Does BI Really Help Businesses Get Smarter?

By Allan Alter  |  Posted 10-15-2007

Does BI Really Help Businesses Get Smarter?

In our October 2005 Business Intelligence survey, more than 90 percent of IT executives at mid-tier firms told us they planned to increase their efforts to apply IT to business intelligence. Two years later, our 2007 BI study shows these firms are avid BI users.

While they don't use as many different kinds of BI tools and they don't pursue BI for quite as many reasons, small and midsize businesses are close behind larger companies in their use of BI.

Mid-market firms invest in business intelligence systems for three main reasons: to improve business processes, compile financial results and gather and analyze customer information. (Compliance and competitive intelligence aren't as high a priority.) They are more likely than larger companies to use open source BI tools. In addition, they are more satisfied with the quality of their BI data than larger companies, although it's still frequently a problem.

Finding 1: Mid-Tier Firms Lag in BI, But Not By Much

Finding 2: SMBs Open Door to Open Source BI

Finding 3: How Good Is BI Data at Midsize Firms?

Next page: Mid-Tier Firms Lag in BI, But Not By Much

Finding 1

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Finding 1
Mid-Tier Firms Lag in BI, But Not By Much
Small and midsize businesses have less experience with business intelligence than larger companies: Only 20 percent of mid-tier companies have had five or more years ' experience with business intelligence, compared with 34 percent of firms with more than $500 million in revenue. As a result, the smaller businesses have limited their BI efforts to a narrower range of objectives, and provide fewer business intelligence tools. Still, it's remarkable that SMBs provide their managers and employees with most of the same BI offerings as larger companies.

Next page: SMBs Open Door to Open Source BI

Finding 2

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Finding 2
SMBs Open Door to Open Source BI
Most mid-market BI users rely on tools from conventional licensed software vendors. But nearly one-quarter claim to use open source BI software; that's more than twice the rate of respondents at larger companies. This is somewhat higher than our May 2007 open source survey, when 11 percent said they used open source BI tools such as Pentaho and BIRT; another 9 percent planned to deploy such tools within the next 12 months.

Next page: How Good Is BI Data at Midsize Firms?

Finding 3

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Finding 3
How Good Is BI Data at Midsize Firms?
CIOs at mid-tier companies claim fewer data-quality problems and more satisfaction with information than their counterparts at larger companies. This is surprising, given the resources and stringent management practices needed to insure data quality. Of course, smaller firms are less complex than larger ones, easing data integration and standardization. And the difference between mid-tier and larger firms is only about seven or eight percentage points. Still, we wonder whether some of respondents underestimate the problem of data quality and overestimate BI satisfaction.