Nearly one-third of companies think business intelligence software is cost-prohibitive; it’s no wonder most BI vendors shy away from the sensitive subject of cost+. But at 5000fish, we take a different approach. We strive to give you straight-talk about every facet of business intelligence, and that includes cost.
The truth is, the answer to “How much does BI cost?” isn’t clear-cut. That’s because the initial cost of BI software varies greatly from vendor to vendor and intangible expenses can significantly increase the cost of your BI initiative.
If you’re considering implementing a BI solution, keep these six factors in mind.
Cost of Software
We’re not downplaying the initial cost of software or how much you might pay to add licenses as needed, but we’re here to tell you software costs are just the tip of the iceberg when it comes to your total BI investment. So although you shouldn’t overlook the cost of software, there are additional factors to take into consideration when choosing a BI solution. Five of them are outlined below.
Insider Tip: Price doesn’t equate to value. As you evaluate BI solutions, look for those that offer flexible pricing and can scale with your organization as it grows.
Cost of Deployment
Most decision makers aren’t IT gurus, so they don’t have a solid understanding of traditional deployment costs. As a result, they spend more on BI deployment than they’ve budgeted for. To avoid the same pitfall, keep in mind that with many traditional business intelligence solutions you have to hire the vendor or a vendor partner to install it- and that’s not cheap. In some cases, you’ll not only pay the vendor for installation but for configuration and report building as well. Even if you’re doing an internal deployment, you must consider the expense associated with taking your IT team away from its daily duties.
Before you can even get to deployment stage, you need to evaluate your BI solution. If during evaluation, it’s hard to get a feel for whether the software is a good fit for your needs, it could be an indication that the software will be difficult (and costly) to deploy.
Insider Tip: Look for a BI solution that’s easy to integrate and deploy; you could reduce your total BI cost significantly.
Cost of Traditional Project Management Life Cycle
The majority of business intelligence vendors follow the traditional project management life cycle: requirements, installation, implementation, testing and deployment. If your organization isn’t using the right BI tool for its needs, the project management lifecycle can add a huge sum to your overall BI cost.
Insider Tip: Be cautious of the tedious (and costly) traditional project management methodology. Evaluate the benefits of software that use an alternate, more streamlined implementation strategy. For example, Yurbi uses Agile Methodology: brainstorming, rapid prototyping, incorporating user feedback and rapid deployment.
Cost of End User Training
The costs associated with end-user training are almost always underestimated. But skimp on training, and your employee adoption rate will surely suffer.
Insider Tip: As you compare BI solutions, take into consideration how long (and thus how much money) it will cost to thoroughly train your users. Solutions that are designed for the business user, offer an intuitive interface and a wealth of self-service tools will help minimize the cost of user training and boost adoption rates.
Cost of Administration
The “people cost” associated with BI administration can devastate your ROI. Traditional BI platforms aren’t well integrated, and they’re notoriously challenging to administer. In fact, many traditional business intelligence vendors require administrators to go through specialized formal training to learn how to manage their software. Training is not only expensive, it takes the administrator away from their routine responsibilities. Moreover, you’ll burden the cost of retaining the administrator- who now has a highly marketable skill and can demand top dollar.
Insider Tip: At 5000fish, we’ve noticed that many of our clients initially come to us when they discover upgrading their traditional BI software to the newest version is cost prohibitive. To help keep BI costs under control for the long run, look for seamless platform that’s easy to manage and doesn’t require intense special training to administer.
Cost of Operations and Maintenance
When determining how much BI costs, the expense associated with operations and maintenance is frequently overlooked. If your BI solution requires a member of your IT team or an outside consultant to do things like build or change reports and adjust security settings, you can count on the total cost of BI to skyrocket. Additionally, because you can’t predict every change or additional report you’ll need, budgeting is nearly impossible.
Also, over time, change management issues become a nightmare and report bloat undermines usability. Before long, the user is overwhelmed by the number of reports and doesn’t know where to get started- or they waste time building reports that already exist. Plus, no one knows which reports are being used, or by whom. The end result is users stop leveraging reports, and adoption rates plummet.
Insider Tip: As you’re investigating various BI options, look for one that has a good change management process. You should be able to determine which reports are being run most often, and by whom. Likewise, it should be easy to discover which reports aren’t being run, so they can be deleted.
As you explore the cost of various business intelligence solutions, keep in mind the sticker price of the software is just the tip of the iceberg. If you’re interested in learning more about the cost of BI, you’ll find this article helpful, “6 Mistakes that Increase the Cost of BI.”