Redefining the Mid-Market and Its Business Intelligence Requirements

Originally published January 27, 2009

Small and mid-sized organizations seem to get the short end of the stick when it comes to their software needs. Until recently, business intelligence solutions were largely targeted at the enterprise market. These solutions required solid IT infrastructures to support the deployment and maintenance of data warehouses, data marts, OLAP and the like. Consequently, even many upper-mid market corporations (i.e., those at $850 million and above) were unable to take advantage of what was available. With limited budgets and lack of internal resources to develop and manage solutions, business intelligence (BI) became the elite software that was relegated to a subset of super users within enterprise organizations.

With the expansion of solution options and the shift toward the mid-market, the BI industry became inundated with newer solutions and niche players that removed the former barriers to entry that existed for many organizations. Although many of these solutions existed beforehand, renewed focus on marketing activities from the larger BI vendors and general confusion caused by a number of vendor consolidations enabled newer players and diverse offerings to shift positions and to become valid options for mid-market companies.

Even with this recent shift, however, the mid-market itself is still ill-defined. Instead of breaking out the market in a way that organizations can relate to, in too many cases, the mid-market is considered to be organizations that make less than $1 billion in revenue per year and small organizations considered anywhere below $250 million or $100 million depending on the source. Consequently, these organizations are lumped together but may have very different needs based on size, revenue, resources, budget, vertical industry, etc.

This article explores whether mid-market needs are being met by the solutions available, some solutions that benefit the mid-market specifically and the need to redefine the mid-market in order to better meet the business requirements of these organizations.

Are Mid-Market Needs Being Met?

Within business intelligence and especially with the more recent expansion of solutions that target mid-market companies, the question still remains: Are these new solutions actually meeting the needs of small and mid-sized organizations? Do stripped down enterprise solutions make the cut, or do some mid-sized organizations actually require the same solutions as their enterprise counterparts but are being pushed aside because of their inability to pay for the infrastructure and upkeep? These are questions that have long been debated; and although they are valid in certain respects, as diverse solution offerings become available and organizations have more choice, they become secondary.

Whether or not pared-down solutions targeted to mid-market companies actually meet their requirements or fall short, little can be said. There is a lack of cohesion existing within the market in terms of what small and mid-sized companies really need to make business intelligence successful. Aside from pointing out what mid-market companies may lack – for instance, budget and IT infrastructure – there is little agreement on the similarities within mid-sized companies and the key requirements needed to meet their BI needs. In addition, lumping a group of companies together based on how they fall outside of traditional BI offerings does little to offer those companies the additional value or unique requirements that will help them get the competitive advantage necessary to grow their business or to maintain their positioning.

Mid-Market Specific Solutions

The mid-market solution landscape is broad. With traditional BI vendors offering targeted mid-market products that resemble a subset of an overall suite, with on-demand and open source vendors offering solutions at lower price points and disparate pricing models, and alternate solutions targeting the smaller enterprise, companies are actually well poised to take charge and demand the types of solutions that most suit their unique requirements. Organizations have the upper hand as they can pick and choose their way through various solution choices, pricing options, and deployment methods. This means that although the business requirements of mid-market organizations have not been analyzed to the depths of their enterprise counterparts, the sheer volume of solutions to choose from balance out that deficit.

On-Demand on the Rise

On-demand solutions may be the best poised to meet the needs of small and medium businesses (SMBs) simply because many of these organizations are used to and comfortable with the on-demand model. Because many smaller organizations preferred to have solutions hosted and kept off premise, basically managed as a set of services, the rise of BI-based software as a service (SaaS) provides many SMBs with the type of solutions with which they are most comfortable. In general, on-demand gives organizations the advantage of full data management, reporting and analysis without the hassle of development and maintenance.

Aside from traditional business intelligence turning to the on-demand model, the rise of embedded analytics as hosted solutions enables organizations to take advantage of operational or pervasive business intelligence without having to identify and integrate any solutions in house. In addition to solutions such as LucidEra, that provide embedded analytics and reporting for salesforce.com, other solutions are available that provide analytics, reporting and visualization on top of ERP and CRM solutions to give organizations a broader view of what is happening within their organizations.

Leveraging Open Source

With the expansion of the data warehouse appliance market, organizations are not stuck paying hundreds of thousands of dollars for a data warehouse or series of data marts. Microsoft’s SQL Server is just one example of how organizations can implement a solution at a lower price point. Vendors such as Greenplum and Infobright take advantage of open source solutions as the core of their products, enabling a lower overall price point. In addition to data warehousing, solution providers such as Information Builders and their integration of R – an open source statistical analysis tool – enables them to use high grade predictive analytics without affecting overall pricing to customers.

Open source enables mid-sized organizations to take advantage of solutions, either directly or through OEM solutions that they may otherwise not have access to. With open source offerings such as those provided by JasperSoft, Pentaho and Actuate, organizations can take advantage of business intelligence for free. The catch is that generally open source solutions are not plug and play, so without a developer in house the solutions may not provide the added benefits of business intelligence with a clean user interface. However, the option to deploy a solution free of charge has pushed many vendors in the market to offer free trials of their products to help end users get a feel for what is available before committing to a single solution.

Final Thoughts

Overall, business intelligence can offer great advantages to small and mid-sized organizations. The problem becomes sifting through the plethora of options to select offerings that meet the organization’s needs and that offer the flexibility required in an agile marketplace. In addition, generalized categories of where small and mid-market companies fit are too broad and need to be reorganized to take into account the requirements of these companies. Because using an umbrella, such as companies with yearly revenues of under $1 billion, it would be wise to generalize the needs of companies small and large alike without taking into account their differences.

  • Lyndsay WiseLyndsay Wise

    Lyndsay is the President and Founder of WiseAnalytics, an independent analyst firm specializing in business intelligence, master data management and unstructured data. For more than seven years, she has assisted clients in business systems analysis, software selection and implementation of enterprise applications. Lyndsay conducts regular research studies, consults, writes articles and speaks about improving the value of business intelligence within organizations. She can be reached at lwise@wiseanalytics.com.

    Editor's Note: More articles and resources are available in Lyndsay's BeyeNETWORK Expert Channel. Be sure to visit today!

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