2012 IT Services Survey: Startling Links Between Data and Financial Performance

We surveyed 300 managers at IT services and software companies (opens in new tab) in the UK, US and Australia to map out where they see opportunities for growth and efficiency in 2012. The results blew us away.

Early this year we released the results of an ambitious survey we commissioned from an independent agency (Loudhouse Research) into the inner workings at IT services and software companies; the report was called "Managing Growth: A review of the global software & IT services industry (opens in new tab)".

Our goal:

Get neutral feedback from finance managers and resource planners into the links between financial and operational data, management systems and their companies’ performance, at a crucial time for the IT services and software industries.

Findings from the IT Services and Software report
The report highlights an upbeat mood in the IT services and software industries (opens in new tab)

"Achieving growth and successfully managing company priorities is currently threatened by an inefficient use of resources, lack of reliable data, and a lack of integration between differing departments and processes." (opens in new tab)

"The research finds clear links between the presence of real-time analytics and highly integrated back-office functions and the overall profitability of the organisation." (opens in new tab)

Profitability and use of real-time financial data
In fact, the survey demonstrated a clear link between IT services and software companies’ access to real-time financial data and increased profitability. Seventy percent of those that used and analysed real-time financial data grew more profitable in 2011, while only 47% not using the data grew in profitability. (opens in new tab)

Integration between operations and finance
Among the survey’s respondents, a heartening 60% cited a high level of integration between financial systems and operations. However, there’s a worrisome discrepancy. From the report: (opens in new tab)

"70% of finance professionals reported full integration between their department and the operations function, while only 49% of operations professionals reported full integration with finance." (opens in new tab)

Clearly, views from each side of the finance and operations fence differ. (opens in new tab)

Other findings from the report
The IT services and software survey included approximately 20 questions, and the results provide a comprehensive snapshot of the management capabilities that differentiate top performers. Some of the kinds of responses analysed in more detail in the report: (opens in new tab)

• The degree of integration of different business systems relative to each other —financials/ERP, professional services management, ecommerce and CRM (opens in new tab)
• The link between systems integration (financials and operations, as well as sales and non-sales) and profitability (opens in new tab)
• The availability of real-time financial data in different data categories (opens in new tab)
• The level of reporting maturity, in terms of access to real-time data and analytics for different departments (versus manual spreadsheet reporting) (opens in new tab)
• The rate of adoption of cloud or Software-as-a-Service solutions for core business functions. (opens in new tab)

The 10-page global software and (opens in new tab)IT services report (opens in new tab) is currently available free of charge from the NetSuite site. Particularly if you’re an IT services or software company in the US, UK or Australia, this report is a great way to benchmark your performance.