Monday, March 2, 2015

What Is Business Intelligence 3.0?

Interactive Visual Analytics represents what Gartner Research calls the consumerization of Business Intelligence.  It’s a good example of a disruptive innovation or, as Qlik’s Donald Farmer calls it, a market changer.

According to
Tableau Software “visual analysis is not a graphical depiction of data. Virtually any software application can produce a chart, gauge or dashboard. Visual analytics offers something much more profound. Visual analytics is the process of analytical reasoning facilitated by interactive visual interfaces”

This new generation of BI tools is so intuitive to the regular user that little or no training is necessary to explore data. This is a great feature since, according to Gartner, BI users do not want to read manuals. They demand intuitive BI interfaces, in line with the internet experience they are accustomed to, like Google searches or smart phone apps.

The current 
low BI utilization rate of about 5% does not provide many companies an acceptable return on their Business Intelligence investment.  The new user-friendly and intuitive visual analytic tools are helping companies exploit the treasure of business trends, patterns and opportunities hidden in their oceans of data by increasing the number of employees that participate in the data discovery process. The technology enables casual users to transition into power-users and power-users into app developers in a matter of weeks.

Depending on the vendor, the new software class is known by different names: Data Discovery, Advanced Visualization, Visual Analytics, Business Discovery, Self-Serve Business Intelligence or Business Intelligence 3.0
Advanced data visualization is based on the fact that 70% of the human sensory receptors are dedicated to vision while the other four senses share the remaining 30%.  In addition, our brains are much more effective recognizing shapes trends, patterns and colors than analyzing spreadsheets or tables full of numbers. Visual data analysis principles are based on the work of Edward Tufte and Stephen Few.

The data visualization market begun to grow during the last decade as business users started purchasing these applications for departmental use, mainly without IT consent.  The reason was simple: business analysts needed the capability to analyze all sorts of data rapidly, beyond the scope of the data-warehouse.  A request that most IT organizations were not prepared to fulfill. Today as data discovery tools have become more popular and scalable IT organizations are more involved in the purchasing process. 
Today more than two dozen applications fall into this category from companies around the globe. The leading ones –Tableau and QlikView- have grown their acceptance at a very fast rate.  Ten visual applications have made it to Gartner Research's 2015Magic Quadrant for Business Intelligence and Analytics and this number will grow in the future as more BI solutions continue to add visual analysis functionality.  Gartner estimates that more than half of net new purchasing is data-discovery-driven.
"For years, data discovery vendors — such as QlikTech, Salient Management Company, Tableau Software and Tibco Spotfire — received more positive feedback than vendors offering OLAP cube and semantic-layer-based architectures.  In 2012, the market responded:
·        MicroStrategy significantly improved Visual Insight.
·        SAP launched Visual Intelligence.
·        SAS launched Visual Analytics.
·        Microsoft bolstered PowerPivot with Power View.
·        IBM launched Cognos Insight.
·        Oracle acquired Endeca.
·        Actuate acquired Quiterian".

To be clear, Self-serve BI does not mean “IT Free” as a strong IT-Business partnership is always helpful to ensure data quality through proper governance and also to maintain the proverbial single version of the truth.  Self-serve refers to the user’s ability to perform data exploration and discovery simply by clicking or tapping into interactive dashboards and reports.  All this without having to request IT to create specific data marts, build OLAP cubes or predefined reports as this would delay the data analysis process.

Also, it’s important to highlight that there are two kinds of self-serve BI user: 
  1. Analytics Power Users who create visual apps from multiple data sources –both internal and external.
  2. Regular Users that can fully explore the visual apps created by power users or IT.
In addition to the typical functionality of multidimensional analysis (drill-down, drill-through, roll-up, sort, group, filter and calculations) some visual tools offer “what-if” scenario analysis, data animation, integration with the statistical ”R” program and mobile capability. 
A great feature of this new generation of BI software is its data blending functionality. These applications allow connecting simultaneously to disparate types of data bases or tables, whether in a data warehouse, data-marts, spreadsheets, text files, Microsoft Access, websites and in the case of Tableau OLAP cubes.

The analytic results are instantaneous since the process takes place in-memory (RAM).  Additionally the visual interface, when used proficiently, permits to digest huge amounts of information and visualize trends and patterns in seconds.  This process enables what many call “analysis at the speed of thought”; Meaning that the answers to business questions can be found fast enough without  interrupting the “train of thought” that leads to the next layer of questions, seeking to find the root cause of issues or opportunities.

Visual Analytics packages are not replacing traditional BI in large organizations but complementing them. They provide fast analytical capabilities to more people that need to gain a competitive edge in the current fast changing market dynamics.

For small and medium size companies that haven’t yet invested in BI, Self-serve, Visual Data Discovery is a cost effective solution that can be deployed very fast.

This new generation of BI software takes descriptive analytics to a whole new level. That's the reason for the fast growth rate this $4.5 Billion market segment has experienced during last few years.

It only takes a few minutes to download the free versions most vendors offer for testing purposes.
Below: Dr. Hans Rosling’s video is a few years old but still illustrates the power of data visualization techniques that make 120,000 data-points tell a compelling story in a way that’s very easy to understand. 

Note: The original version of this article was published here by Bill Cabiró in 2011.

Image: GraphicStock

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