Many Happy Returns

There should be no more doubt about the improving health of IT spending, and BI's expected share of the take. A series of reports indicates that business intelligence projects will be the focus of many of the largest U.S firms this year. But that's not all: Taken together, two of the most recent studies indicate that an increase in BI dollars is likely to continue not just in the coming months but next year as well.

Almost half the 870 North American CIOs surveyed by Forrester said they'll deploy BI applications in 2004, according to findings released last week. This represents no small chunk of change, and it lends credence to upbeat forecasts forwarded by BI vendor CEOs during the year's first round of quarterly earnings reports.

But don't expect the dollars to stop flowing when the fourth quarter closes. ERP will see a big leap in investment, according to Wendover Corp.'s most recent quarterly report on IT spending. Half the executives surveyed by Wendover anticipate a future ERP purchase. The point, as far as BI is concerned, is that what's good for ERP now is good for BI down the line.

As Business Objects CEO Bernard Liautaud said recently, BI applications naturally follow ERP deployments. First comes the database, then the ERP. What follows the ERP implementation is a need to get a handle on what business data can tell companies about their operations. "They think this is a great buy," Liautaud said, "but they still don't have a complete view of the enterprise."

If ERP is the big focus of spending now, then business intelligence might just be an even bigger area of concentration next year than it already is this year. Most IT departments still may not be getting the allocation they need to meet the BI demands they face, and the spending turnaround may have been long in coming. But things are looking up -- not just in the short term, but the long term.