Rethink Your Approach To Business Intelligence
•PDF Version Q&A: Rethink Your Approach To Business Intelligence
By John Roach, Editor, Retail Solutions Online
Can you instantly analyze in-depth, real-time data for your entire retail operation? If not, says QlikTech's Bob Langer, why not? I visited the world headquarters of BI software provider QlikTech and spent an hour talking with Langer, the company's president of the Americas, about the evolution of the BI industry, what those changes mean to retailers, and how you can reap the benefits.
QlikTech, a Radnor, PA-based business intelligence (BI) software developer, is on a roll. Despite a recession, the privately owned company reported a 50% increase in revenues in 2008 to $120 million, and saw its customer base expand to almost 11,000 in 92 countries.
QlikTech's flagship product, QlikView, was launched in 1997 (as version 3.15) and has enabled the company to team with more than 700 specific channel partners worldwide and to sustain an astounding average growth rate of 14 new customers every day. In its 2009 BI/Performance Management report (February 2009), the Aberdeen Group listed QlikView as its only "Champion" — a vendor that has demonstrated superior proficiency in delivering both real value as well as the ability to serve and support its installed user base.
My exclusive interview with Langer, who joined the company in April 2008 after holding leadership positions at Dell and Sun Microsystems, highlights the increasing importance for retailers to understand the potency of the latest innovations in BI software technology.
John Roach: What is your role as president of QlikTech Americas?
Bob Langer: My responsibility for the region is to drive all aspects of our business, whether it's sales, marketing, finance, services, or support functions that go with it. For the Americas region — Canada, the U.S., and Latin America — we grew faster than the rest of the company last year, and we're tasked with that kind of growth again this year. Aside from that, I also love to get out and talk to the customers and our channel partners as much as I can, because that gives me the real-world view of what's going on.
How has your first year at QlikTech compared to your past experiences at places such as Sun Microsystems and Dell?
The time at Sun was actually similar to what we're experiencing at QlikTech. When I was at Sun [1985-94], those were really the go-go years; they were similarly very disruptive in what they brought to the market. Sun believed the network was the computer, and they focused on getting people to understand that large, centralized, monolithic mainframe processing, although appropriate for large-transaction environments, wasn't really appropriate for other kinds of environments.
For me, both companies were great places to spend time because they were very disruptive models. One was more of a pure technology model; the other was more of a market and distribution model.
What should retailers focus on when they're looking for business intelligence software?
They've got to look at platforms that allow them to do a very high level of complex analysis. Most importantly, they need tools that allow them to draw the insight out of the data.
Retailers should not go down the traditional path they have for so many years. If you're still not getting the reporting, analysis, perspective, insight, or the dashboard to the people that matter — which is every employee at the company — then you're missing out. Anyone who touches a customer should have the ability to see exactly what's happening around them.
So retailers have to think a little bit differently — not radically — and start to pay attention to all of these incredible interactions occurring thousands and thousands of times a day in all of their stores, or on the phone, or on the Web. Their employees will see the trends developing, and that will give them the opportunity to act: to change this, increase this, lower that. Immediacy is the key.
Tell me about QlikView's BI capabilities, and how they apply to the retail sector.
We've architected QlikView to be an extremely powerful tool that allows you to do analysis, data visualization, and reporting. QlikView has been put into the BI category because it delivers all the things a BI platform is supposed to deliver. But in reality, I think QlikView is a superset of what BI has traditionally tried to do. We don't build large data warehouses; we don't build pre-defined paths. We focus on being able to very simply connect data sources from disparate locations. Through our technology and our algorithms, we are able to assemble the information in a way that allows users to seamlessly and intuitively start clicking in, drilling in, and getting new levels of insight.
I saw JC Penney chairman and CEO Myron Ullman on CNBC's Squawk Box, and he was asked: What's the one thing that every retailer needs to be thinking about if they're going to have any shot at surviving this whole mess and getting back on track? The answer, he said, was really simple: If you don't have the necessary tools and analytic capability inside your business to measure every moving part and know exactly what levers to throw precisely when, you are dead. And I yelled at the screen: "You tell them!" He was preaching our message. That's what we're seeing in the retail sector.
So QlikView gives retailers access to more information?
It really does. We're being tasked by some pretty tough retailers right now with some monstrously large datasets — multi-billion row datasets — where they're coming up with analytic techniques that are off-the-charts in terms of complexity. Nobody else is pushing our pedal that hard, and we're keeping up, and putting them so far ahead of where they were.
For instance, we're currently working with a large consumer electronics retailer. During a promotion, QlikView allows them to take a snapshot — in real-time, every hour or two — and see their sell-through by SKU or by brand, plus what sort of market-based results they're achieving on services such as installation, extended warranty, or surround sound. Previously, the best the company could do was generate an Excel sheet several weeks after the promo was over and say, "Here's what happened."
According to the retailer's CIO, our proof of concept showed him that he could have all of this information coming through from point-of-sale, inventory, supply chain, and so on, providing a view he'd never seen before. QlikView helps retailers completely rethink the way they should be measuring and managing their business.
What makes QlikView different than other BI software offerings?
The big piece is the associative logic. What fools people, especially competitors, is that QlikView is incredibly simple-looking from the outside: The user interface is as plain and basic as it could be. You have the ability to select how you want to view data, from list boxes to charts to anything you want; it just feels so basic. But when you peel that away and get underneath, there are a couple million lines of code there. It's very complex, which is how it allows users to drill into the information and analyze it. You get to this new level of insight.
Obtaining massive amounts of data, especially as retailers do, is just the very beginning point. You need to harness the data in a way that builds some insight. From that insight, you start to amass knowledge around what you can do, and from that knowledge, you can then take action. If you can't build this continuum where you go from a massive terabyte environment to specific action at a micro level — such as at a SKU, store, market, or a promotion level — how can you improve your lot? All that data does you no good. You have to pull it out into a form that provides visibility not just for the top guy, but all the way down through the organization.
The greatest ideas for change in any company come from the employee base up, not from some vision wizard on top pushing it down. The people on the street with the customers are the ones who get it. They're living it every day.
Do you have a new version of QlikView in development?
We have Version 9.0 coming out late spring or early summer. We try to get a new major release out every 12 to 15 months, then do a quick maintenance release within 90 days for bug fixes. There will be some great new capabilities in 9.0, including mobile support with iPhone and BlackBerry integration. Just about every feature in each new release is customer driven, whether it's from conversations, requests, wish lists, or user group discussions.How is the economy affecting retailers' approach to BI?
Organizations have a sense of urgency that I haven't seen before. Not a sense of panic, but a sense that, "I've got to get something done fast." If anything, that sense of urgency has accelerated our growth. It's sort of a perfect storm environment for our company because the market has shifted dramatically and there's no longer tolerance for long-term projects and large-scale investment with a relatively undefined outcome. Over the last 12 months, customers have become very, very specific and impatient. "I have this problem that needs to be fixed right now. I'll spend money all day long if you can get this problem off my plate, because it's a killer. But if you can't, get out — leave me alone."
So we have to prove to potential customers that we can build this application, deliver it, and have positive financial impact within the quarter — within 90 days, start to finish, which is what we do. This environment is horrible for the dinosaurs in our industry, because they're dependent on big multi-year commitments and selling a dollar of software with six dollars in services. We're the opposite: a dollar of software and 15 cents in services.
Has the economy forced QlikTech to alter its approach at all?
Very little has changed, because the key for us is staying very, very focused. What I've tried to do since I arrived is shift our messaging, which was a little more general, to something much more specific. Within retail, for example, we look at optimizing the damage/recall/return process that occurs between stores and their distribution centers and manufacturers, or at measuring the on-hand availability of specific products within a channel to prevent out-of-stocks. These are just two of the specific business challenges that our retail customers are struggling with. Our message to them needs to be spot on, so that someone raises their hand and says, "That's my problem. I need to speak with you. When can we meet?" And if we don't get that kind of response, then the message is wrong.
What will your organization — and the BI industry in general — need to do to prepare for the future?
I think the opportunity and the challenge for us is building an awareness level for QlikView across the broader markets — getting rid of the "Qlik Who?" We offer a very different way of solving the BI problem, and you can do things so quickly and so impactfully with it.
I think QlikTech is well-positioned now and for when the economy comes back. For now, we thrive because our product provides a significant speed advantage and instant value, at a fraction of the cost of traditional BI software. And we prove it by beefing up the customer base every single day. No one else adds new customers at this rate. So the market is speaking volumes about who gets it done and who doesn't.
Now, could a healthy economy return us to the dinosaur era of BI? I think not. I've been around the industry long enough to have this belief that shift happens. You go through these major transformations, driven by the economy, the market, or technology, and shifts occur. Other companies may feel that the market model, the supply model, or the services model they've had for the past 10 years — as they harvested all those dollars — will return, but it's not coming back.
So back to your earlier question, I'm starting to see a little bit of what I saw in the early years at Sun happening here as well, when Sun was the only one talking about Unix before the competition wised up. We're starting to see our competitors promoting their "in-memory" solutions, "like QlikView" — but they're not like QlikView. Still, the simple fact that they're telling customers, "We're like QlikView," gets customers to say, "Then I guess I need to talk to QlikView."
Have a comment about this article? Let me know. Contact me at jroach@vertmarkets.com.
Click Here To Download:•PDF Version Q&A: Rethink Your Approach To Business Intelligence