There is an emerging segment of the business intelligence market, on-demand BI, also known as SaaS (Software as a Service) or hosted BI.
Many SMBs think of on-demand as BI delivered to them on a “silver platter.” In other words they think on-demand will be the fastest and easiest route to a functioning BI solution.
On-demand vendors host both the BI application and the data for their customers. Customers typically upload their data via FTP or some other secure means of transport. Once the data is in the hands of the BI vendor, they load it into a data warehouse residing on their servers. From there, dashboards, reports, and analysis can be created and delivered via the customer through a web browser.
On-demand BI is appealing to SMBs for several reasons. First and foremost, the SMB doesn’t have to provide the necessary resources to host and manage the application internally. This can be a significant benefit for any business with limited or no IT resources available. Additionally, the SMB would typically pay for the service on a subscription basis, which avoids the higher one-time fees associated with a perpetual license. This can be attractive from a cash management standpoint.
However, on-demand BI is far from the perfect solution. Often, companies that pursue this option think they are too small to be able to maintain an in-house solution. What companies don’t realize is that the on-demand option is equally or more resource intensive from a data perspective. Prior to the initial upload, the data must be pre-processed and cleansed. This process requires significant in-house work by someone who knows the data.
Companies also don’t realize that on-demand BI does not provide real-time access to business information. Once data has been uploaded it is static. To refresh data, another time consuming upload process is required. There can also be problems when companies want to add or change a data source, perhaps one that the on-demand BI vendor doesn’t support. This may require re-working the entire data integration model. So on-demand BI might also limit flexibility down the road as the business grows and needs access to more data.