Data-Driven Decision-Making >> Who's on Your BI Shortlist?
- By Joseph C. Panettieri
The vendors are coming! Business intelligence (BI) software will improve
your operational and financial performance, but the market is set for a shakeout.
Choose your partners wisely.
Tom Mauriello knows how to build profitable relationships. As vice president
of Development at New York Institute of Technology (NYIT),
Mauriello and his team have driven annual giving to the college 80 percent higher
since the 2003-2004 academic year. Moreover, NYIT’s contributor base has
increased 21 percent since that time.
What’s the secret to NYIT’s success? The three-part answer includes
effective data-driven decision-making, progressive collaborative tools, and
a heavy emphasis on personal relationships. “The best technology in the
world will certainly help your cause,” says Mauriello. “But you
also need extensive relationships with people who care about the development
of your institution and its students.”
Even so, it takes a solid technology infrastructure to mine and maintain those
relationships. In recent years, NYIT has shed Digital VAX legacy systems and
increased its reliance on enterprise and BI software from Datatel
Inc., Microsoft Corp.,
and Oracle Corp. to drive
The Bandwagon to Consolidation
NYIT isn’t alone. Across the country, universities are leveraging BI
software to improve data-driven decision-making, which can enhance operational
and financial performance. The lengthy list of BI software providers includes
Business Objects SA,
Cognos Inc., Hyperion
Solutions Corp., Microsoft, Oracle, SAS
Institute Inc., and numerous second-tier players. Even open source companies
such as Greenplum are
leaping into the BI sector (see “Seeing Green?” p. 45).
Demand for such software remains strong: Global BI sales are growing 10 percent
annually and now top about $4.5 billion per year, according to International
Data Corp., a Framingham, MA-based research firm.
Still, industry pundits say the BI sector, much like the enterprise software
market, is ripe for a shakeout. “When it comes to business intelligence
software, you’re talking about a very fragmented market with lots of profitable
players,” says Ed Golod, president of Revenue
Accelerators Inc., an executive consulting firm in New York. “That’s
a recipe for consolidation.”
Oracle agrees. Since 2003, the $12.35 billion database giant’s board of directors
has maintained a shortlist of potential buyout targets, according to Oracle’s
SEC filings. The list includes such database and BI specialists as Sybase
Inc. and Business Objects.
Although Oracle declined to discuss its acquisition list, BI vendors themselves
are snatching up tiny companies to round out their software portfolios. For
instance, in October, Business Objects purchased privately held Infommersion
Inc., a leading provider of information visualization and presentation software.
Similarly, Hyperion earlier this year purchased Razza
Solutions Inc.of Austin, TX. Razza’s software allows customers to
share data across financial and analytical applications.
For CIO’s and senior university administrators, BI industry consolidation
arrives at a critical time. Choose the wrong BI platform for a specific university
environment, and you could wind up with a dead-end solution.
When mulling a BI solution, ensure that the vendor is solidly profitable and
well established in the higher education market (see “Healthy Competition,”
p. 42). Second, the platform should include integrated reporting tools; query
and analysis features, online analytical processing capabilities, visualization
tools, and Microsoft Office integration (see “Five Critical Components,”
above). Third, the BI offering should integrate with existing platforms, such
as Datatel’s enterprise management software for universities.
Eager to meet such needs, in October, SAS announced a far-reaching partnership
with Datatel. The deal will provide Datatel customers with statistical, analytical,
and predictive capabilities from SAS software. “By joining forces, SAS
and Datatel will be able to provide higher education institutions with state-of-the-art
planning and decision-making software to keep them competitive, strong, and
student-focused,” says Mark Milliron, VP, SAS Education Practice.
Milliron’s optimism is easily explained: Once connected to SAS’s software,
universities will be able to leverage data held within the Datatel Colleague
enterprise resource planning solution to view campuswide business operations,
and also manage them for the future.
A LOOK AT THE MAJOR BI PROVIDERS AND THEIR RECENT MOVES.
|| Business Objects XI
||Brown University (RI), Columbia University
(NY), University of Michigan, University of Notre
Dame (IN), University of Pennsylvania, Stanford
University (CA), Vanderbilt University (TN)
||Revenue hit $261.4 million for 3Q 2005, up 19% from 3Q 2004.
|| Cognos 8
||Idaho State University, Penn State University,
University of Kent (UK), University of Toronto
||Canada’s largest software company; annual revenue is approaching (US)
|| Hyperion System 9
||Arizona State University, Cornell University
(NY), University of Akron (OH), Yale University
||Launched Hyperion System 9 in September.
|| SQL Server Accelerator for BI
||Medical University of South Carolina, University
of Pittsburgh Medical Center, University of Wisconsin-Madison
||Acquired ActiveViews Inc., a privately held reporting software specialist,
in mid 2004; Business Scorecard Manager shipped Nov. 1; Microsoft Office
12 with BI capabilities slated for delivery next year.
|| MicroStrategy 8
||University of Bolonga (Italy), University of
Miami, Technical University of Munich (Germany)
||Third quarter 2005 revenue was $65.8 million, versus $60.6 million in
the third quarter of 2004, a 9% increase.
|| Oracle Business Intelligence 10g
||Vanderbilt University (TN)
||The company’s latest software initiative, Oracle Fusion Middleware, aims
to integrate data from disparate systems.
|| SAS Enterprise BI Server
||University of Alabama, Sheffield University
||World’s largest privately held software company; recently inked higher
education software partnership with Datatel Corp.
Common BI Setbacks
Unless managed at the CIO level, BI projects can easily overwhelm a university.
The biggest risk is multiple departments deploying multiple BI platforms without
any central oversight. This scenario is eerily familiar to CIOs who wrestled
with network software installations in the late 1980s and early 1990s.
When PC networks were in their infancy, universities installed a mix of Banyan
Systems Inc. VINES, Digital Pathworks, IBM LAN Server, Microsoft Corp. LAN Manager,
and Novell Inc. NetWare.
“In many universities, each department proceeded on its own and the result
was a hodgepodge of incompatible network software,” recalls Jill Cherveney-Keogh,
director of Academic Computing at NYIT.
It took a decade for universities to standardize on a mix of Windows, Linux, and Unix. That’s repeating itself in the BI marketplace.
It took roughly a decade for universities to sort out the incompatibilities,
increasingly standardizing on a mix of Windows, Linux, and Unix. Now, that same
scenario seems to be repeating itself in the BI marketplace. In the mid-1990s,
university departments deployed a range of BI systems—some of which didn’t
work with one another. Now, universities are taking corrective actions. “We’re
seeing a shift to standardized, enterprise-wide BI solutions,” confirms
Scott Lawrence, director of Product Marketing at Cognos. “This typically
lowers BI’s total cost of ownership, reduces training costs, and paves
the way for best practices across an organization.”
Most successful BI projects start with a specific pain point in a single university
department. At NYIT, the pain point was alumni giving. Founded in 1955, NYIT
maintained alumni records on paper until around the 1990s. Director of Alumni
Relations Jeff Morosoff has spent the past few years ensuring records for all
graduates are input into a central NYIT database. As the database gained more
and more graduate names, NYIT had a richer and richer list of names to call
on for annual giving programs.
Mauriello, NYIT’s vice president of Development, joined the college in
2002 and immediately harnessed Morosoff’s database work. The system was
quickly linked with NYIT’s Web site and e-mail systems, allowing alumni
to donate online, and empowering NYIT to reach out to alumni electronically
with a few points and clicks of a mouse.
Even if a BI project is limited to a departmental deployment, it’s critical
to keep the university CIO in the loop. Without CIO recognition and involvement,
other university departments may embark on BI projects of their own—without
leveraging the knowledge and skill set gained from the initial BI project.
In order to share BI expertise across an academic institution, many universities
are opening so-called BI Competency Centers—a term coined by Gartner
Inc., the Stamford, CT-based technology research firm.
“A [BI Competency Center] enables an organization to coordinate and complement
existing [BI] efforts, while reducing redundancy and increasing effectiveness,”
asserts Patricia Whitaker, strategic programs director for Customer Solutions
and Alliances at SAS. “The centralization of these efforts ensures that
information and best practices are communicated and shared through the entire
organization so that everyone can benefit from successes and best practices.”
Five Critical Components
Look for these five core components found in leading BI software platforms:
- REPORTING TOOLS allow users to produce and access reports across all levels of the university.
- QUERY & ANALYSIS allows users to raise new questions and identify answers rapidly.
- OLAP (online analytical processing) turns raw data into rich information that can be understood by users and manipulated in various ways.
- VISUALIZATION presents data in charts and graphs.
- MICROSOFT OFFICE INTEGRATION allows Microsoft Office users to share information between Excel and BI tools.
Generally speaking, a BI Competency Center is a permanent, formal organizational
structure comprising of members from a university’s offices of finance,
development, enrollment, HR, and information systems, just to name a few. According
to SAS, implementing a BI Competency Center provides multiple benefits, including:
heightened credibility and confidence in university information; increased use
of BI throughout the organization; accelerated and effective decision-making
optimization of resources and decreased cost; and innovation of business processes
Ultimately, BI Competency Centers allow universities to leverage best practices
for BI deployments across multiple schools or departments, notes Lawrence from
Although BI software can empower multiple university departments, one of its
best starting points appears to be the Office of Development.
Just ask Yale University (CT), where progressive fundraising
provides 30 percent of the university’s annual operating budget. Yale’s
Office of Development gathers and stores donor information in an Oracle database,
but the office—until recently—had no effective way of leveraging
Eager to correct this shortcoming, Yale recently deployed Hyperion Software’s
Brio Performance Suite to plan effective one-to-one marketing campaigns based
on donor interests. From Web browsers, more than 160 fundraising staff and their
managers can now view information about more than 100,000 donors in real time,
enabling them to identify new fundraising opportunities and relate to donors
on a more personal level.
“As the core of our business intelligence initiative, Brio enables us
to be more sophisticated in our marketing efforts based on the individual interests
of our donors,” says Marcia Schels, project manager for Yale’s Office
of Development. “Brio enables fundraisers to access, view, and analyze
donor affiliations, contribution history, and specific academic and personal
interests to develop campaigns around each donor segment.”
For example, if fundraising administrators know that a prospect is interested
in the university’s building renovations or funding for academic scholarships,
Yale can act quickly on that information, whether that means e-mailing relevant
information or calling the prospect as part of a targeted phone campaign.
Translation: Yale’s fundraisers now spend far less time waiting on reports
and doing paperwork, and more time talking to donors. In fact, since Brio’s
deployment, annual giving to Yale has risen 10 percent and the Office of Development’s
productivity has jumped by 25 percent.
Even as the BI industry gets set to consolidate around fewer software providers,
it’s easy to see why Yale development officers retain their peace of mind.
A lesson for your institution, perhaps?
Seeing Green? OPEN SOURCE SPECIALIST GREENPLUM ATTEMPTS TO CASH IN ON BI.
GREENPLUM is ripe with innovative software ideas. The tiny San Mateo, CA-based startup company is developing an open source database for commodity hardware that could revolutionize the BI marketplace.
“Imagine going to Google and waiting four days for your search results...No
consumer would stand for that, yet CEOs and business managers tolerate exactly
this on a daily basis when dealing with their BI systems,” says Sam
Mohamad, Greenplum CEO. “By using an open source database optimized
with a supercomputing architecture, [we aim] to give businesses the same flexibility
with their data that consumers enjoy with
Launched in 2003, Greenplum’s management team includes enterprise software veterans from Oracle, Teradata, and Tandem (acquired by Compaq/HP). Greenplum’s emerging product family, currently under development, includes Bizgres, an open source, production-ready database server focused exclusively on the needs of BI applications. The free, downloadable database targets small-to-midsize organizations with entry-level and departmental workloads such as data marts and reporting applications in the 10GB to 300GB range. For larger corporate and university settings, Greenplum is developing Bizgres MPP (Massively Parallel Processing), a database server that can scale to support multi-terabyte data warehouses supported by low-cost server clusters.
Although it’s too early to grade Greenplum’s efforts, the company has considerable buzz among open source software enthusiasts.