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First 2021 Dresner Advisory Update on COVID-19 Impacts to Businesses, Projects, and Budgets

With the COVID-19 pandemic impacting and changing life and business, Dresner Advisory Services continues to conduct primary research into sentiments on how COVID-19 affects businesses overall, as well as how it impacts their business intelligence (BI) projects and budgets.

Our latest data, compiled from survey responses recorded in the first quarter of 2021, indicate that although business impacts remain significant and ongoing, over the course of a year, the general trend is toward gradual lessening severity from what was first reported early in 2020. A majority of organizations continue to report sustained revenue and customer losses—albeit it at lower rates.
Respondents report generally more positive short-term perceptions about business conditions during the past 30 days. The vast majority continue to report stabilized conditions; the number of respondents reporting improved conditions continues to rise, while the number indicating worsening conditions continues to drop.

The data show some notable inconsistencies. Respondents indicate, for almost all organizations, that the impact of COVID-19 to date either increases or validates BI’s importance. But at the same time, data show less positive activity in 1Q21 related to BI and analytics projects, with organizations launching fewer new projects, moving forward on fewer projects, and temporarily delaying more projects than they did in 4Q20.
Continuing a reversal of budget sentiments expressed earlier in 2020 as well as in previous years, the latest data continue to indicate that COVID-19 negatively affects BI budgets significantly. The number of respondents indicating increasing BI budgets fell from 50 percent in early 2020 to only 7 percent most recently. Those reporting decreasing budgets rose from 9 percent to 42 percent. The number of unchanged budgets also dropped (from 40 percent to 37 percent). Not for Distribution

The situation and impacts related to COVID-19 remain highly fluid. We see much of this variability reflected in the data views by industry, geography, and organizational size.
Although our most recent data indicate improving business environments, macro-level events could change conditions rapidly. For example, while some countries and regions imposed lockdowns (again), other governments continue to ease and lift earlier-imposed restrictions. Nations now administer multiple COVID-19 vaccines globally. The only major product shortages and supply-chain interruptions during the last quarter resulted from a barge wedged across the Suez Canal—rather than from anything stemming from the impact of COVID-19.

In the face of such rapidly changing and challenging conditions, organizations—now more than ever—need to understand data and use them to make informed decisions.

1. COVID-19 continues to impact overall business operations significantly, with the majority of respondents continuing to report sustained loss of revenue, customers, or both, albeit it at slightly lower levels during 1Q21 than in 2020.
2. The business impact of COVID-19 is not uniform across all industries.
3. The largest organizations may now be better leveraging their size and scale to offset revenue and customer losses, and avoid temporarily shutting their operations.
4. The latest data on business impact by geography shows more variability than previous survey responses.
5. Organizations that rate their BI initiatives as successful continue to report much lower rates of customer and revenue losses due to COVID-19. Conversely, those that consider their BI initiatives unsuccessful report the highest levels of losses in these areas due to COVID-19.
6. Respondents report generally more positive short-term perceptions about business conditions during the last 30 days.
7. For almost all organizations, the impact of COVID-19 to date either increases or validates their perceptions of BI’s importance.
8. Organizations report less positive activity related to BI and analytics projects in 1Q21.
9. Mid-size organizations stand out for launching new BI projects and moving forward, without delay, on other projects. These data correlate strongly to budget patterns for mid-size organizations.
10.Although respondents in 1Q21 indicate more increasing and fewer frozen budgets, and a lower percentage of unchanged budgets, the most recent data show that COVID-19 continues to affect BI budgets negatively and dramatically.

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