Bangalore:
Leading global IT research and advisory firm, Gartner Inc, says that India has
emerged as the fastest growing business intelligence (BI) platforms market in
Asia (including Japan), posting a growth of 35.6 per cent in 2005-06. BI
platforms revenues in India grew from $12.1 million in 2005 to reach $16.4 million
in 2006, with all leading vendors posting double-digit growth. In
APAC (including Japan), the BI platforms market grew at 16 per cent in 2005 to
reach $491.8 million in 2006, with Japan accounting for more than half the overall
market. “Enterprise
agility is a high-priority goal for enterprises in 2007, but BI''s overall impact
on business is poorly understood and BI is still considered as ‘nice to
have’ in India,” says Bhavish Sood, principal research analyst, Gartner.
“Many enterprises still rely on gut feelings and past experiences while
making decisions and are not comfortable with the democratization of information
and the transparency that BI initiatives bring about.”
The overall BI market in India is at a nascent stage, with a huge up-tapped opportunity
for vendors to capture. Chief Information Officers (CIOs) are increasingly required
to invest in technologies that drive business transformation and strategic change.
“BI can
deliver on this promise if deployed successfully because it can improve decision
making and operational efficiency, which in turn drives the top line and the bottom
line. Also, information generated from enterprise applications is at an all-time
high and will continue to increase. BI platforms can turn that information into
an asset on which better business decisions can be made,” Sood added. Since
India is currently in the implementation wave of business applications platforms
like enterprise resource planning (ERP), customer relationship management (CRM),
and supply chain management (SCM), the demand for business intelligence platforms
will continue to rise. In fact, Indian enterprises show a strong preference for
products like database management systems or application servers with BI capabilities
embedded into the application.
Business Intelligence
Platforms Revenues in India (in Million Dollars) |
Sub-segments | 2005 | 2006 | Growth
2005-2006 | Embedded | 5.0 | 7.4 | 49.6% |
Stand-alone
| 7.1 | 9.0 | 25.7% |
Total
BI Market | 12.1 | 16.4 | 35.6% | (Source:
Gartner September 2007) |
Vendors
also see embedded products as the ideal platform for catering to the burgeoning
small and medium sized organisations. Several vendors in 2006 have been modifying
or extending their product, pricing and partner strategies to reach this key group.
Hosted BI through software as a service is one new approach that is being pioneered
by a cluster of vendors. BI
priorities in India vary both by the vertical and size of the enterprise. Selection
of BI platforms is a key activity carried out by enterprises as part of their
BI initiatives with a granular focus on the technical platform capabilities. While
dashboards and score cards are the common requirements for a range of industries,
the telecom and banking verticals are moving towards implementing sophisticated
analytics for understanding customer churn and making credit risk assessments.
The growth of BI in India is also being driven by standardisation, regulatory
compliance and new laws like the Right to Information Act. The
top four vendors accounted for a majority of the Indian BI platforms market contributing
to more than 72 percent of the overall revenues. SAP grew at an impressive 70.3
percent replacing Microsoft as the largest BI vendor in India, and relegating
Business Objects to the 3rd position.
Top
three BI Vendors in India in revenue terms with market shares (in Million Dollars)
| Vendor | 2005 | 2006 | Share
2005 | Share
2006 | Growth
2005-2006 | SAP | 2.2 | 3.8 | 18.3% | 23.1% | 70.3% |
Microsoft | 2.3 | 3.2 | 19.0% | 19.4% | 38.5% |
Business
Objects | 2.3 | 2.7 | 18.7% | 16.6% | 20.1% | Total
BI Market | 12.1 | 16.4 | 100% | 100% | 35.6% | (Source:
Gartner September 2007) | Despite
the growing economy, and the apparent need for BI, the Indian BI market is less
than 4 percent of the total APAC (including Japan) market. Sood
explains, “Qualitative benefits, such as better insights and better decisions
can be difficult to measure and place in a return-on-investment model. This makes
further expansion of investments harder to justify in numerical terms, posing
problems for both business users as well as the CIO approaching the CFO and/or
management. Secondly,
building BI infrastructure is only one part of the overall problem. Getting employees
and executives to use that infrastructure is a cumbersome exercise and often leads
to under utilization of the BI infrastructure and slower growth opportunities.”
Therefore,
while the market poses a huge opportunity, the lack of a definition or agreement
of what and how to measure/analyze the business will continue to inhibit successful
deployments, discouraging organizations from further investing in BI.
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