Microsoft announced at the end of January that it is folding PerformancePoint Server into SharePoint Server as part of a realignment of its business intelligence (BI) strategy. John Stokdyk reports

In a Microsoft Q&A [1], Office Business Platform Group senior vice president Kurt DelBene described the new strategy as consolidating the scorecard, dashboard and analytical capabilities of Office PerformancePoint Server into Microsoft Office SharePoint Server Enterprise and rebranding them as "PerformancePoint Services for SharePoint".

The financial planning, analysis and reporting tools that were previously packaged together within PerformancePoint will now be part of a wider information delivery system carried within the SharePoint Server web portal mechanism.

"Our decision is based on wanting customers to truly experience pervasive business intelligence in their organisation at a low cost through the tools they use every day," DelBene explained.

"We frequently sum up our mission as bringing 'BI to the masses'. Incorporating Office PerformancePoint Server 2007 features into Office SharePoint Server helps us fulfil that mission and sets us apart from many of the BI vendors that require the purchase of specialised applications."

Market analysts reckon that BI systems are typically only used by around 20% of the people within user organisations, DelBene claimed. By seating BI within commonly used tools such as Microsoft Excel, SQL Server and SharePoint Server, the company is aiming to broaden the BI user population.

DelBene's job is to put a positive spin on Microsoft's new direction, and there may well be merit in trying to weld BI into the organisational infrastructure, but there is a definite whiff of failure hanging over the new direction. In 2006, Microsoft acquired the successful performance management software company ProClarity and based PerformancePoint Server around its analytic tools.

Garter recently concluded that compared to rivals such as Oracle (Hyperion), IBM (Cognos) and SAP (Business Objects), Microsoft's product vision "remains somewhat limited" and Datamonitor [2] also identified shortcomings in PerformancePoint Server, but the latter also noted that Microsoft had reported 188% year-on-year growth in PPS licence sales. Changing tack at this point "dilutes the company's stand in the enterprise BI market", Datamonitor noted, but added that rather than taking on IBM, Oracle, and SAP head-to-head, Microsoft may now be "focusing on its strengths and picking its battles wisely".

In the meantime, the analyst noted, "Microsoft's investment in [PerformancePoint Server] over the last two years and its efforts to build a brand around it are wasted." Microsoft will be back very soon, with performance mangement tools configured around Excel, Excel Services and SQL Services Reporting Services/Analysis Services, all wrapped around the SharePoint Server web portal system, which has become an all-purpose repository in recent years for many of the company's KPI dashboard, scorecard and enterprise search ambitions. (See Ovum's recent report from FASTforward'09 [3] for more background).

If it had a hard time convincing finance departments to take its planning/forecasting, budgeting and reporting suite seriously, Microsoft may face an uphill struggle with an even more complex sales story