Mark McDonald

A member of the Gartner Blog Network

Mark P. McDonald
GVP EXP
8 years at Gartner
24 years IT industry

Mark McDonald, Ph.D., is a former group vice president and head of research in Gartner Executive Programs. He is the co-author of The Social Organization with Anthony Bradley. Read Full Bio

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Without the Business in Business Intelligence, BI Is Dead!

by Mark P. McDonald  |  February 11, 2010  |  16 Comments

It may seem like semantics, but CIO interest in business intelligence technology is changing.  After five years as the top CIO technology priority (2004 – 2009) CIOs responding to the 2010 Gartner Executive Programs CIO survey placed BI as fifth among their top 10 technologies.

Slide1

During a briefing for a group of High Tech analyst relations professionals, I commented that if the preliminary trend held I would write about it in my blog.  This entry fulfills that promise and seeks to describe what is going on.

The shift is the subject of significant interest and discussion among CIOs, the media and research community.  Is BI dead?  Does this mean that companies have given up on data warehouses, analytics and the rest?  What does this say about CIOs and enterprises that have invested heavily in BI for the past five years – were they wrong?

The answers to these questions, in my opinion are:

  • Increasingly yes particularly when you see it as a large upfront technology centric investment
  • No, they have not given up, nor should they
  • No, its just that they have laid the technology and now need to create

Business intelligence the management capability needs to replace BI the technology.  Please notice that we would like to have made a play-on-words to say intelligent or smart businesses, but someone else has trademarked those terms.

BI and the whole area related to creating, collecting, analyzing and applying information and knowledge seems to re-name itself about every six months, according to Jeannie Harris co-author of the new book Analytics at Work.  I think that Jeannie may be right and the industry is undergoing a redefinition that will change its focus away from BI the technology to Business Intelligence the enterprise capability.

Creating a business intelligence capability demands a broader set of people, processes and tools that work together to raise intelligence, analytics and business performance.  That framework, shown below, is explained in Gartner’s Business Intelligence, Analytics and Performance Management Framework ID: G00166512 (license required).  The framework, based on proven practices for gaining business value through business intelligence, highlights the need to have more that just technology to create value.

Slide1

The move from technology to capability is about time as most organizations have already progressed through the peak of their CAPEX curve and moves from buying solutions to applying solutions.  That move alone would cause BI to progress down the list, as it becomes part of the enterprise technology fabric.  Companies that have poorly implemented their first or even second wave of BI poorly probably have

In my personal opinion, BI may be the last major technology to move through the old ‘heavy weight’ model of technology.  That model, described in greater detail here, rests on the acquisition, installation and operation of technology based on a significant upfront investment that is earned out over a period of time.  Most of the major ‘management’ systems ERP/SCM/CRM/PDM operated under that model which made IT appear expensive and less responsive.  BI has gone through that same investment pattern and it may be the last given the availability of Software as a Service, Cloud and Web 2.0 solutions.

On a radical note, we are seeing some early signs that companies are looking to use social media/web 2.0 technologies to address business issues that were previously assigned to BI.  These lighter weight technologies handle tacit information and semi-structured process support better than BI solutions that rely on structured and standardized information.

The availability of light weight substitutes and the ability of social technologies to tackle some of the tougher problems will force BI the technology to give way to Business Intelligence the capability, reducing BI’s position as a top technology priority but raising its importance to enterprise performance.

So is BI dead?

Yes, death to just thinking about the technology

Long lives the capability !

16 Comments »

Category: CIO Strategy Tools     Tags: , , , ,

16 responses so far ↓

  • 1 Bill McCluggage   February 11, 2010 at 10:18 am

    You are correct in your analysis that Business Intelligence is falling down the stack.However, Virtualisation is a more pressing issue as CIOs struggle with realising significant cist containment while at the same time facing increasing demands on back office IT. Cloud based options such as SaaS, IaaS and PaaS capabilities that seem to be driving customer facing transactional processes are not yet capable of handling the high volume I/O demands of full scale business analytics. Hence, for the short term I think CIOs are faced with the reality of fairly large CAPEX/OPEX investment costs Involved in improving their BI capabilities until cloud computing catches up and offers a more cost competitive environment. Hence, the natural drop in relative priority.

  • 2 uberVU - social comments   February 12, 2010 at 12:55 am

    Social comments and analytics for this post…

    This post was mentioned on Twitter by markpmcdonald: Without the business in BI, it is dead. some thoughts on changing CIO attitudes to BI at http://bit.ly/ajEhqm

  • 3 BI Software Reporter   February 24, 2010 at 3:48 pm

    I think it also depends on specific BI Software firm. Many have sought to keep up with the times by adding real-time capabilities, small foot prints, and features that can be integrated into third party propriety solutions or existing in house apps. Take a look at InetSoft’s BI Platform Style Intelligence.

  • 4 Eash Iyer (www.tychio.com)   March 10, 2010 at 1:18 am

    This is a truly insightful analysis of the current BI environment. Larger enterprises had been investing in BI infrastructure in the last many years and are expecting them to pay-off now (i.e. more business benefits for the technology investments made earlier). The SMB market had not invested much in the needed infrastructure and is catching up. But due to the overall economic climate, companies are expecting more business benefits with less technology investments. This needs a fairly different approach in implementing BI and getting the needed ROI.

  • 5 Was ist nur los mit Business Intelligence? « Business Ready Blog   March 23, 2010 at 12:36 pm

    [...] Nicht überzeugt? Dann lesen Sie das Original von Mark McDonald: Without Business in Business Intelligence, BI Is Dead! [...]

  • 6 Mike Beckerle   March 31, 2010 at 2:22 pm

    Great post. Of course I’m biased, my company is more or less based on the premise in this blog post.

    To add another anecdote of evidence. This was overheard recently from a BI industry insider:

    “People want the intelligence, not the BI”

    To me this means BI has almost become a perjorative term outside of IT departments. It is coming to mean big, slow, and unsatisfying to the business needs.

    A big part of the problem is just that all this BI stuff just costs too much both in money and effort/skills, therefore companies centralize it, therefore almost by definition it is too remote from the business endpoints that really need it.

    This results in a lot of frustration with BI technologies, as far too many BI efforts have struggled with the business-knowledge gap where the IT/BI people aren’t close enough to the business problems to add value there directly, and the business side people aren’t sophisticated enough about data and the BI tools to be self service.

    All this points to SaaS BI, but including creation of a real business problem solution, not just deploying a tool in a cheaper way.

  • 7 The New ROI: Return on Intelligence « Rethink Automation   April 13, 2010 at 3:10 am

    [...] in Gartner’s 2010 Executive Program survey to fifth place. Reason enough for Gartner analyst Mark McDonald to have a closer look and find out what has happened behind the curtains. And his conclusion is surprising and reassuring [...]

  • 8 nauman sheikh   September 14, 2010 at 3:57 pm

    In a down economy operational cost elements always move up the priority list. The downturn started in 2008, it takes a couple of years to complete the in-flight and budgeted projects before you move to managing costs

    Managing costs will again be the mantra for the next 2-3 years which means that virtualization, cloud and other technologies offering efficiencies in operational environments will stay at the top

    Now this does not discount the fact that IT departments have failed to show business value out of BI apart from producing reports. Until BI initiatives are empowering growth and profitability and are seen as a “friend” by the business community, it will hover around somewhere low in the top 5 priorities of CIOs

    It should be a business priority and not CIO priority once the basic data management and storage structure is in place

  • 9 Hari Guleria   September 30, 2010 at 9:15 am

    I could not agree with this more. This statement encapsulates what Gartner and we BI strategy folks have been trying to communicate in many words. To me it converts into a crystaline statement that must remain segregated from technology solutions. No matter what technologies we use the underlying goal must adhere to ‘Meet Business Expectations’. Also I dont think this statement is dependent on any SW or HW firm or technology. In too many instances I have seen companies move from one technology to another, one platform to another and still land back exactly where they started. In others I have seem BI initiatives stack one BI technology on another and create a BI on a BI on a BI solution that is not the solution.
    An interesting finding is that 92% of BI implementations are declared successful in Week 1 of ‘Go-Live’, yet only 55% of them remain so by week 10. The key reason once again is the delta between technology and business. The first success was IT and technology, the second was a true business measure.
    Perfectly timed as Gartner has been requesting business ownership and accountability since 2005 or before and this statement now demands it – could not have been stated better.

  • 10 What are the recent technologies that have failed to deliver their promise?   December 17, 2010 at 6:47 am

    [...] Business Intelligence is a technology that promised to revolutionize management, the way we used information, how we worked smarter.  It seems that BI has had a chance to deliver on that promise.  For many reasons it appears that it has not. Now this is not just my opinion, rather I attended and event where a senior executive from a supposed BI-innovator said that BI had done little than act as a higher power reporting tool, that he and his company have been waiting for 10 years for it to deliver and they were still waiting.  I would rather not say whom, because I have not asked if he was ok being quoted, but the sentiment is clear.  See related post on BI [...]

  • 11 Sundararajan Balasubramanim   December 29, 2010 at 1:45 am

    One way to make BI relevant to businesses even in an outsourced BI environment is adoptiong the BICC and BISC concepts. BI Competency Center that is set up with participation from business, IT and vendor, would ensure that all BI activity is aligned towards business needs and business has a say in how BI is implemented and used across the enterprise. BICC is critical for painting the BI vision and the road map for the enterprise while the BI Service Center operated by the vendor is responsible for delivering the vision and the road map.

    If business is not an equal and willing partner in any BI program, BI will never succeed. BICC and BISC structure ensures this particiaption from business.

  • 12 BI is for IT, But Analytics is for the Business User! | Staging Website   October 25, 2011 at 2:55 pm

    [...] Mark McDonald, head of research for Gartner Executive Programs, has a very nice article titled Without the Business in Business Intelligence, BI is Dead!. Sounds like – “The King is Dead. Long Live the [...]

  • 13 BI is for IT, But Analytics is for the Business User! | | EmcienEmcien   February 25, 2012 at 1:54 pm

    [...] Mark McDonald, head of research for Gartner Executive Programs, has a very nice article titled Without the Business in Business Intelligence, BI is Dead!. Sounds like – “The King is Dead. Long Live the [...]

  • 14 Wellesley Information Services | Making “Big Data” Work: Q&A with SAP’s Timo Elliott - Data Informed   April 18, 2012 at 1:25 pm

    [...] A recent blog by Mark McDonald of Gartner stated that traditional “BI is dead”.  Is big data driving the path for real-time business [...]

  • 15 BI Dashboards   July 31, 2012 at 11:42 pm

    I’m glad to see more technology companies making BI simpler and lightweight and accessible to smaller companies.

  • 16 BI is for IT, But Analytics is for the Business User! | Emcien   August 12, 2013 at 12:33 pm

    [...] Mark McDonald, head of research for Gartner Executive Programs, has a very nice article titled Without the Business in Business Intelligence, BI is Dead!. Sounds like – “The King is Dead. Long Live the [...]

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