As retailers strive to make faster, real-time decisions based on increasingly broad and unstructured data sets, their use of business intelligence (BI) applications responding to those needs is on the rise. BI now is a strategic priority, with greater C-level ownership, in retail as well as other industries.
To determine precisely how BI tools are used, how successful they are and why some tools eventually are abandoned, the Business Applications Research Center (BARC), an independent software industry analyst firm, surveyed approximately 3,000 end users, consultants and vendors. Findings about these real-world experiences with BI were published October 2011 in the BI Survey 10.
The BARC BI Survey 10 studied all industries, but retail was one of the best represented, along with manufacturing, wholesale, banking and healthcare. “In the retail segment, where a huge volume of data is collected every day, a well-managed business intelligence system enables retailers to use this data to gain a faster, clearer and more accurate understanding of the day-to-day operations of the business,” Melanie Mack, Head of Market Research at BARC, told Retail TouchPoints. “This in turn allows companies to make quicker, better-informed decisions to increase efficiency and improve the way they operate.”
Boost In Mobile BI Implementations
The report showed mobile BI usage on the rise in retail: “While 12% of retail companies currently use mobile BI, another 30% plan to deploy it within the next 12 months,” Mack said. “Furthermore, those retailers who have already adopted mobile BI reported enjoying markedly higher business benefits from their BI software than their counterparts. Clearly, in an industry where many of the key decision-makers spend a lot of time travelling and visiting stores, the ability to receive and act upon up-to-the-minute information on the road offers potentially huge benefits to retailers.”
In BARC’s analysis of BI in key areas, such as mobile, it used a Business Benefits Index (BBI) score to indicate the level of the tool’s achievement. The BBI score is a composite, weighted rating of the application’s benefits. Specifically, respondents evaluated 11 potential benefits, such as cost savings and data quality improvements. For each benefit, respondents were asked to indicate the level of achievement based on six levels:
1. Proven and quantified;
2. Proven, but not measured;
3. Formally claimed, but not verified;
4. Informally suspected;
5. Not achieved; and
6. Got worse/more expensive.
The three benefits achieved most frequently by companies implementing BI solutions are:
1.Faster reporting, analysis or planning;
2. More accurate reporting and analysis; and
3. Better business decisions.
The business benefits least likely to be achieved are:
1. Saved IT headcount (rated least of all); and
2. Saved non-IT costs.
In addition to mobile, the BARC BI Survey 10 looked at where BI is headed in other key areas, including predictive analytics, real-time analysis, and collaboration.
In the retail segment, “Only 36% of retail companies using BI software report that they employ their BI tool for predictive analytics, which corresponds with the average figure across all industries,” Mack reported. “Predictive analytics is a
practice well-suited to retailers and other companies with very large numbers of customers. The strategy can help retailers improve their businesses by understanding exactly how their customers behave then, based on those analytics, attempt to predict those behaviors. So we were surprised to find that predictive analytics is not employed more frequently in the retail sector.”
Now in its 10th edition, BARC’s survey of BI tools is comprised of three components:
1. The BI Survey Analyzer, allowing users to analyze data in myriad ways;
2. The BI Survey: The Results, an in-depth analysis of survey results; and
3. The BI Survey: Best Practices, the most important factors contributing to BI success.
The report also compares BI software across a number of headline criteria such as performance, scalability and vendor support. Of the 26 products included in this year’s survey, the top four products attracting the most responses (in order) were QlikTech (QlikView), BOARD, Phocas and MicroStrategy.
Based on those findings, and with approval from BARC, QlikTech produced its own report, called The BARC BI Survey 10 ― QlikView Highlights. In the report, QlikTech compares its product against those from its primary peer group: BARC’s BI Giants, or companies with revenues of more than $200 million and a truly international reach. QlikTech reported that QlikView ranked highest among its peers in 10 critical categories, including customer loyalty; overall quality and support; performance satisfaction; overall agility; and implementation time.