Business analysis adapts to life in the cloud
Technology analyst Gartner has released its influential magic quadrant report on business intelligence (BI) applications that are used to run sophisticated financial planning and strategic management processes.
Big data is big news in the IT industry these days, and the annual Gartner study tends to pick out those companies best able what the analyst judges to be a “complete vision” of BI. So the market leaders listed in the top right “magic quadrant” are the familiar giants such as SAP, Microsoft, Oracle who have all acquired BI specialists in the past, plus a handful of challengers, notably Qlik and Tableau:
From a financial management point of view, however, the Gartner analysis is intended more for chief information officers than finance chiefs. The report focuses more on the analytical infrastructure and delivery mechanisms than the kinds of applications used in the field. The importance of BI for finance is that it supports day-to-day activities such as sales reporting, margin analysis, forecasting and budgeting.
As Gartner research vice president Kurt Schlegel acknowledged, “Organisations are being told they need to invest in all this cool, innovative technology, such as predictive, content, and real time analytics; however, they still need to deliver the traditional management reports and dashboards that run the company.”
One of the most commonly featured phrases in the latest Gartner report is “cloud”. Most BI vendors now have a cloud strategy, but as Schlegel pointed out, “Virtually every new BI and analytics offering that hits the market will be designed to work in the cloud first.”
The analyst noted, however, that many BI leaders still do not have a strategy for integrating cloud services with their on-premises capabilities. Developers are also struggling to cope with demand from users for interactive visualisation tools and the ability to explore data sets from different systems within the organisation and beyond (or “multi-structured data sources” in Gartner-speak).
Another trend hinted at in the Gartner report is the “displacement of the incumbents” beginning to take place among smaller businesses by the likes of Qlik and Tableau. While delivering a narrower set of capabilities that the big names of BI, they are being adopted for a range of analytics functions, including reporting. This observation is supported by the presence of both vendors in AccountingWEB’s 2013 Software Satisfaction survey results.
Back in the real world as experienced by AccountingWEB members, the Excel factor remains strong, with Excel reporting tools like Pegasus XRL and Sage Intelligent Reporting taking care of a lot of financial reporting tasks. One reason specialist BI tools have failed to prosper in the SME market is because many common analysis functions have been appropriated by accounting packages and third party companion applications - as well as Pegasus and Sage, Access, NetSuite and SAP Business One are as strongly represented in our community as the likes of Oracle, IBM Cognos and Business Objects (also SAP).
But by focusing so intently on the big technology, enterprise end of the BI market, Gartner appears to have overlooked the explosion of BI developers that has emerged alongside cloud accounting systems. At the recent Xerocon in London, Spotlight Reporting founder and chief executive Richard Francis pointed out that there are 27 reporting add-ons available for Xero, while QuickBooks Online has a similar stable of companions.
At the same time Xero and Sage One have added basic dashboard capabilities to their accounting systems and Intuit is sure to be following not far behind. If and when BI really takes off on a global scale, mass adoption is most likely to be driven by hundreds and thousands of businesses using analytic tools for basic financial management.
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AccountingWEB’s interim Editor in Chief has been with the site since 1999 and returned to the editorial hot seat in March 2020 to lead the hunt for a long-term successor... Send a DM if you're interested! When not tending to the needs of AccountingWEB members and geeking out on their technology habits, he devotes much of his time to his oddball...