Beth Gold Bernstein: Hello, everyone! And welcome to the ebizQ "BI in Action" virtual conference. I'm Beth Gold-Bernstein, director of the ebizQ training center and chair of the conference. Before introducing this key note presentation, let's review our interactive environment. You can chat with other attendees, send a business card, or leave a message. Note the tool bar at the top of your screen, where you will see "My Briefcase." That's where you can retrieve the business cards, messages and files that you download during the conference. To download a copy of today's presentation, click the "Files" button on the grey console.

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Now, it's my pleasure to welcome Boris Evelson, principal analyst at Forrester, who is going to enlighten us on the current state of the business intelligence market. Welcome, Boris!

Boris Evelson: Well, hello and good day everyone! Beth, thank you very much for that nice introduction. I hope everyone is doing well today and I thank you for joining me in what I hope will be a very informative presentation for everyone. I'm assuming everyone can see the slides and can see the controls for chat and etc. And I hope you can see an "enlarge" button in the upper right corner of the slides. So I will be showing some graphics and there will some small text in my presentation, so feel free to navigate the screen and enlarge it as you feel as needed.

So, let's proceed. What is this mysterious and often-mislabeled term, "business intelligence?" This is what we are talking about today. Let's get on the same page here. Let me first of all, start by saying that the information revolution is manifesting itself by producing mountains of digital data and that is becoming more and more challenging to process and analyze. And not only are we generating more data every day but our approach to data analysis, such as structured databases, indices in databases, distributed data architectures, all of that is also contributing to data growth.

And, furthermore, increasing importance of unstructured data, which we will talk about later in the presentation, increasing importance of that to making an informed and effective business decision, adds to data proliferation in business intelligence environments. So in response to these mountains of data and constant, ever-changing information requirements, we have come up with a set of methodologies, processes, architectures and technologies that transform all this raw data into meaningful and useful information.

So contrary to a more popular definition, in my opinion, business intelligence is much more than just reporting, dashboards and analytics, which is what you typically hear out there and we will see that further down in the presentation.

In today's presentation, I will cover several areas: First of all, I will talk about the fact that even though business intelligence has been around for decades, we've definitely seen quite a significant re-emergence of interest in business intelligence applications and various BI offerings by BI vendors. We will also talk about how I define the business intelligence market segment and we will go through some of the major players of the market and talk about the strength and weaknesses. I will then show everybody where I think the market is going in the next few years and we will wrap up with the most important topics, such as best practices and recommendations.

Re-emergence of BI applications

So let's start with why I think there is a re-emergence or an up-trend in business intelligence market. I've been in this business for over 25 years and I've seen many ups and downs in this market. However, lately there is definitely significant up-trend in this market and I am attributing it to least to, there are many more reasons, but am attributing it to at least two major reasons. Let's go through them.

First of all, is that being efficient -- keyword here being efficient -- is no longer enough. Enterprises can no longer stay competitive just by squeezing more efficiencies from operational applications such as trading, clearing systems, ERP, CRM, supply chain management, etc. Now buiness intelligence applications are needed for businesses and processes and business operations to become more effective. Key word here: effective.

So, for example: operation applications such as servicing, customer service CRM can be used to efficiently process a customer credit application. But I need business intelligence analytics to effectively create a customer segmentation analysis in order to extend the credit offer to much more targeted customer segment, so that I can get a better response and I can get better cross-sell and up-sell ratios. This is how I stay competitive these days.

The second reason that business intelligence is in an up-trend is that multiple factors, such as globalization, increased competitiveness, amplified emphasis on operational risks and regulatory compliance, mountains of device-generated data. Now these are just a few of many drivers behind continuous exponential growth rates of digital data our world produces. It's really easy to see how companies today are swimming and in some cases, are drowning, in data.

To be more exact, it's been estimated that the volume of world data doubles approximately three years. So as recently as 2003, the world's information production was 5 exobytes. So that's the number five with eighteen zeros. To put that into context, 5 exobytes is the equivalent to the amount of information contained in 37,000 libraries, the size of the Library of Congress, or one gigabyte for every person, for every person on earth. And growing at about 30 percent a year, we'll reach zetabyte sizes by 2010. That's a number with 21 zeros. And I and my colleagues that I'm sure are on the phone today, we are the ones that have to deal with it because most of the data is stored in magnetic media and that's the data that we deal with every day.

To ask to the tall tasks companies are facing today such as capturing, maintaining and utilizing the right data at the right time, is the fact that the vast majority of data is unstructured with current estimates hovering around 80 percent. So what is being done to deal with this challenge today? Well, business intelligence is moving towards encompassing both structured and unstructured data, traditionally two separate worlds.

Some call it Data Warehousing 2.0 or DW 2.0. It's a move certain to make analytics significantly more comprehensive and effective. But, unfortunately, infinitely more complex. The unstructured data that companies need isn't also readily available from within. Most of the time, it's outside of the company and it's in exobytes. So business intelligence architectures will need to be highly scaleable, flexible and even more capable of managing large loads of both structured and unstructured data from disparate sources.

Defining business intelligence and looking at vendor offerings

So now that we understand the why's behind business intelligence market growth, let's get on the same page as to what it is. Remember how I defined business intelligence at the beginning of the presentation? I defined it as a set of methodologies, processes, architectures and technologies that transform all this raw data which is talked about and the meaningful and useful information. You can actually see on the slide, and my apologies for small print, please feel free to use the enlarge button. But there was no way around this. There were indeed too many components that I wanted to show on one slide.

So, as you can see, I track around eight major layers or sections in this entire environment and a total of over 50 individual components. So even though we don't need to implement every component in every case, but a good majority of these components are needed for successful, scaleable and useful business intelligence implementation.

As you can see what many define as business intelligence, namely just reporting, dashboards and analytics that you see in the middle rows of the scene, they're really nothing but a few components of the so-called presentation layer. And that presentation layer is just one layer of what I call "business intelligence stack." So these cannot exist alone in isolation for most of the other components that discover the data, transform the data, cleanse the data, model the data, and provide a multitude of other supportive and related functions that are necessary for effective business intelligence implementation. So, that's it's quite a bit stack.

Let's move on to the business intelligence ecosystem. And if you recall, the 50 or 60 components that you saw on the previous slide, the key point here is that almost no vendor offers the entire solution on a single platform, although some vendors are getting close. So who are the major players in this business intelligence and what I call, for lack of a better word, ecosystem? So we have so-called pure plays that offer parts of the solution. Companies like Cognos, MicroStrategy, Actuate and Information Builders offer reporting and analytics. And companies like Informatica and Abenitio provide data integration services.

In this particular section, companies like Business Objects and SAS actually come closest to offering almost the entire stack of components in this category. When a company wishes to deal with only a single vendor for all or most of the enterprise applications, not just business intelligence, and we look for so-called "platform vendors" such as Microsoft and Oracle.

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