The 5 Questions You Need to Ask Before Selecting a Business Intelligence Vendor. Share With Us!

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1 The 5 Questions You Need to Ask Before Selecting a Business Intelligence Vendor Share With Us!

2 Overview Over the last decade, Business Intelligence (BI) has been at or near the top of the list of priorities for many executives and information technology professionals throughout the world. Organizations have made major investments in database technologies including CRM, ERP and a slew of other transactional systems that run the operations of a department, division and subsidiaries. As a result, most organizations are sitting on mounds of data and are looking for ways to leverage these data for their business advantage. Transforming raw data into meaningful and useful information enables more effective strategic, tactical, operational insights and decision-making. With literally hundreds of BI tools available in the market, a sound selection strategy that integrates business requirements accurately is more important now than ever. This white paper explores five key questions to ask yourself before selecting a BI vendor. Question 1: How well does the vendor understand your organization s BI requirements and is the vendor willing and able to help you with overall BI strategies versus just implementing a product? Question 2: Does the vendor s BI solution have the ability to work with a wide variety of data sources and how quickly can new data sources be integrated? Question 3: How quickly will the platform be up and running? Question 4: What resources will be required to manage the BI solution post-deployment? Question 5: How comprehensive is the solution and will the solution support our business requirements now and in the future? 1

3 Before you begin The true value of a BI solution lies in the insight it provides on business operations and the opportunities it creates for better decision making. Understanding the business requirements for a BI project is crucial to the selection strategy that aims to align with the overall business objectives while addressing the needs of business users. Failure to integrate business requirements into the selection process can result in substantial cost overruns or, even worse, project failure. A recent survey on Business Intelligence revealed that organizations that place greater emphasis on the vendor evaluation process tended to have a more successful completed project. Not surprisingly, these organizations also consistently outperform their competitors in the marketplace. Organizations will differ in terms of their BI decision support needs. Knowing this, below are five questions that have been designed to identify steps in developing an effective Business Intelligence vendor selection to meet your organization s needs. These questions are not intended as a substitute for conducting a more formal requirements document. Rather, they are designed to help identify high-level topics that should be considered when evaluating multiple BI solutions. 2

4 Question 1: How well does the vendor understand your organization s BI requirements and is the vendor willing to help you with overall BI strategies versus just implementing a product? The number one reason why BI projects fail is a lack of definition from the user needing access to the information. Those pursuing a BI strategy need to ensure that enough legwork has been conducted internally. This will provide a view to fully understand the scope of the challenges that the BI solution is supposed to help solve. Understanding the business requirements for a BI project is crucial to the selection strategy that aims to align with the overall business objectives and address the business user's needs. Failure to integrate business requirements into the selection process can result in additional costs or project failure. An example may look something like this: ABC Company sales team is tired of the length of time it takes to receive sales reports and begins looking for a Business Intelligence solution to assist in the departmental level. They choose a vendor that specializes in sales dashboards and moves forward with that vendor. At the same time, the company Controller is evaluating financial reporting software capable of producing financial statements much easier than their current manual process. They find a vendor with specialty in financial reporting. Multiply these scenarios by numerous departments in an organization, this will result in paying several times over for multiple solutions that all do effectively the same thing. A more cost effective scenario would be for the sales and financial staff, together, to scope the information requirements for the organization. Then a single solution would be implemented to provide the fast information retrieval for the sales staff and satisfy the financial reporting capabilities needed by the Controller. In addition, the solution may need to have the flexibility to deliver in other parts of the organization. 3

5 A major part of defining a BI project is to understand what information the company uses today and what additional access to information would be great to have in the future. Interviewing business users to learn what information they wish to access, will provide additional scope to a project and likely affect the vendor selection. Your requirements definition also needs to address how the business users want to consume the data. For example, do they want information pushed out to them in an every day or do they want to login somewhere to get the information they need? Is integration with mobile devices and tablets needed? Does the solution integrate with tools that the organization may already be using such as Microsoft SharePoint? How well a vendor can support the needs of business users is a key vendor selection criterion. The ultimate determinant of the success of a BI solution is user adoption and key stakeholder satisfaction. The shelf ware rule states that a solution that does not address the business needs will never be adopted by the users. Developing and understanding an organization s information roadmap is the first step to a successful project. More importantly, the information roadmap should be aligned your organization s strategic goals. Companies frequently make the mistake of defining BI requirements around a set of metrics or reports without fully considering what business decisions and actions will be taken based on those metrics. Finding a BI vendor who fully understands the needs of your business and can help you develop a BI roadmap based on your organization s strategic goals is paramount. Bottom line: Choose a vendor who can help you develop a BI roadmap based on your organization s strategic and operational goals versus a vendor that is solely focused on implementing a software product. 4

6 Question 2: Does the vendor s BI solution have the ability to work with a wide variety of data sources and how quickly can new data sources be integrated? Beyond understanding the business requirements, one needs to understand where the data is actually stored. Is it in a single database or are their multiple databases each dedicated to an individual department or process? Are budgets and forecasts in excel or are they integrated into other legacy systems? Is a CRM tool being used and how is it being used? Where exactly is the data that the end users want to report on and analyze? Ensuring that the BI vendor will be able to reach all of the company s information assets regardless of where they are housed is vital to a successful BI project. Many BI software vendors offer reporting tools that are only capable of pulling information from a single database source. But most business questions require multiple data sources to be answered. Choosing a BI solution that can bring together multiple, disparate data sources in a quick and easy manner will greatly improve the chances of user adoption and your BI project s success. The end goal should be a BI solution that handles the required data integration to produce "one version of the truth". Another important consideration is understanding how the BI vendor deals with data quality. The old adage of garbage in, garbage out has never been truer than it is with business intelligence reporting and analytics. Find out if the vendor has integrated data quality tools into the BI tool, or if the assumption is that data hygiene will be performed outside of the BI platform. Selecting a BI vendor that incorporates data quality into the BI solution will help insure that decisions are based on accurate data and also save time in deploying and maintaining your company s BI system. Lastly, keep in mind that not only should the selected BI tool work with the current data environment, but future changes should also be taken into consideration. New data sources are coming online every day. It s not uncommon for organizations to need to integrate 20 or more data 5

7 sources into their BI system. Ask prospective vendors how easy it is to integrate new data sources in their BI tool once the solution has been implemented. Bottom line: Choose a BI solution that is flexible enough to integrate multiple data sources from multiple sources quickly and insure data accuracy with built-in data quality tools. Question 3: How quickly can the BI solution be up and running? The speed to deliver a working BI solution to the defined specification is a key consideration when selecting a BI vendor. Because BI is typically an enterprise-wide solution, the risk of scope creep and project over-runs are extremely high. Unfortunately, poorly executed BI projects have brought a premature end to more than one IT professional s job. One way to mitigate this risk is to break up the larger project into smaller pieces or sprints. This begins with prioritizing business requirements based upon the company s strategic goals, then deploying on a rolling basis based on those priorities (e.g. operations first, then sales, then finance, and so on). Using this rapid deployment methodology can cut down implementation time frames from months to a matter of weeks. Once you ve determined your company s BI priorities, ask each vendor how long it will take for the initial deployment and then subsequent deployments. Then compare their responses. As a practical example, say a manufacturer has invested in opening a new manufacturing plant. The market is established and ready for their products, distribution channels are established and everything is in place to take the products to market. This manufacturer is provided a choice between opening the plant in eight weeks where the organization will begin to recover its investment or wait to open in 6 months to effectively delay the ROI with the same result. Why would the manufacturer wait? 6

8 Business Intelligence projects should not be any different. If a company has clear, defined information requirements and finds multiple vendors that deliver the required functionality, the decision should then move to how quickly the BI implementation will be complete. It should go without saying, the agreed upon time of delivery needs to be outlined in the purchase agreement. However, getting a written commitment to a time frame is only the first step. Speaking with existing customer references will validate their experiences with the vendor of time frame for completion. Bottom line: Choose a BI vendor that provides a solution that supports a rapid deployment methodology to realize quick wins and minimize the risk of a failed project. Question 4: What resources will be required to manage the BI solution postdeployment? The initial deployment of a BI solution represents only a fraction of the cost of the total BI project. The full cost of the project includes the ongoing maintenance and expansion of the BI solution. As the business requirements change, so must the BI system. Unfortunately, many BI vendors today can be described as SVINO's (Software Vendors in Name Only). That is, they sell BI software at a very low cost with the plan of making additional revenue by billing the client for services on the back-end. When evaluating BI vendors, it s important to understand their business model. One question to ask is, what percentage of your revenue comes from software licenses versus services? If the majority of the vendor s revenue is generated from services, it s highly likely that they are a SVINO. Another factor to consider when evaluating post-implementation costs is the skills required to develop and/or maintain the BI application. Some BI solutions can require as many as 18 specialized skills sets to deploy and maintain. Whether you decide to hire or outsource these capabilities, the 7

9 price to acquire these specialized resources is likely to be substantial. Choosing a BI vendor who provides a solution that leverages your existing IT infrastructure (e.g. Microsoft) and skill sets (e.g. SQL) will significantly reduce the total cost of your BI solution. Bottom line: Choose a BI vendor who provides a lower total cost of ownership based on leveraging your current IT infrastructure and minimizing the number and type of specialize skill sets required to implement and maintain the solution. Question 5: How comprehensive is the solution and will the solution support our business requirements now and in the future? It is important to understand the breadth and depth of functionality of the BI solution you intend to purchase when evaluating BI solutions. BI solutions today span a wide variety of functionality. Some solutions are focused solely on front-end reporting for end-users. Others excel at back-end functions like extracting and aggregating various data sources. Choosing a holistic BI solution one that incorporates all of the functionality necessary to meet your organization s BI requirements now and in the future minimizes the cost and risk associated with piecing together multiple point solutions. One might ask, for example, does the application support such back-end functions as extraction, transformation and loading (ETL) as well as front-end reporting? Does the tool allow users to drill up or down in order to perform analytics? Does the tool include real-time monitoring and predictive analytics? Does it include restrictions on access to data that certain users shouldn t be allowed to see, allowing each user to work with only the data that is relevant to their role? Bottom line: Choose a BI vendor who provides a comprehensive, holistic solution that will meet your organization s BI requirements both today and in the future. 8

10 Summary Evaluating BI vendors can be a confusing and complex process. However, knowing the right questions to ask can greatly reduce the risk of selecting the wrong solution provider. The right BI solution must provide business decision makers with the information needed to obtain operational and strategic business objectives. While some believe that choosing a vendor with the most name recognition will provide the optimal value, well known does not always mean it will be the best solution for a particular organization. Furthermore, name recognition usually comes with a heavier price tag. Look for a vendor that provides the solution that best suits the particular decision support needs of your business both now and in the future. 9

11 Learn more at Halo Business Intelligence 10

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