Ovum Evaluates: OLAP Contents Contents and services OLAP fundamentals Using OLAP to make better decisions How to choose the right OLAP tool/s The anatomy of an OLAP tool Guide to the evaluations Guide to the evaluations Briefing papers Growth, transition and change: trends in business intelligence and implications for the OLAP market Summary of the evaluations Summary of the evaluations 1999 Evaluations Applix TM1 Brio Technology Brio Enterprise Business Objects BusinessObjects Cognos PowerPlay Gentia Software Gentia Millenium Applications Platform Hummingbird BI/Suite Hyperion Solutions Hyperion Essbase Information Advantage DecisionSuite Microsoft SQL Server 7.0 OLAP Services Microstrategy DSS Product Suite Oracle Oracle Express Development Suite Pilot Software Pilot Decision Support Suite SAP AG SAP Business Information Warehouse Seagate Seagate Holos Sterling Software Eureka:Suite WhiteLight Systems Whitelight Analytic Application Server Using OLAP to make better decisions Overview ............................................................................................................................. 2 What does an OLAP tool do? ............................................................................................. 3 Ovum definition of OLAP .................................................................................................... 5 The uses of OLAP ............................................................................................................... 6 Overview Decision making is at the heart of running a business. Whatever the depart- mental function or level of management, there are decisions to be made. Decisions range from operational issues requiring immediate resolution to longer term strategic issues. At the heart of decision making is access to quality information, meaning that it is correct, complete, timely and consist- ent. It is generally implied (rather than explicitly stated) that this informa- tion must also be in an accessible form. Online application processing (OLAP) is an important technology for organi- sations looking for better ways to access and analyse information. OLAP can enable organisations to improve their analysis of performance indicators, manage their customer relationships more efficiently and support critical parts of the manufacturing process. Given the current corporate climate, all decision makers need to know about, and exploit, this technology. Improving decision making with tool support is not an option, it is an imperative. What does an OLAP tool do? Online application processing (OLAP) is the interactive analysis of business information. End users can explore important business measures (such as profits, sales and costs) along many different ‘dimensions’. With an OLAP tool, the user moves seamlessly from one perspective on the business (‘an- nual sales for all stores’) to another (‘the most profitable stores over the last three months’) and drills between different levels of detail (sales by day, week or quarter). This interactive exploration of information is commonly referred to as multidimensional analysis. The common factor defining all OLAP tools – and there are many different implementations of the core functionality – is an analytical engine that turns corporate data into multidi- mensional information for online analysis. Complex decision support and tailored, easy-to-use applications with limited functionality can be built with OLAP tools. However, OLAP tools also sup- port applications that match the needs of a much wider range of users. These applications are characterised by the flexibility offered to the user not merely in terms of navigation through a multidimensional model, but also in terms of the definition of reports and applications. OLAP applications are characterised by a lack of fixed structure. An OLAP tool provides an analytical environment for the power user or specialist knowledge worker, which enables them to use a range of functions to explore the information available. As well as core multidimensional operations such as drilling and rotation, users can quickly define new reports and may even have access to advanced features such as forecasting algorithms, data mining tools or software agents. The overlapping relationship between reporting, OLAP and data mining tools is shown in Figure 1. Reporting tools are aimed at a general audience, and the results are dissemi- nated throughout the organisation. OLAP tools are specialised for the interactive exploration of multidimensional information and are used at all levels of the organisation. The division between the two types of tool is not totally clear-cut however, because some reporting tools have limited facilities to allow users to explore data, and OLAP tools benefit from some of the features of reporting tools. Figure 1 Tool relationships Reporting tools OLAP tools Data mining tools Increasingly specialised At the other end of the spectrum, data mining tools allow users to find patterns and explore data using less structured hypotheses. Some OLAP tools offer limited data mining features, although the current trend is more towards integration with data mining tools than an expansion of the func- tionality of the OLAP tool. Ovum definition of OLAP The Ovum definition Ovum defines online analytical processing as: the interactive, multidimensional analysis of business information on an enterprise scale. Interactive, multidimensional analysis Multidimensionality frees the users to examine their key business measures (sales revenues, costs, profits and so on) from different perspectives (for example, by time, by products or by region). It is the interactive exploration of information along these different ‘dimensions’ that distinguishes OLAP from simple query and reporting tools. Business information OLAP allows users to focus on business concepts (such as sales, profits, customers and products). The users work intuitively with the data they wish to analyse, framing questions that answer their business needs. The user is unaware and unconcerned about technical issues such as the physical data formats and client-server architectures. OLAP does not force users to con- form to the requirements of the technology. Enterprise scale Users are able to work with corporate data sources and share information across the enterprise. OLAP is a strategic technology: it must be robust and scalable enough to meet the information analysis needs of an organisation as a whole. The uses of OLAP Information is a resource Thirty years of automating manual and administrative processes has gener- ated unimaginable amounts of data. The amount of data collected has further escalated with the widespread use of bar codes and EPOS systems and dramatic reduction in the price/performance ratio for collecting, storing and analysing that data. Now more than ever, exploitation of this resource is seen as a crucial element in the armoury of any competitive strategy. There are three major driving forces behind the desire to make better use of information within all organisations. The complexity of the market The increasing volume of data is only one aspect of an increasingly complex commercial environment. Deregulation of markets, new competitors, new forms of relationship (with both customers and suppliers), and external technological, social and economic changes all help to further complicate the forecasting and planning process. Customer focus Competitive advantage is no longer seen in terms of price and quality alone. Companies must be able to innovate to survive. They must understand their customers needs and be able to meet them in an increasingly personalised fashion. The move from mass marketing to individual marketing requires great resources to be devoted to information collection and analysis. Organisational change The 1990s have seen major organisational changes on a worldwide scale. Business process re-engineering has led to a drastic thinning of middle management ranks and a new emphasis on flatter, more flexible organisa- tion structures. The re-engineered organisation requires information to be available to those who need it to make the most effective decisions at the most effective time. How OLAP can help OLAP has an important role to play in helping organisations deal with several challenges: • it helps establish, monitor and communicate the performance measures that allow managers to understand how the business is performing in a complex competitive environment • it enables a better understanding of markets and customers • it can make manufacturing more efficient • it allows quality information to be shared and disseminated within the organisation. Measuring performance A core function of OLAP is the monitoring of important performance meas- ures. OLAP provides a flexible environment for the definition, analysis and sharing of information on performance, including: • the interactive analysis and exploration of performance measurement data • exception reporting, which provides an automatic check of important performance indicators • flexibility in the definition and redefinition of applications to monitor performance measures – making it easier to redefine those measures in line with changing business needs • an environment for the definition and communication of the values to be measured, helping to build agreement and support for the underlying goals. OLAP has a well-established role in budgeting and planning, cost monitor- ing and other standard management functions, but it also has much