ERP scrambles for slice of BI pie
ERP scrambles for slice of BI pie
Enterprise resource planning vendors have rushed business intelligence tools to market, and face scalabilty issues, according to Meta Group analysts
Business intelligence pure play vendors face a direct challenge from heavyweight traditional ERP software houses, Oracle, PeopleSoft and SAP. All three vendors have announced business intelligence (BI) and business performance management products during 2002. However Meta Group analysts say these offerings are burdened by scalability issues.
In 2002, mega-vendors Oracle, PeopleSoft and SAP moved into the BI market with standalone and embedded analytical tools. Yet Meta Group analysts said most of these BI solutions, such as SAP Business Information Warehouse version one and Oracle Business Intelligence applications, were "rushed to market".
ERP vendors "misjudged" the difficulty of producing practical BI solutions and are now playing "catch-up" to match offerings from established BI vendors, said Meta Group analysts in a report titled "Business Intelligence Solutions for ERP packages Best Practices 2003/04".
Enterprises are challenged by the limited capability of their traditional enterprise software planning (ERP) investments, such as SAP R/3 or Oracle 11i, to access and analyse the corporate information such transactional applications capture. Meta Group says that enterprise application packages have become "data jailhouses" – where data goes in but can not easily be taken out. Many users took a step backward in reporting capabilities in the past two years, the firm said.
To this end, stand alone BI tools from pure-play vendors such as Business Objects and Cognos, continue to be on the short list for enterprises needing better reporting tools for their ERP tool.
However, competition pressure is building with the three ERP vendors, Oracle, PeopleSoft and SAP, aggressively pushing into this market space. By the end of 2004, 60 per cent of companies will have made strategic BI tool selections, according to Meta Group. Enterprise business application vendors will embed analytic engines, taking substantial market share away from independent BI vendors through 2005 to 2006.
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