Aberdeen report explores the differences in strategies, capabilities and technologies in use at different sized organizations
If you’re overseeing performance management initiatives at a midsized organization — one with annual revenue between $50 million and $500 million — then you probably have a thing or two to learn from your counterparts at larger enterprises.
FOR IT TEAMS: Top 5 network management investments
That’s the upshot of performance management research Aberdeen Group completed late last year [2010]. In surveying nearly 400 respondents, Aberdeen said it found that in critical measures of business performance, midsized companies are significantly underperforming when compared to larger organizations.
In the report, “Performance Management — What the Mid-Market Can Learn from Large Enterprises,” Aberdeen evaluates the differences in strategy, capabilities and technologies between large and smaller companies. It found, for example, that 47% of large organizations but only 30% of midsized companies use specialized performance management software.
No surprise, then, that the research also finds notable differences in the ability of organizations to measure performance in a timely manner. Aberdeen found that 66% of large organizations track performance against corporate and departmental goals at least once a month, while only 47% of midsized companies do the same. “The longer the interval between performance measurement, the longer that actual performance can deviate from desired performance before management intervenes,” Aberdeen noted.
Overall, larger organizations “have a greater appetite” for performance management tools and technology than midsized companies, Aberdeen found. While more than two-thirds of respondents at large organizations use scorecards and dashboards, for example, less than half at smaller organizations use those capabilities. A similar breakdown occurs for business intelligence and performance management software, with roughly half of respondents at large organizations using those tools compared to 30% at midsized companies.
“Bringing performance management and business intelligence software together provides a way to both define plans to execute strategy and monitor and measure the execution of those plans. It is also possible to obtain a performance management solution with business intelligence already built in — and large companies are more likely to do so than midsized companies,” Aberdeen noted in the report.
Among other suggestions, Aberdeen recommended that midsized companies adopt tools and reduce time spent on manual, repetitive and error-prone tasks. What’s more, it advised midsized organizations to dig into the potential of business intelligence and performance management solutions to help improve business performance.
Toward this end, such users might consider software-as-a-service (SaaS) offerings, Aberdeen said. In its research, 35% of midsized companies cited the cost of software and services as an obstacle to adopting performance management software. However, only 9% of such companies say they have SaaS-based performance management solutions in use with another 14% indicating they plan on using SaaS to automate performance management initiatives.
Are you ahead of the game in aligning IT to the business? Share your success story here.
