In-Depth

Business Intelligence: Data Warehousing in 2001 and Beyond

• By Wayne W. Eckerson
• 12/01/2000

As we stand at the cusp of the 21st century, we must ask what the future holds for data warehousing and business intelligence. Can we expect the industry to continue its rapid growth? What new tools or technologies will facilitate the analysis of data? How will data warehousing and business intelligence adapt to new business goals and strategies?

What’s clear is that even after five years of strong growth, the data warehousing and business markets are continuing to expand. You only have to look at the financial reports of the industry’s leading players to see that data warehousing and business intelligence are alive and well. Vendors, such as Business Objects and Cognos, are growing at a 50 percent clip on a quarterly basis, which is astounding given their current size. Even mammoth vendors, such as Oracle, IBM and Microsoft, are reporting healthy growth rates in their business intelligence units.

Although 2000 has been a strong year for data warehousing and business intelligence, the future looks even brighter. Web and portal technologies, along with new e-business and customer relationship management (CRM) imperatives, are unleashing pent-up demand for analytical technologies and infrastructures. The great news is that it appears that we are entering a second wave of growth in business intelligence and data warehousing markets.

Impact of the Web. The Web is fueling this second round of growth because it democratizes information access and analysis. Three to four years ago, business intelligence vendors were fortunate to close a $100,000 deal. Now, they are bankrolling multiple deals worth more than $1 million. Why?

Before the Web, companies purchased analytical tools for a handful of technology-savvy business analysts. The Web now lets companies distribute interactive reports to any worker who needs them, as well as customers and suppliers. The potential for new business intelligence and data warehousing users is enormous!

Corporate Portals. Portals further disseminate business intelligence capabilities by providing a personalized Web-based dashboard that provides users the critical data they need to do their jobs, and respond quickly to changes in the business. These portal-based dashboards are the antecedents of personalized analytical applications that will soon be the norm for how business users gather and analyze information, and collaborate with colleagues, customers and suppliers.

New Business Imperatives. Portals and Web-based analytical tools are critical components in new e-business and CRM strategies dotting the business landscape. Successful 21st century companies will capture information about customers, suppliers and supply chain operations, and act quickly and intelligently to meet customer demands in an efficient manner. They will also create and maintain knowledge by embedding decision-making processes, rules and experience into Web-enabled analytical applications that all employees can use.

Mobile Mania. Analytical tools and their underlying infrastructure will get a further boost as mobile users seek to interact with reports unfettered from hard-wired corporate networks. One of the killer applications of the mobile B2B marketplace will be realtime, wireless decision support.

The second wave of expansion depends on business intelligence and data warehousing undergoing a fundamental change – from product-based technologies to embedded services.

We are currently witnessing an explosion of analytical applications – both custom-built and packaged – that incorporate data warehousing and business intelligence technologies. ERP vendors, such as SAP, Oracle and PeopleSoft, offer data warehousing adjuncts to their core applications, and their portal solutions integrate tightly with decision support capabilities. CRM and e-business vendors are negotiating shotgun marriages with business intelligence vendors, or developing their own analytical capabilities.

Business intelligence vendors are creating packaged analytic applications based on consulting projects in a single industry or market segment. Value-added resellers – especially Microsoft’s Solutions Providers – are busy incorporating data marts, OLAP and data mining tools into new or existing applications.

In the next five years, business intelligence and data warehousing will be considered a "utility" – like plumbing, electricity or heat – that all corporate applications need to plug into in order to deliver value to the business.