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How Will the Consolidation in the BI Technology Space Effect Innovation Going Forward?

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David Linthicum: How will the consolidation in the BI technology space effect innovation going forward?

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  • Innovation will continue to come from young companies that can be disruptive since they don't have large installed bases that inherently inhibit true innovation. This disruption is in business models (cloud and SaaS) as well as technology (real-time operational BI) and user community (everyone making operational decisions as opposed to a small number of business analysts).

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    You know what they say: the bigger the dinosaur the more more meat for the mammals and insects to eat...Oracle / IBM / SAP and all their recent acquisitions won't affect the innovation curve at all.


  • After years of denying the fact, the Mega Brands that have acquired the largest BI vendors are now scurrying to address their lack of true innovation.
    It seems like yesterday that the established BI vendors were buying up each other in the first phase of BI consolidation. Before any of these newly consolidated Mega BI vendors really had their act together they were in turn snapped up by the Mega Brand vendors like Oracle, SAP, IBM and Microsoft.
    The result has been that BI innovation was put on hold as integration replaced true innovation with little value created for the end-users.
    BI innovation will continue to come, as it always has, from the new thought leaders and innovators in the space that want to change the game and bring disruptive technologies and approaches into the market place.

    It will not be as easy this time around for the Mega Brands to buy their way in as innovation in BI is not just at the technology level this time around. Open source and SaaS are all “all in? bets that few Mega Vendors can endorse without cannibalizing their existing revenue streams.
    Look for the next generation of innovation and subsequent consolidation not from the established Mega Vendors, but from the SaaS and Cloud computing vendors that are not afraid to press the envelope on both technology and business model innovation.

  • BI and BPM are my main avenues into the business market.

    BI so everyone can know what is accurantely going on.
    BPM so they can make the best judgements on that real time Information

  • There is big difference between "innovation" and "disruption". The platform players will continue to innovate but above the line of "performance oversupply". These are innovation that don't help customers (can you name a new Excel feature?). The real disruption happens below the "performance oversupply" line with product that are somehow limited but offer disruptive features. And for many reasons the big players simply can't deliver truly disruptive innovations...

    Roman Stanek
    http://roman.stanek.org/2010/02/15/with-friends-like-forrester-and-gartner-ibm-and-sap-dont-need-enemies/

  • Consolidation in the BI space is a good thing for innovation. It showcases that innovators who have built disruptive or new technologies with strong management and technology teams can help drive success for the acquirer. I speak from relatively recent experience where I worked at Ascential Software which was acquired by IBM. Ascential was known as a both a consolidator, having acquired several innovative companies and also an innovator, having developed several key innovations in the enterprise data integration space. After being acquired by IBM, we enjoyed the opportunity to work with several innovative teams including teams of very smart and experienced innovative researchers. A good example is the IBM ManyEyes project which showcased an innovative solution for social based visualizations for data that is now available on the IBM Alpha Works website. When you combine great companies thru consolidation, you also combine great talent that drive innovation to market with greater ability to execute.

  • Overall, I feel that consolidation will have a positive impact on Innovation in the BI space. The big players like SAP, Oracle, IBM, Microsoft etc. who have acquired / consolidated their BI offerings will innovate to integrate BI (or increase the integration of BI) with other systems in the IT landscape. For example, CMIS (Content Managment Integration Services) specifications once fully adopted by data integration tools can help combine unstructured data from content management systems into an Enterprise DW. We might also see the presence of BPM, EAI tools more frequently in an organization's BI architecture. IBM's Business Analytics & Optimization (BAO) initiative is aimed at collating its expertise across multiple dimensions - Analytics, Process Management, Operations Research, Simulations etc. and bring it into mainstream BI. All this innovation augurs well for BI as a discipline.

    Consolidation also helps the smaller players to focus on "What is missing" in the top tier vendors. The rapid development of Cloud apps, Open source platforms, column major databases, MPP architecture, etc. are examples of how smaller, intelligent companies are taking advantage of the inherent inertia among the bigger players and addressing specific needs in the market for BI tools & services.

  • If the past decade has been any representation of how consolidation stifled innovation in BI the impact will be neutral. Innovation has been mistaken as integration and additional functional improvement that all but met most organizations expectations in terms of business intelligence; but did little to exceed.

    Innovation or better yet disruption will continue take place below the radar; as mentioned in comments above and will go beyond the "what is missing from the solution suite" question rather it will look at shifting how organizations perceive value from their information.

  • Listening to Larry Ellison say that everything in software is mature and there is nothing more to innovate and it's only consolidation from now on, I am reminded of quite a few vignettes from past history:

    -- The clerk at the patent office proclaiming that everything that needs to be invented has already been invented.

    -- Ken Olsen, founder of Digital Equipment Corporation famously being quoted to ask "who needs a personal computer?".

    Innovation has not even begun in earnest in BI. We just have mastered the art of collecting all the data and putting in a large bag! No one knows how to get the insights, advice, real-time alerts they want nor do they get in the form that is useful for them.

    The big ones will be surprised soon with the Internet, Mashups of Location, Demographics, Personal purchase behavior, trends, fashions, current events, word of mouth, web 2.0, 3.0 tools combining with traditional data in a bag to provide all kinds of BI we have never thought of yet.

    Anyone seen the movie Minority Report?

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