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Former GE chief Jack Welch’s business axiom is well known but rarely practiced among small and midsized companies: “It can’t be managed if it can’t be managed.” But there’s growing evidence that midmarket companies are looking to business analytics and applications as critical tools for improving and growing their businesses.

The recently released IBM “Inside the Midmarket” study reveals a dramatic shift among midsized companies around the world from a conservative, cost-cutting stances to ones of investment and growth. The difference from previous expansion and growth-oriented years is that midmarket companies are smarter and looking to business intelligence applications and processes to enable more efficient and productive operations.

“The strategic mindset of midsize firms has dramatically shifted during these challenging times to place more emphasis on growth, innovation and customer value. Midsize businesses are taking the steps needed to make better use of the information and resources available to them in order to increase productivity, attract and retain customers, and improve competitive positioning – all within a cost-effective business model,” states the IBM report.

Those changing priorities are seen in the mindset of midmarket executives. Those focused on revenue growth increased 5 percent over 2009; focus on innovation improved 7 percent year over year; and prioritization of customer focus improved 11 percent. Conversely, the focus on operational efficiency and cost reduction declined a whopping 32 percent.

The shift in priorities mirrors the improving economic climate and business confidence. Across the board, businesses are looking to begin investing in new products, market development and sales expansion in the coming year. While no economist is forecasting a robust 2011, most say this year will be one of continued and steady recovery.

The IBM report reflects what many have long waited for: a smarter midmarket. The marketplace has long watched the most successful midmarket companies following the same or similar processes as large enterprises. What’s held back the masses from that analytical approach is the unavailability of affordable, scaled business intelligence applications. Andrew Monshaw, general manager of global midmarket sales and distribution at IBM, says the difference is that more business intelligence software packages are now more accessible as cloud solutions.

Monshaw’s assertion is reflected in the specific business priorities noted by midmarket companies. Seventy percent surveyed say they’re prioritizing IT projects that involve business analytics, intelligence and performance management (finances). Another 69 percent are pushing information management applications, and six out of 10 are prioritizing new and improved customer relationship management projects.

These IT priorities are directly inline to support the midmarket’s business priorities. While only 62 percent say their improvments increased insights for better decision making, nearly all the other business priorities cited – cost reduction, improved efficiencies, improved customer service, increased productivity, optimizing business processes and increased flexibility – require business intelligence and quick access to meaningful data.

In a review of the survey results with Channelnomics, Monshaw noted many midmarket companies aren’t just adopting business intelligence applications, but working with vendors and ISVs to develop horizontal (enterprise-wide) and vertical (industry-specific) dashboards. These information portals make information more easily digestible and provide for easier deeper analysis.

The IBM report found that most midmarket companies (70 percent) want to work with local providers in the development, deployment and support of business intelligence applications and other solutions. This presents a significant opportunity for business-savvy solution providers. Midmarket companies are discovering business intelligence applications, but that doesn’t mean they have the defined and documented processes in place to make use of the applications. Solution providers can do more than just sell, but provide strategic guidance to their customers in developing the processes that will make the most use out of these powerful applications.

Between midmarket desires and the delivery of solution providers, 2011 may end up as the year of business intelligence.

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Lawrence M. Walsh is CEO and president of The 2112 Group, a technology business advisory service that specializes in optimizing indirect channels and partner relationships. He’s also the executive director of the Channel Vanguard Council. He is the former publisher of Channel Insider and editor of VARBusiness Magazine. You can reach him at lmwalsh@the2112group.com.

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Larry Walsh:@lmwalsh2112| Channelnomics: @channelnomics