This is the second in a series of BI-related posts and it deals with what platforms are being selected and what objectives are being served with SMB Business Intelligence customers. Despite a much shorter history than packaged BI, our survey found a higher level of Cloud-based than packaged BI applications within the SMB respondent base. You may want to open it up to full size as the charts are a little crowded.
Techaisle Analyst Insights
Trusted research and strategic insight decoding SMBs, the Midmarket, and the Partner Ecosystem.
In the early days, the key question wasn’t “when?” but “what?” Looking back at 2011.
Four years ago, Techaisle’s 2011 SMB Cloud Adoption report began with a discussion of cloud awareness within the SMB community. Results showed that while SMBs were reasonably familiar with the terms “private cloud” and “public cloud” (recognized by 84% and 74%, respectively, of SMB respondents), “XaaS” had not yet entered the SMBs’ lexicon: less than 25% were familiar with the term “hybrid cloud”, and IaaS and PaaS were also not commonly understood.
Discussions of reasons for adoption and barriers to cloud adoption also illustrate how much the cloud market has evolved over the past four years. In 2011, SMBs cited “simplified access through a browser from any location” as the second-most important reason to adopt cloud; in today’s multi-screen, mobile world, requirements have progressed much further, with an application interface layer capable of responding to different displays, a practical necessity for many business systems. Similarly, features like “eliminating the need to upgrade individual users” and “getting new features automatically” have become expected attributes of cloud, as attention progresses to issues like building agility and obtaining new capabilities. The data did highlight one issue that has remained constant from 2011 to 2014 though: as was the case with Techaisle’s most recent 2014 SMB cloud survey, the 2011 results emphasized a desire to increase IT staff’s efficiency as a key reason to embrace cloud.
In 2011, when asked, “What vendor actions would compel you to use cloud services?” 46% of small businesses and 38% of medium businesses replied that they would “never consider using hosted applications.” Today, of course, refusal to consider SaaS is still an option; but increasingly, it is an expensive, non-mainstream option – helping to remind us that “never” is not a good planning horizon for new technology.
Overcoming Cloud Adoption barriers of 2011
In many ways, a review of the list of barriers to cloud adoption cited by our 2011 respondents is even more helpful in illuminating increased SMB focus on cloud. In the 2011 research, respondents not using cloud were asked to specify the conditions that would prompt them to consider use of cloud services. The list of top responses is intriguing. The most frequent answer cited by 2011 respondents was “if the cost of owning the applications is significantly higher than renting them”. It can be argued that this condition has been met – that for many applications, ranging from office suites (where pricing for Office 365 is more compelling than for boxed versions of the software), to niche-specific applications where on-demand fees provide far superior economics than a combination of new hardware and licensed software, to the “fail fast” mantra used to apply cloud to emerging business opportunities (one which relies on the freedom to spin up and spin down applications quickly, without reference to the depreciation cycle associated with the underlying hardware), the economics of cloud are compelling for at least some applications.
Similarly, the second most frequently-cited condition that would prompt 2011 non-users of cloud to consider adoption – “if the application we need meets our needs completely” – is also often frequently met today, thanks to the explosion of niche-specific applications available from an ever-expanding universe of cloud application sources. Viewed in hindsight, we can see that cloud provides an ideal delivery platform (and associated business model) for addressing these conditions, which has in turn helped fuel cloud’s advance in the SMB market.
Where are we heading from here? Tracing the trajectory of SMB cloud usage
Through its relatively brief history, cloud projections have been hampered by the “hockey stick” phenomenon. Cloud is growing in multiple ways simultaneously: the number of firms using cloud is increasing, the number of individuals using cloud within these firms is increasing (e.g., as business users in different areas and IT workers find discrete uses for cloud-based systems), and the number of platforms and applications in use within each organization is increasing. These compounding growth curves drive extreme growth expectations that are difficult to digest.
Based on our most recent 2014 SMB cloud study we have constructed a “current and projected” perspective. The data serves to reinforce the belief that hybrid is emerging as the dominant cloud delivery model. Some of the hybrid growth numbers are extraordinary: use of “hybrid-only” is increasing by 87%, while the proportion of SMBs using a combination of private and hybrid is expected to grow by 122%, and use of all three of public/private/hybrid cloud is expected to increase by 130%.
However, even the figures that are less exceptional still relay an impressive underlying story. Take, for example, the “public only” group. Data shows that businesses using only public cloud will shrink by 20% within US-based SMBs. However, public cloud itself will be a growing part of SMB cloud delivery strategies and is actually poised to increase by 75% through the forecast period.
Using the same survey data based projection methodology we have created workload scenarios across sixteen different applications areas. The “full market adoption” scenario assumes that all SMBs reporting plans to adopt cloud do so whereas the “gradual adoption scenario” takes a different approach: it assumes that current cloud users will adopt each technology according to current plans, while new cloud users will adopt each technology only at current usage rates.
Data clearly shows the coming dominance of hybrid as a delivery model – which drives increased demand for both public and private cloud as well – and provides high-growth forecasts for cloud storage, data backup and cloud security at a workload level, and for vertical applications, content publishing, CRM and BI/analytics in SaaS. It can be difficult to parse through the many, extraordinary growth projections for cloud. By connecting user intentions for growth in overall cloud adoption with adoption patterns for delivery, workloads and applications, Techaisle provides its clients with the data needed to calibrate the growth needed to keep pace with or exceed the overall SMB cloud opportunity.
Related research report: SMB & Mid-Market Cloud Computing Adoption Trends
Techaisle’s global mid-market businesses’ Big Data Adoption & Trends study shows that the promise of superior data-driven decision making is motivating 43 percent of global mid-market businesses to either invest in or investigate Big Data technology. Out of these, 18 percent of mid-market businesses are actively investing in big data related projects. The possibilities of analyzing a variety of data sources, producing action-driven business insights is too big to ignore for mid-market businesses.
Big Data requires a certain level of IT sophistication and a history in the linear investment in Information Technology enablers to be successfully. While these factors predispose larger accounts to Big Data, the competitive imperative to understand customers, innovate products and improve operational efficiencies has already started to reach down to the mid-Market, forcing a search for how to leverage primary and secondary data that is generated by the business.
The current and planned investment represents a sizable opportunity considering that the segment is relatively new and requires a certain level of IT sophistication and a history in linear investment in Information Technology enablers to be successful. North America has both the largest market and the highest level of investment in Big Data overall in SMB and mid-market segments. Mid-Market attitude towards Big Data transitions from “Over-Hype” to “Must-Have” technology with the increase in employee size. However, nearly one-fourth of lower mid-market businesses consider big data to be over-hyped and yet 29 percent think that it will be an important part of their business decision making process in the future.
Business intelligence by itself has provided enough business insights, however, mid-market businesses are now looking for extracting business perspectives to drive superior decisions and ultimately achieve superior results. Extracting business perspectives has become important as they rethink their marketing strategies because mobility, social media, and other transactional services have increased the number avenues for connections with their customers and partners.
In addition to understanding customers, mid-market businesses are also considering big data analytics as an important initiative to help them improve operational efficiencies.
Techaisle’s study shows that there are many different tactical objectives for deploying big data projects but the top among them are sentiment monitoring, generating new revenue streams & improving predictive analytics. It must also be said that businesses have figured out that there is a lot of publicly available data which could also be analyzed to their advantage.
The mid-market businesses actively investing in big data technologies are expecting some clear cut benefits from big data analytics such as increased sales, more efficient operations and improved customer service. These objectives differ slightly by different geographic regions. As the growth rates continue to lag in mature economies, the pressure to increase revenue grows resulting in developing robust analysis and extracting insights from all sales and customer data including transactions.
When specifically asked about preferred deployment choice in terms of on-premise vs. cloud, mid-market businesses are unsure as they are still navigating through their technology options. However, Hadoop dominates as the preferred platform but confusion exists.
In terms of analytics skill-set and long-term vision, the potential of linking structured and unstructured data sources to create new business insights is being considered very useful but at the same time mid-market businesses are not really prepared for it. In fact one-third of mid-market businesses agree that linking structured and unstructured data would be very useful for big data analytics but over 70 percent mention that they have either none or very limited capabilities of analyzing unstructured data. This is where they are turning to external help for guidance.
Needless to say, survey reveals that big data deployment is posing tremendous challenges. Technology confusion, lack of skilled resources and potential unclean data are being considered as the biggest roadblocks for big data project implementations. Big data technology and its far-reaching capabilities are being viewed by mid-market businesses as very complex resulting in very steep learning curves.
In spite of challenges, the study shows that there have been some successes when business units, IT & data analysts exhibit extraordinary alignment. Highest success rates for project implementation and generating new insights have been achieved when IT and data analysts work with external consultants from project inceptions.
Detailed Global Mid-Market Big Data Adoption and Trends report is available for purchase. Details are given here.
Big Data requires a certain level of IT sophistication and a history in the linear investment in Information Technology enablers to be successfully. While these factors predispose larger accounts to Big Data, the competitive imperative to understand customers, innovate products and improve operational efficiencies has already started to reach down to the mid-Market, forcing a search for how to leverage primary and secondary data that is generated by the business.
The current and planned investment represents a sizable opportunity considering that the segment is relatively new and requires a certain level of IT sophistication and a history in linear investment in Information Technology enablers to be successful. North America has both the largest market and the highest level of investment in Big Data overall in SMB and mid-market segments. Mid-Market attitude towards Big Data transitions from “Over-Hype” to “Must-Have” technology with the increase in employee size. However, nearly one-fourth of lower mid-market businesses consider big data to be over-hyped and yet 29 percent think that it will be an important part of their business decision making process in the future.
Business intelligence by itself has provided enough business insights, however, mid-market businesses are now looking for extracting business perspectives to drive superior decisions and ultimately achieve superior results. Extracting business perspectives has become important as they rethink their marketing strategies because mobility, social media, and other transactional services have increased the number avenues for connections with their customers and partners.
In addition to understanding customers, mid-market businesses are also considering big data analytics as an important initiative to help them improve operational efficiencies.
Techaisle’s study shows that there are many different tactical objectives for deploying big data projects but the top among them are sentiment monitoring, generating new revenue streams & improving predictive analytics. It must also be said that businesses have figured out that there is a lot of publicly available data which could also be analyzed to their advantage.
The mid-market businesses actively investing in big data technologies are expecting some clear cut benefits from big data analytics such as increased sales, more efficient operations and improved customer service. These objectives differ slightly by different geographic regions. As the growth rates continue to lag in mature economies, the pressure to increase revenue grows resulting in developing robust analysis and extracting insights from all sales and customer data including transactions.
When specifically asked about preferred deployment choice in terms of on-premise vs. cloud, mid-market businesses are unsure as they are still navigating through their technology options. However, Hadoop dominates as the preferred platform but confusion exists.
In terms of analytics skill-set and long-term vision, the potential of linking structured and unstructured data sources to create new business insights is being considered very useful but at the same time mid-market businesses are not really prepared for it. In fact one-third of mid-market businesses agree that linking structured and unstructured data would be very useful for big data analytics but over 70 percent mention that they have either none or very limited capabilities of analyzing unstructured data. This is where they are turning to external help for guidance.
Needless to say, survey reveals that big data deployment is posing tremendous challenges. Technology confusion, lack of skilled resources and potential unclean data are being considered as the biggest roadblocks for big data project implementations. Big data technology and its far-reaching capabilities are being viewed by mid-market businesses as very complex resulting in very steep learning curves.
In spite of challenges, the study shows that there have been some successes when business units, IT & data analysts exhibit extraordinary alignment. Highest success rates for project implementation and generating new insights have been achieved when IT and data analysts work with external consultants from project inceptions.
Detailed Global Mid-Market Big Data Adoption and Trends report is available for purchase. Details are given here.
