Vendors are 'dumbing down' software to compete

IN CONVERSATION

SAS originally started out as the Statistical Analysis Software Institute. It evolved as a business intelligence software vendor, then dropped 'Institute' from its name.

However, it retained the acronym SAS. The man behind the company's success, Jim Goodnight, shares his views in an email interview with Business Standard as the company celebrates its 30th anniversary. Here are the excerpts:

You have moved to making Business Intelligence (BI) software that essentially comprises tools for analytics and reporting. Kindly explain this shift.

At SAS, we acknowledge and know the power of analytics and predictive software to help businesses solve crucial problems, become more competitive, and achieve success and profitability.

Analytics, however, is not a cure to all business challenges. Companies must bring together, organise and clean huge amounts of data, including that on their customers, finances and suppliers.

What has made BI a business priority worldwide is that it encompasses data integration and predictive analytics in addition to reporting tools.

Business Intelligence is something that even Business Objects, Oracle, Microsoft and SAP is venturing into. How does SAS view the competition?

A strategy that some vendors have adopted is to try hijacking and 'dumbing down' an existing segment of the software market to match their own limited offerings.

Operational vendors, and even personal-productivity vendors like Microsoft, have attempted to pass off query and reporting tools as all the BI and analytics a business needs. True business analytics, however, involve predictive capabilities, including data mining, forecasting and optimisation.

Operational systems "� even with the thin veneer of so-called analytics provided by query and reporting tools "� will never provide this predictive capability.

The 'intelligence' these vendors provide "� basic reports on what happened last year, last quarter or even last Tuesday "� fall woefully short of what leading companies need to remain competitive.

Customers have found, once again, that they're not achieving the ROI the operational and enterprise resource planning (ERP) vendors promise. SAS goes beyond the simple definition of BI and the limitations of operational software alone.

How do you see the future of real-time analytics or BI tools?

The speed of analytics should be at the speed at which decisions can be made and executed in the physical world. In the case of price optimisation at a brick-and-mortar retailer, prices in the stores can only be changed so often due to labour constraints and to avoid customer confusion.

As a result, price optimisation models in the retail space are normally updated and tuned not in real-time, but at a weekly, monthly or even seasonal frequency.

At SAS, we strive to ensure that our customers have the right analytics at the right time, whether real-time, near real-time or otherwise.

Yet we don't want our customers to be paying more for a real-time application that they don't really need. Does a retailer, for example, need to update its price optimisation model in real-time, after every purchase? Of course not.

A low turnover rate, constant growth over three decades. What is your vision for SAS?

I don't have a grand vision. I have a tough enough time looking a year or two down the road. But I do foresee us maintaining a quality work environment, quality software that solves customer problems, and a healthy bottom line.

I also see us expanding into growth markets like India and participating in the exciting boom that is transforming the world economy.