Not that I'm sure what the economy will deliver this year. Most financial analysts are cautiously predicting a conservative recovery, but you can flip a coin and be as accurate as they are.

We're in a good position either way, as demand for business-intelligence software continues to be strong. Companies are trying to turn their fortunes by cutting costs, increasing customer retention, and maximizing customer profitability. Business-intelligence software is a critical underpinning of those strategies.

In addition to economic pressures, businesses face regulatory changes, brought on by accounting scandals and security threats, that are driving investment in business-intelligence software. With increased scrutiny from regulators, investors, boards of directors, and the criminal-justice system, executives need complete and accurate information about their companies. As a result, CFOs are looking for ways to enrich financial reporting with performance indicators. We've seen this trend reflected in increased interest in performance-management solutions.

At the same time, heads of IT are coping with thinner staffs and tighter budgets by pushing integration back to software vendors. They simply can't afford the time and cost of integrating hundreds of niche applications. SAS's strengths have always been in accessing, managing, and analyzing massive volumes of data. We've begun to encounter companies that are implementing IT portfolio-management strategies, eliminating redundant or difficult-to-integrate software from their organizations. Data-integration capabilities are proving to be a strong value proposition to these companies. The new challenge is to provide this access in real time, so companies can make predictions about prospective customers on the fly.

Gartner has been aggressive in predicting that half of the software vendors that were in business in 2000 will be gone by the end of 2004, either through merger, acquisition, or disposal. We continue to look at acquiring companies and technology that will enhance our own offerings, but not at the expense of integration. Our ability to move forward with our long-range plans has put us in a position of strength in our industry, whether the economy grows slowly or takes off again.

Jim Goodnight is president and CEO of SAS Institute Inc. Dedicated to fostering young people's passion for learning, he established SAS inSchool, a division of SAS that develops Web courseware and curriculum resources for public, private, charter, and home schools.

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