To win a game of any sport, you need to strategize and build up the right team to achieve the target. Similarly, to succeed at running a business in a highly competitive environment, you need to implement the right strategy.
If you are offering a service, your strategy might include collecting customer feedback for improvement. If you are producing a commodity, your business strategy can entail selling your product to a new or broader consumer base. Whatever the case may be, the term strategy holds immense significance when planning the correct growth methods.
A Business Intelligence (BI) strategy enables you to improve your business performance, considerably increase financial gains, and work towards augmenting your business growth. It is the most effective method to make your business competitive, upsurge your profits, and plans a way to achieve your business objectives. The key to success is proper planning of the strategy, gaining shareholders’ trust, and continuous evaluation.
The Necessity and Importance of Business Intelligence
Your business cannot survive in today’s competitive world if you do not make good use of the right set of tools. A business intelligence strategy is one such tool. Commonly, business owners think that their advertising and marketing plans will get them the desired results. However, these are only the business tools through which you market your existence. Their success inevitably depends on data collected via sales, research, and customer feedback. BI helps business owners to perform all three tasks and make sense of the gathered information for better decision-making.
Creating a business intelligence strategy requires appropriate planning, collecting data, analysing information, and utilizing it to make the right business decisions. As an entrepreneur, one way to go about it is to learn this with an analytics degree online to apply and incorporate a business intelligence strategy within your business and help it grow on a rapid scale. Alternatively, you can also hire an expert.
According to business experts, not implementing a BI strategy will expose you to the following risks:
- Losing growth openings.
- Increase in costs.
- Decreased customer gratification.
- Being less competitive.
And let’s face it; no business owner wants ever to encounter such problems! Hence, successfully implementing a robust BI strategy is essential. Here are a few valuable tips that can help you develop and implement one.
- Gain shareholders’ trust
The most crucial aspect of developing a BI strategy – or any strategy for that matter – is to acquire your shareholders’ trust. Many a time, business executives cannot understand the benefits of change within an organization. Therefore, you need to build a multi-functional team that leads the way. The best way to begin is by selecting an executive sponsor who understands the business’s nature, core values, and company mission. Someone at the senior management level is ideal for this role, such as a company’s CFO.
The BI strategy leader or executive will make shareholders and top management understand the importance of developing a BI strategy while tackling any barriers that come in the way. You need to bring resources from various organizational departments together to create a more holistic approach. This includes the finance department, IT personnel, marketing, and HR. Everyone needs to be on the same page to develop an effective BI plan.
2. Inspect and record the present situation
The next step is to examine, observe, and document the current business performance and state. This requires accurate data regarding recent financials, profits and losses, and the organization’s structures, processes, and resources. The idea is to identify and separate necessary information from the redundant one to make a more actionable plan. Consequently, improving plans and procedures that are not beneficial and eliminating information is not relevant to the strategy.
3. Establishing and identifying lead indicators
Establishing lead indicators refers to identifying key performance indicators or KPIs for the business. Successful implementation of a BI strategy depends on identifying relevant KPIs that can be measured and recorded to analyze its position. Make sure your KPIs are smart, quantifiable, and achievable. You have to choose KPIs aligned with your business’s nature and must track them at all times.
4. Develop a universal language
Developing a common language is as essential as establishing KPIs. The difference in language and terms can become a hindrance and lead to ineffective communication within the company. Therefore, you must agree to use accurately defined terms in the same meaning as every other department. For example, some departments only use the word “assets,” whereas there is a difference between current and non-current assets. Some people might use ‘revenue’ and ‘profit’ interchangeably, and many think ‘profit margin’ and ‘gross profit’ are the same terms. Getting terms like these mixed up can lead to miscommunication and potentially costly errors. It is best to identify terms and create a glossary for everyone to adhere to.
5. Find a digital solution
BI is dependent on the use of data, and having the right software can make all the difference. For a BI strategy to be successfully implemented, data needs to be understandable and useable. More importantly, it needs to be accessible by everyone responsible for implementing the strategy. A BI software or a partner will help your BI strategy to deliver and improve your business performance in very little time. A company might have to invest in training its employees to make the most out of BI software, but it will benefit in the long run. Cloud-based solutions make sharing data extremely easy. Make the best use of technology in a highly digital world.
6. Always do a trial run
Your entire BI strategy does not necessarily need to be applied at once. You can always select a few KPIs and gauge performance one at a time. The selected KPIs can be used to develop dashboards and reports and gather feedback regarding the method used to achieve the objective. This trial run will determine whether the KPIs selected are working according to the BI strategy or not. You must ensure that the KPIs improve your business performance. Otherwise, you will have to make some amendments to them or possibly start all over again on the drawing board.
7. Effective communication and evaluation
Without effective communication, all your efforts to use BI to improve business performance might go in vain. Change takes time and brings about many questions and uncertainty in the minds of those not directly involved in the process. Effective communication helps to keep everyone informed. It also helps evaluate the outcome of the trial run.
Savvy businesspeople invest in intelligent business decision-making. Proper preparation, dedication, resource allocation, data collection, KPI identification, and execution are required to successfully implement a good BI strategy. You can always take help by creating a roadmap in the beginning. The journey to achieving success isn’t a short one though.