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The fallout over LucidEra ceasing operations has done nothing but fuel confusion. It’s not  surprising, I suppose, as the next wave of on-demand BI players jockey for position. On one hand, headlines declare the end is near for SaaS BI; on the other, vendors are falling over themselves to offer “rescue” or “safe-harbor” programs for LucidEra customers.  Both sides of the debate miss the point:  while selling hosted BI tool subscriptions might sound seductive to a ‘data junkie’, this does nothing to solve business problems.  And in the SaaS world, there are hundreds of business users for every one data junkie.  LucidEra didn’t fail because they focused too narrowly in the market; rather their assumptions about what drives adoption in the SaaS world were flawed.

The target consumers of SaaS BI - LOB management - continue to evaluate BI solutions not on technology, breadth of offerings, or ease of use, but the value they deliver.  Vendors that “get it” have almost universally eschewed the term “BI” to describe their service offerings and have instead focused on creating out-of-the-box, configurable solutions that deliver measurable business value.  The challenge for up-and-coming vendors is to create a scalable business that provides business users with the experience they’ve come to expect in the application world - plug and play.

But even that’s not enough. Industry best practices are essential to help LOB managers ask the right questions in the right order. If they don’t know what they NEED to know then the best tools, technologies, reports, and dashboards are useless.

Marrying automation and best practices as part of a total offering works. We’ve experienced record growth for the past three quarters, just closed our ‘B’ funding round and our solutions are generating a great deal of momentum at large, global customers like Siemens, Beckman Coulter, and Thermo Fisher Scientific.

This is the perfect storm SaaS BI vendors are up against:

• LOBs that use SaaS transactional apps like Salesforce want to consume their ‘analytics’ in a like manner: easy-to-use, business-controlled, and rapid time to value.
• IT is rarely part of the equation and if it is, there is rarely rapid time to value
• LOBs don’t want to become BI experts; they want to focus on their business
• IT is skeptical of SaaS BI for many well-understood reasons.

So it’s no wonder why some Sales VPs don’t see the value in SaaS BI Erector Sets that vendors throw into their laps without any understanding of how the business really works. Why? Because these vendors are good at BI, not any particular LOB operational management.  Those that don’t “get it” will continue to fall by the wayside.

So I have to shake my head when I see SaaS BI vendors charming the data junkies among the LucidEra customer base while ignoring the business users. To me, they are offering more of the same and, unfortunately, “more of the same” will also mean more failure and frustration for SaaS BI vendors and more trusting customers left high and dry.

As a long-time sales executive, I’ve struggled first-hand with the profound lack of tools  available that actually contribute to more effective management. CRM systems are good at record keeping, and more recently they’ve even done a better job supporting more of the selling process.  Indeed, these systems help my reps, but they don’t make me a better manager. And they remain woefully underleveraged as a source for real front-line enterprise learning.  I know how successful companies run their sales processes, but key to a successful sales team is a manager engaged in a productive management process.

The CFO has Corporate Performance Management systems to automate the annual planning process, but the rest of the company needs management systems that are far more nimble to drive quarterly, monthly, and even weekly operating cycles. IT is stretched, infrastructure costs too much and takes way too long to get in place - most managers default to Excel as it’s the only thing they can control.  Managing the operations of a business is like helming a sailing yacht: the minute you’ve got everything running smoothly, something changes and you have to react immediately.  If you don’t have the controls you need to detect that change coming, you’ll be too late… every time.  No one has solved this problem yet for the average operating executive, not even the BI (Business Intelligence) vendors.

It might have been on one of those long flights to Australia when the light bulb went on. It wasn’t so much that BI vendors didn’t want to solve the problem, they didn’t know how to solve it with the technology they had. And it became clear to me that it was going to take completely new technology to deliver “performance management for the rest of us” at a price point and with ease-of-use that an operating executive with no control over IT could readily embrace. It was at that moment I traded in my corporate gig for the life of an entrepreneur.

Fast-forward three years. Now, in April 2009, our first instantiation of this new breed of Operational Performance Management applications for front-line executives, the Cloud9 Dynamic Pipeline Management Suite, has been thoroughly embraced by customers all over the globe. They are seeing things in their CRM data now they never thought possible. And they’re able to get ahead of change in their pipelines - and their business - far more effectively. Sales leaders are engaged. CRM adoption is strong. Win rates are up.

This blog is about the journey Cloud9, our customers, and the industry is taking to transform front-line leadership effectiveness with Operational Performance Management for the rest of us. We’ll have conversations about pipeline management because that’s a huge pain point for so many organizations. But we’ll also have conversations about how marrying performance management best practices with automation can make operating teams more effective. We’ll talk about how cloud computing is helping to make these solutions real.

The world of possibility is changing fast and it’s going to be a fantastic ride. Hang on.