Despite cloud computing promising a new dawn for business intelligence (BI), South African companies are still at pains to justify both the initial rollout and recurring BI analyst costs required to gain full value from such systems.
"Cloud computing definitely adds a new dimension to the delivery and consumption of enterprise-grade IT services, but it is not the panacea that many expect will magically solve all ills," says Dave Ives, director of BI at iSPartners, a Microsoft Gold Certified Partner.
"BI is all about extracting and using information with which to make better business decisions, and even if it is now more affordable due to the advent of cloud computing, the scarcity of qualified analysts is a major stumbling block.
"This opens the way for the introduction of the 'BI Bureau' as a concept, whereby companies not only make use of shared infrastructure by way of the cloud, but draw equally on shared industry expertise and insight to extract maximum value."
Ives believes the market is ready, and overdue, for such an integrated, outsourced service that draws on the considerable benefits of cloud computing technology in tandem with BI experts in key industry verticals such as retail, manufacturing, hospitality, and so forth.
"The real value lies in the interpretation of the data," he argues. "Without this insight that is generated through understanding the significance and relevance of the data, the company will never be able to develop the actions required to react to the insights borne from a BI system."
He adds that the market can expect to see the emergence of more niche service providers that have specialised skills within certain industry verticals.
By being able to draw on a pool of expertise within an industry, customers are alleviated of the pain of undergoing the same learning curve, and can thereby capitalise on existing experience and can solve complex business process issues more quickly and efficiently.
The value of BI cannot be denied, even accounting for project and operational costs. For example, iSPartners recently helped a customer identify a R53-million opportunity to improve stock management after implementing a conventional BI system.
The benefits of BI extend beyond purely bottom-line calculations such as these, with Ives pointing out that a well-designed BI system frees up personnel's time to do more analysis, and less extraction and trying to understand data.
"The idea is that if you free up people’s time to analyse the issue and make changes, you should actually not need to employ a battery of people to do this," he says.
This concept of a BI Bureau therefore suddenly brings the benefits of BI to a far larger audience, particularly smaller businesses.
In many ways, small businesses can very quickly benefit from a process like audit review, suggests Ives, that allow organisations to submit their financials to the cloud service and receive a set of financial reports that provide a view of the business.
"Also, services that provide easy-to-assimilate reports and analytics of your business are very real today and not expensive. The opportunity for SMMEs to benefit from these aggregated services is high because of the economies of scale. Today, these processes can be automated and, for the most part, run unattended," he says.
The success of the BI Bureau model is dependent on gaining critical mass, showing companies what can be done, with stronger bottom line returns being the ultimate acid test.
"Showing how these processes can make companies more profitable is paramount, but very achievable. This will in turn contribute to economic growth. For example, just by improving the profitability of a few 1,000 SMME by 1-2 percentage points means they can employ more people, thereby reducing the social economic challenges in our country.
"We need to understand the implications of improving the way we work, and the knock-on effect this has on our economy," concludes Ives.