Data Warehousing and Businesss Intelligence are Still Hot Topics
I used to run a syndicated resarch-based information service called “Business Intelligence/Data Warehousing” or BI/DW. For those of you not in the know, a Data Warehouse is merely a collection of databases with software (typically relational database management systems) that permit data from one or more databases to be combined with data from other databases. That capability gave rise to a host of new applications such as “Market Basket Analysis”, “Risk Management”, and “Supply Chain Management.” Collectively, those applications became known as Busines Intelligence, a phrase coined by some clever IBM PR person who thought Data Warehousing was unsexy. We now have a new phrase bandied about in the technology press, “Business Analytics.” Let me just say that “a rose by any other name . . . . ”
My 2003 worldwide forecast for the BI/DW market inclusive of all user expenditures was $150 Billion, growing at an annual rate of 40% per annum. While that forecast turned out to be pretty accurate for its time, the BI/DW market continues to grow at a high rate, led by the big hardware/software firms, IBM, Oracle/Sun, HP, SAP and the big consulting firms like Accenture, McKinsey, et al. In fact, the service/sofware opportunity is significantly larger than the computer/storage opportunity. I estimate that the worldwide BI/DW market today is on the order of a quarter of a trillion dollars.
The Gartner Group recently published a free white paper (sponsored by IBM) indicating that BI is a hard sell in many companies. While that may be true in some places, BI/DW is a necessity for any but the smallest companies to be competitive. Not very long ago, Sears Roebuck was the world’s leading retailer by a significant margin. Today it ranks 9th, well behind WalMart. How did that happen? One part of the answer is that WalMart embraced BI/DW as a core strategy even before the terminology became popular. Applications such as supply chain management and market basket analysis enbabled WalMart to surge ahead of its competitors. It’s a lesson for the ages.