{"id":11898,"date":"2007-09-11T21:28:21","date_gmt":"2007-09-11T20:28:21","guid":{"rendered":"http:\/\/192.220.58.236\/blog\/?p=51"},"modified":"2007-09-11T21:28:21","modified_gmt":"2007-09-11T20:28:21","slug":"the_top_6_on_demand_bi_confusi","status":"publish","type":"post","link":"https:\/\/timoelliott.com\/blog\/2007\/09\/the_top_6_on_demand_bi_confusi.html","title":{"rendered":"The Top 6 On-Demand BI Confusions"},"content":{"rendered":"<p>I&#8217;m a big believer in the future of on-demand BI, and&nbsp;yes, it&#8217;s <a href=\"http:\/\/www.lucidera.com\/blog\/index.php\/2007\/09\/11\/on-demand-bi-so-hot-right-now\/\">hot<\/a>. &nbsp;But a lot of the articles promoting on-demand BI don&#8217;t always separate fact from self-interested fiction. Here&#8217;s my attempt to redress the balance.<\/p>\n<h4>1. On-Demand = Subscription Pricing = Mid-Market<\/h4>\n<p>There are three different axes that are often discussed as if they overlapped:  <\/p>\n<ul>\n<li>on-premise vs. on-demand\n<li>perpetual license vs. subscription license\n<li>enterprise vs. mid-market. <\/li>\n<\/ul>\n<p>On-demand BI is typically subscription-based, aimed primarily at the mid-market, but it&#8217;s far from being the only valid combination. &nbsp;and on-demand BI can&#8217;t  <\/p>\n<p><strong>Perpetual licenses vs.&nbsp;subscription. <\/strong>On-demand BI isn&#8217;t the same thing as subscription pricing. For example,&nbsp;<a href=\"http:\/\/www.sas.com\/\">SAS<\/a> has always charged an annual fee for their on-premise software. Perpetual&nbsp;licenses for a hosted services are rare, but they do exist outside of BI&nbsp;&#8212; e.g. <a href=\"http:\/\/www.crucialservers.net\/hosting\/hosting\/Lifetime_Web_Hosting_a_new_trend.html\">lifetime fee offers<\/a> for hosted web sites.  <\/p>\n<p><strong>Enterprise vs mid-market.<\/strong> Mid-market organizations may well be attracted by on-demand options, but the BI vendors are all successfully selling&nbsp;mid-market on-premise packages.&nbsp;In addition, larger organizations are showing interest in hosted BI &#8212; although the extra complexity around data sources and customization may mean that it takes a while longer to become popular.  <\/p>\n<h4>2. On-Demand BI is Cheaper<\/h4>\n<p>First, what does &#8220;cheap&#8221; mean? I haven&#8217;t yet found anybody who <em>wanted<\/em> to pay more for their BI software, but whatever the price there will be some people who can&#8217;t afford it (this includes &#8220;free&#8221;, since it always take effort to set up). According to Gartner, BI is the fastest-increasing investment priority for CIOs in 2007, indicating that BI is considered &#8220;cheap&#8221; by most organizations &#8212; i.e. they see&nbsp;possible benefits that outweigh the&nbsp;price.  <\/p>\n<p>On-demand BI is clearly targeting price-sensitive, lower-functionality-requiring customers first. But there&#8217;s nothing in the rule book that says that a hosted service has to be cheaper than an on-premise equivalent:  <\/p>\n<ul>\n<li>A major cost component&nbsp;&#8212; running the machines &#8212; is provided by the vendor. This means that total cost of ownership could be lower, but it also means that vendors could (&#8220;should&#8221; in a perfectly competitive market) charge higher prices than for equivalent on-premise software.\n<li>On-demand BI that charges subscription fees rather than a perpetual license can be cheaper initially &#8212; but more expensive over the long run. And again, subscription pricing is available for on-premise BI.\n<li>Equivalent functionality has to be taken into account &#8212; hosted on-demand doesn&#8217;t&nbsp;(yet) provide the same level of BI sophistication as on-premise BI, and so doesn&#8217;t have the same top-level prices. There&#8217;s also a huge market in cheap on-premise BI notably with Crystal Reports (Business Objects) and&nbsp;Microsoft.<\/li>\n<\/ul>\n<h4>3. On-Demand BI is Simpler and Easier to Use<\/h4>\n<p>This is a mantra of on-demand offerings, and it has to be true to some extent, or there would be little incentive to implement them, given the cultural misgivings about SAAS in general. <\/p>\n<p>But there&#8217;s a certain amount of deliberate confusion between &#8220;simple&#8221; on-demand solutions (because that&#8217;s all that is available, or because the complexity is hidden by the vendor) and &#8220;complex&#8221; on-premise solutions (nothing says you have to every feature available, or implement it all yourself).<\/p>\n<p><strong>Ease of use:<\/strong> there&#8217;s clearly nothing inherently easier&nbsp;about an on-demand interface rather than on-premise interface.&nbsp;In fact, since most of the vendors that currently sell on-premise solutions support both web and full-client access,&nbsp;there&#8217;s greater choice (you can do analysis during&nbsp;that&nbsp;transatlantic flight), especially for power users. And two of the vendors that try the hardest to differentiate on ease of use and simplicity provide primarily full-client, on-premise products (<a href=\"http:\/\/www.tableausoftware.com\/index.htm\">Tableau<\/a> and <a href=\"http:\/\/www.qliktech.com\">Qliktech<\/a>). And <a href=\"http:\/\/www.xcelsius.com\">Xcelsius<\/a>, a full-client tool that produces online dashboards,&nbsp;also provides great ease-of-use.<\/p>\n<p><strong>Data integration and data quality:<\/strong> On-demand BI is not a magic wand, sadly. The data isn&#8217;t going to integrate itself or spontaneously become error-free. Having an on-demand BI vendor do it for you, on their platform, can certainly make your life easier &#8212; but so can a consulting company doing it on your machines.&nbsp;And having pre-built solutions for particular data sources and business uses can help with integration &#8212; but that&#8217;s also applicable to both on-demand and on-premise<\/p>\n<p><strong>Ease of installation. <\/strong>This is clearly an area where on-demand BI can claim to have an advantage &#8212; but not as much as you might think, especially with the&nbsp;introduction of <a href=\"http:\/\/www.businessobjects.com\/partners\/oai\/default.asp\">BI appliances<\/a> and <a href=\"http:\/\/www.businessobjects.com\/news\/press_release.asp?id=20070910_006622&amp;intcmp=07qa_web_am_rss_3\">virtual appliances<\/a>.<\/p>\n<h4>4. On-Demand BI is Less Secure<\/h4>\n<p>In case I&#8217;m accused of being too hard on on-demand BI, here&#8217;s a misconception that clearly goes the other way. The perception of security is a cultural and trust issue, not a technological one. Do you keep your money under the mattress &#8212; or is it stored &#8220;on-demand&#8221; in a bank?<\/p>\n<p>There&#8217;s&nbsp;no&nbsp;<em>technology<\/em> differences that accounts for why an organization should trust their funds to the&nbsp;international banking system&nbsp;but not their data to an on-demand BI provider. <\/p>\n<p>Having trust, governance, compliance, or legal concerns is perfectly legitimate, but they are already dealt with on a daily basis with full outsourced IT deployments, so shouldn&#8217;t be an issue with on-demand BI.<\/p>\n<h4>5. On-Demand BI is Only about Software<\/h4>\n<p>A key part of BI 2.0 will be &#8220;<a href=\"https:\/\/timoelliott.com\/blog\/2007\/08\/how_am_i_doing_really_the_need.html\">information on demand<\/a>&#8221; &#8212; the ability to easily augment internal data with external benchmarks, such as market share, economic predictions, etc. Note that the information on demand can easily be consumed by either on-demand and on-premise solutions.<\/p>\n<h4>6. On-Demand BI is The Future of BI<\/h4>\n<p>No, it&#8217;s <u>part<\/u> of the future. It&#8217;s not really a choice between on-demand and on-premise &#8212; organizations want it all, just like we don&#8217;t want to choose between the internet and our PCs (<a href=\"http:\/\/en.wikipedia.org\/wiki\/Internet_appliance\">internet appliances<\/a> were apparently one of the &#8220;eight biggest tech flops ever&#8221;.)<\/p>\n<p>Despite the silly &#8220;no software&#8221; slogan (OK, not so silly: it &#8216;worked&#8217;), even Salesforce.com has had to provide <a href=\"http:\/\/blogs.salesforce.com\/features\/2006\/03\/offline_edition.html\">offline versions<\/a> of its products for sales people on the road, and companies can spend lots of time connecting it to their internal systems. <\/p>\n<p>Organizations ultimately want a solution that can be installed on-premise, used on-demand, or any combination in between. With service-oriented architectures, the boundaries between on-demand and on-premise solutions will become increasingly vague. Tomorrow&#8217;s BI users will be accessing a seamless combination of web services that are executed on systems inside their organization and systems that are outside their firewalls. <\/p>\n<hr>\n<p>Other resources\/articles that illustrate or deal with&nbsp;the points above&#8230; <\/p>\n<ul>\n<li><a href=\"http:\/\/www.TechLINKS.net\/CommunityPublishing\/tabid\/92\/articleType\/ArticleView\/articleId\/3718\/On-Demand-Business-Intelligence-Solution-Lowers-Total-Cost-of-Ownership-and-Risk.aspx\">On-Demand Business Intelligence Solution Lowers To<br \/>\ntal Cost of Ownership and Risk<\/a>&nbsp;(does it solve world hunger, too?)  <\/p>\n<li><a href=\"http:\/\/biforbusinesspeople.blogspot.com\/2007\/09\/on-demand-bi-fits-casual-male.html\">On-Demand Vendor Strategy<\/a>\n<li><a href=\"http:\/\/www.ondemand.com\/solutions\/default.asp?intcmp=odhp_ondemand_bi\">Business Objects&#8217; on-demand BI<\/a>\n<li><a href=\"http:\/\/www.dmreview.com\/article_sub.cfm?articleId=1089411\">On-Demand Business Intelligence<\/a>\n<li><a href=\"http:\/\/blogs.ittoolbox.com\/crm\/realms\/archives\/fear-factor-business-intelligence-as-a-hosted-service-18929?e=unrec\">Fear Factor: Business Intelligence as a Hosted Service<\/a>\n<li><a href=\"http:\/\/www.lucidera.com\/blog\/index.php\/2007\/07\/18\/on-demand-bi-sig-presentation\/\">Five Primary Drivers of BI On Demand<\/a>\n<li><a href=\"http:\/\/blogs.zdnet.com\/SAAS\/?p=369\">Oracle\u2019s misconceived SaaS strategy<\/a> <\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>I&#8217;m a big believer in the future of on-demand BI.  But a lot of the articles promoting on-demand BI don&#8217;t always separate fact from self-interested fiction. Here&#8217;s my attempt to redress the balance. (more&#8230;)<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[3],"tags":[160,204,785,904],"class_list":["post-11898","post","type-post","status-publish","format-standard","hentry","category-bi-20","tag-bi","tag-business-intelligence","tag-ondemand","tag-saas"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/p3X9RF-35U","_links":{"self":[{"href":"https:\/\/timoelliott.com\/blog\/wp-json\/wp\/v2\/posts\/11898","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/timoelliott.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/timoelliott.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/timoelliott.com\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/timoelliott.com\/blog\/wp-json\/wp\/v2\/comments?post=11898"}],"version-history":[{"count":0,"href":"https:\/\/timoelliott.com\/blog\/wp-json\/wp\/v2\/posts\/11898\/revisions"}],"wp:attachment":[{"href":"https:\/\/timoelliott.com\/blog\/wp-json\/wp\/v2\/media?parent=11898"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/timoelliott.com\/blog\/wp-json\/wp\/v2\/categories?post=11898"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/timoelliott.com\/blog\/wp-json\/wp\/v2\/tags?post=11898"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}