San Ramon, Calif.- June 28, 2011 – To maintain and improve their market competitiveness, small and midsized businesses are turning to focused analytics that help them manage today’s vastly greater information flows, operate more efficiently and make better decisions, new benchmark research from Ventana Research finds.
For these businesses the most important categories of metrics are financial (identified by 64% of participants), cost (62%) and operational (53%). However, the research indicates that despite viewing them as valuable and important, small and midsize businesses are maturing only slowly in their use of analytics. Fundamental barriers block the road to improvement in metrics use, the research finds; topping the list are the absence of resources, of a strong business case and of a budget and a low awareness of the need to change. This lack of maturity is reflected in the finding that only 51 percent of these organizations can deliver metrics and key performance indicators as quickly as within one week of the end of the month. Additionally, 47 percent report that at least some of the data to which they apply analytics is stale or outdated and more than half (52%) say the data is only somewhat accurate.
The research also shows that more than half of small and midsize organizations (62%) use as their only tool to generate analytics desktop spreadsheets, which are time-consuming, error-prone and unreliable. Midsize companies have an increasing number of practical options for replacing spreadsheets, which would likely improve their business performance. The Ventana Research Maturity Index analysis finds that only 15 percent of all small and midsize businesses are functioning at the highest Innovative level of maturity in their use of analytics.
This in-depth benchmark research on small to midsized business analytics, the latest from the leading business technology research firm, analyzed business and IT organizations around the world to assess the maturity and direction of their efforts. Ventana Research undertook this research to acquire real-world information about maturity, trends and best practices in how small and midsized organizations use analytics and key indicators to optimize their business and IT processes and organizations. It explores how they do this now, how teams view the current processes and tools, plans they have to change or improve them, and benefits they hope to gain by doing so.
The findings offer fresh research-based information on these companies' attitudes toward business analytics. They confirm that business and IT organizations use a variety of analytics, but the data indicates that small and midsized businesses have not yet automated many of the underlying data integration and analytics operations needed to generate metrics. The research also shows that usability and flexible functionality are important criteria in these organizations’ search for the right analytics, that failing to examine timely availability, broad access and efficient handling can obstruct analytics use, and that to improve the maturity of applications usage spreadsheets should be replaced with more appropriate tools.
"The advent of business analytics is clearly a game-changing opportunity for smaller organizations that want to be more efficient in their business processes and more competitive," noted Robert Kugel, SVP of research at Ventana Research. "Without a strong business analytics foundation they simply won’t be able to understand where to optimize performance, let alone plan to achieve the goals required for guiding an organization’s performance.
“This research found that the small and midsize organizations that invest in business analytics are most likely to be innovative and achieve increased operational efficiencies,” Kugel added. “This research provides new insights to help advance the science of analytics and help guide a better understanding of best and worst practices, and also to better inform technology suppliers about what matters most to these organizations.”
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