As manufacturers look for ways to gain an edge in this economy, many are weighing technologies that help them improve performance, accelerate decisions and adapt swiftly as global competitors advance on their turf. One of the biggest challenges they face is how to derive hidden value locked away in massive stores of data generated by their operational systems and enterprise applications.

The latest data reaffirms the value of business intelligence (BI) in unleashing access to meaningful information in these systems. For example, Aberdeen Group announced that BI will continue to have a significant impact on organizations based on strategies leading companies are taking to integrate BI with existing applications in areas such as ERP and CRM. Yet in these lean times, the cost and complexity of traditional on-premise BI software solutions have dimmed their appeal.

A new breed of BI solutions has emerged to fill this gap using a cloud-based Software-as-a-Service model. These serve to augment an on-premise BI software solution, or as an alternative. In fact, recent research from IDC suggests the need to "do more with less" will "push more organizations toward SaaS and outsourced BI and analytics solutions."

A Latte a Day

Often referred to as a "pay as you go" approach, SaaS BI solutions allow organizations to realize the benefits of traditional BI systems more quickly and at a fraction of the price -- less than a 'latte a day' per user in some cases.

While some skeptics express uncertainty over the scalability and security of these solutions, the reality is that companies are succeeding with SaaS BI deployments that match or exceed the boundaries of traditional BI implementations. As the economy flounders and more companies look for ways to improve performance and drive competitive advantage, we're seeing a surge in the size and scale of these systems. During Q1, more than 1,000,000 reports were delivered monthly on PivotLink's SaaS BI solution, representing a 30% increase over Q4 last year. And the trend is carrying over to the access and data side too, with customer implementations exceeding more than 1,000 active users and approaching three billion rows of data.

All of this supports the notion that SaaS adoption will continue to grow. In a recent article, Ray Wang of Forrester Research refers to SaaS as "moving beyond the 'Tipping Point,'" noting that "Enterprise customers are moving to the on-demand model for a variety of applications as concerns about its shortcomings decline."

One of the biggest drivers to adoption -- unlike traditional business intelligence systems, SaaS BI requires no costly software or hardware to install.

Companies have made enormous investments in systems that gather and store operational data to drive insights into what's happening, for example, in real-time (or near real-time) on the production line. The next step is to fine-tune business decisions at a strategic level and make BI capabilities more pervasive so that decision makers across the entire supply chain can collaborate on improving profitability and performance.

What does this mean for manufacturers? By providing an environment that engages decision makers using a simple Web browser for collaborative analysis and dashboarding, SaaS BI can help manufacturers:

  1. Understand demand and buying trends: quickly adjust manufacturing and production levels to avoid excess inventory and fulfill new demand.
  2. Analyze supplier costs and delivery histories: identify the most cost effective and reliable providers.
  3. Uncover trends: match customer demand with the right products.
  4. Empower your channel teams: Offer the right products with full visibility to sales history across each channel.
  5. Increase profitability: Improve cost control and optimize inventory levels.
  6. Improve customer satisfaction: Synchronize feedback on quality to the product development process.
  7. Constantly improve operations: Gain the right visibility and insight across your extended enterprise.

Shaklee, a leading provider of natural nutrition and personal care products and a PivotLink customer, is a perfect example of how companies are making pervasive business intelligence a reality using SaaS. Their goal was to bring data about customers, products, distributors, promotions and other business metrics together in a single location to overcome the challenges of an existing solution that was costly to manage and maintain and accessed by a small group of users. A case study details the benefits of moving to SaaS BI, including making it easy for many more users to understand and access data, being quick to deploy and simple for non-technical users to maintain, easily adapting to ongoing changes in the business, and offering an affordable solution with low ongoing support costs.

Another case study describes how REI, another customer, wanted a BI solution that allowed its employees analyze things like product performance, sales trends and returns. SaaS BI made it possible for users across the enterprise to synthesize and drill into performance data and see relationships they never could before. It wasn't long before suppliers jumped in. Now the system supports thousands of users across the supply chain.

On-demand BI solutions can help overcome the failure points of traditional on-premise BI solutions by providing a platform that is easy for non-technical users to access and maintain without making a significant hardware and software investment. Generate the insights you need to get ahead with SaaS BI. Now that's smart business.

Dyke Hensen has spent over 20 years at the forefront of business intelligence with software providers such as SPSS, Hyperion Solutions and Arbor Software. He currently serves as CMO at PivotLink (www.pivotlink.com), a leading provider of SaaS-based BI solutions.


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