Organisations are increasingly adopting technology that allows them to predict business disruptions using ‘leading indicators’, according to Gartner
Organisations that use predictive business performance metrics will increase their profitability by 20 percent by 2017, according to a report from IT research firm Gartner.
With this in mind, organisations are adopting intelligent business process management suites (iBPMSs) and operational intelligence platforms that increase their ability to successfully respond to business disruptions, Gartner said.
These technologies leverage predictive analytics and provide information that makes it easier to identify relevant predictive metrics. Gartner estimates that the BPMS market will reach $2.8 billion (£1.8bn) in 2014, an 8.8 percent growth from 2013.
“Using historical measures to gauge business and process performance is a thing of the past,” Samantha Searle, research analyst at Gartner, said in a statement. “To prevail in challenging market conditions, businesses need predictive metrics – also known as ‘leading indicators’ – rather than just historical metrics (aka ‘lagging indicators’).”
The report noted organisations struggling to cope with today’s accelerated business cycles, which require business and IT leaders to track work in progress, are seeing an increasingly vital need to make optimisation adjustments in real time, and increase organisational responsiveness to market dynamics and evolving event patterns.
“Business process directors who don’t apply predictive metrics to cross-boundary business processes will leave their organisations vulnerable to the risk of failing to execute their business strategies,” Searle continued. “This is because they are unable to anticipate how well critical processes are driving strategic business outcomes, and therefore are unable to make well-informed decisions and intervene when process performance has plummeted below acceptable levels.”
As the speed of business increases velocity, the report warns senior IT managers and business process directors will increasingly be called on to manage an unprecedented degree and pace of business change, and to seize transient business moments by discovering what customers value and by personalising processes to deliver that value – all in the same instant.
A recent Gartner survey, conducted among 498 business and IT leaders in the fourth quarter of 2013, showed that 71 percent of business and IT leaders understood which key performance indicators (KPIs) are critical to supporting the business strategy.
However, only 48 percent said they can access metrics that help them understand how their work contributes to strategic KPIs, and 31 percent agreed they had a dashboard to provide visibility of these metrics.
“Business process directors should identify the business processes that are critical to driving strategic business outcomes and strategy execution, and determine how best to measure business outcomes in a way that triggers human or automated actions before an undesired outcome occurs,” Searle concluded. “This ability will be crucial in determining the organisations who survive the shift toward a digital world and those who will be left behind.”
Do you know all about the Internet of Things? Take our quiz.
Originally published on eWeek.