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February 4, 2009
BI for the Mid-Market - Part 1
BI and the Mid-Market: Some Definitions
With BI for the mid market, we immediately enter the realm of the vague unless we start with some rock-solid definitions. I think it was Voltaire who said something like "define your premises, and our conversation will be productive." Good old Voltaire--I always liked the chap.
So, here are the definitions in our context.
Business Intelligence (BI): A set of technological tools that turn corporate data into useful information that is available, reliable and actionable. No, Excel does not fall within this definition, although it can both be a data-source (as it's commonly used as such) and an additional tool.
Mid-market: The market comprises companies with a revenue between $100M and $1B. In this regard, we can further break down this market into three categories:
1 - The lower mid-market ($100M-250M)
2 - The middle mid-market ($250M-750M)
3 - The upper mid-market ($750M-1B)
I know that, especially vis a vis business intelligence, this definition of the mid-market is somewhat arbitrary, but it's not unusual and more and more analysts are adopting it (or something similar).
The Historical BI Options of the Mid-market
Until recently, mid-market companies had some pretty poor choices as far as BI. BI was almost a luxury good that Big-name legacy vendors had created around blue-chip companies. Complex architectures, expensive data warehouses and eons-long implementation times were something that neither the vendor nor their clients minded. But in recent years, the picture has changed.
The BI industry realized that the mid-market needed business intelligence pretty much at the same time that (or perhaps a little later than) the mid-market realized that it needed BI. And at this point, two things happened.
1 - Legacy BI vendors started licking their chops (at least the smart ones), and scrambled to either adapt their products to the budget of the mid-market or to buy upstart companies that offered product seen as being in line with the mid-market's needs and resources.
2 - Upstart BI companies refined their targeting to the mid-market, emphasizing their (often rightful) "I was here first" message.
So, the result was that in recent years, there has been a lot more available in terms of BI for the mid-market. Now, the mid-market company can choose in terms of features, technology, architecture, licensing model, upfront cost, support structure, etc. To quote the always eloquent Lindsay Wise, "companies are actually well poised to take charge and demand the types of solutions that most suit their unique requirements." Or, to quote me, more choice and competition among vendors is a jolly good thing for buyers.
What Does the Mid-market Need?
Trying to answer this question in a way that is *truly* valuable is, quite literally, above my pay-grade. If I could, I would also probably know what women really want and what the meaning of life is. The truth is that the mid-market is what bridges the gap between small companies and large enterprises (duh), so the gamut is truly wide. It's like trying to describe the color gray: not really black, not really white, but a heckuva lot of degrees in between these extremes.
To make things worse, there hasn't been as much valuable ink spilled on the needs of the mid-market as there has been on that of large corporations.
So, we can approach the BI needs for the mid-market not positively but by exclusion.
What the mid-market, in general, does not need in terms of BI:
Solutions that are too expensive. Especially in this time of recession, when cash is in short supply, mid-market firms cannot afford the same model of BI that the traditional legacy vendors sold years ago (and still do to some extent). This is rather self-explanatory.
Solutions that are too lengthy and resource-intensive to implement. What came first--the chicken of an increased rush to buy BI on the part of the mid-market or the egg of commoditized BI? Either way, this is the reality: a mid-market company is not very likely to buy a BI solution that takes months to implement and that requires a regiment of IT personnel and consultants. Time and money considerations preclude it.
Solutions that require complex and expensive architectures. This is a corollary of the previous point. Even an economical and easy-to-set-up BI solution is going to make the mid-market's brow furrow if it requires a complex technological architecture to support it--such as an expensive set of data-marts, a data warehouse or an OLAP environment.
Solutions that discourage user-adoption. User-adoption is, together with a clear strategic vision, the most critical issue that makes or breaks BI projects. For even the best solution yielding (potentially) the most leverage to the company deploying it will be all but useless if it does not follow a strategic vision. And even one that does will be all but useless if it's not adopted as part of the company culture by as many users as possible. And a costly mistake of the proportions of a failed BI project will be felt much more by a mid-market company than by a large enterprise.
In part deux of this discussion, we'll see the actual options that today's mid-market firm has in terms of business intelligence. Stay tuned.
Posted by Hound of the BI-skervilles at February 4, 2009 1:45 PM
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