Business Objects on SAP R/3 or BW

Hi,

My client has got SAP R/3 and Recently Purchased Business Objects.

Now my question is what approach is better:

1) Business Objects on SAP R/3 directly

2) SAP r/3 ---> SAP BW --> Business Obejcts.

Also please suggest me the best/cost effective tools for Option 1.

Please suggest me the Pros and Cons of Both options. Which is SAP recommended, and share me if there is any document by SAP.

Thanks in advance

Siva.