What's Your Business Intelligence?

We have seen this scenario played out many times: A small, up-and- coming business has outstanding products and services to offer. However, the organization lacks resources and employee power to track and centralize customer relationships, leads, market data and key performance indicators. Business intelligence (BI) tools can help to fix this situation quickly — helping companies organize and manage customer and transaction data so that management can make tactical and strategic decisions to better grow the company.

Generally, any software that collects and presents information for analysis can be considered a BI tool. These can range from the very basic, like an Excel Spreadsheet, to reporting tools found in most financial software, to very sophisticated software that grabs data from a multitude of systems (financial, manufacturing, human resources, CRM, etc.). The one thing that BI tools have in common is that they can analyze data to gain insight into customer behavior, events and market opportunities, and therefore can help management improve strategic decision making, streamline operations and enhance sales and client relationships. An easy-to- use “dashboard”-type user interface can present these complex relationships and performance metrics in a simple and clear format, readily available at the click of a mouse.

The good news for the small business owner is that powerful BI tools, once only affordable for big businesses, have made their way downstream and now can be deployed by businesses of all sizes. But before we get to these, let’s start by looking at the BI tools you most likely already have.

Using What You’ve Got

Capturing the benefits of a BI investment doesn’t have to be challenging or complex. As a business owner, you can take the first step by simply understanding and utilizing the reporting features of the common software applications you already use.

The financial software that most small businesses use, such as Peachtree or QuickBooks, has a robust reporting engine. In addition to creating a large number of standardized reports, such as income and expenses, it can be used to customize each report to fit particular business needs using a simple graphical user interface. However, most small businesses utilize only a fraction of the features available to them in their financial systems. You can start down the road to better information analysis by looking at reports such as profitability by customer, time allocation per customer, or even staff or resource utilization.

Customer relationship management (CRM) systems also have good reporting features, especially when it comes to showing sales leads, pipelines and revenue forecasts. When viewing most reports on a PC, users can drill down into individual items for greater detail. If more advanced analysis is needed, especially number crunching beyond what the software provides, most systems can export reports into an Excel spreadsheet for further refinement.

It is important to take an inventory of the current software you utilize every day to run your business. I am sure you will be surprised to find how much information these systems contain that can be quickly accessed through the user-friendly reporting features. Utilizing these features is an easy first step toward deploying a BI strategy for your business.

BI Tools — The Keys To Your Business Dashboard

Purpose-built business intelligence tools such as QlikView and Microsoft Analytics are designed to pull information from a variety of business systems and organize it into a business “dashboard.” Dashboards provide visual summaries of key business information. The power of the dashboard comes from connecting it to live data from systems such as CRM, manufacturing, marketing, human resources and financials. Dashboards consolidate information in real time and display key performance indicators (KPIs) or key financial indicators (KFIs), which are high-level gauges that show how the organization is performing against specific goals.

A business owner can quickly scan the KPIs through the dashboard and drill down into them to make informed business decisions and projections, spot trends and manage the overall health of the organization. Typical KPIs include sales and revenue forecasts, financial budgets, cash flow, lead conversion rates (in sales) and inventory turnover (inventory management). The dashboard also allows users to easily add any type of information or statistic that is unique to a company or industry.

For example, the CEO of a small manufacturing company uses a business dashboard to check key performance indicators (KPI) and can see, in real time, such things as pending orders, inventories and production capacity. As the executive drills down into the inventory KPI, he notices that he has an abundance of one product on the shelves in comparison to the orders that need to be filled by the same product. He then takes action based on this intelligence, and creates incentives and promotions to reduce the excess inventory and increase the company’s cash flow.

Dashboards can also be linked to live data feeds such as Hoovers or Dunn & Bradstreet for financial analysis of customers and prospects. These information systems, once cost-prohibitive for small businesses, are now accessibly bundled.