'Analytics' buzzword needs careful definition

Definition of analytics is a broad one, leading to confusion among enterprise users

One of the buzzwords around BI (business intelligence) software -- analytics -- has been through the linguistic grinder, with vendors and customers using it to describe very different functions.

The term can cause confusion for enterprises, especially as they consider BI products from vendors who use analytics to mean different things, said Andreas Bitterer, a Gartner research vice president, in a presentation Tuesday at the company's BI conference in London.

"It's fairly interesting who is actually positioning themselves as a vendor who can provide the ability to do analytics," Bitterer said. "And again, whatever they mean by that is still fairly unclear. If you believe some of the marketing and PR ... it is just fluff."

When Gartner conducted an informal survey among users about what the term means, the answers ranged from online analytical processing (OLAP) to monitoring call centers to reporting and data mining, Bitterer said.

The responses "were completely all over the place," he said, adding that Gartner had more questions than answers after the survey.

Gartner has created its own definition: "Analytics leverage data in a particular functional process (or application) to enable context-specific insight that is actionable." It can be used in many industries in real-time data processing situations to allow for faster business decisions, he said.

For example, a customer trying to withdraw money from a cash machine shows analytics in action: The data being leveraged is a bank account balance, the process is the withdrawal, the context-specific insight is the fact that the customer has no overdraft protection, and the action is the confiscation of the debit card.

Analytics is different from BI, although BI products play a role in analytics

SAP, Oracle, and Microsoft have no apparent definition of analytics, although they toss the word around frequently, Bitterer said. For customers trying to define how the various definitions align, "just grill them on that, because it's kind of meaningless if they sit on a term," he said.

Despite the ambiguities, those vendors, along with Siebel Systems, appear to be the most best suited for providing analytics capabilities, Bitterer said.

Copyright © 2006 IDG Communications, Inc.

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