Tuesday, October 27

LucidEra a casualty of poor design

The rumors could be more than rumors for the SaaS BI company that focused on analytics for Salesforce.com. LucidEra used a variety of open source BI software to address a market need. People wanted SaaS BI and were paying for it. So what was the problem?

If you haven't heard, the rumor is that LucidEra is no longer in business.

I want to say rumor until someone from the company verifies it. However I've heard from a couple sources now, which is good enough for me to publish this post. Plus their blog is down. Some Salesforce.com customers are looking for BI vendors again. And senior executives have moved onto other companies.

What went wrong?

Rumor #1: LucidEra had more servers than NetSuite!

One advantage that SaaS should bring to the table is ease of scalability. Without that you're just on-premise software in someone else's data center adding servers for new customers. SaaS architecture needs to have automated scalability.

Rumor #2: Not a multi-tenant architecture.

A few things could have taken them away from a pure multi-tenant architecture. The open source BI software, like Mondrian, may not have lended itself well to multi-tenancy. (Maybe someone technically savvy could verify or refute this?) Another issue can be the data model design. Replicating data models for each new customer isn't multi-tenancy. I'm not sure why or where LucidEra moved away from a pure SaaS model. But that's what I'm hearing.

Rumor #3: Customers loved them and their product.

If you want to please your customers, find out how LucidEra did their sales and customer support. They are an example of how a SaaS business needs excellent sales and customer support AND savvy engineers and architects.

At least this casualty wasn't because of the economy or so the rumors go.

Monday, August 10

BI only used by 8%, what is the point

It's hard to hear about the proverbial glass ceiling with the Business Intelligence (and data warehousing) industry. This ceiling acts as an invisible force stopping the industry from moving up or beyond it's current paradigm. Perhaps the holy grail is on the other side; or maybe this is the end. And really there are only two choices: assume the ceiling cannot be broken and live happily or innovate around it breaking past the barrier and into more chaos and opportunity.

Shawn Dolley mentioned Netezza's new blog, Previously Impossible. They quote a survey that shows just over 8 percent of employees actually use BI tools. And this is for BI-using organizations! The article also talks about the inflated usage statistics by BI vendors (they want to show value and sell more user licenses - usage is a must-have metric).

Many people mention the high cost of BI/DW. I wouldn't mind that so much if there was equal value in the results, the ROI. I think any MBA would be hard pressed to find positive ROI with only 8 percent of employees using such a costly system. However, companies pay for large BI/DW initiatives either out of necessity or ignorance.

Let's say it's out of necessity with the mounds of data being captured daily.

Now what. There is a need for information but there is still much pain with BI pre and post implementation. Some vendors will jump on the "low cost" wagon with starter kits, blueprints, configuration tools, cheaper hardware, etc. The problem I hope more people are looking at, the real glass ceiling problem, is addressing the question, "why are so few using BI?"

Look at how many people use Google to research or find information. Google's search success is because it's easy and quick! When my father who is 73 can find stuff that's a testimonial! Alternatively BI is still too confusing for the general employee. Dashboards. Analytical cubes. Reports. Forecasts. Anytime you need more than a few hours training (and re-training when you haven't used it for a month), it's too much. This, of course, assumes "BI for the masses".

So will BI ever get to the ease and simplicity where my father could determine the best deal of potato chips and dip mix combination near his location?

Tuesday, June 16

10 Questions with Bruce Armstrong, CEO Kickfire

When you talk with a person who has worked for successful companies and spent time as a venture capitalist sitting on multiple boards, you tend to actively listen to the stories and glean what insight you can. When I spoke with Bruce Armstrong, CEO of Kickfire, it was such a conversation.

Bruce is looking to take Kickfire and disrupt the data warehouse market. Their product, as Bruce put it, helps bridge MySQL (which doesn't understand data warehousing) with data warehousing (which doesn't understand open source). He is now in the midst of a David and Goliath battle with Teradata -- his former employer.

Question: Hi Bruce. Care to describe this battle with Teradata?

Answer: Actually, Tom, we believe the battle is less with Teradata’s existing high-end data warehouse business and more for the vast, under-served data warehouse “mass” market out there. As such, we don’t plan on taking the battle directly to Teradata or anyone else, but rather create a new market by providing affordable, easy-to-deploy data warehouse and data mart appliances for the mass market. The mass market for data warehousing includes rapidly growing small & medium businesses as well as departments in larger organizations who simply can’t afford either their own Teradata machine or in a lot of cases even the charge-backs from central IT to time share on a Teradata machine. So, we hope to be complementary to Teradata, but realize there may be some skirmishes for budget dollars in the market today!

Question: You started as employee #16 at Teradata who boasts Walmart as a customer. Was that your start that brought you to running Kickfire today?

Answer: Yes, I was at Teradata for 15 years, Tom. I worked my way up from programmer to President after we went public and were acquired by NCR/AT&T. I spent almost 10 years in the field working with customers – including Walmart – so I developed a pretty good idea of what they are looking for at the high end. After Teradata, I was GM of the Server Group at Sybase where one of the products I launched was Sybase IQ, the first column-store database on the market. Later, I was EVP of Sales & Marketing at Broadbase – the second column-store database on the market and a pioneer of data marts. Since then, I have been involved in doing due diligence for a lot of the data warehouse startups, including Netezza, Greenplum, and Vertica.

Question: What did you learn from Teradata back then that you are applying to Kickfire today?

Answer: While I learned many things at Teradata that are applicable to Kickfire, the key concept for me was just how different the data warehousing high end is from the mass market. At the high end, once you’re able to break into the market with a new approach, it quickly becomes less about technology and more about services and support. Large customers just simply demand more hand holding. In the mass market, it’s just the opposite. Customers in the mass market expect the product to be highly packaged – easy to buy, install, and manage. They simply can’t afford lots of services and support, so the product needs to deliver high performance in a plug-and-play way.

Question: You have years of history in the data warehouse industry. Care to explain what makes you think the data warehouse industry needs changing?

Answer: While I believe every sector of the data warehouse market is looking for more performance, faster deployments, and lower cost, our goal at Kickfire is not necessarily to change the data warehouse industry but rather to enable more people in the market to take advantage of the benefits that come from data warehousing. Again, we’re going after an under-served market with rapidly growing small and medium sized businesses and departments in enterprises that simply can’t afford Teradata or Netezza. The change that’s required to enable the mass market is to get high-end performance out of a mass-market machine. Kickfire achieves this through our patented parallel-processing SQL chip. In a single chip, we are able to get the performance of dozens of general purpose CPUs. So, in the same way that NVIDIA has radically changed the dynamics of the graphics industry by encoding the graphics processing language in silicon, Kickfire has the same opportunity in the data warehouse industry.

Question: There have been recent acquisitions. Sun purchased MySQL. Then Oracle purchased Sun. Should the MySQL community be concerned?

Answer: We do not think so. We believe that with Solaris, Java, and MySQL, Oracle now has the kind of assets they will need to truly make Microsoft worry. With MySQL, Oracle will finally be able to undercut Microsoft as well as to dominate the high end in databases. As such, we think Oracle is going to continue to invest in MySQL. In fact, Oracle has already proven to be a good steward for InnoDB, the most popular MySQL storage engine they bought several years ago.

Question: About Kickfire, how does this chip technology bridge MySQL with data warehousing?

Answer: MySQL has become the de facto standard for online businesses by virtue of its open source business model and the fact that it has increasingly become production-ready for transaction processing applications. For data warehousing applications, though, MySQL remains very primitive. As such, customers struggle with database volumes as small as 50GB when it comes to reporting and analytics. The primary technical issue with MySQL regarding data warehousing is that MySQL does not have any query parallelization capabilities. This is where Kickfire comes in: using MySQL’s pluggable storage engine API, Kickfire takes over a query from MySQL and provides parallel-processing with the SQL chip allowing queries to run 10x – 1000x faster.

Question: Are you getting any response from the MySQL or data warehouse communities? Are they seeing potential benefit?

Answer: Yes! We have a large and rapidly growing pipeline of opportunities in the MySQL community. One of our early customers, Mamasource, has been using MySQL for years to drive their online community website. However, when it came to analyzing the clickstream data about their community in order to improve the user experience and increase ad revenue, MySQL hit the wall at less than 30GB of data. With Kickfire, Mamasource is now able to run their queries on average 20x faster and up to 600x faster for complex queries. More importantly, Mamasource can now scale their data warehouse to over 300GB, which allows them to increase from just one month of data to a full year.

Question: It's hard to ignore Microsoft. How does Microsoft with SQL Server fit in the Kickfire world view?

Answer: Microsoft and Oracle are the predominant databases in the mass market today. As MySQL continues to penetrate the market (at a rate of 70,000 downloads a day, by the way), Kickfire will be brought into more and more Microsoft and Oracle shops. As such, one could imagine us building more specific features to co-exist with those databases in addition to MySQL.

Question: You spent time as a Venture Capitalist. We won't hold that against you but what are your take-aways from being a VC?

Answer: My time as a venture capitalist was really more about board work than investing. As an operator, the VC firm I was with was interested in my ability to help identify interesting spaces, provide input on business plans and teams, and then work with portfolio companies from a board perspective in order to help generate value for shareholders. A lot of what I did was to dive deep into each function (sales, marketing, development, etc) of the portfolio companies and provide input to the boards (including the CEO’s) on where things could improve. Having served on 20+ boards, I got a pretty good idea of what works and what doesn’t work in start-ups and rapidly growing companies. The lessons I learned were really quite simple:
  1. make sure you have a big market opportunity;
  2. understand very clearly who your customer is and why they should buy from you;
  3. build a very high quality product;
  4. regularly assess your market position and look for ways to change the game in your favor;
  5. don’t be afraid to tell the truth about the business – there’s always more than one way to create a market leader.

Question: It’s been a pleasure talking with you Bruce. Do you have any additional links or information about Kickfire you want to share?

Answer: Thank you – the pleasure’s all mine. Please come visit us at www.kickfire.com!

Monday, March 16

13% achieve BI objectives

I'm tired of reading posts about business intelligence needing "an army of consultants", concerns about "losing control over our BI system to a third party", and only 13% achieved their business intelligence objectives.

Or Boris Evelson's quote, "Business intelligence is still an art much more than a science."

Or Hound of the BI-skervilles stating that data is safer inside a company's firewall than outside in a professional data center.

Based on these comments, the way business intelligence is being done today just doesn't make the grade.   There are all kinds of statistics to support this.

So where will the change come from?  The generation of young people coming into the workforce has the power of change behind them.  They do things differently.  Chat, instant messenger, Facebook, MySpace, Twitter are their tools.  They are information consumers with search, investigation, collaboration skills.

So what about those people and companies wanting to keep and hold onto the status quo.

They say improve and maintain.
I say destroy what we know and reimagine!

They say, "BI needs an army of consultants."
I say, "your scope is too large and unrealistic."

They say, "you need control over our technology."
I say, "leverage the internet and don't reinvent the wheel."

They say that "BI is more an art than a science."
I say, "find repeatability and gain from economies of scale or be one of the 87% of unsuccessful projects."

They say, "we have people with years of experience in business intelligence."
I say, "I love smart, innovative, talented, internet saavy people wanting to turn BI upside down."

They say, "data is safer behind your company firewall."
I say, "what are they smoking. Data centers specialize in security."

They say, "users have a fear of the technology."
I say, "you're using the wrong technology for that audience."

They say, "radical change takes a decade."
I say, "radical change takes a minute.  Those hanging onto the past want it to take longer."

They say this is a rant.
I say this is our reality.

Thursday, March 12

The Net Generation

Don Tapscott is entertaining to watch.  He always is pitching his latest book.  An eternal salesperson.  Today it was Grown Up Digital.  Don is calling the Net Generation the generation of kids after Gen X.  These kids have grown up with the internet, Facebook, and Twitter.  Now that 80 million of them are coming into the workforce, they will have the power to change business and our way of life.

This will affect companies and governments in significant ways.  I was inspired to write about change in the healthcare industry.

More from Don's book.  In 1983, only 7% of households owned computers.  By 2004, the number had grown to 44% and a whopping 60% of those households had children.  Now 100% of American schools provide internet access.  75% of teenagers between 12 and 17 years old have mobile phones.

Technology is like the air for Net Gen children.  Technology has fostered a new way of communicating, accessing information, and entertaining oneself.  They are not obsessed with technology and in fact use it as we would use the tv.  It's just where you go for news and entertainment, except the internet is where they go for interactive fun, friends, and communication.

So where does this leave business intelligence?

Well, Net Gen kids have had to search for, rather than simply look at, information.  This forces them to develop thinking and investigative skills.  Unfortunately the tools they use are nothing like pivot tables, analytical cubes, reports, forecasting models, or statistical tools.  Their tools are collaborative.  The internet and its global reach is unique.  And the world is enabling global communication.

Maybe you will say BI 2.0 is the answer.  Although I'm not sure I have seen a truely collaborative platform for corporate data.  Sure, some products allow you to tag reports and provide comments.  However true collaboration in business intelligence I have yet to see.

Tuesday, February 24

Can BI be recession proof

Seems 2008 was a good year for business intelligence companies.  Some of you may not want to read that others are prospering, while many struggle (or at least worry about the future) but business intelligence could be a beacon of light for IT companies.

Here is a small sampling of growth numbers for traditional on-premise vendors that I found.  The article also said the business intelligence market is larger than Forrester's estimation of $8.5 billion.
  • SAP Business Objects posts double digit growth.
  • IBM Cognos reported 12% revenue growth for first nine months.
  • Microstrategy growth at 8%.
  • SAS Institute growth at 5%.
For many companies, these could look like great numbers in these economic times!  I hope you are apart of this growth in some shape or form.

Then I thought about the numbers (briefly).  Typically B2B sales take several months, maybe 6 - 10 months or longer to complete.  Meaning these growth numbers are from sales initiated in 2007 or early 2008.  Really not when the recession was causing havoc.  So the true test to the resilience of business intelligence will be the 2009 numbers.

"Is anyone looking to buy in 2009?", is the real test.

While growth numbers may or may not be interesting.  What could be very interesting would be to compare SaaS BI company growth with traditional on-premise.  Get the real numbers out there.  Of course, the size of revenues may be apples vs oranges but the percent growth would be interesting, yes?

Here are the 60 fastest growing companies, which SaaS vendors comprise much of this growth.  The link is near the end of the post, if you're not interested in healthcare on the internet.  Unfortunately I haven't found comparable numbers I could use (send some along if you know of any - we could do quick collaborative analysis).

As an aside, I am reading more and more about business intelligence being an add-on to ERP packages.  The first link above mentions the BI market of $8.5 billion doesn't include BI tools packaged with ERP, HR, and customer analytics applications.

I think it's inevitable that on-premise BI's future will be an attachment for ERPs.  Where that leaves enterprise-wide BI, I'm not sure.  Perhaps the value of enterprise-wide BI will be for large organizations with deep pockets to pay for the on-going costs.

If you're looking for emerging bright light technologies, check out:
  • predictive analytics
  • business activity monitoring (or complex event processing)
  • text analytics
  • column-based databases

Wednesday, February 4

Don't live in the past, predict the future

If Jethro Tull is "living in the past".  And hindsight is 20/20.  Then you're reading this blog in the moment to learn how to predict the future.  From a business intelligence perspective, that is.

Thanks to Accutate for providing this short article on Predictive Analytics.

"Predictive analysis can be an extremely useful tool for many different types of businesses. In fact, where there is any type of data warehousing there should be implementation of a business intelligence program that includes predictive analysis. However, in order to learn how your business can profit from this facet of business intelligence, you are going to have to understand exactly how and why predictive analysis works.  

The main idea of predictive analysis is to use current and past data to predict future events. The goal of the statistical techniques used in predictive analysis is to determine market patterns, identify risks, and predict potential opportunities for growth. In addition, data relationships can be reordered to determine the most plausible outcome of possible solutions and patterns can be recognized that might have the power to alter the outcome of a probable event.  

One of the most important aspects to reliable predictive analysis is data quality. The information provided by predictive analysis can only be as effective as the abundance and accuracy of data available. Data quality is absolutely necessary to the process of predictive analysis. In order to attain accurate business intelligence, companies must maintain quality data.  Predictive analysis requires both past and current data about many different things including customers, businesses, products, and the economy. All of this information is used to draw relationships and patterns between sets of data. If the data is accurate and well maintained, then the business intelligence produced will be high quality as well.   

In the past, predictive analysis was mainly used for newly emerging technologies. However, in recent years these practices have quickly started to become common for mainstream businesses. There are a few differences between the ways that these techniques are currently used and how they were used in the past. One of the main reasons for these differences is why companies use predictive analysis. In the past, these techniques were used for long-term analysis of market and consumer trends. However, in recent years, the mainstream implementation of predictive analysis techniques has tended to focus more on immediate, tactical uses. Because of the “real-time” nature of this business intelligence, more and more companies are using predictive analysis as standard in making predictions about particular industry markets and consumer trends.  

Some of the industries that have started utilizing these business intelligence techniques include telecom, insurance, pharmaceutical, and financial industries. All of the companies in these different business sectors have been able to use predictive analysis to make the right decisions to move their businesses in a positive direction. These processes can help with economic predictions as well as predicting the behavior of businesses and consumers. This type of information, made available in an efficient manner by business intelligence, is understandably invaluable. It can turn a simple prediction into intelligence that is more precise than even the most educated guesses. Predictive analysis with appropriate attention paid to data quality has made it easier than ever for businesses to make accurate market and consumer predictions and thus smarter decisions for the growth of their company."

Thursday, January 29

Microsoft bundles BI software - what they are doing unveiled

The inevitable nature of big companies is to lock customers into their suite of products. For instance, Oracle started with databases, now bundles financial and integration software with their database. Customers are told it's easier to use their add-on, value-add products than use another vendor and get into compatibility issues. Add-on, value-add products are sometimes free, enticing you even more.

So it comes to no surprise that Microsoft has announced they have tightly bundled their BI software, PerformancePoint Server, with their document management software, Sharepoint. Joined at the hip, you cannot buy one without getting the other.

Comparatively to other BI vendors, Microsoft has the only bundled BI, document management, workflow, collaboration software on the market (I think). IBM Cognos, SAP Business Objects, and Oracle Hyperion are behind with this endeavour - they haven't tightly integrated BI with their other software.

Each of these competitors to Microsoft have similar software breadth but Microsoft's tight integration is a step ahead. It may take years for IBM, SAP, and Oracle to properly integrate BI, document management, workflow and collaboration.

But what about the customers? On the surface, the tight bundling can be viewed as positive. You could be using Sharepoint and now want some BI reporting. Or maybe you have PerformancePoint reports and need to manage documents.

Tackling both BI and document management pieces is challenging.  Without considering planning, governance, and skillsets, you will most certainly encounter serious setbacks.  Or worse your vision is restricted to an unimpressive rollout.

Here are some problems you may encounter with tight bundling of BI and document management.
  1. Standardizing on Microsoft, Oracle, IBM, SAP technologies requires highly paid IT resources and/or consultants (not great for this economic climate)
  2. Very different skillsets are required to build Sharepoint sites vs PerformancePoint reports (need to hire more staff and/or pay for more IT training)
  3. Goverenance and best practices are very different for managing BI vs documents (different knowledge needed, so twice the effort)
  4. Locked into sole-source agreements (difficult switching BI or document mgmt products for a better and more cost effective product in the future)
Putting those concerns aside, there are positives in Microsoft's story.  Microsoft's price point is unbeatable when compared to other on-premise vendors.  This can offset additional costs (see points above) and make your entrance into Document Management and Business Intelligence a little easier.

The question is whether the competitors - Oracle, SAP, IBM - will compete directly by integrating their products with BI.  Here's my thoughts on where these companies are going.
  • In the case of SAP Business Objects, it's natural direction would be to simply use Business Objects as the reporting engine for the SAP application (do away with SAP's current BW).  Perhaps keep Business Objects as a stand-alone BI product set... perhaps.
  • Hyperion is a natural fit for Oracle Financials.  Hyperion was deeply entrenched within the financials of large companies.  But Oracle has many other products that could work along side Hyperion's BI.  For instance, SOA/messaging integration replacing traditional ETL (or parts of it).
  • As for IBM... guessing where they are going is just a gamble.  I don't have any insiders that could give me hints.  IBM and Cognos were working together prior to the acquisition and you look at the breadth of products, consulting division and R&D coming out of IBM... well your guess is probably as good or better than mine.

Friday, January 2

Why the auto industry sells lemons

Let's start the year off with something fun.  And Happy New Year everyone.

I was sent this Calvin & Hobbs comic strip about lemonade stands and business [you can find the full strip below]. After I had a good chuckle, it got me thinking. How often is the 'lemonade stand' used as an example for business? Surprisingly quite a few.

In Donald Trump's "The Apprentice", Donald gave each team $250 dollars to start a lemonade stand. There are 3,233 book results from Amazon for 'lemonade stand'. Countless blogs on the subject -- how to be a Lemonaire and Umpqua Bank funding kids starting a lemonade stand.

However Calvin's lemonade stand highlights well known problems with business. One could apply this to the automobile, financial and oil & gas industries. Companies in these industries are either having troubles currently or problems are looming (of course unless your government simply bails your company out).

What are the problems through Calvin's eyes?
  • Stockholders demand monstrous profit for their investments.

  • Presidents and CEOs demand exorbitant salaries.

  • Employees demand high wages and all sorts of company benefits.
Not to be flippant using a comic strip from 10+ years ago to emphasize problems with business today but one must admit there is truth in Calvin's statements.

Here's an idea for those who can navigate Web 2.0, mashup, and BI. The SEC is requesting company filings via XBRL and making them freely available online.   What if BI was applied to analyze executive salaries across companies and industries. Or compare financial costs of employee salaries and benefits.

Would there be answers to why the Ford company didn't take the bail out but GM and Chrysler did?

Why would someone do this?

Think of the comparisons that can be done. Comparing trend increases or decreases of salaries. Have union salaries and benefits brought down GM and Chrysler? How does the auto industry compare to the oil & gas industry for executive salaries? Could predictions of bankruptcy be made for other companies because of the comparison made with GM and Chrysler?

[this post used copyrighted Calvin & Hobbs material]