SAS and Accenture form predictive analytics group

SAS Institute Inc. and Accenture Plc. are teaming up to form the Accenture SAS Analytics Group, a joint venture that will develop, implement and manage predictive analytics solutions. The venture is a “first for both companies,” according to Accenture.

The Accenture SAS Analytics Group will develop industry-specific solutions that initially focus on financial services, health care and the public service sector. The group also plans to develop cross-industry offerings, starting with customer acquisition and retention and enterprise analytics.

Business analytics software vendor SAS, has worked management consulting firm Accenture, for over 10 years. “Our successful work together since 2007 has shown the potential for us to jointly address the growing interest in predictive analytics,” said Pat Finerty, vice-president of alliance and business development at SAS Canada, the Canadian subsidiary of SAS. The venture will bring “SAS's leadership position in the advanced analytics space together with Accenture's leadership position as thought leaders in management consulting and systems integration,” said Finerty.

Enterprise analytics is the concept of bringing true predictive analytics and insight to decision-making throughout the entire business processes of an organization, which is really the end-game for clients, explained Finerty. There are no intentions to develop a new suite of predictive analytics products, according to Finerty.

Any jointly developed software and services will enhance and add new value to SAS's existing offerings, not replace them, he said. “This group intends to offer clients Analytics as a Service, which will combine innovative new approaches such as subscription and managed services,” said Finerty. The three industries and two cross-industry offerings are “just the beginning,” he added. The joint venture is an “extremely important development from the standpoint of SAS,” according to Gareth Doherty, research analyst at Info-Tech Research Group Ltd. “In my mind, there has never been any question about whether or not SAS's tools are valuable and useful to organizations — the question has always been whether or not the organization is capable of being able to use the tools,” he said.

One of the biggest barriers to large-scale deployments of SAS analytics within enterprises is the level of expertise required to use the toolsets, according to Doherty. “You're going to need a rocket scientist to use some of these advanced analytics tools for predictive modeling,” he said. By combining SAS's existing training with Accenture's consulting expertise, the Accenture SAS Analytics Group will be able to provide the services businesses need to use the toolsets, he explained. Doherty also finds the venture “a very strong response” to IBM Corp.'s announcement in the spring of 2009 to start offering advanced analytics consulting services. IBM “seemed to be ahead of the curve” in recognizing that providing the tools for organizations to perform sophisticated analysis like predictive modeling wasn't enough, he said. “They realized that they also needed these value-added services on top to make sure they could entrench the tools in the organization,” he said.

SAS is potentially facing its first real major form of competition in the market with IBM, according to Doherty. IBM's advanced analytical capabilities might not match the degree that SAS provides, but it is “very close,” he said. “Teaming up with Accenture is essentially, I think, a response to IBM with their product Cognos and their acquisition of SPSS,” he said. Doherty anticipates the joint venture will help SAS “maintain their current standing” in the market. Sebastien Ruest, vice-president of services and technology research at IDC Canada Ltd., sees the venture increasing SAS's status in the business community. “SAS has excellent software, but it's a very specialized type of software that is recognized by specialized users,” said Ruest.

Accenture has “an excellent position” inside the business suites of organizations, which will increase the awareness of SAS as a solution among the non-techie individuals, he said. Predictive analytics has been a hot area within business performance management ever since the economic meltdown, Ruest pointed out. Research from IDC Canada, based on conversations with executives over the last 12 months, suggests organizations have not been making additional investments in software upgrades or licenses.

Instead, they have been reducing and consolidating their software and focusing on generating revenue or identifying new revenue opportunities within existing business environments and with existing data sets, he said.