Business Intelligence no.1 priority as NZ analytics spending nears $100 million mark
- 24 February, 2015 06:29
In New Zealand, spending on Business Intelligence analytics will grow 9.3 percent to reach NZ$94.2 million in 2015, according to recent findings from analyst firm Gartner.
Across the Tasman, Australian organisations will spend $694 million on BI and analytics software in 2015, an increase of 12.1 percent from last year with double digit growth rates forecast in both countries for the next three years to 2018.
In comparison, the global business intelligence (BI) and analytics software market is projected to grow 6.9 percent in 2015, with sales predicted to total $22 billion, up from $20.4 billion in 2014.
Following years of modest growth, Gartner believes spending on BI and analytics software will rise to double digit growth again by 2018, reaching $21.4 billion worldwide.
Consequently, IT decision makers, including CIOs in Australia and New Zealand (and worldwide) ranked business intelligence and analytics as their top technology priority for 2015 in Gartner’s annual survey of more than 2,800 CIOs.
Speaking in the keynote at the Gartner Business Intelligence, Analytics & Information Management Summit in Sydney, Gartner vice president and distinguished analyst Andrew White claimed that more than half of new investments in business intelligence software are now going to data discovery and self-service.
“The vendors that have been so successful in the past are now having a hard time transitioning to this new market reality,” he said.
“New vendors have emerged and seized the opportunity, with great vision and iron execution. And unbelievably quickly.
"But the other half of the market is still about management reporting, performance management and dashboards.”
The analysts said business intelligence and information management professionals are facing three primary dilemmas:
1) Centralisation versus decentralisation
"Over the years, we've established clear best practices for business intelligence and information management,” White added.
“Our informal surveys at Gartner events indicate that two-thirds of organisations have created a BI competency centre, or broader information management competency centre.”
However, according to Gartner, the use of self-service BI has increased by a factor of 10 in the last two years, and BI teams are actively encouraging it - this is decentralisation.
White said that the role of BI has shifted from being something to help monitor and manage the organisation, to information itself being a monetised product or revenue stream.
Gartner predicts that through 2017, the number of citizen data scientists will grow five times faster than the number of highly skilled data scientists.
“Information professionals face a choice: do I own information and analytics, at least my part of it, or do I support information management and analytics, but a much larger part of it,” White added.
“But neither choice provides the full solution.”
The solution, according to Gartner, lies in operating a bimodal IT approach.
In mode one, there are clear best practices, well-defined business cases, well understood business requirements and budgets.
There is a big focus on enterprise architecture, and security. Standards are important. The data needs to be accurate for wide re-use, and audit able.
Mode two involves being fluid, flexible and highly iterative. This is the domain of data discovery, big data, advanced analytics and the cloud, exploration and permission to fail.
Gartner research shows that 45 percent of organisations already have bimodal capability. By 2017, this will grow to 75 percent.
2) Certainty vs. Opportunity
Existing certainty versus new opportunities will always be need for standard management reporting, and integrated information, but the most impactful way to limit uncertainty is to take a different approach, according to Gartner research director Lisa Kart.
“The organisations most successful with big data and analytics are the ones that take an experimental approach," Kart added.
“They don’t immediately build a business case and put together a whole project team.
"By collecting more information, creating options for a more liquid IT strategy, and staging your commitments, the dilemma disappears.”
3) Sharing versus protecting data
Gartner research vice president Frank Buytendijk said that politics in internal management information are more than just annoying, they are undermining the business.
“You can’t imagine how many times we have heard about the old trick of labeling data as "classified" because of "compliance", so that it cannot be shared," he added.
"But in the digital business, where technology becomes part of every product and every service, protecting the past is senseless. The politically smart thing to do is to claim the future.
Chief Data Officer
According to Gartner, one of the most influential new roles is that of the Chief Data Officer (CDO).
From an organisational perspective the idea of the CDO helps solve the share versus protect dilemma. More than 75 percent of CDOs will not report to the CIO or other IT leader.
“With a CDO in place, the internal dilemma is addressed,” Buytendijk added.
“Where broader use and governance of information is needed, the CDO is in charge. And where information is specific to one business function, it is OK for it to be protected instead of shared."
Gartner research shows that the number of CDOs worldwide doubled in 2014, and it will double again in 2015.