Before we consider Software as a Service business intelligence, or SaaS BI, let’s start with the basics.

Traditionally, software has been run on in-house servers, but hosting it on remote servers managed by a third party can improve scalability and reduce both administration effort and costs. The software is hosted remotely on the Internet or in the cloud, these locations amounting to much the same thing. The service is usually accessed through a thin client, which in many cases is a Web browser. So the principle of remote hosting is easy; it’s the nomenclature that’s hard.

The term

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Software as a Service has been around for a while now, often shortened to SaaS with the double “a” pronounced as the standalone one is in the word apple. It’s also called on-demand software services and the phrase service in the cloud (SiC?) is increasingly apparent.

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And just when you thought we had reached the end, Data as a Service appears and is acronymised to DaaS. (No washing powder jokes, please.) This term is used by several leading names in the business intelligence (BI) market. Hosting data remotely (as opposed to just software) is a great idea, but as the service provider, you can’t just hold the data; you have to also provide some kind of software that allows it to be manipulated. So the vendors provide an engine to store the data, administer the engine for you and allow you to access the data for BI-type analysis.

SaaS technology has already taken hold in particular niche areas: Customer relationship management (CRM) is a prime example, especially the analysis of customer behaviour and of pricing, promotions, shopping baskets and churn rates. Other areas where SaaS is popular are enterprise resource planning, content and service desk management, human resource management and many forms of collaborative work.

SaaS is particularly worthy of consideration for an organisation with significant data volumes and without a bottomless money pit to fund IT systems. So that would be most organisations, then.

SaaS benefits for a BI system

There is, of course, a potential cost benefit to SaaS BI and other cloud services. The packages offered by different SaaS providers will vary, but one model is to charge for the processing time you use and the disk space to accommodate your data. The most flexible arrangements do not commit you to a particular level of usage per week, month or whatever, but will instead charge you for the actual processing you undertake.

Further savings in time and effort are accrued because the service provider will manage the administration and security of the SaaS system.  Indeed aspects such as physical and application security, data backup, user authentication and data encryption may all be handled for you; but this may vary from provider to provider.  So it is well worth checking the service-level agreements for the offerings that interest you to see exactly what is being offered.

Another benefit of SaaS technology is the potential for rapid deployment. Once you have negotiated the CPU cycles and disk space you require, you typically can start using a SaaS system almost immediately. There’s no specifying, buying or setting up hardware and no installing or maintaining software.

In addition, the ability to scale elegantly is often inherent in the contract you sign with a SaaS provider. If you need more disk space or additional processing resources, you can increase your capabilities accordingly without having to do anything on your end.

There are several specific areas of BI that potentially can benefit from the SaaS approach.

 The first is the extract, transform and load process; as part of that, the data taken from source systems can be sent to a SaaS tool for cleansing and integration before being loaded into a central data warehouse. Traditionally, the core data warehouse has been hosted on-site -- but it doesn’t have to be. A number of vendors offer SaaS hosting for data warehouses.

The heart of SaaS BI technology lies in analytics, though. SaaS offerings include tools that let end users browse and search data, tools for ad hoc data analysis and tools for generating reports. Reporting has been available as a software service for some years now, with various vendors offering options including dashboards and other graphical and visualization elements).

The bottom line is that whatever you call it, SaaS has reached maturity. You can go out today and buy these services from reputable companies. You need to look very hard at the deals they offer and quantify the costs vs. savings very carefully. You also need to consider security and the guarantee (or otherwise) of service uptime. SaaS in BI is here to stay. 

About the author

Mark Whitehorn works as a consultant for national and international companies. He specializes in the areas of databases, data analysis, data modeling, data warehousing and business intelligence (BI). Professor Whitehorn also holds the chair of Analytics at the University of Dundee where he works as an academic researcher, lecturer and runs a Masters programme in Business Intelligence.


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This was first published in February 2012

 

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