I was very pleased by the extremely bullish outlook on cloud computing voiced at SaaSCon, especially by representatives from some of the larger companies. More than one speaker indicated that the market has reached a tipping point, where the maturity of services and software offered, combined with the current economic climate, are making the cloud much more attractive to large companies. Some, like Bob Sala, CEO of Distribution Marketing Advantage, stressed that moving to the cloud is now a strategic imperative.

Sala delivered a compelling presentation about his company’s SaaS journey. DMA is a $3 billion, privately-held company with 85 warehouses that is an alliance of North American regionally-owned and operated food service distributors. DMA members serve multi-unit restaurant and institutional operators in the United States and Canada. Chain operators like P.F. Chang’s, Hyatt, The Melting Pot and about a dozen others are served by DMA’s food distributors. [Full disclosure: DMA is a PivotLink customer and partner]

“We distribute food products to chain restaurants in the 50-250 store space,” Sala said. “The chains require standard distribution services, standard pricing, centralized reporting and a central point of contact. DMA exists because we are able to replicate a national distributor with 12 of the best regional distributors in the business, a portfolio of national accounts management tools, and talented people.”

Sala stressed that DMA is a supply chain logistics company, not a technology company.

DMA's SaaS ecosystem is Cloud-to-Cloud and uses PivotLink for real-time business insight.

That said, DMA began operating its business in the cloud when it implemented its order entry system in 2001, long before SaaS was even known as SaaS. Since then DMA has implemented all its systems in the cloud, including data warehousing, custom hosted applications, business analytics, CRM, expense reporting and network services. Their ecosystem of more than 13 integrated SaaS applications contrasts the BI integration woes in Doug Henschen’s article in Information Week that cites findings from Howard Dresner’s Wisdom of the Crowds study.

“We have been able to out-maneuver our larger, less nimble competitors using SaaS technology,” Sala said. “Moving to SaaS has become more of a strategic decision and less a capital decision for DMA.”

With pre-tax margins of 2 percent, DMA does not have much room for error. “SaaS gets us up and running faster than our competitors,” Sala said. “With PivotLink, a Chili’s store manager can see the results of particular shrimp promotion in 13,000 restaurants, by store, by units, over-time, and get it in a graphical report.”

With nearly a decade’s experience working with SaaS, Sala offered his philosophy on how to choose the right SaaS vendors and partners.

7 Guiding Principles for Selecting
Integration Friendly Application Partners

1. Commitment to products, services innovation aligned with our technology vision: Fit is first and foremost, according to Sala.
2. Commitment to protect data confidentiality and respect for data ownership: Confidentiality is extremely important, because it provides DMA, and other businesses, with competitive advantage. Sala does not want his vendors to use or re-purpose any of DMA’s data.
3. Provides cost effective, scalable solutions: DMA intends to keep growing, and its technology infrastructure needs to scale.
4. Financially viable and have experience hosting: Sala asks to see every vendor’s financials if they are a private company, and isn’t inclined to work with inexperienced SaaS vendors.
5. Provides high service levels (up-time) backed by service-level agreements: Systems downtime kills profits and service-level agreements assure that outages will be kept to a minimum.
6. Flexibility approach to customized/ professional services with exclusivity: DMA insists on exclusivity agreements on custom solutions built by systems integrators because they don’t want the solution to be re-packaged and sold to its competitors.
7. SaaS 70 Type II Certification: Only the highest security certification will do for DMA’s solutions.

Have a question about DMA’s approach? Let us know. We’d like to hear your take.

Read about DMA in Robert Mitchell’s Computerworld article “SaaS Takes on Business Intelligence” or learn more in the case study or DMA’s website.

The New BI is in the cloud and benefits from the inherent advantages of this computing model (affordable, agile, quickly deployable, high bandwidth, “always on”, extend more kinds of data to more users). Most importantly, the New BI isn’t shackled behind the four walls of an organization. It goes well beyond and helps individuals extend their network far and fast enough to get timely insights and answers to their operational and strategic questions. The New BI goes beyond analysis and reporting and ventures into the realm of true collaborative decision making. Web 2.0 social tools wrapped around the New BI have the ability to quickly collect and spread knowledge, connect people who would otherwise have remained unaware of each other, harness their collective intelligence and enhance individual decision making.

Three key forces are driving the trend towards the New BI: 1) the explosion of  more and various types of information in our day-to-day work lives, 2) a new generation of digitally savvy employees and 3) a blurring of the distinction between technology used in our personal and our work lives. With dynamic flows of information coming at them each day, users need new ways to access and analyze it and then relate it to their decisions and actions. Secondly, those who grew up with personal technology – Millenials, Gen Y – are changing the culture of the workforce. The emerging workforce prefers information in multimedia to words, the collective intelligence of individuals and they rely upon online resources such as social networks, expert communities and bloggers for strategic information. As people become increasingly used to sharing and collaborating outside the office (e.g. Facebook, iPhone, LinkedIn, Twitter, YouTube) they are coming to expect their work places to become more open and collaborative as well. Many companies today are organized into separate regional product-line and functional “silos”, making it hard for people to share information beyond their immediate colleagues. As a result valuable information and insight ends up being siloed or simply not shared. Even worse, opportunities for innovation don’t surface.

The New BI enables organizations to leverage information in valuable new ways including connecting employees who need information with the experts who have it, enabling the best ideas to emerge organically and using those ideas to catalyze innovation. As the New BI gains traction, it will transform the way companies organize and manage their information assets and ultimately empower individuals to re-design their decision making processes to make not only more timely decisions, but more confident and creative ones.

At PivotLink we give business people tools that allow them to access, aggregate and analyze the information they need to improve understanding and decision making and ultimately do their jobs better – without burdening IT.  PivotLink customers such as the North Face, DMA and OrderMotion have already had success with the New BI to speed up knowledge-sharing both internally and across the extended supply chain, in turn breaking down silos. The New BI is a more efficient and effective business intelligence paradigm. It is positioned to help users know more, do better and thrive. Stay tuned, it’s about to get really interesting !

Traditional tools – “Your fathers BI” – are not suited to the needs of business executives and managers in this new environment. Gone are the days of large CAPEX-consuming IT projects that take months or years to deliver business value and the days when IT tolerated their role as glorified report writers for business executives. On-demand business analytic (BA) tools will replace “your fathers BI” and play a major role in delivering insights that help organizations manage costs and discover new competitive advantages at the speed of business.

I was speaking with a customer recently that offers solutions for online merchants. Wendy LaHaye, Vice President of Products & Professional Services at Order Motion, made a good point about how on-demand BA solutions can drive performance-enhancing initiatives. She said, “The key to success in today’s challenging economy is not lots and lots of raw data – it’s the ability to understand that data so you can make effective decisions, manage costs and find opportunities to unlock value that might have otherwise been overlooked – in a timely fashion.” She chose the PivotLink solution because it makes timely business information readily available to a large base of various users, in a way that is highly relevant and useful to each.

The “new normal” requires a faster, easier and more cost-effective way for decision makers to securely access relevant data and take analytics into their own hands. This shift will help bring down organizational stove pipes within a company and the boundaries between supply chain partners so that sharing information and insight becomes more dynamic and fluid. The concept of dynamic insight is something that IT analyst Merv Adrian touches on in his BeyeNETWORK blog.

At PivotLink we’re building the leading on-demand BA solution that helps companies keep pace with the “new normal.” We are the only SAS 70 Type II certified SaaS business intelligence solution, which puts us well ahead of the competition in providing customers with the highest standards of safety and security. Over the past two years we’ve experienced phenomenal growth – a testament to the fact that business users are yearning for new tools to help them improve business visibility and manage through the challenging economy. We deliver On-demand BA solutions to over 15,000 paid subscribers who generate over 1.5m analytical reports every month. Moreover, I am confident that adoption of PivotLink’s solution will accelerate as more and more businesses catch on to the “new normal”.

Business Intelligence (BI) initiatives have been high on enterprise IT’s priority list for decades.  There are countless on-premise BI tools in the market today.  In spite of all the advances in hardware and computing capability, BI implementations continue to be the most challenging IT projects, filled with broken promises, low user adoption and poor ROI.  Instead of creating an enterprise-wide view of the business, current practices typically result in a proliferation of complex information silos that are hard to build and maintain.  Worse yet, they become the very source of information bottleneck and the dreaded multiple versions of the truth problem that they are supposed to fix.  Instead of helping IT to deliver timely and accurate information to decision makers, they become a significant source of distraction for precious IT resources and CAPEX.

On-demand BA represents a radical new value proposition by making business analytics, or core BI, a secure, affordable, easy-to-use and scalable solution to more people than ever before.  Leveraging a cloud-based infrastructure, on-demand BA has the potential to support the trend of increased collaboration within and beyond the extended enterprise by allowing authorized users to access relevant information anywhere, any time.

The rapidly changing landscape of Web based consumer and business applications is ushering in a paradigm shift in how key IT initiatives are delivered.  Savvy enterprises are discovering that partnering with the right on-demand solution provider like PivotLink can bring unparalleled level of speed, quality and reliability to business users.  In the words of one our customers at Macys.com “PivotLink has changed my expectations of how fast, easy and affordable BI can be.” One important reason is that the focus of an on-demand service provider is much better aligned with that of the businesses they serve.  For an on-demand BA service provider to be successful, it must focus on innovations that greatly simplify the solution deployment process, deliver extremely high operational efficiency and reliability, and ensure widest possible secure distribution of functionality, none of which are traits of traditional on-premise BI tools.  It not only frees IT from the onerous aspects of maintaining on-premise BI solutions, but also gives end users a new relationship with their data and new found capabilities to develop analytical competence that helps drive better individual as well as overall business performance.

On-demand BA solutions are gaining traction because unlike traditional on-premise BI, which requires the buy-in and support of multiple divisions within a company, it can be purchased directly by the line of business owner.  The monthly-subscription pricing model alleviates the need for large upfront CAPEX to ensure that an enterprise realizes the maximum and immediate return from the get go.

We believe that as you ponder the most cost-effective way to deliver the next generation BI to your enterprise, where there is an increasing need to accommodate information consumers collaborating inside and outside your firewall across the globe, you will find that on-demand BA may just be the ticket to your success.  The world is changing and so is BI – according to PivotLink. Our vision of highly secure, easy-to-use and affordable tools delivered as a service is the vision for the next generation of enterprise BI – and we are leading the way!

PivotLink isn’t the only one who believes that organizations are ready for the next generation of BI. It’s interesting to read articles by cnet’s Stephen Shankland and searchCIO’s Anne McCrory and to see that Gartner is calling out BA (in lieu of BI) as a top 10 strategic technology for 2010.  Check out Doug Henschen’s recent InformationWeek article The New BI is (Finally) Here – PivotLink is featured in the section “SaaS Makes it Mark in BI”.