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Technology / Data

Millions being wasted on poor BI

UK businesses are wasting millions of pounds on unsuccessful business intelligence (BI) initiatives, with some spending as much as £1m on analytics implementations, according to research from Kognitio.

The survey was carried out by Vanson Bourne to gauge attitudes towards BI at UK businesses. The company quizzed 200 IT directors at companies with over 1,000 employees.

The costs associated with BI implementations are causing UK companies a number of headaches. A quarters of those quizzed admitted that they had spent over £1m on BI, and over half said they had spent at least £500,000.

The majority (65%) of firms believe that BI is too expensive due to the manpower and time required from the IT department, the cost of acquiring and deploying the necessary hardware and the cost of software licences.

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There were also concerns raised about the ROI from BI implementations. The vast majority (78%) of respondents said that it takes over a year to see any meaningful results, while 62% admitted that they still receive a barrage of complaints from their business users.

“These results are extremely worrying. Gaining intelligence a year after starting a BI implementation is completely unacceptable – it is no wonder BI implementations so often fail and that they have such a bad reputation,” said Roger Llewellyn, CEO, Kognitio.

Llewellyn added that the use of on-demand technologies should encourage firms to take a project-based approach to business intelligence and analytics.

“By going down a project route they can benefit from the ability to run ad-hoc queries, such as ‘who is my most profitable customer?’ or ‘how many staff do I need on the checkouts?’ without needing to install large, costly BI infrastructures in-house,” he said. “Instead, these can be run in an outsourced architecture, costing four rather than six figures.”

It is perhaps not surprising that many BI projects fail to generate the required results, with 88% of UK firms claiming that their business departments do not define what they want to achieve from an implementation, as they expect the IT department to do it.

“The clue is in the name – for the success of an implementation it is critical to involve business users and departments from the start,” said Llewellyn. “When done correctly, business intelligence provides immense value to companies and is even the difference between success and failure. However, it is critical that businesses understand what they want to achieve and that they communicate this to IT, otherwise they might as well be throwing money down the drain.”

 
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