Businesses bamboozled by information explosion, according to new research
London
20-Sep-2011
The vast majority of businesses think it is important that they respond quickly to changes in their operating environment, but many are worried that the time it takes them to make key decisions is increasing.
An Economist Intelligence Unit survey, sponsored by Progress Software, has found that 74% of businesses think the pace of change in their industry's operating environment has increased over the past five years, with many putting this down to factors such as the volatile economic environment (39% of respondents) and increased competition (36%).
The vast majority of businesses (79%) recognize that it is important to respond quickly to these changes, but nearly half (48%) think the amount of time it takes them to make key decisions has increased over the past five years. Only 22% say that it has declined.
Key reasons for this surprising finding are the rapidly increasing amount of information that businesses need to deal with when making decisions and the increasingly complex and uncertain nature of the environments that they are operating in.
Indicators illustrating the pace of change, include:
More information: it has been estimated that the world generated 1,200 exabytes of data in 2010[1], equivalent to a stack of books 1.2 billion miles high.
- There was a 56% increase in the number of academic articles published around the world between 1990 and 2007.[2]
- Wal-Mart currently processes approximately 1m customer transactions every hour.[3]
- The Lehman Brothers email universe was 30 terabytes[4], twice the number of catalogued books in the US Library of Congress
More complexity: the number of actors in the market system has increased and the technologies they use are evolving, increasing competition and putting pressure on firms to develop new products and services in order to stay competitive. According to World Bank data:
- The share of exports in world GDP increased from 19% to 24% in 2009, reflecting the increase in trade and the development of emerging economies
- There was a 365% increase in internet users between 2000 and 2009, including a 1,600% increase in China.
- The number of mobile phone registrations per 100 people increased by 468% between 2000 and 2009, and there is expected to be a big increase in smart phone use over the next five years.
"With all the analytical tools at their disposal, you might think that companies could reduce the amount of time it takes them to make key decisions," said Chris Webber, Senior Editor with the Economist Intelligence Unit. "In reality, only a small percentage are managing to do that, while many more are seeing the time it takes them to make these decisions increase. Corporate decision making capabilities are clearly struggling to keep up with the pace of change in the world around us."
Press enquiries:
Joanne McKenna, Press Liaison, +44 (0)20 7576 8188; joannemckenna@eiu.com
Chris Webber, Senior Editor, +44 (0)20 7576 8239; chriswebber@economist.com
About the research
These research findings are part of a research project conducted by the Economist Intelligence Unit and sponsored by Progress Software. The findings are based on a survey of 390 business executives conducted in August and September 2011. Respondents were drawn from a range of industries and locations around the world. A report analyzing the survey results and drawing on extensive interviews with leading business thinkers will be published in October 2011.
About the Economist Intelligence Unit:
The Economist Intelligence Unit (EIU) is the world's leading resource for economic and business research, forecasting and analysis. It provides accurate and impartial intelligence for companies, government agencies, financial institutions and academic organizations around the globe, inspiring business leaders to act with confidence since 1946. EIU products include its flagship Country Reports service, providing political and economic analysis for 195 countries, and a portfolio of subscription-based data and forecasting services. The company also undertakes bespoke research and analysis projects on individual markets and business sectors. More information is available at www.eiu.com or follow us on www.twitter.com/theeiu.
About Progress Software
Progress Software Corporation is an enterprise software company that enables businesses to be operationally responsive to changing conditions and customer interactions as they occur. The company offers a comprehensive portfolio of enterprise software spanning event-driven visibility and real-time response, open integration, data access and integration, and application development and deployment. Progress can be reached at www.progress.com or +1-781-280-4000.
