Alinean Recognizes Top 50 Small and Midsized Businesses Deriving Highest Return on IT (ROIT)

Top Performers Spending More Per Capita on IT than Average

View the SearchSMB 50 ranking - a listing of 50 small and medium-sized businesses that excel in maximizing IT investments.» How do you compare to the SearchSMB? Calculate your own IT ROI using Alinean's downloadable worksheet »

ORLANDO, Fla. (Oct. 5, 2005) — Alinean today unveils its first annual ranking of the top 50 small and midsized businesses (SMBs) achieving the greatest return on IT (ROIT™) from more than 8,000 U.S. public companies studied. Due to rising energy prices and traditional frugal IT spending, the very best-of-the-best are energy companies – Vintage Petroleum, Inc., KCS Energy, Inc., Encore Acquisition Co., and Berry Petroleum, Co. Other high-performing SMBs include leaders in financials such as FirstCity Financials, technology such as MicroStrategy and companies in legal and insurance, and transportation and materials industries.

Top-performing SMBs tend to be more frugal, spending a mere 2.8 percent of revenue on IT in contrast to the average SMB, which spends 4.8 percent of revenue on IT. However, on a per-employee basis, leading SMBs spend more than the average – $15,223 per employee, $1,251 more than the median. These leading SMBs utilize technology as a productivity enhancing and revenue generation tool to defer adding head count to meet business needs.

Proving that size does matter, a comparison of SMBs with larger competitors reveals that small companies consistently outspend their larger peers, mostly because of the economies of scale that help large organizations save on IT infrastructure, administration and support. On average, small companies spend 4.8 percent of revenue and $13,972 per employee on IT versus larger companies’ spending of 3.3 percent of revenue and $11,580 per employee.

The SearchSMB 50 ranking, published on SearchSMB.com, gives IT stakeholders in small and midsized businesses an actionable benchmark to compare their own IT spending and performance against that of the most effective public U.S. companies with annual revenue between $50 million and $1 billion, and employee head counts between 100 and 1000. Periodically grading IT investment performance allows IT executives to speak the CFO’s language and identify which investments are paying off, drive improvement of current technologies, and uncover new opportunities where reallocation of technology investments can boost a company’s shareholder value and competitive advantage.

“Small and medium business are always challenged to do more with less; the leaders reveal how IT can support this drive, as spending more per employee on IT can help achieve higher business performance with less staff,” said Tom Pisello, CEO and founder of Alinean. “While these leaders are certainly prudent with IT spending, they’re investing wisely in the right IT projects to maintain their competitive edge.”

To create the rankings, Alinean utilizes its PeerComparison™ – Enterprise v2.5 software, a business intelligence tool used by CIOs and consultants to benchmark any company against up to 11 of its closest peers, competitors and industry leaders. The software includes a database of more than 20,000 worldwide corporations including financial data from Mergent and Stern Stewart, and IT spending and total cost of ownership (TCO) data from IDC and Alinean. To create the ROIT rankings, Alinean examines company performance versus IT spending, to compare the effectiveness of IT spending with overall company performance, measured by Stern Stewart’s widely used Economic Value Add metric (EVA = net profit – cost of capital * (assets – liabilities)). This ratio highlights those companies  spending less compared to the shareholder value they are creating.

More information on this year’s ranking and Alinean are available at http://searchsmb.techtarget.com and www.alinean.com.

View the SearchSMB 50 at http://searchsmb.techtarget.com/smb50/0,296288,sid44,00.html.

Top U.S. SMBs with Highest ROIT™ by Industry Sector
SearchSMB 50: http://searchsmb.techtarget.com/smb50/0,296288,sid44,00.html
 

About SearchSMB.com
SearchSMB.com is a member of the TechTarget portfolio of IT management Web sites. SearchSMB focuses on small and medium-sized companies.
TechTarget publishes integrated media that enable information-technology (IT) marketers to reach targeted communities of IT professionals and executives in all phases of the technology decision-making and purchase process. Through its industry-leading media and events, and its ROI-focused lead-generation and lead-management services, TechTarget helps IT marketers generate qualified sales leads, shorten sales cycles and grow revenues. Founded in late 1999, TechTarget has won dozens of awards for its innovation and industry leadership, including more than 25 awards for editorial excellence in the past three years alone. More information about TechTarget is available at www.techtarget.com.

About Alinean

Alinean develops software and solutions to streamline the B2B selling process with business value selling solutions – using ROI/TCO and business case analysis to prove and improve the value of solutions to prospects and customers. The company’s founding team pioneered the concept of interactive ROI and TCO software in 1994, developing award-winning solutions for leading B2B vendors and consultants. Its research methodologies and software tools are used by analyst firms and consultancies such as IDC and B2B leaders such as Oracle, HP, Dell, SAP, Microsoft, Symantec and IBM, and have helped justify billions of dollars in IT spending and derived value. For more information, visit www.alinean.com or call 407.382.0005.
 

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