Here’s a chart from a recent study by the Economist Intelligence Unit called “Big data: Harnessing a game-changing asset”, showing that only 9% of respondents believe that they use data worse than their competitors.

Let’s face it, they’re probably in denial. It’s often called “Illusory Superiority” or the “Lake Wobegon Effect” (a radio show where “all the children are above average”), and it’s a real force in the analytics market.

Because better data is often considered a “nice to have”, or “important but not urgent”, companies often only invest in better business intelligence when confronted with evidence that their competitors have the edge (this applies to BI vendors, too: long-clamored-for features mysteriously get prioritized the instant another vendor provides it).

This chart shows that companies are probably underestimating their competitors ability to use data – and therefore that they should probably be investing more in business intelligence…

While we’re all busy making predictions about new waves of technology in 2009, many companies are only just now starting to consider implementing business intelligence on a wider scale.

In case you doubt me, take a look at the eye-opening chart below from a recent survey done by Computerworld (and sponsored by Oracle) called "BI: Proven Tools for Competitive Advantage in Uncertain Times"

That’s right: the top three BI investments are all things that have been around for over 20 years — production reporting, spreadsheets, and ad-hoc queries — and which get very little attention in business intelligence coverage.. 

These days, any mention of reporting in BI marketing brochures is typically in the condescending form "our solution provides much more than mere reporting". But production reporting remains vitally important. It is the original "BI for the masses", and we often forget just how much value organizations can get from putting even basic information into the hands of their employees, partners, and customers.

Other interesting results in the report include:

• Only 26% of respondents expect to spend less on BI in 2009
• People are struggling to afford to save money — "realizing cost efficiencies" is the #1 reason to implement new BI initiatives, but "budget constraints" is the top business challenge to doing so!
• 72% rate BI as high or critical priority over the long term

Overall, it looks like it should be a good year for Crystal Reports, the clear market leader in reporting solutions — and I’m sure Microsoft will be happy with the results, too…

I’ve also added a couple of business and industry trend overviews that mention business intelligence. I’m sure I’ve missed some others — please don’t hesitate to comment…

2009 Business Intelligence Trends

Shawn Rogers: 2009 Business Intelligence Technology Poll

Take the Poll! See the latest results by clicking on the chart, or going here

Experts forecast business intelligence market trends for 2009

Wayne Eckerson

• Analytic database platforms go mainstream
• Open source BI gets evaluated
• Packaged analytic applications gain traction
• Software as a Service (SaaS) picks up in the midmarket
• Next-generation dashboards emerge.
• Analytical literacy improves
• More analytical sandboxes come to the fore
• BI goes green
• Advanced visualization corrals BI
• Event-driven analytic platforms hit the scene

James G. Kobielus

• BI moves into the cloud
• BI adopting Web 2.0 development paradigm
• BI growing more federated
• BI evolving into advanced analytic applications

Gartner Inc.  (various analysts)

• By 2012, business units will control at least 40% of the total budget for BI
• 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
• By 2010, 20% of organizations will have an industry-specific analytic application delivered via SaaS as a standard component of their BI portfolio
• In 2009, collaborative decision making will emerge as a new product category that combines social software with BI platform capabilities
• By 2012, one-third of analytic applications applied to business processes will be delivered through large-grained application mashups

Rich Sherman: Business Intelligence & Data Warehousing Trends: 9 for ’09

1.    Economic concerns distorts IT budget decision-making
2.    Business intelligence expands
3.    IT expands its BI vendor shortlist
4.    Data integration  continues healthy growth
5.    Data integration breaks out from the “Magic Quadrant”
6.    Incremental beats out big bang projects
7.    “Good enough” replaces best-in-class
8.    SMB BI demands outstrip a constrained adoption
9.    Industry consolidation continues

David Stodder: Nine BI Megatrends for 2009

Megatrend 1: The Impact of Open Source

Megatrends 2, 3 & 4: BI Tool Innovation

• BI becomes less isolated
• Users demand a richer experience
• BI will focus on relationships

Megatrend 5: Business Modeling Meets MDM

Megatrends 6, 7 & 8: Breaking the BI/DW Mold

• MapReduce meets large-scale data analysis
• Column-oriented databases take aim at performance woes
• Event processing opens new analytical possibilities

Megatrend 9: Too Big to Fail

Ken Rudin: What’s in store for Business Intelligence in 2009?

• Cloud computing will cause a shift in the BI balance of power from IT to business users.
• Simplicity will be the driving mantra for both consumers and vendors of BI.
• The continued drive for simplicity will cause a shift towards prebuilt analytic solutions with best practices built in, and away from generic toolsets.
• Data interpretation will become a significant challenge for new BI users.

James Taylor: Predictions for 2009 (Enterprise Decision Management)

• Cloud computing will impact decision management
• More use of analytics by systems rather than people
• More focus on rules from application and platform vendors 
• More business rule vendors
• More rules in Business Process Management
• Business rules to decision management 
• Pre-built decisioning components 
• Simulation and scenario management 
• More business user control

Ted Cuzzillo: BI Transformation in 2009

• The few big tools will start giving way to many small tools.
• Business users will take more of BI back from analysts.
• Analytics will gain new importance.
• BI’s focus will sharpen on the human factor.
• BI will surge in the mid-market.

Colin White: BI Predictions for 2009: What Ever It Takes to Get the Job Done

• Quick and low-cost approaches will have most impact in 2009
• Open source software, BI software-as-a-service, low-cost application appliances, search, the integration of BI with collaborative and social computing software, rich internet applications, web syndication, and data and presentation mashups
• Line-of-business IT rather than the enterprise IT
• May lead to anarchy and islands of data and software

Neil Raden: Surround the Warehouse: Prediction for 2009

."..a move toward a broader data warehouse concept that includes data sources that are only connected to the data warehouse through some sort of metadata"

Oco Predicts 2009

• Growth of Complementary BI
• SaaS Goes Upmarket
• Information Silos Will Tumble
• Collaborative BI Throughout the Extended Enterprise
• Corporate Hot Spots Will Drive BI

Business and Industry Trends

The McKinsey Quarterly: Eight business technology trends to watch

Managing relationships

1. Distributing cocreation

2. Using consumers as innovators

3. Tapping into a world of talent

4. Extracting more value from interactions

Managing capital and assets

5. Expanding the frontiers of automation

6. Unbundling production from delivery

Leveraging information in new ways

7. Putting more science into management

8. Making businesses from information

7 Experts Paint Enterprise IT Landscape for 2009

Dana Gardner, Briefing Direct:

1. Shadow IT
2. Cut Costs.
3. High-Scale Business Intelligence
4. No Stomach for Upgrades
5. Social Data-CRM Mashups

Jim Kobieius, Forrester:

1. Obama
2. Cloud Computing
3. Recession
4. Governance, Risk and Compliance (GRC)
5. Social Networking

Tony Baer, Ovum:

1. Cost Savings
2. Low Cost or No Cost IT
3. Managed Clouds
4. IT Service Management
5. GRC

Brad Shimmin, Current Analysis:

1. Collaborative Social Networks
2. Cloud Software
3. Enterprise Oligarchy Models
4. Blended Internal and External Communities
5. Virtual Worlds Gain Foothold

Joe McKendrick, independent analyst

1. It’s the Economy.
2. IT Can’t Cut Too Much More
3. Enterprise 2.0
4. Cloud Economics
5. Low-Cost Methods to Reach Markets

Dave Linthicum, Linthicum Group

1. Cloud Computing Matures
2. Open Cloud Services
3. Some Cloud Social Connections
4. Rogue Clouds and PaaS.
5. SOA Gets Cloudy

Mike Meehan, Current Analysis

1. Take My Hardware, Please.
2. Tough License Negotiations
3. Easier Integration
4. Smooth SOA
5. Telecom Realignment

JP Morgenthal, Burton Group

1. Business Process Focus.
2. Social Networking Backlash
3. Era of Anti-IT
4. Millennial Workforce Shifts
5. Digital Rights Management Changes

IDC Predictions 2009: An Economic Pressure Cooker Will Accelerate the IT Industry Transformation

• Global IT growth will be cut in half
• Emerging markets and small businesses spending will slow significantly
• The IT industry’s expansion to "the cloud" will accelerate
• The struggling offline economy will drive more shoppers to the online economy
• The telecom industry will consolidate, and expand, in 2009
• It will be a grim year for mobile gadgets.
• The crumbling of the "business/personal" wall in IT will accelerate
• The reinvention of information access and analysis will accelerate in 2009
• Green technologies will have a good year, disguised as "cost cutting"
• Government initiatives in 2009 will catalyze massive IT investments and industry growth 

or "Reasons To Be Cheerful if Your Job Involves BI"

The Economy is Awful

Around the world, governments have drastically slashed their growth estimates for 2009.

And according to a recent IDC survey, more than half of us believe that the current economic crisis will last at least a year.

Faced with all the mayhem, it’s not surprising that today’s New York Times Op-ed includes the phrase "Let’s not mince words: this looks an awful lot like the beginning of a second Great Depression."

Some forecasters see a fast recovery, but this may say more about newspaper performance incentives than the state of the economy (counter-intuitive headlines drive readership, so it was just about inevitable that such an article would be written, no matter how few optimists). And depressions often have short periods of optimism before settling in for long-term misery (sometimes poetically called the "dead cat bounce").

So is 2009 going to be an terrible year for us all? The answer is clearly no: the misery isn’t spread equally. You probably wouldn’t want to work in the finance or auto sectors in 2009, but IT — and particularly business intelligence — looks to be one of the best possible sectors to ride out the crisis.

IT Spending is Still Increasing

IT spending growth expectations have been slashed as CEOs demand cutbacks — but they remain positive. According to IDC, worldwide IT spending is expected to grow 2.6% in 2009. Much of this will be driven by emerging economies (Central & Eastern Europe, Middle East & Africa, and Latin America), but even the established markets of the US and Western Europe will see positive growth.

Gartner research agrees and predicts that even in a worst case scenario, IT spending will increase 2.3% in 2009, providing a better outlook than the spending cuts seen during the dot com bust.

Within IT spending, hardware and services are expected to be the worst hit, with negative growth. Software spending, on the other hand, is still predicted to grow at over 4% world-wide.

These numbers are backed up by a survey from the Society of Information Management (SIM) carried out in November that showed that only 19% of CIOs and IT executives expect to cut their budgets in 2009.

Why this optimism? It’s partly because IT spending is only loosely connected to the current economy. It’s driven much more by the underlying infrastructure cycles, and some big drivers of IT spending show no sign of slowing down: commerce and customer service via the Internet; interactive communication devices; and increasing IT investment in small and medium-sized businesses.

Compared to previous recessions, there’s also more awareness that scrimping on IT can have dire consequences down the road. Good times means that there’s enough to go around for everybody. Tough economic conditions, perversely, provide the best opportunity to innovate and grow market share significantly, as the less-prepared fall by the wayside. The Economist, November 2008:

"Paradoxically, a recession can be a fantastic time to launch innovations. For one thing, tougher times can make consumers reconsider many of their purchasing decisions, leaving them open to trying something new. For another, a less crowded marketplace makes it easier—and cheaper—to create awareness of a new offering."

Business Intelligence Spending Even More Robust

According to Gartner, Business intelligence has been the number one technology for the last three years running, and a SIM survey of CIOs and IT executives showed business intelligence as the #2 most important "application and technology issue" for 2009, after anti-virus protection.

IDC, in a market study published in November 2008, predicted BI that spending will grow at a rate of almost 10% over the next 5 years:

"The business analytics software market continued to grow despite acquisitions and mature product offerings… We expect a slowdown in growth in 2009, but the fundamental drivers of adoption remain strong and will help the market to recover to previously forecast growth rates in 2010."

Why is business intelligence such a bright spot? It’s because BI is more important than ever in tough environments — as organizations make cuts, executives will only get once chance to make the right strategic decisions — as the old phrase has it: "measure twice, cut once".

Rumored to be one of the top searched-for terms on their web site, Gartner picked business intelligence as a top strategic technology for 2009:

"Business Intelligence (BI), the top technology priority in Gartner’s 2008 CIO survey, 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 is particularly strategic because it is directed toward business managers and knowledge workers who make up the pool of thinkers and decision makers that are tasked with running, growing and transforming the business. Tools that let these users make faster, better and more-informed decisions are particularly valuable in a difficult business environment."  (emphasis added)

In an article called "Business Intelligence: A Bull in a Bear Economy", Madan Sheina of Ovum calls BI "recession proof technology":

"BI has proved to be an unusual segment of enterprise softwa
re in that it never seems to have a down-cycle. That’s because BI is a Janus-faced technology. If the economy is doing well then BI and data warehousing helps companies optimize their operations and grasp new and lucrative business opportunities before their competitors do. However, if the economy isn’t doing so well then BI becomes an effective cost-savings tool, allowing companies to squeeze greater cost efficiencies from their existing processes and resources, and identify and mitigate business risk." (emphasis added)

A Computerworld research white paper called "BI: Proven Tools for Competitive Advantage in Uncertain Times" reports (emphasis added):

"Turbulent economic times can impact expenditures and technology deployment plans. However, 42% of respondents expected their overall expenditures for BI tools and solutions to increase from 2008 to 2009. Even with the current state of the U.S. and world economies, respondents said they are extremely or very likely to invest or expand investments in BI in the areas of production reporting (48%), spreadsheets (47%) and ad hoc queries (45%)." (emphasis added)

Which Vendors Will Do Best?

It’s not clear who will benefit most from the BI spending growth in 2009.

On the one hand, people typically turn to established leaders in tough times. On the other hand, companies are reviewing their spending priorities, which may lead to opportunities for perceived lower-cost options such as open-source BI, or SaaS BI vendors (whether they actually turn out to be lower-cost is a longer conversation — and note that the leading vendors also provide SaaS BI options).

One study, at least, seems to show that SAP may be in a better position than its direct competitors:

"Companies seem more willing to spend on SAP products than those of other vendors, according to a recent UBS survey of the spending priorities of 100 CIOs. CIOs expected IT spending in general to decline about 2% over the previous year, according to the report. But when asked about demand for products from specific vendors, the CIOs expected to see spending increases in 2009 for SAP products but not for products from IBM, Oracle and Microsoft." (emphasis added)

Conclusion

So despite a weak economy, IT spending growth remains positive. Within IT, software spending is the healthiest. And within software spending, BI is a top priority.

So if your job involves business intelligence, you should bless your good fortunes in 2009, as you should can expect a (relatively) good year — because BI really does transform the way the world works.

• Perhaps surprisingly, over 30% were already using text analytics
• The highest usages were for “voice of customer” and “competitive intelligence”

Also of interest was the ranking of BI technologies in order of importance — Query and Reporting 1st, OLAP Data Cubes last.

I believe there’s an opportunity there, between Business Objects Web Intelligence and Crystal Reports products, and SAP’s NetWeaver BI data warehousing environment…

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!