The effective use of business intelligence has the power to support and grow any business. The key is effective use of business intelligence.
Business intelligence has a long history in supporting business, from the days of filing cabinets full of information to computer storage and data warehousing. If you’re interested, click here to read more information on the history of business intelligence.
These days, business intelligence is a broad term referring to the technology, the applications and the practices that collect, integrate and analyze business information, with a goal of supporting decision-making processes. Effective business intelligence tools can give you various views of your business operations – historical, current and future or predictive views.
But like many other components of your business, rather than rushing in by finding a business intelligence solution, it’s best to start by developing a valuable strategy that can then be executed on.
Establish Vision and Goals
The basic purpose of business intelligence is to provide the information that allows you to analyze the business, adjust course if needed, and make decisions that support strategic goals. So, the first step in an effective business intelligence strategy is to develop vision and goals for the strategy.
To do this, consider:
• What does your business need to evolve and improve?
• What data can support that growth?
• What is it you want to accomplish with your strategy?
This will help you build your vision for the strategy, which could be as simple as:
“Establishing a centre of analytics that provides key business performance measures that are easily understood and actionable.”
It’s important to know where you want to go before starting down the road.
Build a Supportive Team
Whatever the size of your business, it’s important to build an effective team to develop and implement the strategy.
There are some key components to consider when building your team.
The first consideration is to ensure there is an Executive sponsor, often the Chief Financial Officer. The sponsor needs to value the data and understand the benefits of it to the business. The sponsor will be your voice at the Executive table, will support any funding decisions needed and will help remove any roadblocks to implementing the strategy.
It’s also important that the rest of the organization sees that the Executive finds value in the strategy. This will help with support and buy-in across the business.
The Executive sponsor can also provide the corporate view of the key measures that need to be gathered and analyzed.
Which leads to another key component, having a cross-functional team. It’s important to bring together subject-matter experts from various parts of the organization, which will provide different views into the information that needs to be gathered. Different levels of the organization will give you a strategic view, a tactical view and an operational view of the information that needs to be gathered and how it will be used.
A cross-functional team also ensures there are advocates for the strategy throughout the organization, and provide you with an expert in each area of the organization, as team members will be able to understand the information.
Develop Key Metrics
Once you have your vision and goals established, and your team is in place, it’s time to determine the information needed to support the strategy. After all, business intelligence is about analytics and data, and they need to be effective to support the strategy.
Again, your cross-functional team will provide value by working together to determine the key performance indicators (KPIs) with a view across the business.
Some important considerations as you determine your business KPIs are:
• What are the main analytics that you want to track and where will you get that information?
• What are your industry’s KPIs that you want to benchmark your business against?
• What is your company’s historical data that’s important to analyze in order to track progress?
• Who will be using the information and how can it best be delivered to them?
From this important conversation, your team will be able to develop custom KPIs for your business. These company-specific metrics are what you will track, report, and monitor. The best decisions will be made by understanding who will use the data and how they will use it, which in turn determines the type of information needed and the frequency of information gathering.
It’s also key to ensure the data is gathered and presented in a way that makes it easy for all areas of the business to understand, digest and act on the information.
Consider small steps, if that works for your business. Perhaps you don’t need to track every measure at the outset. Choose a few KPIs and track and report them, gather feedback on the information, and adapt if necessary before tackling all the KPIs.
Find a Technology Solution
Only once you have your strategy in place and your key metrics determined are you able to think about a technology solution that supports your strategy. That’s because business intelligence is not just a technology initiative. The hard work the team has done to this point will ensure you’re in the best position to find the right tool and implement it successfully.
Your cross-functional team will again be key in this decision. While the technology experts can provide key answers to questions such as number of servers required, or security of the data, the other stakeholders can provide input into how they will use the data to ensure the solution meets their needs. The entire business can have input into the best solution.
After the solution is chosen, be sure the team supports implementation and tracks progress on a regular basis.
Analyze and Adjust
Once your business intelligence strategy is implemented and is being used, it’s important to step back regularly and analyze the decisions made using the data.
The strategy must evolve to keep the business evolving:
• Did the data provide the right information, at the right time?
• Did the data support effective decision-making?
• Is there additional information needed?
• Is there information that wasn’t valuable or relevant, that doesn’t need to be gathered any longer?
• What can be done differently the next time a decision is made using the data?
• What went right and what went wrong?
• Stepping back to answer such questions allows the business intelligence strategy to adapt to suit the needs of the business.
There isn’t a one-size-fits-all business intelligence strategy for every organization, but these steps provide a solid framework for any type or size of business to develop and implement a strategy that works. It’s important to be able to gather important data and use it to make valid business decisions. The variety and volume of information available provides huge potential for data-driven insights, which in turn can help grow your business.
Author Bio: Danielle Canstello is party of the content marketing team at Pyramid Analytics. They provide enterprise level analytics and BI platform. In her spare time, she writes around the web to spread her knowledge of the marketing, business intelligence and analytics industries.