Picture the scene. You’re a business owner with a multitude of data across your business. Naturally, you’re keen to improve your financial performance. You know that there are tools out there to easily analyse this data and enable you to identify underperforming elements in the organisation. However, instead of implementing these simple tools and increasing profitability, you decide to do nothing. Does something seem out of place here?
One of the many pieces of feedback you often hear from business intelligence (BI) users is that prior to using BI, they felt they were doing fine. The perception was that BI tools were an unnecessary luxury, too complicated to implement and use without hiring specialist staff. New staff hires, which just couldn’t be justified based on the minimal perceived benefits BI would bring.
It’s true that traditionally, BI tools have been very complex to use and required highly trained data analysts to make sense of company data. This is no longer the case, with a range of extremely intuitive BI packages able to democratise data usage throughout a company. The question, however, still remains – is bringing BI on board worth it, and can it have a positive impact on the bottom line?
A recent Economist Intelligence Unit report has sought to answer that very question. The jury was out on whether BI was financially worth the implementation. The report, entitled ‘Fostering a data driven culture’ demonstrated that there is a clear link between improved financial performance and a widespread use of data throughout an organisation. The survey of 530 senior executives found that companies are more than three times more likely to rate themselves “substantially ahead in financial performance” when they believe their data usage is ahead of their competitors.
The research also highlighted that the link worked both ways. There are companies whose lack of proper use and understanding of data is undermining their financial performance. The evidence is clear, and it supports the theory that a ‘data driven culture’ offers an improvement in financial performance and a positive impact on the bottom line. This raises questions about whether company analysis of its data should be commonplace. Could it be that BI simply isn’t accessible to most companies? And what exactly does a ‘data driven culture’ entail?
The BI and data visualisation tools available today are a far cry from those of yesteryear in terms of simplicity – in both set up and usage. Today’s BI tools can be deployed very quickly and figured out by pretty much anyone. We call this the ‘democratisation of data’, and for many organisations it’s clear that there’s simply no need for data analysts. For those whose scale does warrant it, they are there merely to augment that democratisation.
BI tools have taken a huge leap forward in recent years, and it is now possible for everyone to get insights from the data produced on a day-to-day basis. This means that data is used by all employees, regardless of position, to better understand how to have a positive influence upon the organisation.
For example, a restaurant could view its sales in real time, seeing which drinks are most popular that evening, and at which tables. Staff could then be incentivised to sell particular products that are known to be perfect accompaniments. By identifying these previously unseen opportunities to upsell, revenues could be pushed up.
It all comes back round to the fact that modern BI tools are simple, and intuitive to use. They’re not as expensive as you may think, and the cost involved will almost certainly be proved elementary, with long-term financial rewards outweighing initial costs.
Hopefully the old misconceptions of clunky, complex BI tools that need a data scientist to operate them will soon be banished. If so, business owners will surely realise we can’t continue to rely on the IT department as we have been. It just creates bottlenecks that don’t help anyone. The tools are there and readily available. Put simply, bringing BI tools in your organisation will almost certainly provide improved financials. And that’s the bottom line.