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Considerations for Selecting a BI System for Small and Medium Organizations

10 November 2001
Tzvika Amit

Decision support systems need not be the exclusive domain of large organizations. Small/medium organizations can leverage the many advantages in this area and thereby gain an edge over their competitors in the market. A wise choice of a BI system for a small/medium organization can contribute to understanding and analyzing data from various systems and assist in making informed decisions. The BI field can provide the organization with an internal view for improving its performance and an external view for examining the market. How does one choose a valuable and practical decision support system based on the resource constraints that characterize a small/medium organization?


Selecting a Suitable Fit

The decision support systems market includes numerous technological solutions, vendors, and consultants. There are popular software packages aimed at large organizations that provide a wide range of sophisticated tools and options that would impose excessively high costs and resources on a small/medium organization. The implementation process for these systems is too long, and the data complexity is too great. For these reasons, the organization must remember its goal, not to perform a large amount of data analysis but to draw practical decision-supporting conclusions considering its resources.


The market offers various BI solutions for small/medium organizations at different costs. Choosing a solution that meets the organization's essential needs cost-effectively would be better. Starting small and growing is usually a healthier strategy. With a modest effort, we can find a system that integrates effectively from all the organization's data repositories without expensive and complicated technology. The organization should also know which data repositories are worth analyzing and which can be disregarded due to low data quality or cost-benefit ratios.


A small/medium organization needs to think deeply about its actual technological needs:

  • Which BI tools does the organization need?

  • Does the system under consideration offer much more than what is required?

  • What is the level of complexity in the system?

  • What are the highest-quality data we would want to analyze?


Data Information Overload

In large organizations, BI systems provide extensive and sophisticated information about data characteristics in systems such as event dates and times, symbols, notes, and more. Extracting this information comes at a high price in terms of expensive technology and high costs for the information analysis process. The price a small/medium organization can pay for this information overload includes high costs and low usability. The wisdom is to configure a balanced system between the organization's essential needs and its ability to draw valuable conclusions so that expensive resources are not wasted on excess information.


System User-Friendliness

There are many cases where the cost of technology becomes marginal compared to the cost and resources the organization will have to invest in system support and maintenance. We want an intuitive system that will provide autonomy to the organization and not force it to depend highly on the vendor and system supporters. When purchasing the system, one should examine the ease of use and adapt it to the user's computer literacy. Examining the variety of tools and their form is advisable so they do not burden users and are not too difficult to operate. We can do this by examining the experience of different employees working with the systems we are considering and getting feedback on their ability to handle them. This will increase the chances of getting a practical and sound system instead of another "white elephant" in the organization. Too many tools in the system will lead to confusion and drifting, while too few will lead to frustration and poor results. Some niche companies in the market specialize in easy-to-install BI solutions for small or medium-sized organizations that provide simple and convenient tools for operation. Choosing such a company could provide the organization with a quick, convenient, and practical solution.


Models for Purchasing and Operating BI Systems

Naturally, organizational systems develop rapidly (especially in the first few years) and become increasingly sophisticated as the organization grows. Considering this and choosing a payment model that suits the organization's current and future resources is advisable. Different modules for purchasing BI systems significantly impact the bottom line. One should consider the payment model depending on variables such as software upgrades, support, and minor customizations for the organization's needs, the cost of adding users to the system, the number of server operations, and any addition to the payment appearing in the contract with the supplier that significantly inflates the total cost.


With a modest effort, one can find a software company offering BI solutions for small/medium organizations with a fixed and convenient annual payment. This solution will ensure that the organization does not exceed the predetermined budget for operating the system.


Proper Selection of the Software Company

Selecting a BI system and software vendor is essential for the project's success. In addition to examining the system's suitability for the organization's needs from a technological, budgetary, operational simplicity, and implementation simplicity perspective, the organization should also investigate the vendor's suitability for its needs. The less recommended considerations for evaluating the vendor are popularity, market presence, and customer list. The more important considerations are the vendor's reliability, service characteristics, professional capabilities, and financial stability. A large BI vendor may offer an expensive solution that may not necessarily provide the small/medium organization with the maximum return for a reasonable price. In contrast, a vendor focused on BI solutions for small/medium organizations, their "bread and butter," may be a better fit.


Summary

Small/medium organizations can enjoy many advantages the business intelligence field offers. With modest effort, they can adopt a BI system tailored to their size and resources. An organization that does so will significantly contribute to its ability to deeply understand comprehensive processes through data analysis and make much more informed decisions.

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