Metrics Matter

I had a very interesting conversation last week with Dyke Hensen, SVP of Product Strategy for PivotLink.  For those of you not familiar with PivotLink, the company is a SaaS BI provider that has been in business for about 10 years (before the term SaaS became popular). Historically, the company has worked with small to mid sized firms, which often had large volumes of data (100s of millions of rows) taken from disparate data sources.  For example, the company has done a lot of work with retail POS systems, ecommerce sites, and the like.  Pivotlink enables companies to integrate information into a large columnar database and create dashboards to help slice and dice the information for decision-making.

Recently, the company announced ReadiMetrix, a SaaS BI service designed to provide, “Best practices-based metrics to accelerate time to insight.”  The company provides metrics in three areas:  Sales, Marketing, and HR.  These are actionable measures that companies can use to measure itself against its objectives.  If some of this sounds vaguely familiar (e.g. LucidEra), you might be asking yourself, “Can this succeed?”  Here are four reasons to think that it might:

• PivotLink has been around for the past decade.  It has an established base of customers and business model. The company knows what its customers want. It should be able to upsell existing customers and it knows how to sell to new customers.
• From a technical perspective, ReadiMetrix is not a tab in Salesforce.com like many other business SaaS services.   Rather, the company is partnering with integrators like Boomi to provide the connectors to on premises as well as cloud based applications. So, they are not trying to do the integration themselves (which often trips companies up).  The integration also utilizes a SOA based approach, which enables flexibility.
• The company is building a community of best practices around metrics to continue to grow what it can provide and to raise awareness around the importance of metrics.
• SaaS BI has some legs.  Since the economic downturn, companies realize the importance of gaining insight from their data and BI companies of all kinds (on and off premises) have benefited from this.  Additionally, the concept of a metric is not necessarily new (think Balanced Scorecard and other measurement systems), so the chasm has been crossed in that regard.

Of course, a critical key to success will be whether or not companies actually think they need or want these kinds of metrics.  Many companies may believe that they are “all set” when it comes to metrics.  However, I’ve seen firms all too often think that “more is better” when it comes to information, rather than considering a selected number of metrics with drill down capability underneath.  The right metrics require some thought.  I think that the idea of an established set of metrics, developed in conjunction with a best practices community might be appealing for companies that do not have expertise in developing their own.  It will be important for PivotLink to educate the market on “why” these categories of metrics matter and their value.