1December 1, 2005
State of the Business Intelligence Industry in Canada
Presented by:Steve Mossop, PresidentMarket Research Canada West
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Outline of Today’s Presentation
Background
General Definition of BI
BI Intelligence Study
– Objectives and Purpose
– Awareness, Involvement, Knowledge of
– Overall Organizational Performance
– Importance of BI Relative to Other Functions
– Spending levels and Priorities
Overall Challenges For MRIA/BI
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Defining Business Intelligence
MarketResearch
TelephoneSurveys
OnlineSurveys
FocusGroups
MysteryShopping
CustomPanels
Online FocusGroups
One-on-ones
EnvironmentalScanning
AC NeilsonReports
AssociationStats
GovernmentReports
MediaMonitoring Economic
Reports
SyndicatedStudies
Data Mining
Predictive Modelling
Segmentation
Mining Customer Records
POS Systems
CRM
LibrarySciences
CompetitiveIntelligence
InternalScanning
News Scanning Services
Ad Scanning/Tracking Mystery
Shopping
Website
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Purpose of the Study
The purpose of the study was to gather perspectives on Business Intelligence in order to further promote BI.
Specific objectives include:
– Determine who is responsible for BI in the organization and who are the key influencers.
– Understand how BI is defined within the organization.
– Identify the common practices that exist and the areas that are growing in the future.
– Identify some of the leading edge trends and techniques that exist.
– Assess the importance of BI in the organization relative to other business functions.
– Determine how BI is funded (amount and from who’s budget).
– Explore expectations for future growth in BI for organizations.
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Methodology and Sample
The findings are based on an online Ipsos Reid poll conducted across Canada on behalf of MRIA and EDS between November 7 and 15, 2005.
Respondents had to be very or somewhat knowledgeable about at least one aspect of Business Intelligence activities:
– Data mining,– Environmental scanning,– Secondary research, – Competitive intelligence, or– Primary market research.
Of the 674 willing participants, about 76% or 514 qualified for inclusion in this study.
We did 5 follow-up one-on-one interviews to get more depth to the findings.
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Methodology and Sample
Respondents consisted of:
– Managers (40%)– Directors/Top Level Executives (27%)– Professional/VP (10%)– Owners (7%)
Large and small organizations:
– 50 or less (43%)– 51–500 (24%)– 500+ (34%)
Profile:
– Male (70%), female (30%)– 7% under 35, 22% 35–44, 35% 45–54, 36% 55+– 46% with university degree (inc. 16% with graduate degree)– 38% Ontario, 24% Quebec, 14% BC
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Definition of Business Intelligence
Business Intelligence is defined as a process for professionally gathering, processing, analyzing and disseminating decision-making information relevant to your organization. It can also be referred to as knowledge management. Business Intelligence involves the collecting, filtering, analyzing and prioritizing data from various sources including data mining (from customer records, databases and other internal sources); market research; competitive intelligence; and, industry resources.
61% Have Heard of Business Intelligence
98% Agree With the Definition
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Organizational Involvement in Business Intelligence Activities
Have you heard of the following business terms?Which of the following is your organization involved in?
Aware ofBusiness Term
% Yes
Organization Involved in Activity
% Yes
Business Intelligence 61 45
Data Mining 61 42
Environmental Scanning 45 41
Competitive Intelligence 49 38
Market Research 98 30
Base: All respondents (n=514)
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Awareness and Knowledge of Business Intelligence Activities
28%
17%
16%
16%
12%
64%
48%
51%
43%
46%
7%
26%
25%
30%
33%
9%
8%
12%
10%
1%Market Research
Data Mining
BusinessIntelligence
CompetitiveIntelligence
EnvironmentalScanning
Very knowledgeable Somewhat knowledgeableNot very knowledgeable Not at all knowledgeable
Base: All respondents (n=514)
How would you describe your level of knowledge of …?
Awareof Term
98%
61%
61%
49%
45%
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Level of Involvement in Business Intelligence Activities
16%
16%
16%
14%
14%
25%
27%
28%
26%
23%
28%
30%
31%
30%
29%
27%
26%
31%
34%
30%Market Research
Data Mining
Business Intelligence
CompetitiveIntelligence
EnvironmentalScanning
Primary decision-maker Key influencerSecondary influencer No input at all
Base: All respondents (n=514)
Please indicate your level of involvement, within your organization, in each of the following.
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Performance Rating of Business Intelligence Activities
23%
13%
17%
12%
14%
19%
24%
29%
32%
22%
19%
30%
53%
59%
52%
67%
68%
52%
Importance of BI (n=514)
Business Intelligence
Data Mining
Market Research
Competitive Intelligence
Environmental Scanning
Rated 1, 2, 3, 4 Rated 5, 6 Rated 7, 8, 9, 10
Base: Organization involved in activity (n=varies)
Please indicate how important Business Intelligence is to the success of your organization.
How would you rate your organization’s overall performance in each of the following?
Note: Importance ratings are based on a 10-point scale where 1 means not at all important and 10 means very important.Performance ratings are based on a 10-point scale where 1 means very poor and 10 means excellent.
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Responsibility for Business Intelligence Activities
BI is a high-level function/responsibility in organizations, falling under:
– CEOs (35%)
– CMOs (14%)
– CIOs (9%)
– Sales (12%)
Among CEOs, the level of commitment to BI is high:
– 31% very committed
– 34% somewhat committed
– However, 17% not committed, and 18% DK
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Importance of Business Intelligence in Organizations
20%
17%
16%
13%
13%
11%
13%
12%
12%
41%
37%
36%
34%
31%
31%
30%
28%
28%
Base: All respondents (n=514)
Please rate the importance of Business Intelligence compared to each of the following otherbusiness functions of your organization.
9%
14%
11%
13%
13%
11%
16%
11%
10%
17%
23%
25%
26%
27%
24%
29%
27%
21%
Marketing/Advertising/Communication
Much more Somewhat more
% More Important
Somewhat less Much less
% Less Important
Sales
Management
Administration
Operations
IT/Technical Support
Accounting and Finance
HR
Production
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Spending in BI Initiatives
A total of:
– 1.18M businesses in Canada– Total revenues of $2.552 trillion dollars in 2004 – 495,000 over 5 employees
Average spending on BI in survey
– Median: $25K– Mean: $200K
$12B–$29.5B industry in Canada
– (1.18M*$25K=$29.5B, or 495KX$25K=12.37B)– Or about 1% of all revenues
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Spending Priorities For Business Intelligence
36%
34%
33%
32%
27%
Base: All respondents (n=514)
Do you think your organization should be spending more, less or about the sameon each of the following in the future?
% More% Less
Business Intelligence
Competitive Intelligence
Market Research
Data Mining
Environmental Scanning
5%
6%
6%
7%
8%
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Spending Priorities For Business Intelligence
36%
34%
33%
32%
27%
34%
30%
33%
32%
27%
Base: All respondents (n=514)
Do you think your organization should be spending more, less or about the same on each of the following in the future?Still thinking about the future, would you say your company is likely to increase or decrease its level of investment for
each of the following?
Business Intelligence
Competitive Intelligence
Market Research
Data Mining
Environmental Scanning
5%
6%
6%
7%
8%
4%
4%
4%
4%
4%
Spend moreIncrease investment
Spend lessDecrease investment
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Investing in Business IntelligenceWhich of the following categories best describes where your company would allocate the increased investment for …
Business Intelligence
(n=176)%
Data Mining(n=163)
%
Market Research(n=171)
%
Competitive Intelligence
(n=153)%
Environmental Scanning(n=141)
%
Tools/infrastructure 49 57 36 41 40
External services 47 36 58 54 54
Hire additional staff 27 23 30 26 28
Staff training 51 44 40 44 41
Other 1 3 1 3 1
Don’t know/not stated 6 5 5 7 11
Base: Greatly/moderately increase level of investment for
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Involvement in BI in Large vs. Small Organizations
Small organizations are almost equally involved in BI activities as small ones.
Overall BI scores are similar across company size, but data mining scores higher.
BI is equally important across all company sizes.
Individuals from large companies are far more likely to think their organization should be spending more in BI.
Size of Company
<$5M$5-10M
$10M+
BI 40% 56% 56%
Data Mining 33% 52% 54%
Environmental Scanning
36% 47% 45%
Competitive Intelligence
34% 47% 48%
Primary MR 23% 38% 40%
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Barriers to Implementing BI
Follow-up one-on-ones showed significant barriers to adopting more BI initiatives:
– Cost/Funding
– Lack of Awareness/Understanding/Know-how
– Time/Time Management
– Buy-in From Senior Levels/CEOs/Boards of Directors
– Proving ROI
– Lack of Organizations Representing Interests of Profession
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Overall Conclusions
Overall awareness, and practice of BI is relatively low.
Level of influence on BI activities in organizations is widespread and all over the map.
Individuals rate their company’s performance relatively poorly.
Individuals rate the importance of BI highly, especially relative to other internal business functions.
A significant minority feel spending should increase.
BI is a huge business in Canada, and growing.
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Overall Implications
Ensure BI does not become just a management buzzword.
Need to create more synergies between the various functions.
Encourage companies to organize the functions together to take care of the synergies between them.
We need to make the discipline more exciting/sexy.
We need to promote the discipline – both internally and externally.
MRIA needs to do a better job in representing and promoting all facets of the discipline, not just research and competitive intelligence.
Need to do a better job in selling BI to senior ranks.