To Build or Buy with Embedded BI

The profile of the average end user is evolving, and that means a more diverse set of people are interacting with software every day. Many businesses, therefore, wish to embed business intelligence (BI) analytics capabilities within their enterprise software installs to empower employees to become analytically active.

In response to the end-user diversification and the enterprise cry for embedded analytics, today’s software companies are increasingly seeking to capitalize on this trend by embedding BI capabilities (e.g., dashboards, search-based analytics, and data discovery tools) within their commercial offerings. Aberdeen research shows that enterprises, however, are more likely to build out this functionality themselves.

Build or Buy: Is There a Right Approach to Embedded BI?

For the purpose of this analyst insight piece, Aberdeen defines “software companies” as those organizations most often referred to as independent software vendors, or ISVs. “General enterprises” refers to basically any company that does not offer commercially available software applications.

General enterprises have long developed both proprietary, internal applications and external programs largely limited to supplier- and customer-facing applications. ISVs specialize in a core software competency — making and selling offerings such as human resources applications, customer-relationship management (CRM) or enterprise resource planning (ERP) software, or financial applications, to name a few examples. One area solidly outside the purview of ISVs, however, is embedded analytics functionality. In fact, recent Aberdeen research shows that ISVs are more likely than general enterprises to buy, or plan to buy, embedded analytics functionality from third-party vendors (Figure 1, below).

Figure 1: ISVs Try Not to Reinvent the Analytics Wheel

Figure 1 shows that ISVs are 60% more likely than general enterprises to buy (or plan to buy) embedded analytics capabilities from a third-party vendor to embed within their solutions (75% vs. 47%). And, ISVs are 53% less likely than general enterprises to build, or plan to build, their embedded analytics functionality in-house (25% vs. 53%).

The data illustrates a clear difference in preference for how an organization attains embedded BI: Software vendors prefer to buy a third party’s analytics capabilities, and general enterprises prefer to build their own.

Takeaway

Given the breadth, depth, and user-friendly nature of analytical capabilities on the market today, enterprises seeking embedded BI should consider the technology that is available for purchase before attempting to build out their own analytics features.

The willingness to plunge head-first into an in-house build of analytics functionality is indeed commendable, but you’d be wise to embed analytics like the ISVs do, and let an expert build and maintain your organization’s embedded BI. Third-party vendors are more likely to embed newer analytics technologies like interactive visualization, machine learning, and predictive analytics. Also, spending less time developing BI allows them to get their products to market faster. ISVs experienced a 27% faster time to market with embedded BI than enterprises did.

Spend less time reinventing the wheel, and more time implementing a wider feature set with a faster time to market.