With a recent study by Statistics MRC suggesting that the global business intelligence (BI) market could be worth $30bn by 2022, you might think that such fervent scrutiny is only reserved for the global behemoths.
Interestingly enough, though, the biggest driver of BI growth is not multinational corporations with unlimited resources at their disposal. Rather, it is modern small- and medium-sized businesses (SMBs), all of whom are aiming to leverage sophisticated tech to reach that next level. Therefore, an intriguing question presents itself: is BI the way to achieve this objective?
The Benefits of Business Intelligence
Whether you have heard about the concept in the mainstream business press, learned that your rivals are using BI tools in daily operations, or discovered that you are losing out on enormous revenue-generating potential, then you might be wondering if you should incorporate BI into your business model. Some degree of consternation is understandable, too; after all, BI does require some investment and tech-savviness in order to properly deploy an effective strategy.
Overall, though, the benefits far outweigh the drawbacks. To illustrate how, we've compiled a comprehensive breakdown of the advantages of using business analytics, regardless of your size, industry or niche.
If you want to understand what the hype is for, and why you should get involved, this is what you need to know.
1. BI Offers Faster and More Accurate Reporting
What makes BI such a crucial component for any business – large or small – is that it gives you access to fast and accurate reporting. Depending on the tools you are using, such reports can be completed in real-time, so that you have all the timely and relevant financial information, operational data and sales numbers to assist your company in moving forward.
Rather than waiting for reports to be compiled (most of which will feature information that is already out of date), you can utilise a variety of customised templates, graphs, tables and charts that are put together with the very latest available data.
2. It Improves Data Quality
Fast and accurate data reporting is a huge bonus, but in order for it to be genuinely useful, it needs to be high quality. Indeed, this is a common concern for most enterprises when presented with an opportunity to collect and collate large volumes of information.
However, while low-quality data may have been a problem during BI's infancy, now data is gathered, updated and sourced from multiple locations that maintain high degrees of authority. Therefore, you have a more detailed portrait of what is happening in your business, in your industry, and within the overall marketplace.
3. It Gives You a Competitive Advantage
To put it bluntly, business intelligence provides you with an immediate competitive advantage. It provides access to a treasure trove of data, but, perhaps more importantly, also allows you to manipulate and execute strategies that aid in investing, forecasting, planning and budgeting. BI can track your firm, the market and, crucially, your rivals' sales and marketing endeavours.
Remember: business analytics do not only need to be internal. They can be external, too.
4. It Reduces Costs and Increases Revenues
Arguably, the two most important objectives for any business are to cut costs and increase revenues. BI software and tools can help you do this.
For instance, they can help you better understand why specific trends are unfolding within your organisation. Why are your sales falling? Why are your competitors seeing better sales of the same product? Business intelligence can ask better questions and offer better answers.
In terms of cutting costs, a company-wide BI system can enable you to limit expenditure, identifying waste and analysing any unnecessary additional spending, regardless of your size. Is there an overlap between departments? Is your point-of-sale (POS) system inefficient? BI can find the answer and offer a solution.
5. It Streamlines Business Operations
Another significant hurdle that companies often need to overcome is the wastage of valuable resources. Every company is guilty at some level of failing to maximise productivity, whether it involves managers bound by red tape, or workers being forced to adhere to ineffective practices.
One of the critical advantages of BI is that it enables you to streamline operations by simplifying workloads, as well as introduce mechanisms that allow your people to work more efficiently.
6. It Identifies New Opportunities
In any venture, it is effective management to maximise your strengths in the global economy and conceal your weaknesses from your competitors. This means responding quickly to change by adapting to market trends and conditions, a process that is made far easier by BI.
This is because it can serve as a tool in the learning of your capabilities, as well as help you:
- Identify profitable customers.
- Learn about money-making prospects.
- Understand why customers are dissatisfied.
- Discover the reasons for rivals' declines.
- Examine how to take advantage of new developments.
As any SWOT analysis will tell you, your company can survive and thrive in any market if you know how to exploit an opportunity.
7. It Helps with Corporate Negotiations
Negotiating with suppliers and vendors can be a tricky task, particularly if you have little experience in this area. However, it is a lot easier if you have a clear idea of the kinds of figures that are realistic. BI tools can provide you with detailed and current data relating to:
- Sales trends
- Customer preferences
- Unexplored markets
- Product improvements
- Inventory pricing
Depending on the tools or software that you use, you can gain access to the most recent relevant industry reports, although – of course – it is up to you to take full advantage of these factors during negotiations.
8. It Enriches the Customer Service Experience
Customer relationship management is a core part of doing business in 2020, with consumers clear about what they expect. With BI, you can get a much better handle on what your customer feedback means for you.
BI tools extend users a myriad of customer service-related behaviours, patterns and needs that can allow your company to improve service, anticipate demands and pinpoint buying expectations. One way it achieves this is by taking customer feedback in real-time and then translating the information into actionable insight.
9. It Manages Inventory
Inventory management is difficult when you are running a large-scale operation, but BI software ensures that you are executing the correct orders at the right time. If you use it in tandem with IoT technology, your entire inventory process becomes simple, and you can always guarantee that you have enough goods in stock. This is important, as it accomplishes two things:
- Reduces Excess Inventory: You can prevent having too much stock in the back room that may take up too much space.
- Ensures Products Are in Stock: You can avoid having specific products out of stock that customers want.
BI software can facilitate effective inventory forecasting that can operate in real-time, making the entire process far more efficient and transparent.
Sales and marketing have the most considerable interest in adopting BI, while business, insurance and technology services have the highest rate of integration today. But business intelligence can be used in any sector and by any company.
A self-serve BI dashboard tells you everything you need to know about your company's past, present and future, with big data, analysis and metrics able to generate valuable insights into your customers and your operations. This means that you have a full understanding of what can make a profit, and what can save you money – good news, in other words, for your bottom line.
What else can business intelligence do for your business? Let us know your experiences and thoughts in the comment section below.