RAPID INSIGHT WITH RESULTS:

HARNESSING ANALYTICS IN THE CLOUD

June, 2014

Michael Lock, Vice President & Principal Analyst,

Analytics & Business Intelligence

Report Highlights
p2
Best-in-Class cloudBI users saw a 21%
year-over-year
increase in operating
profit.

p2
Top cloud analytics
users drove more
than twice the
reduction in
operating cost.

p5
Leading companies
are twice as likely as
all others to use inmemory analytics
technology.

Todays data-driven organization is faced with magnified

urgency around data volume, user needs and compressed
decision time frames. In order to address these challenges,
while maintaining an effective analytical culture, many
organizations are exploring cloud-based environments coupled
with powerful business intelligence (BI) and analytical
technology to accelerate decisions and enhance business
performance.

p7
Best-in-Class cloud
users are 50% less
likely to have critical
information
delivered late.

Rapid Insight with Results: Harnessing Analytics in the Cloud

2
The Growth of Analytics in the Cloud

Today's evolved
cloud-based
environments allow
for acceleration in
the process of
converting raw data
into consumable
insight, ultimately
paving the way for
enhanced business
decisions.

Early generations of cloud-based solutions and Software as a

Service (SaaS) applications were typically considered to be
lighter in functionality and lower in performance. During this
time, the ubiquitous web browser was the tool of choice for
delivering software capabilities. Nowadays, as cloud-based
infrastructure has become more robust and pervasive, and
technological firepower has advanced significantly, companies
are trusting more critical functionality to the cloud.
Meanwhile, the world of business analytics has also seen its
share of evolution. As more business users are becoming
comfortable with analytics, technology advancements have
paved the way for powerful tools like in-memory computing and
columnar databases. Combining evolved cloud infrastructure
with developments in BI has borne a new generation of cloudbased environments that are delivering significant business
value. Aberdeen's March 2014 report, Cloud Analytics in 2014,
demonstrates a recent example of how effective cloud analytics
can deliver results (Figure 1).
Figure I: Executing with Top-Notch Cloud BI
Best-in-Class: Cloud

All Other Cloud Users

24%
21%
17%
14%
11%
5%

Organicrevenue
revenuegrowth
growth
Organic

Increase
Increaseininoperating
operatingprofit
profit
Average Year-Over-Year Change

Reduction in
in operating
operating cost
cost
Reduction
n = 152

Source: Aberdeen Group, June 2014

www.aberdeen.com

Rapid Insight with Results: Harnessing Analytics in the Cloud

Rather than just using a browser-based delivery of a report or a

dashboard, companies are now migrating more of their data
infrastructure and critical analytical functionality to the cloud.
Today's evolved cloud-based environments allow for
acceleration in the process of converting raw data into
consumable insight, ultimately paving the way for enhanced
business decisions.
Background: Increased Data Urgency
Regardless of whether a company is grappling with the challenge
of managing Big Data or has already developed a level of
maturity that allows for the exploitation of Big Data, companies
these days are seeing an increased urgency around their data.
This urgency typically comes in three flavors: volume,
complexity, and speed. Aberdeen's 2013 report, Big Data Trends
in 2013, demonstrates the first two facets of urgency (Figure 2).

56%

Data volume is growing too

rapidly - 47%
Too much critical data is
late - 46%
Data is too
fragmented/"siloed" - 45%
Poor data quality is
impacting decisions - 39%

36
Avg. Unique
Data Sources

38%
29%

Top pressures driving Big Data

initiatives: (% of survey
respondents)

Figure 2: Growing Data Volume & Complexity

Annual Data
Growth Rates

Fast Facts

22

30%

Dec 2009 Feb 2011 Jan 2012 Jan 2013

Small
Mid-Size
Large
Companies Organizations Enterprises

Source: Aberdeen Group, June 2014

It is generally accepted that business data used for analysis is

growing every year, but the research shows that the rate at
which it's growing is also increasing. Secondly, regardless of
www.aberdeen.com

Rapid Insight with Results: Harnessing Analytics in the Cloud

4
Fast Facts
The "decision window":
How quickly do you need
information in order to make
effective decisions? (% of survey
respondents)

In real time, or near real

time - 15%
Within the hour - 9%
By the end of the day - 33%
Weekly or more seldom 25%

How has that time frame changed

over the previous year?

Shortened substantially 19%

Shortened noticeably - 43%
Stayed the same - 36%
Lengthened - 2%

company size, the challenge of data complexity is ever present.

Looking at the number of unique data sources companies use for
business analytics, even small companies are dealing with
significant disparity. The third aspect of urgency has to do with
speed and time. The most striking and relevant business
insights are generally useless if delivered late, and unfortunately
for most companies the definition of late is getting more
stringent. The research shows that almost two thirds of decision
makers today say that they have less time to make critical
decisions (see sidebar). Faced with those three aspects of data
urgency, companies today are looking to augment and expand
their approach to analytics in order to capture more value from
their data and deliver business results.
Expanding Analytical Strategy
In addition to the trend around data urgency discussed above,
there has been a notable shift over the past few years in the
composition of analytical users at most organizations. Where
once business intelligence and analytics were owned by IT and
data professionals or technically savvy business analysts,
today's analytical user looks more like a typical line-of-business
decision maker. This new and expanded class of analytical
thinking business managers necessitates new ways of delivering
BI capabilities.
For an executive or a mobile sales employee needing insight on
the move, companies often look to deliver insights via a mobile
device. On the other end of the spectrum, to satiate the techhungry analysts and data scientists, some companies explore
software or data warehouse appliances that combine powerful
search and data retrieval technology with low-cost hardware. Or
to expand the reach of analytics into more functions across the
organization and create a more pervasive analytical culture,

www.aberdeen.com

Rapid Insight with Results: Harnessing Analytics in the Cloud

many companies are migrating their analytical capabilities to

the cloud.
Aberdeen's recent 2014 Business Analytics survey, of over 675
companies, revealed how top performing companies are using a
variety of different methods to deploy analytics, with the cloud
being at the top of the list (Figure 3).
Figure 3: Best-in-Class Explore New Analytical Approaches
Best-in-Class

Industry Average

Laggard
40%

36%
30%

30%
21%

25%

27%

26%

According to Aberdeen's report, Big

Data Trends in 2013, leading
companies look to build trust in
their data environment through
supporting capabilities such as:
Strong data governance/oversight
capability
48% of Leaders
33% of Followers

10%

Mobile BI

Fast Facts

BI / data warehouse
appliance
% of respondents

Cloud-based analytics

n = 676

Source: Aberdeen Group, June 2014

In addition to these expanded deployment options, companies

are also combatting their data challenges with a variety of key
internal capabilities and some powerful technologies.
Aberdeen's 2013 examination of Big Data Trends showed how
leading companies are leveraging capabilities to build a
foundation of trust in their data while at the same time seeking
help from technologies like in-memory analytics and columnar
databases (see sidebar). This evolved and expanded approach
to analytics helps top companies enable more line-of-business
decision makers with relevant tools, while at the same time
empowering the more technically proficient with the analytical
horsepower they need to derive insight from Big Data.

Continuous monitoring of data

quality
41% of Leaders
21% of Followers
Leading companies also explore
new, powerful technologies such
as:
Columnar database technology
50% of Leaders
36% of Followers
In-memory analytics
28% of Leaders
14% of Followers

www.aberdeen.com

Rapid Insight with Results: Harnessing Analytics in the Cloud

6
Leveraging third party
infrastructure and IT
manpower, cloud
analytics users are
able to deploy the
solutions to all
intended users in less
than half the time.

Performance Implications of Analytics in the Cloud

Delivering effective analytical capability is a progression that
culminates in the kind of performance improvements depicted
in Figure 1. The early stages of this process involve getting the
solutions deployed efficiently, and then building adoption and
engagement with analytics. When comparing cloud analytics
users to those taking an on premise-only approach, the research
shows some fairly wide discrepancies across these metrics
(Figure 4).
Figure 4: Agility with a Cloud Approach
Cloud Analytics

On-Premises Only

7.8

65%
52%

3.3

42%
35%

A Hybrid Approach

Total BI deployment time

(Months)

% of users actively
engaged with analytics

% of users with selfservice access to BI

n = 197

Typically, a cloud-based approach

to analytics is not an all-or-nothing
proposition. Of the 152 cloud users
cited in this report, 75% of them
are blending cloud analytics with
on premise infrastructures as well.
Additionally, 52% of Best-in-Class
cloud users are also utilizing
mobile BI as another channel for
delivering critical insight to
decision-makers.

Source: Aberdeen Group, June 2014

Depending on the magnitude of deployment (number of users,

breadth of analytical capability, etc.), implementing analytics
can become a long and arduous process for the ill-prepared.
Leveraging third party infrastructure and IT manpower, cloud
analytics users are able to deploy the solutions to all intended
users in less than half the time. Once deployed, cloud users are
also more proficient at driving adoption and usage of the tools.
With a faster and less technically-heavy deployment, cloud users
are able to foster a higher degree of analytical activity in their

www.aberdeen.com

Rapid Insight with Results: Harnessing Analytics in the Cloud

user base, while also promoting a culture of self-sufficiency with

analytics.
With a higher degree of adoption and self-service usage, these
companies are then in a position to effectively transform data
into timely insight. Looking specifically at cloud users, the
research shows that Best-in-Class companies are able to access
more relevant data for analysis, and then deliver results within
the necessary timeframe (Figure 5).
Figure 5: More Data, Faster Delivery
Best-in-Class: Cloud

Industry Average

Companies that put

processes in place to
make data more
searchable and
discoverable are able
to enrich their
decisions with more
data-backed insight.

Laggard

85%

44%

71%

33%
29%

Average increase in searchable /

discoverable data

67%

Percentage of critical information

delivered "on-time"
n = 152

Source: Aberdeen Group, June 2014

While many companies have taken strides to capture and store

more data (out of strategic desire, or perhaps regulatory
requirement), oftentimes a significant portion of that data is
inaccessible or unusable for analytical purposes. Companies
that put processes in place to make that data more searchable
and discoverable are able to enrich their decisions with more
data-backed insight. Top performing cloud users were able to
boost that amount of searchable data by 46% more than all
other companies. This improved data infrastructure helps them
address the urgency they face regarding both data volume and

www.aberdeen.com

Rapid Insight with Results: Harnessing Analytics in the Cloud

8
Read the full report,
Cloud Analytics in
2014: Infusing the
Workforce with
Insight"
Related research,
"Big Data Trends in
2013"

complexity as they can utilize more data, and it's typically

presented in a more consumable way.
The other critical component of a Best-in-Class cloud strategy is
their ability to deliver against the time urgency of data.
Whatever the decision window is for a particular user (within the
hour, within the week, real time, etc.) top cloud users are able to
produce relevant information within that window 85% of the
time. Abstracting the information in Figure 5 produces another
interesting finding. If Average and Laggard companies deliver
within that window roughly 70% of the time, that means that
approximately 30% of their information is delivered late.
Contrast that with the Best-in-Class, who see late information
less than half the time of all others. The ability to distribute
information in a timely way is perhaps the most critical element
of effective business analytics, and the Best-in-Class have put
the right pieces in place to support timely information delivery.
Key Takeaways
For any organization that is driven in a significant way by data,
effective business analytics has evolved from "nice-to-have" into
"must have". In this new analytical landscape, competitive edge
will be derived not just from making data-driven decisions, but
also from the ability to enrich and accelerate these decisions
with more clean and relevant data, supported by a potent and
well-tailored suite of analytical technologies. While a cloudbased approach to analytics can deliver value on its own (faster
deployment time, higher adoption, etc.), Best-in-Class
companies understand the power of improving and extending
the BI environment through a hybrid approach. As companies
consider migrating aspects of their analytical strategy to the
cloud, the following high-level takeaways should help guide that
approach:

www.aberdeen.com

Rapid Insight with Results: Harnessing Analytics in the Cloud

Data challenges are driving analytical adoption.

Finding after finding reveals that data truly is at the core
of the challenges companies face, ultimately motivating
their analytical activities. Data volume is showing up not
just in the form of traditional structured transactional
data, but also non-traditional sources like
sensor/machine data or unstructured data from social
channels. This growth in volume and complexity,
coupled with an increased urgency for faster information,
necessitates a mindset, a culture, and a technological
infrastructure that can facilitate the transformation of
raw data into consumable insight.

Getting the right tools

in the hands of the
right people, quickly
and efficiently, helps
support a higher
degree of analytical
activity with a lower
reliance on IT support.

Top companies are exploring new technologies and

strategies. The three-pronged data urgency that drives
analytical strategy is also forcing companies to think
differently about their approach to analytics. Increased
data volume, while often a major problem for some
companies, is opening up more opportunities to view
data as a strategic asset. As more of that data, in all of its
various forms, is incorporated into the analytical
environment, decisions can be enriched with supporting
information that was previously inaccessible. Increased
disparity and complexity of data is driving investments in
some new technologies that can enable faster and more
efficient retrieval of information from the variety of data
sources in the organization. Finally, the need for speed
in the data environment is influencing the way top
companies deliver analytical capabilities. Getting the
right tools in the hands of the right people, quickly and
efficiently, helps support a higher degree of analytical
activity with a lower reliance on IT support.

www.aberdeen.com

Rapid Insight with Results: Harnessing Analytics in the Cloud

10
Cloud-based environments are delivering tangible
results. Gone are the days when cloud and web-based
infrastructure was relegated to supporting only lightweight, low functionality, browser-based applications. As
cloud-based environments have become more robust,
and analytical functionality has evolved and become
more powerful, leading companies are looking for ways
to integrate these new solutions into the cloud. Those
that are the most effective with a cloud-based analytical
infrastructure are able to deliver solutions quickly,
engage the line-of-business, enrich their decisions with
more data, and deliver results before the decision
window closes. The net effect of this Best-in-Class
strategy for cloud analytics is substantial and repeatable
business performance enhancements.
For more information on this or other research topics, please visit www.aberdeen.com.
Related Research
Collaborative Data Governance: Peeling the Red
Holistic BI: Three Cogs in a Well-Oiled Analytical
Tape Off Data Discovery; May 2014
Machine; May 2014
Three Pillars of Big Data Strategy: Trust,
Mobile BI: Portable Firepower for Line-of-Business
Availability and Speed; May 2014
Insight; April 2014
Best-in-Class Reporting and Dashboards: The
Cloud Analytics in 2014: Infusing the Workforce with
Workhorse of Analytics; May 2014
Insight; March 2014
Author: Michael Lock, Vice President & Principal Analyst, Analytics & Business Intelligence
(michael.lock@aberdeen.com)

www.aberdeen.com

11

Rapid Insight with Results: Harnessing Analytics in the Cloud

About Aberdeen Group

Aberdeen Group conducts research focused on helping business leaders across sixteen different B2B technology
disciplines improve their performance.
Our process is simple we conduct thousands of surveys every year to identify top performing organizations and
uncover what makes them different. We share these insights back with the market in the form of in-depth research
reports and content assets to help our readers build business plans capable of driving better results with the right
set of tools to help them get there.
This document is the result of primary research performed by Aberdeen Group. Aberdeen Group's methodologies
provide for objective fact-based research and represent the best analysis available at the time of publication. Unless
otherwise noted, the entire contents of this publication are copyrighted by Aberdeen Group, Inc. and may not be
reproduced, distributed, archived, or transmitted in any form or by any means without prior written consent by
Aberdeen Group, Inc.

IML14439-USEN-00

www.aberdeen.com