Business Intelligence (BI) for the Mid-Market
Business Intelligence (BI) applications are no longer out of reach for the small- and mid-market.
Delta Sonic is part of a growing trend. An increasing number of small- and mid-market CIOs are justifying the cost of BI applications to the business by showing how the insight into customer behavior these tools provide can be harnessed to drive incremental revenue to the bottom line. Also driving the adoption of BI by this market are less costly applications. BI no longer requires an expensive and complicated set of solutions to access and organize the necessary data, database and storage applications (see "Smart Tools and How to Pick Them").
"That adds up to a significant IT investment," says Jim Baum, president and COO of data warehouse appliance provider Netezza. Instead, the new BI tools can provide an appliance-based approach that works within an existing IT infrastructure, which is easier to operate and maintain—and cheaper, he says.
In short, BI isn’t just a technology for megacorporations anymore.
"BI is showing signs that it is picking up for the midlevel market," says Greg Belkin, a research analyst at Aberdeen Group. "The midlevel market is under a lot of pressure to think out of the box so it can compete against the big guys."
For the midlevel market—companies with revenue between $100 million and $1 billion—making the argument for BI can be harder than at larger companies. BI can be a relatively large investment (the investments for the small- and mid-market companies CIO spoke to were in the low six figures). It demands a serious time commitment from a smaller IT department that is likely overtaxed by user requests. But the business case for BI can be compelling, say small- and mid-market CIOs. While there is no research on BI’s returns in the mid-market, anecdotal evidence from IT executives suggests that careful investments can pay off. They say a successful implementation relies on four ingredients: negotiating up front with business colleagues about how to invest in BI; establishing quick wins to build trust; giving users a stake; and making sure data is clean before launching an application. In that way, these IT leaders have established BI applications that are beginning to generate more ways to drive sales and curb costs.
"It’s taken us time to get people used to it, but it has been worth it," Boebel says. "It’s really beginning to show up in sales and cost savings. More will come over time."
How BI Helps You Grow
One of the most difficult transitions for mid-market companies is that of making the leap to become a large business with more than $1 billion in revenue. Investing in bigger staffs to support that level of revenue, managing over an increasingly large geographic area and competing against businesses that have even larger budgets and better brand name recognition are just some of the challenges. So some mid-market CIOs have turned to BI as part of a strategy to grow and better compete as their companies bump up against bigger and better-financed operations.
