In today’s digital and customer-centric world, most business owners are immersed daily with ‘Information overload’. They are also sitting on a potential ‘goldmine’ of data such as client/customer behaviours, financial information, marketing/sales performance etc. Businesses are increasingly seeking ways of obtaining greater control and intelligence of the available data.
The solution to this problem lies in investing in business intelligence (BI) solutions. However, most companies have been quite slow in adopting it due to lack of knowledge on what it entails. Also, some companies are not even aware of what business intelligence is, and where to start. If you are starting your journey, this article will help you understand why your business needs BI.
Business Intelligence refers to the tools, technologies, applications and practices used to collect, integrate, analyse, and present an organization’s raw data in order to create insightful and actionable business information. BI as a discipline and as a technology-driven process is made up of several related activities such as data mining, online analytical processing, querying, and reporting. More on those later.
Nowadays, the internet is generating a lot of knowledge that can be harnessed into informative and actionable insights. An incredible amount of data, around 2.5 exabytes, is generated daily and needs a tool to collect, filter and sort. Admittedly, not all the data available on the internet is relevant for your business. However, within your organisation and its immediate external environment, you will find plenty of relevant data that you can use.
If you can successfully harness information relating to your business operations, you will be able to make informed decisions that will give you a competitive advantage in your industry. A BI software enables you to collect and process data, enabling you to have a better understanding of your business.
BI provides two functional components- predictive analytics and descriptive analytics. The latter mines past performance and historical data, and provides the reasons for the success or failure of such performance. Management reporting uses descriptive analytics to answer the “why” and adjust current strategies in sales, finance, operations and marketing. Afterwards, the predictive component answers “what would happen” by mingling historical data with forecasting techniques and external data to predict the likelihood of the situation recurring in the future.
When it comes to business decision making, time is usually of the essence. BI helps you to purify data and present it into easy to understand visualisations that can help in decision making. Companies that utilise BI tools are five times likely to make faster decisions and this will help them gain a competitive advantage. Consequently, a reliable BI will help you to respond to any analytical query without retrieving files to help you.
BI provides information and insights that are used to make informed decisions that boost efficiency and productivity. Fortunately, most BI systems allow easy sharing of information, both vertically and horizontally, across the organisation. The BI software easily pulls data from several organisational units, analyses it and then produces uniform visualised reports. By so doing, information sharing mitigates on duplication of roles or duties within the organisation and enhances relevance and precision.
Customer insights are very important for any business. By collecting customer data of buying behaviours and analysing details such as product preferences, demographics, changing tastes and consumption patterns, seasons and times of high buying activity and other variables, you can be able to initiate a good customer attraction and retention strategy. Using BI, you can easily collect and sort this data and provide meaningful customer insights and thereby customer service.
A 2014 Nucleus study revealed that organisations investing in analytics solutions reap average returns of $13.01 for every dollar spent. These returns are realised through greater productivity, operational efficiency, improved customer service, automated data-related processes, and better total performance. Clearly, reaping a 1300% ROI on your dollar spend for BI, and attests to the effectiveness of using BI software for business decision-making.
Why not? The prevalence of cloud-based and SaaS business intelligence solutions, BI software is now affordable to businesses of whatever size. Initially, BI software was exclusively for large businesses that could maintain costly processors and systems that could crunch, sort and analyse big data. However, BI software tools are now readily available and hosted online at very cost effective prices.
Also, there are BI tools and self-service analytics that you can use to give you insights on the health of your business without any background in IT. Generally, BI has levelled the playing field enabling small business owners to acquire tools that were exclusively for larger businesses. As a result, the software will be the key determinant in gaining a competitive advantage over your competitors
Conclusively, the benefits of BI software are many, but the already discussed are enough to show you why your business requires business intelligence. And contrary to popular belief, BI is not just for big businesses. Instead, it is a solution for both big and small businesses and with the dominance of cheap robust cloud BI platforms, any business can get a piece of the BI pie. If your business doesn’t have a business intelligence software, it is high time you considered having one before your competitors outdo you.