What are the top 3 factors disrupting the Business Intelligence channel?
Strap yourself in. It’s going to be an exhilarating, rapidly accelerating and very rewarding ride for the Business Intelligence (BI) channel – providing you’re properly prepared, that is.
The BI market is shifting and growing quickly. To some, this may be ‘old news’, but the scale and scope of change may surprise.
A growing market; a growing opportunity
Industry crystal-ball-gazers, Gartner, have reported that they anticipate the global BI platforms market to grow at a compound annual growth rate (CAGR) of almost nine percent through 2018. This makes it one of the fastest growing markets in the global enterprise software industry.
To give this greater context, a report by analyst firm MarketsandMarkets from April this year – Business Intelligence and Analytics Software Market by Segment – Global Forecast to 2020 – forecast the worldwide BI and analytics software market to grow from $17.9 billion in 2015 to $26.78 billion by 2020, a CAGR of 8.4%.
So what’s driving this growth? Well, many factors, but most are linked to cross-industry demand to improved operational efficiencies, better decision-making processes and enhanced competitive advantage.
This thirst for business analytics has also been driven by the continued push of reporting and analytics into the mainstream. With proven ROI, a proliferation of new and existing (harness-able) data types and sources, combined with a growing library of analytics success stories (from basically all industries), is it any wonder that Gartner’s global 2015 CIO Survey revealed that BI is again the number one technology priority for CIOs?
Changing of the guard: BI user types and decision-makers
But Gartner’s industry research has also revealed a changing of the guard in BI users, and decision-makers, when it comes to BI technology and deployment decisions. For the first time ever, people from business functions – as opposed to IT – are having a bigger say on decisions relating to BI technology selection and rollout. Business people now also represent a majority of BI users in the average deployment, as organizations realize the benefits of more pervasive BI implementations that reach far outside the confines of the IT department. This dramatic shift is now placing pressure on the BI channel to deliver technology solutions that address these new demands. For example, product ease-of-use is now the number one consideration for organizations looking to purchase a BI tool (according to Gartner).
In fact, Gartner’s 2015 Magic Quadrant for Business Intelligence and Analytics Platforms study, as reported by forbes.com, predicted that: “By 2017, the majority of business users will have access to self-service tools to prepare data for analysis.” However, this trend is now creating a dangerous situation, where Gartner expects that less than 10 percent of self-service BI deployments will be governed sufficiently through 2016 to “prevent inconsistencies that adversely affect the business”. So, what’s the strategy that Gartner has found most organizations adopting in order to balance the self-service BI demands of business users with the governance requirements of enterprise IT? Apparently, it’s the waiting game: “Gartner is seeing the majority of enterprise customers waiting to see if their enterprise-standard BI platform will deliver on the business-user-oriented capabilities they prefer to use to meet new analytics requirements beyond production reporting,” read the same forbes.com article.
This situation represents a massive opportunity for the channel industry. An opportunity to fill this void by partnering with BI vendors and technologies capable of meeting demand for pervasive business-oriented BI, while delivering IT the architecture they need to sufficiently govern large BI deployments, to ensure that the best people get the best insights at the best time.
But the way this technology is delivered – and the flexibility, scalability, speed and total cost at which it’s delivered – is also growingly important.
A new approach: Organizations begin to embrace the cloud
Evidence shows that, after hesitation and trepidation at the start, organizations are beginning to embrace the benefits of cloud-based BI deployments. This developing trend is an enormous opportunity for channel players who partner with BI vendors that give them the flexibility to develop hosted solutions for their clients.
Redwood Capital highlighted the extent of these changing views, and size of the emergent opportunity for the BI channel, with its recent Sector Report on Business Intelligence. The report predicted the cloud BI market to grow from $.75 billion in 2013 to $2.94 billion in 2018 – a CAGR of 31 percent. MarketsandMarkets forecast the broader global cloud analytics market to grow from $5.25 billion at the end of 2013 to $16.52 billion by 2018.
And, according to a recent research note – titled 2014 Analytics Market Survey – compiled by analyst and advisory firm Nucleus Research:
- Sixty-one percent of organizations using on-premise BI are considering moving to the cloud within the next two years
- Seventy percent of organizations are considering the cloud as their primary platform for new analytics projects
- By 2020, fewer than 10 percent of analytics deployments will be entirely on-premise
These findings mirror Forrester Research’s expectations that 65 percent of organizations will have adopted some form of cloud-based BI by the end of 2015.
The other major factor driving this change is easy connection to, and the proliferation of, cloud-based data sources. Gartner Research Director, Joao Tapadinhas, neatly summarized the situation when he recently said: “As more data sources move to the cloud, it makes more sense to also adopt Cloud BI solutions because that’s where the data is”.
Where to next?
For those involved in the BI channel who are willing and able to embrace changing technology, data, users and delivery demands, the quickly growing and evolving BI market offers enormous upside.
To learn more about the emerging opportunities, and how to grasp them, sign-up to attend Yellowfin’s free event, Making BI Partnerships Easy today.
Keep a lookout for our next channel focused blog post, The top 3 challenges facing Business Intelligence resellers.