CIO — Analytics is one area where ERP vendors are starting to respond to CIO demands for new capabilities.

Forrester Research principal analyst Paul Hamerman writes that embedded analytics represents a key functionality for ERP in the future. "Rather than having to leave the application and launch separate reporting and analytics tools, ERP applications are moving toward embedding analytics within the context of the application itself," he wrote in a recent report. Examples include SAP BusinessObjects, Epicor 9 and the as-yet-to-be-released Oracle (ORCL) Fusion.

In an IBM (IBM) survey published last summer, 83 percent of CIOs reported that business intelligence and analytics—"the ability to see patterns in vast amounts of data and extract actionable insights"—would be the way to enhance their companies' competitiveness. "We need an ERP system to do a lot of predictive forecasting, and output different [project] models and business scenarios for us," confirms Nectarios Lazaris, CIO with global architectural design firm Woods Bagot.

Lazaris says, however, that the analytics available from his ERP vendor right now doesn't always meet business needs. In fact, Lazaris laments that users still have more affinity for Microsoft (MSFT) Excel sometimes than they do with Woods Bagot's ERP system (he declines to name the vendor). "Sometimes [as the CIO] you have to take it on the chin from your users," he says. "You go back, you try to talk to the account exec at your ERP vendor, and you try to get it across that you hope the next release is better. But [my] people will say, 'Why can't an ERP system be as powerful as Excel?' which is ironic."

Information in this story appeared first in "The Future of ERP, Part II."