Choosing a Vertical- or Horizontal-based Solution

Organizations should identify whether more value will be provided by a vertical solution that is built specifically for the organization's industry or department, or by a horizontal solution that can grow with the organization. For example, does the organization need a generic reporting, querying, and analysis tool that will extend across the organization, or does the organization need to develop a process and compliancy that will adhere to the US Sarbanes-Oxley Act (SOX) or Health Insurance Portability and Accountability Act (HIPAA) standards? The answer to this question will help the organization define which type of solution will best meet its needs.

In addition, anticipated use of BI in the future may help determine whether a horizontal or a vertical solution will best meet the organization's needs. Organizations that must adhere to compliance standards should take advantage of vertical-based solutions, because vendors have developed solutions that meet specific compliance requirements. Horizontal solutions need a large degree of customization to bring them up to par, leading to extra time and money spent on developing the solutions.

Organizations in key vertical industries should strongly consider vertical-based solutions that will meet their needs, out of the box. Vertical-based solutions are likely to meet the general requirements of a specific industry or department, but since horizontal BI solutions do not base themselves on specified data models, they may be more versatile to the changing demands of the organization. Therefore, if an organization anticipates rapid BI growth across the organization, having the ability to develop solutions based on individual needs may be more beneficial. This relates to identifying the business problem and anticipating the future needs of the organization.