CIOs are deluged with data. New streams of unstructured data are coming in from the cloud, social network sites, and mobile devices. Combine that with the structured data generated by enterprise applications, and the potential for insight into customers' preferences, changing markets, and internal processes is enormous. The trick is unlocking that knowledge.

Analysis

More CIOs than ever are turning to business intelligence (BI) to make sense of all this data, according to recent surveys by research firm Gartner and CIO magazine. With BI, CIOs can pinpoint the data that will drive better business decisions and get it in the hands of the employees who can take action with it. BI is evolving to become more predictive, giving CIOs greater insight into how the business is performing now and in the future. When done right, it can help organizations discover their strengths (and capitalize on them) and ferret out their weaknesses. It can even help organizations define new business opportunities.

"BI platforms enable users to build applications that help organizations learn, understand, and optimize their business," says Gartner in its 2010 Magic Quadrant for Business Intelligence Platforms report.

BI generally includes a variety of applications that gather, store, analyze, and provide access to a company's raw data. The related functions they perform include forecasting, data visualization, data mining and more. Armed with these tools, organizations can use their data to guide their strategic decisions about products to sell, contracts to negotiate, customer service to improve, and markets to enter. BI can also help organizations identify internal business processes that can be made more efficient and less costly.

BI Capabilities

A BI platform should deliver 13 capabilities that support integration, information delivery, and analysis, according to Gartner. The research firm expects to see a greater demand for tools that go beyond information delivery to "enable easier and more intuitive analysis to discover new insights." These key features are:

Shared BI infrastructure
Metadata management
Development tools
Collaboration
Reporting
Dashboards
Ad hoc query
Microsoft Office integration
Search-based BI
Online analytical processing (OLAP)
Interactive visualization
Predictive modeling and data mining
Scorecards

Deployment Options

BI platforms have traditionally been installed on-premises, but like with other enterprise applications, alternative deployments are emerging as the BI market matures. Software as a Service (SaaS) and open source BI may make sense especially for smaller organizations that need a lower-cost option.

According to research published in March by Aberdeen Group, open source BI gives organizations a chance to explore the software and see if their internal IT staff has the skills necessary to take on a BI project, without making a capital investment. Aberdeen's Open Source Business Intelligence report says that "open source also promotes a more iterative and incremental approach," noting that this lets IT departments work at a pace that best suits the company.

Conclusion

Despite the many acquisitions of the last couple of years, there are still many vendors in the BI market, including pure-play BI vendors and enterprise software "megavendors" that offer BI along with apps like CRM (customer relationship management). In January, Gartner identified IBM, Microsoft, MicroStrategy, Oracle, SAP, and SAS as the market leaders; the research firm's Magic Quadrant report also named pure-plays QlickTech International, Tableau Software, Targit, and Panorama Software as well as enterprise software vendor Tibco Software. Open source BI software is available from Pentaho and Actuate.