Business Intelligence Versus Business Analytics--What's the Difference?
Mon, February 27, 2006
CIO — The marketing and analyst airwaves are flooding with speculation about what is next for business intelligence (BI). What will comprise BI 2.0?
Historically, this market has been served by vendors such as Business Objects and Cognos. But the competitive landscape is changing. Microsoft has now shrewdly entered the market by driving the placement of SQL servers into the space in order to broadly deploy and deliver its BI suite and reporting services in volume. Oracle has seen the effect of companies moving data out of the database to stage it for analysis. The resulting data warehouses have provided a degree of utility in housing, manipulating and delivering “strategic” information across the organization.
Recently though, established vendors such as SAP and Siebel have unveiled BI product suites under the banner of “analytics.” SAS, a perennial stalwart of the statistics market, is suddenly being touted as the number-three BI vendor and frequently positions itself as an analytics vendor.
With analytics finding its place within many functions and business processes it seems clear that it will be a defining feature of next generation business intelligence. Particularly, a significant new group of business users—a group I like to call “Go-To Guys”—are in need of analytics tools to tackle daily problems and opportunities. Go-To Guys are the operating managers of company—product managers, sales managers, researchers, engineers and marketers.
So, what is analytics? Neil Raden of Hired Brains, a market research and management consulting firm, has said that, “the proper term for interacting with information at the speed of business, analyzing and discovering and following through with the appropriate action, is ‘analytics’.” CIOs often assume that business analytics (BA) comes along with BI. The traditional BI market has been associated with providing executive dashboards and reporting to monitor the assumptions and key performance metrics that are part of long term planning cycles.
Everybody wants a dashboard. To the extent that all of us are CEO’s of our own business discipline, we want a simple measurement display of how we are doing and an alert mechanism of when something goes wrong. Additionally, dashboards address the growing urgency around Sarbanes Oxley. Monitoring planning assumptions and key performance metrics has now become mission critical from a regulatory and compliance standpoint.
Where BI Stops and BA Begins
But BI reporting ends with the dashboard, which is sufficient only for some business planning, and BA picks up the rest for the Go-To Guys. Simply, this group must interact with data in a much different way from what traditional BI allows.
