BI Moves to the Cloud

One in five IT leaders expect cloud or software as a service to be their main BI solution within three years

An overwhelming majority of IT leaders handle their business intelligence (BI) in-house now, but a recent CIO survey suggests that will change in the next three years.

The survey, conducted in May among 335 IT leaders whose organizations use BI and analytics tools, found that one in five respondents (23 percent) expect cloud or software as a service to be their main BI solution within three years. That's up from the current 7 percent.

Steve Pike, CIO of the wireless networking provider Enfora, says he recently moved customer service and support to a cloud-based solution. "It is pretty simple to do and the platform is very agile. You can set up quick wins and get information out."

Despite the potential of cloud, in-house solutions are still dominant. Presently, 93 percent of respondents use on-premise BI tools, and 77 percent expect to continue with in-house solutions during the next one to three years. Heather Hartman, director of IS technical services at Care New England Health System, said her company is among those sticking with in-house solutions. "The number of disparate systems we have makes it difficult to [use] the cloud."

Jason Lichtenthal, vice president of IS at PURE Insurance, thinks there's some risk in investing in cloud platforms now, but thinks his company will adopt them in the future. "It is a fledgling industry. They are still working out the kinks," he says. "The more success stories they have, the more trust we have in them. It's just a matter of time before cloud is the way to go."

Nearly two-thirds of respondents (65 percent) credit the use of BI and analytics with directly driving a business-process change in the past year, but only 13 percent say those initiatives were closely aligned with their organizations' business-process management tools. (See " Analyzing the Future.") Spending on BI and analytics is on the upswing, with 57 percent of respondents anticipating a bigger investment in the next year.

Read more about business intelligence (bi) in CIO's Business Intelligence (BI) Drilldown.

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