IT is no longer in control! Software is, but IT is not. Maybe that’s not a bad thing. But, do we truly understand what this freedom of choice is costing our enterprises? How much does BI cost an enterprise?
IT was the Gatekeeper
Enterprises for decades have relied on their Information Technology (IT) departments to screen, test, install, upgrade, and support all its software and supporting hardware needs. Along with this responsibility came the controls in place to ensure IT agreed on all software purchases. At some point, however, the rules of the game changed. Maybe it was because IT was perceived by the rest of enterprise groups as being hurdles as opposed to helpers. Maybe it was because there weren’t enough IT resources to screen, test, install, upgrade, and support any new software applications. Regardless of the reasons, enterprise IT groups had to adapt. New software offerings had to be considered. The business had to be enabled!
Software Preferences Vary
Along comes software sales to the business units outside of IT. With power being transferred from IT back to the business comes a proliferation of software for the enterprise. This department likes Tableau. That department likes PowerBI. This department uses an application that requires XYZ to be used. That’s the real world for most enterprises today. And perhaps we needed to swing the pendulum back to this to get the business quickly enabled. But, now let’s consider the costs for staying here.
BI Cost Considerations
Each piece of software that an enterprise uses comes with an initial purchase price as well as ongoing maintenance costs (annual renewals and support). In addition to these costs are the costs of the hardware (virtual or not), the location of this hardware (subscribed or real) along with the resources (third-party or in-house) necessary to keep these systems running and integrated. There are real and associated costs for each piece of software in an enterprise. As a result, it would make sense that there could be great savings to the enterprise if some consolidation analysis was done.
Client Saved over $1.5M
Finding great savings is exactly what our Client, one of the nation’s largest food chains, with over 3,500 locations and serving approximately 3 million customers per day, was looking for! Our Client chose to target their enterprise Business Intelligence (BI) tools for savings and efficiencies. After inventorying all the BI software in place, they concluded there were over 12 unique pieces of software being used across the enterprise to deliver BI. First, they calculated the cost to own and annually renew each piece. They factored in the internal resources necessary to upgrade, maintain, and support each piece. Next, they calculated the cost for each dedicated hardware platforms from which these pieces were supported. Finally, they analyzed each piece of BI software as a potential tool that could consolidate the content from each of the other tools. They were seeking a true enterprise-ready, single BI platform.
Recognition was given that all users would need to compromise and that there would be some net gains and losses in functionality between pieces; however, this did not deter the effort. After all analysis was completed, the client chose IBM Cognos Analytics (CA) as its enterprise BI platform from which all BI would be served. Because of the implementation of Cognos Analytics, the business created a fraud detection solution within the software which allowed the creation of innovative analytics scenarios to realize over $1.5M in annual savings.
Conclusion: How much does BI cost?
Regardless of how your BI solution came to be, companies can objectively evaluate and make changes. The BI cost savings alone are worth the analysis. Not to mention the ongoing time and resource savings within the IT organization. To read more about our Client’s BI consolidation effort and BI cost savings, check out eCapital’s Case Study, Consolidation of BI Systems.