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Question and Answer: Straight Talk With Information Builders’ Straight Shooter

Information Builders CEO Gerry Cohen doesn’t mince words, and as our own Stephen Swoyer found it, the New York-based software player has a few cards up its sleeve.

You can’t say Information Builders Inc. (IBI) CEO Gerry Cohen doesn’t speak his mind. You might be tempted to call him a straight shooter. For example, even though IBI is sitting on one of the niftiest data integration technologies on the market—its iWay family of connectivity solutions—Cohen dismisses data integration as an over-hyped buzz-term.

Instead, he’s abuzz over what he calls operational business intelligence (BI)—i.e., the use of BI technologies in conjunction with conventional enterprise applications and systems. OBI is an untapped commodity, Cohen says, that can result in substantial cost savings for adopters. Of course, competitors like Actuate Corp., Business Objects SA, and Cognos Inc. might beg to differ, but Cohen remains undeterred.

If 2003 was the year BI reporting went big time, 2005 looks to be a year in which data integration will follow a similar story…

You don’t think data integration is a little over-hyped?

Well, hype or no, it’s been in the news an awful lot this year. But I’ll bite—why do you think it’s over-hyped?

Data integration has been around for umpteen years. There used to be data dictionary products. Data integration is largely a metadata description of a lot of data. It’s getting a lot of play because after IBM bought Ascential they put Ascential into the DB2 group and then they started to talk about data integration and started talking about building a warehouse. Different people have different understandings of what data integration means. If you’re MetaMatrix the software company, it’s describing all of your data. It’s a nice term. It’s necessary to have uniform descriptions of data across different islands. But what’s driving data integration more than anything else is not the BI side, but the B2B and what I would call the application integration [sides].

You’ve got a heck of a data integration story in iWay, with connectivity into an enormous number of sources, but—from my perspective, at least—it’s a somewhat muted story. That might be consistent with your positioning of [iWay] as more of a B2B or EAI technology, but clearly it has BI strengths, as well. What’s your strategy with iWay, and do you plan to kind of amplify what you’re able to do with it in conjunction with your BI technologies?

iWay software is really an EAI company. Now we call it an "SOA middleware company," because that’s what the buzzword is. In the BI space, yes we do join different worlds together. We are a very powerful engine. We have a lot of very nifty applications that are both iWay and WebFOCUS. But they’re very specific in some sense. We have an application called Syndromic Surveillance: it picks up all of the hospitals in a radius that take up emergency room people. iWay picks up all of the various people’s information who come to the emergency room; iWay brings all of that information, transforms it into something common, and puts it into a database. WebFOCUS is a reporting engine off that database. That’s the kind of [BI] application I’m talking about.

But do you plan to more aggressively push iWay in tandem with your BI solutions, however?

We are very active in promoting iWay for [data integration] and BI. In fact, we just finished a series of lecture tours for the integration council in Canada. We’re very active on the SOA [front], and we’re very active hyping [iWay for] SOA, too.

There’s been some talk about BI standardization—or, more accurately, BI tools consolidation—much of it propounded by the major suite vendors. The idea, if I can paraphrase them, is that organizations want fewer discrete tools and more integration, in large part to help drive down costs. I wanted to get your thoughts on a couple of things in this respect. First, can IBI offer the breadth of feature and functionality coverage that a Business Objects, Cognos, or Hyperion can offer?

I think we’re the only ones who can. We offer what’s also known as operational BI, where to a great extent they offer what I would call analytical BI. Business Objects and Cognos, they basically sell systems like they would in the old client/server world, [i.e.] small deployments, where you’ve got 50 people who need to get information out of a particular database. In operational BI, what we’re doing is applying BI to operational systems where you can have 1,000 or 5,000 simultaneous users. That’s a really big system—a total of 2 million users with as many as 5,000 users online at the same time.

Isn’t standardization somewhat unrealistic or at least misguided as a trend, though? That is, will organizations find that they’re going to have to rely on at least a few best-of-breed BI tools to get competitive advantage?

No company is going to say, ‘I want to get more vendors.’ They’re going to say it’s more economical to have fewer vendors. Companies have been saying that for years in every category. We’re overdoing this best-of-breed; let’s cut back on vendors. However in the BI space, it’s very likely that large companies will have multiple vendors. We have been involved in quite a number of situations where a company has taken seven down to three, and that makes sense. And we feel that we’re going to be one of the three, so to speak. When you think about the requirements of operational BI, It takes a certain kind of architecture to do that. We have clustered machines with failover with automatic load-balancing. We’re real heavy duty. No one else can support 5,000 concurrent users like we do.

You mentioned what you call operational BI. Would you say that’s similar to the kind of operational reporting companies do everyday? If that’s the case, how do you propose to differentiate IBI’s strategy from those of competitors like Cognos, Business Objects, or Hyperion, which have moved more aggressively into operational reporting and BI?

I think this [operational BI] is quite important. I also think it’s something that’s unique for us. We’re applying BI to operational systems, systems that companies rely on to run the company. If you have intelligence in those systems, you get payback, more return on investment for those systems. We have a system where phone companies distribute to the workmen in the field all of that information about what they’re doing, fixing Mrs. Jone’s phone. So the phone guy can actually see how many jobs he’s completing in a day, compared to his coworkers. When you have 5,000 people basically controlled by a scheduling system that’s the heart of the enterprise, there’s a chance of getting a lot more savings. The guys in the field discovered an error in the scheduling algorithm that told them where to go, so that their service calls weren’t scheduled as efficiently as possible: that’s an enormous savings. The improvement they’ve made in that system, they claim it’s $1 million a month. That’s what I mean by operational BI: the unanticipated but significant savings you get when you bring intelligence to those [operational] systems.

The big BI suite vendors have fleshed out their analytic expertise with operational reporting solutions, however. And they say they can scale to support these kinds of requirements. On the flip side, what kind of analytic technology can Information Builders bring to the table?

We have a complete, beautiful set of tools for analysis. We have an OLAP methodology that can work on any database. It’s a metadata layer over the database that makes it look dimensional. We have end user tools and we have a [technology] that we call structured ad hoc, where if you want to get any reports on your own, you bring up a form and just go click-click-click, and we generate a form for you. We can parameteratize and we can get to anything you ask for on a form; it’s just a matter of designing a form that’s appropriate for you—and that’s useful for very large numbers of users with no training.

The enterprise applications space has thinned out considerably over the last 30 months. J.D. Edwards is no more. Nor PeopleSoft or Siebel, for that matter. For all intents and purposes, there’s just Oracle and SAP, with a host of smaller players dotting the landscape. It’s probably too early to expect that so drastic a culling will occur in the BI space, but there’s already a pronounced trend toward consolidation. I wonder if you think that history—in the ERP market and elsewhere—is a reliable indicator of what’s to come?

It probably will come, but it’s not as imminent as it was in the ERP space. Even in the ERP space, now that PeopleSoft is gone, J.D. Edwards is gone, we see a lot of activity in the smaller ERP players; they’re getting a lot of activity; they’re doing fine. It sort of has freed them. A lot of these smaller guys are very niche players. I met a guy the other day who only does agricultural products, people who either grow products or market farm products. I met another guy who only does retailers—both of these guys doing great.

What’s in store for IBI in 2006? What product releases, strategies, or trends are foremost on your radar screen? What goes—if only provisional—do you have for the coming year?

We’ve got some second digit releases, some upgrade releases that have some nice new features. We will have a new iWay release coming out probably in February or March. We’re moving ahead on a number of fronts. We’re making a number of partnerships and expanding the kinds of things we do. We’re trying to get away from the kind of things that Cognos and Business Objects do, MicroStrategy—there’s just too many guys doing that 100 user thing.

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