More thoughts on BI in the Economic Crisis – this time from Forrester Research

zdnet-small forrester

At this rate I am going to have to create a “BI and the economic crisis category”. In this latest article on ZDNet, James Kobielus from Forester Research explores whether the BI market is really recession-proof.

Rather than making generalisations, James considers the potentially diverging fortunes of different players with different product sets. He highlights the benefits of having functionality that extends beyond traditional “core BI” areas and of strong customer relationships; either mediated by the BI vendor’s own professional services organisations, or strong ties with the major consultancies. A final differentiator that James identifies is strength in the growth area of business analytics.

The article is a thoughtful and insightful one, which I would recommend reading.

Forrester Research, Inc. is an independent research company that provides pragmatic and forward-thinking advice to global leaders in business and technology. Forrester works with professionals in 19 key roles at major companies providing proprietary research, consumer insight, consulting, events, and peer-to-peer executive programs. For more than 25 years, Forrester has been making IT, marketing, and technology industry leaders successful every day. For more information, visit

James Kobielus serves Information & Knowledge Management professionals. He is a leading expert on data warehousing, predictive analytics, data mining, and complex event processing.

ZDNet is part of CBS Interactive.

Gartner says “BI must transform and improve businesses”

The title is paraphrased. The actual quote, as reported on BeyeNETWORK, is as follows: –

“Organizations will expect IT leaders in charge of BI and performance management initiatives to help transform and significantly improve their business,” said Nigel Rayner, research vice president of Gartner. “This year’s predictions focus on the need for BI and performance management to deliver greater business value.”

To me this immediately suggests one, potentially awkward, question – what on Earth have some BI initiatives been focussed on before 2009 if it was not transforming and improving business?

BeyeNETWORK article about the economy and BI


For obvious reasons, this has become something of a theme recently and is an area that I have touched on in two earlier posts: Will the economic crisis actually be positive for BI? and Pitching BI in difficult economic circumstances.

The BeyeNETWORK article by Nancy Williams provides an interesting perspective and some practical guidance for BI practitioners who are grappling with the current situation. It is and is well-worth reading.

BeyeNETWORK provides viewers with access to the thought leaders in business intelligence, performance management, business integration, information quality, data warehousing and more.
Nancy serves as Vice President of DecisionPath’s Business Intelligence and Data Warehousing Consulting practice. She has more than 17 years of consulting and management experience, and is a highly sought after authority on data warehousing and business intelligence issues. Nancy is a regular instructor at TDWI World and Regional Conferences and has taught the TDWI Fundamentals and Data Modelling courses for a number of Fortune 500 companies and Government agencies. She holds an MBA from the Darden School at the University of Virginia and a BS in Education from the University of Virginia.

Pitching BI in difficult economic circumstances

linkedin EPM Business Intelligence

This brief article simply reprises a response I made to a question on the EPM – Business Intelligence group (you will need to be a menber of and the group to view the link).

The essence of the question was what key BI-related words would resonate with Executive teams. Here is what I said: –

“In an unfavourable economic climate, many companies will be thinking first about survival and defensive measures. Only the very best will consider this environment an opportunity, and the very best will already have established BI that this part of their corporate DNA. Let’s rule these paragons out and think about the rest of the herd.

If you are focussed on survival, then it is probably worth extending the metaphor to think about an animal that is in a daily life-or-death situation. It would want to have as much information about impending threats as possible (what can I see?, what can I hear?, what can I smell?, etc.). It will err on the side of caution assuming that half-glimpsed shapes are potential predators and act accordingly. It will want to understand its current environment (how far am I from a place to hide?, are there other animals around who might also be a target – reducing the risk for me?, what is the terrain like and how fast can I move over it?, are there any blind-spots around me?, etc.).

Translating this into a business arena, maybe you can pitch BI by saying that when every penny is precious, having an in-depth understanding of what you do, what it costs, and what value it generates is crucial. Also understanding trends in your book of business is important; am I starting to lose business, if so, what types and why?, are prices eroding, if so, for what products and in which territories?, where are the pain points?, are there any areas that are still doing well that I could focus on more?, etc.

BI can play a major part in identifying what is going well and what is going badly. It can also track the impact of your current tactics, be these aggressive or defensive. Maybe these are some themes that you could pick up on.

When the seas are very rough, having good navigational equipment becomes essential to avoid running aground. “


My earlier article focusing on whether the economic crisis will be positive for BI may also be of interest in this area.

Since writing this article, I have penned some others in the same area and also found a number of interesting pieces elsewhere on the web. In response to this I have created a WordPress category “BI and the Economic Crisis“, which will hopefully provide a hub for this important area.

Will the economic crisis actually be positive for BI?

This article was prompted to some extent by a discussion posted in the Enterprise Performance Management group on (the thread may be viewed here, but you will need to be both logged on to and a member of the group to view it).


The economic turmoil encompassing much of the world is certainly being felt in IT. As one of the largest areas of expenditure in an organisation, IT is always somewhere where it is tempting for those looking to make cuts to start. In many organisations, IT expenditure has been under pressure for many years as rising software costs have taken a larger chunk of overall expenditure. Replacement of obsolete hardware and software is also something that cannot be put off indefinitely and such work often further reduces the CIO’s room for manoeuvre. These factors tend to lead to either stagnant or reducing IT budgets. In some organisations, cuts are “democratically” spread across all areas of IT, but the more sophisticated operators will look to be selective. In this second type of organisation, it has been suggested that business intelligence (BI) may be one of the winners. This article explores this idea.

It is first of all important to realise that sometimes investment in BI is driven by a crisis. When things are going wrong, or have already gone wrong, then the instinctive reflex of CEOs is to want to know both what is happening and why. Often they will find that they do not have the tools in place to answer either of these questions and BI is the best way of addressing this need. In relation to the credit crunch, this type of BI investment can be thought of in the same way that greater focus was placed on control systems and internal auditing in the aftermath of the Enron and WorldCom debacles (they now seem a lifetime away don’t they?).

However, there are some things to be said against this. First, the current crisis is not within a single company, but across virtually all companies. Second, the factors behind the crisis are already apparent: a drying-up of commercial credit as banks do a 180° in their appetite for risk and seek to rebuild devastated balance sheets; and, proceeding from the first factor, a plunge in consumer and business confidence as individuals and companies face – at best – straitened financial circumstances and – at worst – insolvency. Of course the combination of these issues leads to a vicious circle. Good BI is not necessary to qualify these already crystal-clear problems.

Despite the systemic nature of the challenges, companies that have already made investments in BI will have tools at their disposal that are pertinent to navigating some aspects of the current financial difficulties. This should place them at a competitive advantage to organisations that have not been so foresighted. As ever corporate discomfort will not be spread evenly across the board. Whilst all companies will suffer, the strongest ones will suffer least. These organisations may even be able to take advantage of their competitors’ travails to expand market share and attract disaffected customers. One thing that will undoubtedly be a feature of the strongest companies is good BI. These observations may be enough to drive continued support of BI in organisations that already value it, they may even lead to a mild expansion in facilities. But what can we say about those companies that have not already invested in BI?

It is undeniable that creating good BI from scratch is both a lengthy and costly process. I would argue that – in normal circumstances – the payback is extremely positive; indeed BI is one of the highest-yielding types of IT projects. The challenge is that the financial crisis is biting deeply now and BI’s benefits are in the future; at least a year away for most organisations (though it is feasible that some interim solutions to the most pressing questions could be produced more rapidly). Is this a time at which senior management is likely to be receptive to an investment with a medium-to-long term payback, no matter how large that payback might be? The answer to this question probably lies in the degree to which the external crisis has been reflected in an internal crisis. If a company is fighting for its survival day-to-day, then existing BI will be invaluable, but BI with a delivery date in 12 months time is not likely to get very far up the priority list; paying suppliers and staff in the next few days is a more pressing issue.

So my opinion is that there is scope for expanded BI expenditure in those companies that have already made investments, this may be related to specific tools to help take advantage of customers deserting distressed competitors. There is also scope for BI projects to be initiated in companies that are suffering, but whose business is essentially sound. In these types of businesses decisions can still be taken with an eye on the medium term. However a balancing factor is that companies whose future is in the balance are very unlikely to see BI as a major contributor to any short-term turn-around strategy. In these organisations, slashing all IT expenditure is more likely to be the prevailing wisdom.

In aggregate it is difficult to work out the impact of these different trends on the BI market. This will depend sensitively on the triage of companies into the groups identified above. My unscientific sense is that BI may fare marginally better than many other elements of IT, but the overall outlook is negative in the short-term. However, for those companies that survive the down-turn and have not already put a BI strategy in place, it may well be that the area will see renewed interest once the economy reaches calmer waters. This realisation may well arise from noticing how much better those companies with good BI have fared in difficult market conditions.

Since writing this article, I have penned some others in the same area and also found a number of interesting pieces elsewhere on the web. In response to this I have created a WordPress category “BI and the Economic Crisis“, which will hopefully provide a hub for this important area.