SEC Filings as an IT Benchmarking Tool

Ever looked to SEC filings as a source for IT benchmark data?  These reports offer a wealth of information that can be used for competitive benchmarking, PESTEL analysis, macro trends analysis, and more.  And they are free!

I was recently doing some competitive benchmarking using SEC filings, which I hadn’t done for a while, and the exercise served as a reminder of the value of this type of data.  I focused on the 10-K annual report and 10-Q quarterly reports and there are others that may be of value depending on the situation.  I was pleasantly impressed at all the information I was able to retrieve.  In just a few minutes, I was able to compare total revenue and EBITDA and then went on to find details on capitalized software development, major IT capital purchases, and IT operating expenses.  While this data is fairly high level, it helped me to quickly understand how my company compared to three other competitors relative to percentage of spending in these areas, which will be very helpful during budget planning.

Then taking some time to more fully digest these reports, ranging from 55 to 90 pages, I found a bunch of competitive information beyond just the financial statement data.  One company discussed the importance of some key patents, a number of which were about to expire.  Another company talked about key technology initiatives, like the completion of a highly successful mobile device application that was developed to provide rapid self-service, and a new customer information system being developed that presented a high risk of business interruption if not completed successfully.  And a third company shared that sales had increased significantly due to technology investments to enhance the customer experience.  Some provided more details than others, but this was excellent competitive information overall.

The bottom line is that these standardized filings, designed to help investors make informed decisions about whether or not to invest in a company’s securities, can also help IT leaders refine their technology investment strategy.  Please share your thoughts and experiences with this type of benchmarking as well.