- July 5, 2019
- Posted by: Financial Intelligence
- Category: Innovation
This is the era of the intelligent enterprise. Technologies such as machine learning, artificial intelligence, blockchain, and the Internet of Things offer exciting new opportunities to detect patterns, predict outcomes, and suggest actions from the growing mass of an organization’s process, social, and market data.
The challenge is knowing how to take advantage of these intelligent technologies to deliver deeper insights and better business outcomes. Bringing the power of data and analytics to business users within their day-to-day work environment requires specialist skills and knowledge, and companies are increasingly turning to independent software vendors (ISVs) for help.
IDC research shows that advanced analytics and the are critical components in driving success in this new age of exploding data volumes and rapidly increasing complexity. To explore the opportunities and challenges in more detail, IDC surveyed 350 ISVs from North America, the United Kingdom, and Japan that offer – or are planning to offer – cloud-native, analytics-infused solutions and services to their customers.
In the first of a series of three blogs, we look at some of the key market factors and trends in analytics and their implications for ISVs.
Analytics turns data into intelligence
IDC predicts that by 2022, more than 60% of global GDP will be digitalized, with growth in every industry driven by digitally enhanced offerings. Facing the most dynamic market conditions in history, companies must constantly innovate, reinvent, and modernize to survive. But data alone doesn’t provide a competitive advantage; it’s how a company uses its data resources that will enable them to compete. Forward-thinking ISVs are partnering with technology companies to differentiate their capabilities and help them drive new levels of customer insights and actions as part of their software offerings.
Analytics is big business
According to the IDC Worldwide Semiannual Big Data and Analytics Spending Guide, in 2019, enterprises are expected to invest US$185 billion in analytics and artificial intelligence systems, and this is expected to rise at a compound annual growth rate of 12% over a five-year period. Embedded analytics and applications infused with analytics will also continue to gain momentum as companies strive to differentiate and innovate in the data-driven economy. More and more organizations will turn to ISVs to provide these value-added offerings.
Cloud is the key
Cloud platforms make it easier to build and deploy analytics applications globally. According to the IDC 2018 CloudView Survey, 61% of respondents run analytical applications in the cloud. Interviews with ISVs show that they have been able to harness the power of analytics to create new revenue streams, spur innovation, offer differentiating capabilities, and drive growth. Fifty-seven percent of respondents indicated that more than 30% of their analytics software revenue is cloud-based and growing rapidly.
Analytics is the engine for growth
IDC research shows that 73% of ISVs across all segments and industries believe analytics to be critical to their success. IDC’s ISV survey showed that 80% of respondents attributed double-digit growth in revenue to their analytics offerings and stated that software revenue based on analytics contributed significantly to their bottom line.
Invest in technology, people, and processes
Success in the digital economy means being able to deliver on customer expectations and use data and analytics to make intelligence-based decisions. Therefore, organizations must invest in technology, people, and processes that leverage data to drive revenue, accelerate innovation, and optimize business outcomes.
In the next blog, we’ll look in more detail at the advantages – both for ISVs and their customers – of integrating advanced analytics into business applications. Companies that are already doing this are reaping the benefits. “Data is influencing our business model in unprecedented ways,” says Hanno Schoklitsch, CEO and founder of Kaiserwetter Energy Asset Management GmbH, in his IDC interview. “We are transforming ourselves from an asset management company to an analytics company and a data-as-a-service provider, which gives us unlimited potential to grow.”