Directions Magazine
Hello. Login | Register

Articles

All Articles | Post Comment

Location Intelligence Hits Gartner’s Hype Cycle

Monday, May 5th 2014
Comments
Classified Ads:

Summary:

Two recent market research reports studied the deployment of “location intelligence” technology with business intelligence solutions. Unfortunately, the results appear contradictory. Editor in Chief Joe Francica examines the results to find the reason for the low adoption of technology that integrates location-based information.

In its infinite wisdom, Gartner, the market research company, placed “location intelligence” (LI) on the “Slope of Enlightenment” and nearing the “Plateau of Productivity” on its 2013 edition of “Hype Cycle of Emerging Technologies” (see graphic below). The report was released last August. The plateau is the last phase of the hype cycle, a chart that attempts to explain the maturity pathway for new tech innovations, which usually begin in the “Peak of Inflated Expectations,” followed by the “Trough of Disillusionment,” then the “Slope of Enlightenment,” and finally find themselves in the “Plateau of Productivity.” This last phase signals nearly full acceptance and integration into enterprise computing.

I find it surprising that location intelligence is placed on the hype cycle at all since it didn’t appear on either the 2011 or 2012 hype cycles, thus depriving those of us intimately familiar with LI of any travel through “inflated expectations.” Having started the Location Intelligence Conference in 2004, I can tell you I’m feeling some “disillusionment” with Gartner’s analysis, and wondering why LI has just now hit its radar.

Brief Background

In 2004, when Directions Magazine launched the conference, which I chaired, at the Wharton School in Philadelphia, the objective was to put the geospatial technology vendors in the same room as the business intelligence software providers and look for ways to integrate location-based information with BI analytics. Many attended; not everyone grasped the objective. It was clear that there was a lack of enthusiasm on the part of some of the business intelligence companies that carries over to this day. PeopleSoft, Information Builders, SAS, Seibel Systems and Oracle represented the BI players in the room. Of the LI players, Esri, MapInfo, Buxton Company, Korem, MapQuest, Tactician and many others attended. As many may remember, the discussions were at times “heated” with the cry of “spatial is not special” uttered by one BI executive.

Adoption is Not Complete

Today, however, the story is much different. Many BI solutions embed some location technology either for display or analytics. And yet, the adoption rate by businesses is low and I have to question why Gartner perceives that location intelligence is on the verge of providing clear contributions to productivity advancements. Again, those of us in LI understand the potential of location-based information and geospatial technology but this isn’t born out in a recent analysis by Ventana Research.

Benchmark Study

The study by Ventana Research points to the many benefits of integrating location analytics with business processes but highlights dissatisfaction with how the technology is appropriated. For example, the study points to 71% satisfaction by those using a dedicated tool for location analytics, while only 22% satisfaction if the location analytics solutions was embedded within a BI tool. Surprisingly, many in the study said that they had difficulty analyzing data that had a location context, and two-thirds of organizations found that it required “significant effort” to do so, indicating that spatial thinking may not be a skill found often within today’s businesses.

Still Using Spreadsheets

The Ventana Research study bore evidence that those needing location analytics may simply be using the wrong tools. The study indicates that spreadsheets were used 49% of the time to analyze location data, while GIS systems were in use only 23% of the time. What this seems to indicate is that while businesses understand the benefits of spatial analysis, they tend to use the wrong tools or are simply unfamiliar with the right tools. In fact, the study points out that those using GIS to solve location-based problems were “very satisfied” (49%) with this kind of dedicated solution, while those using spreadsheets gave only a 16% approval rate. Similarly, of those indicating that location analytics improved business results, GIS users far outpaced spreadsheet users, 55% to 35% ,with BI tools falling somewhere in between.

Today’s BI tools are Not Fulfilling the Dream

Just as it was hard to encourage a marriage between the geospatial and BI solution providers at the first Location Intelligence Conference (now the Location Intelligence Summit), the problem persists today in form and function. The Ventana Research study also found that one of the biggest impediments of using location analytics was integrating BI and LI tools. In addition, a substantial minority indicated that location technology improved customer experience (21%) or helped to gain a competitive advantage (20%). You can interpret these findings two ways: either 20% are beating their competitors with location analytics or 80% find little use for it. However, of the companies using BI with location analytics, 61% said they were “satisfied” or “very satisfied” with their solutions. Does this mean that while satisfied with their solutions, only 20% of BI/LI users can find measurable benefits?

The Disconnect

If the Ventana Research study shows such “disillusionment” or uncertainly with BI/LI solutions, why then, has Gartner placed location intelligence as nearing the “Plateau of Productivity”? There seems to be a major disconnect between the studies. This much, however, is true. Most of the BI solution providers are embedding location technology within their solutions. Gartner’s own evaluation of location analytics far undervalues its importance. In its 2013 “Magic Quadrant for Business Intelligence and Analytics,” Gartner completely dismissed the importance of applications employing location analytics but acknowledged that many do so. Ventana’s study paints a more positive acceptance of location analytics but the numbers are far from overwhelming.

I would posit that location intelligence has simply jumped the “Trough of Disillusionment.” Mobile apps that embed location technology exploded so profoundly during the last four years that enterprise apps are only now catching up. Many enterprise BI solutions are deployed as mobile apps, such as Salesforce.com. However, I also think Gartner is confusing enterprise with mobile. I would refer readers to Gartner’s “Digital Marketing Transit Map,” a unique and instructive diagram that shows technologies in use as they apply to marketing. Gartner heavily skews geospatial applications in “geofencing” and “geotargeting” into the “Mobility” domain of marketing.

The confusion may be justified but not excused. Businesses that want to deploy a BI/LI solution need to understand what tools comprise today’s productivity suite. Many solutions exist from companies such as Alteryx, Tableau, Galigeo, Yellowfin, TIBCO Spotfire and others. Oracle has an OBIEE suite that is spatially enabled; Esri has solutions for Cognos and Information Builders; Pitney Bowes has solutions for desktop and server, SAP has spatially-enabled HANA, while Google is preparing a solution for better location analytics soon. Yet, the one big problem that remains is training in spatial thinking. Until today’s business schools understand that location analytics is an important discipline, many graduates will fail to use the tools effectively and companies who wish to benefit from LI will continue to stumble into the trough of inefficiency.

Graphic courtesy of Gartner


Did you enjoy this topic? Check out these Channels:
Location Intelligence

Bookmark and Share


Stay Connected

Twitter RSS Facebook LinkedIn Delicious Apple Devices Android Blackberry






Recent Comments


DirectionsMag.com

About Us | Advertise | Contact Us | Web Terms & Conditions | Privacy Policy
© 2014 Directions Media. All Rights Reserved