Project No 2: Business Analytics - 'ZIFFPAGE TITLEFilling in Fact Gaps '

Filling in Fact Gaps

Filling in Fact Gaps

Demand for analytical tools increasingly comes from all departments, from marketing and sales up to the executive suite. In the post-Enron era, top managers in particular need to be able to document and explain the metrics that underlie their decisions, according to Robert Blumstein, a research director at IDC.

"Distributing analytics to the whole organization has empowered employees to make decisions that in the past they didn't have the data to make—or might have made in off-handed ways," he says.

IDC expects the analytics software market, which includes both basic and more sophisticated predictive tools, to continue to grow from $8 billion in 2003 to $11 billion in 2008, about 8% per year.

Analytics packages, from vendors including SAS, MicroStrategy, Business Objects and Cognos, increasingly deliver information visually with a mosaic of charts, graphs, scorecards, buttons and flashing alerts. Analytics capabilities are also being built into enterprise resource planning, customer relationship management and business performance management software.

Such sophisticated analysis is new for AvMed Health Plans, Florida's largest not-for-profit health maintenance organization, which has more than 200,000 members. The HMO's savvier consumers want to know which of the plan's doctors and hospitals are the best, according to AvMed CIO John Higbee, so the organization is turning to analytics software to deliver the data.

"It's a wonderful trend," he says about his customers' demand for more detailed metrics.

This year, Miami-based AvMed plans to spend less than $500,000 on an analytics system, Higbee says. The point of the project: to determine the effectiveness and efficiency of individual practices. The software will, for example, evaluate a provider's practice, looking at initial and ongoing costs as well as types of patients. The findings will be available to the HMO's members via the AvMed Web site, which will eventually provide access to claims, authorizations and benefits data.