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Microsoft Takes A Shot at the Business Intelligence Market

Written By: Lyndsay Wise
Published On: June 30 2006

Introduction

Although business intelligence (BI) touts itself as being able to provide analytics to the general user population within organizations, in most instances only a small portion of decision makers actually use BI tools and applications. Generally, applications are implemented in silos across an organization. In some cases, this means implementing various applications and vendor solutions based on the needs identified within individual departments. For example, an organization may implement a Cognos solution to manage its sales force performance, and a Hyperion solution because of its strong financial consolidation functionality within the finance department. As BI has changed to accommodate real-time data analysis, and to provide forward-looking business planning and strategies, the need to bring a single set of analytical tools to every decision maker across the organization has grown.

Enter Microsoft, with its release of Business Scorecard Manager (BSM) in November 2005. Microsoft's goal by adding BI to its platform is to bring BI to the small-to-medium (SMB) market, making it accessible to all decision makers across the organization. Additionally, Microsoft's recent acquisition of ProClarity and its recent announcement of next year's full release of PerformancePoint 2007, an integrated performance management suite, indicate that its focus now includes the BI market. Microsoft's low cost high-volume strategy, and its goal to make its BI and performance management suite as popular as e-mail, will help drive demand for BI in the broader market, and push towards the performance management concept of using software to help drive an organization's business goals.

Business Intelligence Software Components

Microsoft's BI offering is built on an inclusive platform designed to encompass an entire business intelligence suite, while being fully integrated with its other product offerings, including Microsoft Dynamics (enterprise resource planning [ERP]) (for more information on Microsoft Dynamics see Microsoft's Dynamic New Approach to Professional Services Automation). Its BI product line includes online analytical processing (OLAP), extract, transform, and load (ETL), and reporting services, as well as providing front-end scorecarding functionality that integrates with SharePoint and Excel, making it an integrated approach to BI.

Business Scorecard Manager (BSM) 2005 sets and monitors key performance indicators (KPIs), allows teams to analyze issues based on metrics set, and allows users to drill down to data stored in the SQL Server to identify the structured and unstructured source data, in order to view more detailed information. BSM offers collaboration among users, personalized notification of status changes within a scorecard, task assignment to individuals based on KPI, and distribution of scorecards via email.

SharePoint Server 2007 provides a centralized Web portal for Microsoft's BI offerings. Information can be distributed across the organization to enable all employees to collaborate, edit, post, distribute, and reuse documents and information. Other applications using SharePoint can be leveraged as well, aligning BI with other business initiatives.

SQL Server 2005 RDBMS uses its SQL Server BI Development Studio as an integrated development environment (IDE) for the development of its BI applications. The BI Development Studio is a centralized tool to leverage multiple technologies such as OLAP, relational databases, reporting, Web pages, and Microsoft coding languages. It includes the following components:

  • SQL Server Integration Services (SSIS) provides ETL capabilities. In addition, data can be transformed without the use of staging tables, thereby reducing data latency. Both structured and unstructured data can be extracted and converted between various types of data such as numeric and string (and so on), and data audits can be performed. Also, to account for slowly changing dimensions (SCDs), SSIS has a built-in wizard.

  • Analysis Services provides data mining and OLAP capabilities to enable users to identify and set KPIs, set custom aggregations and semi-additive measures, and create decision trees and perform regression analyses to identify forward-looking business needs. Unified Dimensional Model (UDM) uses one platform to address the needs of multiple dimensional models and relational reporting, creating a centralized structure improving the performance of summary type queries.

  • Reporting Services provides advanced authoring tools to allow ad hoc and user report creation through the use of its Reporting Services Report Builder. Report Builder allows users to create reports from an existing business model, build new reports, modify existing reports, and build reports based on OLAP or relational database tables. Aside from the flexibility of its interactive reporting environment, Reporting Services leverages multiple data sources and provides the ability to embed its Web services architecture, to allow users the ability to collaborate on initiatives for Web-enabled reporting tools.

Additionally, MS Excel 2007 is the newest version of Excel that works with the BI platform identified above. It leverages performance management functionality within its structure by using SQL Server 2005 to embed heat graphs, KPIs, and so forth, allowing trends to be identified more easily. Excel spreadsheets can also be published to the SharePoint server to allow collaboration among various employees across the organization as well as interaction with real-time data that can be published to the server.

Product Strengths

Based on the wide use of Microsoft Office products within organizations, Microsoft has a natural advantage due to its far reach. Organizations which have not implemented BI solutions and that cannot afford the large price tags associated with BI vendor solutions can use Microsoft's general BI solution, as it encompasses a back-end solution to complement its front end analytics. This means that Microsoft, although coming late to the BI game, may actually push a broader use of BI tools throughout organizations, making it easier for other vendors to penetrate the mid-market and to expand their client base.

Also, the ease of use (due to MS Office integration) provides users with a big bonus in terms of integrating BSM into the current Microsoft product suite. Users can leverage their current products to define the required metrics to help measure performance. An example of linking BI with the broader Microsoft offering is through the use of Microsoft's Web portal, SharePoint. In SharePoint, documents can be linked across the organization; enterprise search and Web forms can be used; document management can be leveraged; and the various functionalities can be accessed within the same portal and within the BI structure as well.

In terms of functionality, accounting for SCDs is an important factor when implementing a BI solution across an organization. SCDs are an evolutionary process because business needs change over time. This means that the data identified and captured, as well as the relationships identified between data elements, likely will change over time. Therefore, having a built-in wizard that helps account for business model changes that can be related to metrics set is an important (and often overlooked) feature that is not always provided in a user-friendly manner—or at all—by other vendors.

Product Challenges

Microsoft's late arrival to the market may have consequences, as many other BI and performance management vendors already integrate with Microsoft. Within the enterprise market, many BI tools have already been implemented across the organization, thereby making the adoption of yet another Microsoft product unlikely. Although Microsoft may choose to focus on BI and its complete performance management offering, the functionality provided by BSM does not outweigh that provided by other vendors. Microsoft's BSM functionality is fairly standard in terms of its competition. Additionally, even though Microsoft is focusing on using its partnerships to increase its user base, the BI suite offered has not been differentiated enough to provide users a reason to implement it on top of an existing BI or performance management software suite.

User Recommendations

With the planned release of Microsoft PerformancePoint in 2007, which consolidates BSM and ProClarity to provide enhanced performance management functionality, Microsoft's BI suite is well on its way to becoming a full solution for organizations. By leveraging the functionality provided by ProClarity, it is clear that Microsoft is serious about its participation in this market. For organizations currently using ProClarity, the product will be upgraded naturally to reflect the Microsoft offering.

Organizations which are considering a new BI solution and which rely heavily on MS Excel and other Microsoft-based products should investigate Microsoft's BI solution. Aside from the breadth of functionality that ranges from OLAP and scorecarding to ETL and data warehousing, Microsoft's pricing strategy is hard to beat. This means that SMBs that haven't been able to touch expensive enterprise software offerings can gain similar advantages in terms of functionality provided with the added advantage of ease of use.

Organizations with BI solutions already in place can leverage extra features offered within Microsoft's new product offering. However, aside from the ease of use and interoperability with MS Office, it may be difficult to find additional benefits to diversifying an organization's front end BI tools. If anything, organizations should be working to consolidate their BI platform to provide a centralized structure, both in terms of data consolidation as well as standardized tools to create ease of use.

 
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