March 17, 2014
Much of the success of small and medium enterprises (SME) relies upon creating a system that is efficient and effective. Many entrepreneurs like to focus on sales and marketing, and some ignore optimizing their operations. However, business intelligence tools (BI) are changing the way many SMEs manage their data.
According to a 2013 study by Gartner, the market for business intelligence (BI) is one of the fastest-growing software markets. The industry is growing at nearly 7 percent annually, and is expected to reach over $17 billion by 2016.
For business owners, using BI software can yield the following benefits:
- Promote cost efficiency
- Optimize inventory levels
- Reduce waste
- Improve business processes
From paying employees, purchasing supplies, and keeping machinery in good condition, it can be difficult to manage costs and understand where every dollar of overhead is going. A BI program can help entrepreneurs understand where spending is going, and determine solutions to cut costs.
For example, an analytics dashboard may determine that most of a company's working capital is tied up in warehouse inventory that yields the lowest profit margins. To improve the cash cycle, an entrepreneur may decide to stop offering such products, and to reduce the number of SKUs.
Time Management and Revenue Growth
Business owners must allocate their time on projects and responsibilities that promote the growth of their company. By reducing disorganization and chaos, entrepreneurs can better manage their time so they can focus more energy on more impactful value drivers.
Advanced apps such as DataRPM are incorporating search engine-like qualities that allow users to use natural language in queries, much as they would when typing a question into Google. In the near future, getting key information may be as easy as typing “What's my sales per branch?”
Business intelligence for marketing can help entrepreneurs grow their company. For example, an analytics dashboard may identify better prospects through factors such as income level, education, and age. Marketing efforts can then concentrate on customers who generate higher returns, resulting in better time management for the salesforce.
Whether sales managers want to track company growth, target a certain sales demographic, or optimize prospecting efforts, BI sales software can align processes and activities with business insight.
Optimization of Operations
Businesses use BI tools to organize their big data. This means gaining real-time insights on production, sales, and business processes. Becoming efficient also means having a better understanding of the products coming in and out of your warehouse, as well as finding opportunities to streamline the production line.
Reducing waste directly affects the bottom line.
BI is designed to help companies draw correlations between multiple sets of information. Some programs include graphic design tools which generate visual aids like charts, graphs, and other infographics to help you better understand trends.
BI applications are getting more sophisticated. Thus, these programs are becoming more user-friendly to entrepreneurs and small business owners.
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