Digital Transformation

The State of Data Analytics Adoption and What It Means

What is the current state of data analytics adoption among SMBs and what does the outlook look like going forward?

Blog Post

5 minutes

Feb 03, 2021

Here at Impact, we always advocate for businesses to embrace data analytics adoption because we believe that a data-driven organization is far better suited to deal with market disruptions and opportunities than companies that remain dependent on gut-feeling or rudimentary data analysis for their decision-making.

Unfortunately for us, adoption among small and midsized businesses—which together make up over 99% of all businesses in the US—find themselves lagging behind when it comes to the adoption of platforms that enable proper leverage of data.

We’re going to take a look at the state of data analytics adoption for SMBs—what the uptake is, why decision-makers are hesitant to adopt, what the outlook is for the future, and whether you should adopt it yourself.

Where Does Data Analytics Adoption Stand Today?

The picture of adoption among SMBs in the US for data analysis tools is one of limited implementation.

A study by Gartner in 2019 found that more than 87% of businesses were classified as having low business intelligence (BI) and analytics maturity.

Indications so far suggest that organizations are struggling to oversee implementation projects for platforms that allow data analysis, even to a minor degree.

NewVantage found that just 27% of businesses in 2020 consider their work environment to be “data-driven”, with 73% citing big data management as an ongoing challenge for their operations, suggesting a lack of any overwhelming progress over the last two years.

While the circumstances of 2020 led many businesses to increase their digitization efforts, much of this was directed towards communication tools, cybersecurity, and IT management, rather than a comprehensive new look at how they can utilize their data.

What’s even more interesting is that while data analytics adoption remains a big obstacle for many, the desire from business leaders and decision-makers to implement it is higher than ever.

Last year, Dresner found that over half (54%) of all enterprises say cloud BI is either critical or very important to their ongoing and future initiatives.

So, what does this suggest? It suggests that decision-makers are well aware of the benefits of data analysis for their business and want to adopt technologies for this purpose, but the reality of day-to-day operations is that companies are not leveraging the data they have to its fullest capabilities—or anywhere close.

getting to grips with big data graphic

Why Are Businesses Reluctant to Invest In Data Analytics?

The question naturally is, why? If the benefits are so great, then why are organizations, time and again, showing a reluctance to adopt business intelligence and analysis systems?

It’s not a simple answer, as there are several factors. One of the primary issues is that many SMBs are still operating today with legacy solutions for different departments and processes.

Sales and Marketing are still using the same CRM they’ve always used, the warehouse is still operating with the same on-premises ERP solution, and other departments are not integrating their apps into an enterprise-wide cloud ERP.

A study by MicroStrategy of organizations with $100 million or more in annual revenue found that the industries that place the highest importance on mobile business analytics applications and platforms are hospitality (58%) and telecommunications (56%).

In short, businesses are well aware of the advantages a company-wide integrated platform that provides analytics can bring, but the challenge and perceived cost of upgrading inhibits their ambitions.

But even these legacy integrations with analytics apps are not so widespread that anything even close to a majority of organizations can be described as digitally mature.

Most of reason for this lag is to do with notions that a business intelligence rollout will be too expensive, and a hesitancy to upset the operational procedures that have been in place for a long time.

Businesses must make an assessment of whether holding off on data analytics adoption is worth the missed opportunities that not being able to utilize their data to its full potential causes.

For most organizations, these missed opportunities in the long term will damage their revenue, which is why a lot of companies opt to ease their way into data analysis by adopting cloud platforms for some of their operations—like a cloud ERP for your supply chain, for example—before scaling it up to include other departments like HR, IT, sales and marketing, too. 

What Does the Outlook for the Future Look Like?

As with most aspects of digital transformation, the outlook for data analysis appears to demonstrate that adoption is heading in one direction—up.

Reporting, dashboards, data integration, data warehousing, and data preparation are top technologies and initiatives strategic to BI.

Business leaders, all the way up to the c-suite, are more inclined than ever to invest in analytics. McKinsey found that 70% of business leaders agree that analytics has changed their respective industries in at least a moderate way.

As more and more SMBs see the advantages of data analytics adoption, the number of these making implementations to achieve analytical maturity will increase over time.

This is even more the case when you consider that primary concerns—namely that implementations are costly and time-consuming—are being addressed by modern vendors.

Consider, for example, that the median implementation time for a BI and analytics platform is about four months; a lot shorter than what many might imagine.

Combine that with the efficiency and competitive benefits that can be achieved through these solutions, and it’s almost certain that data analytics platforms will be the norm, rather than the exception.

Bottom Line

Despite the benefits that data analytics adoption brings to SMBs and the clear need and desire from decision-makers to implement it, many organizations find themselves severely lacking in their projects.

This is a mixture of reluctance to change established procedures, perceived costs, and perceived time for implementation.

In 2021, cloud-based analytics platforms and their comparatively simple integration with ERPs and existing legacy systems means it’s actually a lot easier for companies to invest in analytics than they might have imagined.

SMBs should think about what areas of their business can benefit the most from data analytics and, if cautious, consider starting their journey with small implementations for certain departments or processes before scaling up to include their entire business.

If your small or midsized business is in need of data analytics adoption but you don’t know where to start, you’ve come to the right place. Learn everything you need to know about what our business analytics services can do for you.


Digital TransformationStreamline ProcessesCRMData AnalyticsEnterprise Applications


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