FSN: Microsoft raises the bar in Business Intelligence (BI) and Business Performance Management (BPM)

Microsoft raises the bar in Business Intelligence (BI) and Business Performance Management (BPM)

5th December 2005
Microsoft's much trumpeted launch of SQL Server 2005 last week represents a broadly based attack on the established players in Data warehousing, Business Intelligence and Business Performance Management. In its biggest ever product launch, Microsoft signalled its attention to get even closer to the core of enterprise computing with a stack of announcements that strengthened the performance of its database offerings, its ability to manage enterprise wide data sources and to provide business users with simple tools to extract and report business information. Gary Simon, FSN's managing editor was at the launch to assess its impact on the business community.

Last Monday, Microsoft finally extinguished any doubts the business community might be harbouring about its intentions in enterprise computing. Ever since the early part of this century Microsoft has been transitioning from a supplier of personal computer systems and productivity tools into a serious provider of fully fledged business systems. Microsoft now claims the lion's share of the corporate database market measured in terms of the number of systems sold although this represents only twenty percent by value. In other words, Microsoft has successfully penetrated a very large number of businesses with its relational and multidimensional databases but at a relatively low cost to the buying organisation.

When Microsoft first embarked on its mission to infiltrate mainstream business computing at the turn of the century, there were doubts about the scalability of the solutions it could provide. Afterall, its history is steeped in personal computing rather than heavy duty databases. But any lingering doubts were quickly scotched at the launch event last week as customer after customer reported very large scale databases and massively improved performance.

Nick Lansley, of Tesco.com, told the audience how SQL Server 2005 had allowed him to cut processing time from 12 hours to 4 hours when a recently introduced customer incentive scheme had unexpectedly caused performance issues across their database of 20,000 products.

Furthermore, Microsoft SQL Server 2005 scored its highest ever recorded performance using standard benchmarks on SAP Sales and Distribution applications with a theoretical maximum of 93,000 concurrent users. According to Microsoft's Andy Lees, SAP customers employ more SQL Server databases than any other database to run their SAP applications. In effect, he said there now appears to be no practical limit on the scale of SAP implementation that can be supported.

But the launch event wasn't limited to issues of scalability and performance, important though these are. The announcements included significant changes and improvements around the way that data can be integrated from a wide range of data sources using SQL Server 2005 Integration Services (SSIS), and at the other end of the technology stack how data can be retrieved using "Analysis Services" and "Reporting Services". In particular, Analysis Services, now contains a KPI Framework which Microsoft says can be used to build balanced scorecard and other types of Business performance management applications. In addition, "Report Builder", a newly released component of Reporting Services is designed to allow business users to create their own reports using a browser based application which leverages business names for database fields and tables. Microsoft describe it as a "ClickOnce" application which offers typical business users the ability to create reports by selecting report layout templates containing pre-defined data sections such as tables, matrices and charts. They can 'drag and drop' report items from the data model to the design surface, set report filters to refine the data included in the report, add text and formatting, create new fields and calculations, preview print and publish the reports and export to Excel.

However, mature performance management vendors do not see the latest Microsoft developments as a threat. Howard Dresner, Chief Strategy Officer of Hyperion told FSN, "Microsoft may have ambitions to enter the BPM space but I don't see anything particularly new in these announcements. They are probably going to impact the lower end of the performance management market and are going to compete with those vendors that have a tools based orientation such as Actuate and Business Objects. Business performance management is all about having a business orientation and Microsoft does not have domain expertise or legions of accountants to credibly develop and support business performance applications"

Michael Coveney of BPM vendor Geac agrees. He told FSN, "Microsoft is not really encroaching because the value we add is in the specialist applications and support we provide rather than the tools. These announcements are going to be more of an issue for the pure BI (Business Intelligence) vendors. As far as we are concerned these developments are quite helpful if they allow users to access information more easily. At the moment they can routinely pull information into Excel if they want to and it sounds as though Reporting Services is an extension of this."

However the Microsoft customers that FSN questioned said that, in their view, they could meet their business information needs using a pure Microsoft platform and without recourse to best of breed applications. Linda Chandler, of the London Development Agency, said "We see our investment in Microsoft as very strategic and do not see the need to use best of breed applications." Similarly, James Bacchus, of Ministry of Sound was confident that he could meet his business users' information needs without stepping outside of the Microsoft environment.

Many of the Business Intelligence vendors saw the looming threat from Microsoft a few years ago and took the opportunity to diversify into business applications or to merge with application vendors. With the benefit of hindsight this appears to have been a good call. But this still leaves some of the BI suppliers vulnerable to head on competition from Microsoft in price sensitive segments of the market since so much functionality is bundled in the standard SQL Server 2005 offerings.

For the time being, Microsoft appears to be after complete domination of the enterprise database market, closely followed by end to end business intelligence. To this end, it has Oracle and IBM firmly in its sights. So for the moment it seems that BPM vendors can breathe a sigh of relief.

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