the design authority. Over time, it is hoped that this group will become a fully-fledged BICC, with a focus on data architecture, people, and process.

Conclusion

BI is the number-one priority for today’s CIOs. Implementing BI successfully requires a strategic approach to BI that includes implementing BI standards.

Rationalizing the number of BI tools in your organization can result in cost savings, more control over information, and better alignment with your busi­ness goals – and increased competitive advantage by fully exploiting the bene­fits of enterprise BI.

Faced with the current tough economic conditions, can we predict how organizations might react?

(1) People will try to do without BI — and fail

BI is important, but rarely urgent. In dire economic conditions, some organizations will be too busy trying to survive to think about doing analysis. But action without analysis is called guessing, and is unlikely to help.

(2) People will revert to hand-coding and excel macros — and waste a lot of money

Corporate cutbacks, "thou shalt not buy anything" policies, and new levels of sign-off will encourage some people to attempt to do analysis without extra software investment: hand-coded data extraction in SQL, data manipulation using Excel macros, etc. 

Over time, the work involved in developing and maintaining these solutions will cost much more than purchased packages. The scripts won’t include any comments. The people responsible will leave the company exactly 4.3 months later. Nobody else will be able to figure out how it works. The project will limp forward for another 7.7 months, and then vendors will be invited in to do prototypes which will reveal that the scripts are faulty and the company has been basing their decisions on incorrect data for the last year. This will be covered up.

(3) Organizations will implement standards — but omit to change organizational structures

Keen to reduce costs, organizations will standardize their BI environments — but will balk at the perceived cost of implementing a dedicated central BI organization. The result will be lower procurement costs, but without a BI competency center there will still be silo BI projects. This will result in continued needless duplication, BI skill shortages, multiple definitions of¨"profit", "headcount", etc. Savings will be a fraction of what they might have been, with no improvement in overall view of information across the organization.

(4) Business units will find it easier than ever to implement their own solutions — to the detriment of the company as a whole

Chafing against corporate BI standards that they didn’t chose, business units will find it easier to ever to implement their own "shadow" BI systems. Lacking any incentive to plan how their system fits in with the others, the result will be more silo BI systems, making it harder than ever to get a "single version of the truth" across the organization.

The answer? Step one: BI organization

What can organizations do about this? Now more than ever is the time to implement BI shared services or a BI competency center. Create one by bringing together all the resources that are currently being wasted collecting and analyzing information separately in each department. The first goal of the team should be to prioritize BI projects and consolidate existing projects and solutions, eliminating waste and increasing information flow. Managed correctly, the group will more than pay for itself.

Several large customers are looking for external validation of how many BI users they “should” have, and of what profiles (simple reporting, interactive reporting, ad-hoc reporting, OLAP analysis, etc.), in order to have a basis for negotiating an enterprise-wide BI platform deal.

Despite the best efforts of a bunch of very smart people, I haven’t yet found anything like this. Obviously it’s hard to have a definitive “answer” when organizations differ widely in their information use, BI penetration is a moving target, technology is improving, etc., but it is something that many organizations are increasingly interested in….

Does anybody out there know of something relevant? If so, please let me know, (telliott@timoelliott.com) and many thanks in advance!

Recording – Benchmarking Your BI Maturity Overview
Provides an overview of the five stages of the BI Maturity model and the two major obstacles – the Gulf & Chasm. The goal is to demonstrate how the model can be used to help assess and evolve any BI/DW program.

September 25 at 12:00 pm Eastern
Spanning the Gulf: Getting Traction for Your BI Solution
Explains the symptoms of the Gulf and provides prescriptions for making a clean crossing into a BI environment that delivers tangible business value. If you’re having difficulty getting traction for your BI solution, you’re probably stuck in the Gulf – a confluence of obstacles and challenges that affect early-stage BI projects.

September 27 at 12 pm Eastern
Crossing the Chasm: Delivering a Strategic, Enterprise BI Solution
Reviews the key challenges facing more mature BI programs and provides tips for creating an agile architecture and organizational structure that can help you cross the chasm to deliver high-value strategic solutions across the enterprise. If you are struggling with reconciling the different BI/DW deployments in your organization and dealing with issues of scalability in terms of people and processes, this webinar is for you

We’re going to try to make it as interactive as possible. Please join us, and ask difficult questions!

What is BI Standardization?

The phrase “BI standardization” often gets a negative reaction, because people equate it with choosing only one tool to the exclusion of all others, and taking away existing products from happy business users.

My definition is this:

Pragmatically implementing BI standards to reduce overlapping tools, lower costs, and maximize the benefits of BI.

The definition explained:

• Pragmatically. It’s not about architectural elegance, it’s about business benefits
• Reduce overlapping tools — it’s about having a rational portfolio strategy, not a single product from a single vendor.
• Lower costs. This is the reason organizations start talking about standardization
• Maximize the benefits of BI: This is why reasons should be looking at implementing BI standards

Other terms that could be used include “BI rationalization,” “BI consolidation,” or “preferred BI vendors” — whatever the language used, there are clear benefits.

Why BI Standardization?

Why do organizations implement BI standards?

• To save money. The first, clearest, and most obvious benefit of standardization is that you can save money in every area of implementing BI projects. You can avoid unnecessarily duplication of the costs of evaluating, purchasing, implementing, and maintaining multiple overlapping BI tools.
• To increase business insight and alignment. The more BI tools you have, the harder it is to get a full understanding of  the business. A single standard makes it easier to establish common definitions of your key performance indicators. You can spend less time arguing over the data, and more time arguing over what to do.
• To reduce risk and confusion. Implementing standards makes it easier to ensure that you’re following data and compliance rules. Having the same tools for financial reporting, risk management, and budget tracking make it easier to spot anomalies.

For more detail, see my 2005 white paper on ”Benefits of Business Intelligence Standardization“.

How to Implement Standards?

All organizations have explicit or implicit tiers of IT standards, running the continuum from “we don’t care” all the way through to ”don’t even think of using something else”. As business intelligence has matured and become more widespread in organizations, it has slowly climbed the ladder.

BI standards are typically initiated by procurement teams. Noting that the organization is purchasing the same products across multiple departments, they step in to purchase in greater volume for the organization as a whole, driving down the average per-user purchase price.

Note that this only directly saves money on software license costs — typically a tiny proportion of the overall costs of implementing BI. Getting the full benefits of standards requires a team that can persuade various different BI projects to work together for the greater good of all: a BI competency center (see “fixing the BI tragedy of the commons”).

Note that most organizations will never reach their standard, because there are inevitable trade-offs between efficiency and local flexibility — but heading for a standard is obviously better than accepting chaos.

For more information, see my 2005 white paper on “Implementing BI standards — a Field Guide“.

What’s the Future of BI Standardization?

There will always be procurement benefits of buying products in greater volume, but the hard part is standardized metadata and semantics across the breadth of data sources that real-life users are interested in, including personal and non-structured data.

As the business intelligence industry adapts to a services-oriented world, there may be the potential for organizations to be able to mix-and-match different solutions and still retain a coordinated overview of the business as a whole. See “Will BI Sparql Thanks to the Semantic Web“.

But even when individual BI projects are successful, many organizations stumble on the journey to true enterprise BI deployments. What goes wrong?

First, organizations must realize that implementing enterprise BI is not simply about implementing a bigger BI project. Just as Tiger Woods decided that he needed to relearn his swing in order to take his game to the next level, organizations have to reconsider some of the basics of their BI deployments in order to move to enterprise BI. And just as in golf, some of the skills and approaches that are typically associated with initial success may actually hinder enterprise BI success.

Individual BI projects typically focus on expert users who work with high-value information. This is a great place to start, but it’s easy to over-deliver to a small number of vocal, technical users, and miss the greater value of a broad deployment to less-technical users.

With only experts using the system, the temptation is to:

• Fix problems such as data quality in a patchwork, ad-hoc way
• Tolerate poor ease-of-use and a confusing variety of different systems
• Provide information to non-expert users rather than rolling out self-service access.

And because this approach provides a rewarding role for BI experts, it may even lead them to have a vested interest in resisting a more comprehensive approach to enterprise BI.

Diagram: Moving from a series of successful BI projects to enterprise-wide BI deployments involves changing some of the habits that made the initial projects successful. Two key initiatives are required, involving new approaches and audiences

After review of organizations that have implemented enterprise BI, there are broadly two sets of initiatives that are highly correlated with success, both involving reaching out to different users than individual BI projects.

Initiative 1: Implementing an Information Infrastructure

After several key successful projects are in place, successful companies start “filling in” a broad foundation of information use throughout the organization, with the following elements:

• A systems approach to data quality (rather than ad-hoc fixing of numbers)
• Simpler data access for a broader range of users (along with greater investment in training and best practice)
• An emphasis on collaboration and discussion around data
• Making information actionable by embedding BI directly into operational systems, at the point of decision

This information infrastructure approach puts the right framework in place for a culture of information use and fact-based decision-making. It fosters a virtuous spiral of increasing numbers of employees accessing, analyzing, and sharing data and improving operational performance.

Supporting this information infrastructure typically requires organizational and technology changes. Some form of BI competency center is essential, tasked with the optimal use of information across the organization as whole. And one key task of the BI competency center is to standardize the BI products used in the organization, favoring systems that have the openness, breadth, and integrated approach to support the variety of environments and profiles that exist throughout the organization.

Initiative 2: Aligning Information Use with Corporate Strategy

Having an good information infrastructure isn’t enough. If enterprise BI is only “part of the plumbing”, it won’t get the resources required to thrive over the longer term.

The second initiative that correlates with enterprise BI success is making sure that there’s a strong link between the information systems and the strategic directions of the company.

In most organizations, there are two types of dashboards: bottom-up, automated dashboards that track the performance of a particular process or business unit, and top-down manual dashboards that track strategic initiatives. And there’s typically a huge gap between them.

Organizations increasingly realize that they have to take a systems approach to linking strategy to execution. Bridging the gap between IT and Finance is crucial to the success of this initiative, Financial and strategic planning systems are essential pieces of the enterprise BI puzzle. IT has to work with the finance function to tie the financial systems more tightly to operational systems through integrated financial and non-financial key performance indicators, enhanced business reporting, and scorecards.

Conclusion

(1) You might have to take a step backwards in order to take two steps forward. 
(2) It’s time to start bridging the gap between IT and Finance.

The big question is this: why don’t more people take that step “back” to turn their BI success into a solid foundation — incentives? politics? is there simply not the time to concentrate on strategy when the existing projects need to be dealt with?

According to this article, the latest OLAP report ranks MicroStrategy as the top product for BI standardization.

This seems counter-intuitive, to say the least: from my experience, standardization deals usually boil down to a face off between the top two vendors in the account (typically Business Objects and Cognos), and the winner is almost inevitably the product that currently has the most usage. In the remaining cases, the decision is typically to maintain multiple standards and review them again at a later date. I’ve never yet seen a case where a minority vendor was chosen as the standard.

In addition, MicroStrategy has a relatively narrow range of products compared to the market leaders in the space, and so is on the face of it an unlikely candidate for a single corporate standard, which typically must cover a broad range of user needs.

Still, it’s an interesting data point, and deserves an explanation. Here is my guess on what may be happening.

Interpretation

First, note that the data point is about existing MicroStrategy users’ intention of standardizing on MicroStrategy. It does not necessarily say anything about the general question of which product is “best” as a BI standard.

Selective data use

Although it vaunts its independence and objectivity, the OLAP Report sells vendors the rights to publish data from the report as selectively as they wish (unlike Gartner, for example), and it wouldn’t be the first time that MicroStrategy have taken advantage of this to come up with statements that were factually true but misleading.

For example, after the OLAP survey 3, MicroStrategy used the fact that they had the highest input median data volume to imply that they were the clear choice for large databases:

“For the third consecutive year, MicroStrategy customers indicated they analyzed the largest amounts of data — a median of 312.5 Gigabytes (GB).”

But in fact this reflected the broader usage of the leading tools in the space. A better measure of “proof of ability to analyze large amounts of data” would be market share among customers with large databases — which would have shown that Microstrategy was far from being the leader.

Self-selection bias

In this case, the data is perhaps just a reflection of MicroStrategy’s customer base: MicroStrategy is a niche player in the BI market, and their customers may have fewer different tools than organizations with more general BI needs.

For example, assume 10 companies chose MicroStrategy, and 90 chose both Cognos and Business Objects, and ask them to standardize on a tool. Assume that companies choose evenly between Cognos and Business Objects as their standard. MicroStrategy would score the highest on “percentage intention to standardize”, but a customer chosen at random would be 4.5x more likely to have chosen Business Objects than MicroStrategy as their standard.

Unfortunately, it’s impossible to tell you if this is indeed what’s happening without paying the OLAP Report for the rights to publish the data.

Choosing a standard

So how should organizations choose a standard? First, organizations should realize that BI standardization is about pragmatically minimizing the number of overlapping tools, not necessarily about choosing just one single standard.

Second, each organization’s needs are different, but the criteria for a BI standard can typically be grouped into three main areas of requirements:

• Functional capabilities. The ability of a product to address the identified BI user needs.
• Infrastructure requirements. The extent to which the product meets the infrastructure needs of the organization in terms of fit with existing architecture, scalability, and extensibility.
• Vendor criteria. The ability of the chosen vendor to support current and future projects in terms of stability, resources, and experience.

Organizations with a variety of functional needs and complex infrastructure requirements are best advised to choose a market leader, not MicroStrategy.

What do you think?