To start with your business means to compete with the established ones in the market.
“If you don’t have a competitive advantage, don’t compete” – Jack Welsh, CEO, General Electric.
This means that having a competitive advantage is critical if you want to stand out in the market. But how do you achieve it?
Business Intelligence or BI is the answer.
What is BI?
The term Business Intelligence traces back to 1989, before that its characteristics used to be a part of executive information systems.
“BI is about providing the right data at the right time to the right people so that they can take the right decisions.”
This is how Nic Smith, the Head of product marketing for data and analytics, puts it in the simplest manner.
Business Intelligence is, thus, a platform with the goal of providing comprehensive data insights to organisations, which opens the doors to dig deeper into data patterns and make intelligent decisions, helping them to attain a competitive advantage — a critical factor for all businesses.
Business Intelligence can be called an umbrella term, which locks data analytics, data visualization, data mining and business analytics within itself.
While traditional BI used to be driven by IT industries and most of the queries related to analytics were resolved through static reports, modern BI promises direct interaction and approach, allowing users to answer their analytics queries.
Why do Organisations need BI Platforms?
BI is not just a software, it is a comprehensive approach to use data in daily operations. Business Intelligence tools have changed the ways of marketing over the years, helping organisations make decisions based on their customer behaviour. But this is just one of the multitude of factors BI can help with.
There are several advantages and goals businesses can achieve with BI platforms. Let’s know the most practical ones with real-life examples.
- Easy & fast reporting. With BI dashboards, businesses can get monthly reports condensed into a single snapshot, reducing the hours spent in manual reporting.
PepsiCo reported a 90% reduction in reporting time with BI analytic tools, utilising their time in analyzing the data and finding problems, rather than in putting it together.
- Increased competitive advantage. To build a successful business, it’s necessary to know your competitors. With BI software, you can get the ideas to outperform and stand out in the eyes of your customers.
Walmart attained a competitive advantage by using BI to track prices set by its competitors, which helped in identifying market trends while also anticipating customer needs.
- Improved employee satisfaction. With BI dashboards, departments need little training to access their data, without having to contact IT for the slightest queries. They are designed to provide data solutions to employees with a non-technical background in an easy-to-operate way.
New York Shipping Exchange (NYSHEX), a digital platform working for improving global shipping, used BI to give data access to its entire team allowing employees to get any insights whenever they need it.
- Data-driven decisions. The fast reporting, competitive advantage and employee satisfaction, in the end, lead to data-driven business decisions. Giving data access to employees means they can analyze data in real-time, making faster and intelligent decisions.
A wholesale distributor, Baylis and Harding, used business intelligence tools to create custom dashboards focusing on relevant areas leading to progressive decisions.
With all its features and advantages, BI has led numerous companies towards smarter and better decisions. However, it has not been universally adopted yet.
What, then, is stopping businesses from adopting BI?
Major Challenges Deterring Businesses from BI Adoption
According to statistics, the global business intelligence adoption rate is 26%.
A NewVantage Partners survey revealed that 54.6% of respondents were competing on data and analytics, and only 26.5% stated to have adopted data-driven ways.
What are the reasons for these fewer adoption rates?
1. Implementation Costs and Difficulties
The first step towards implementing BI is choosing the right software. The one suitable for your business needs. It sometimes can be tricky because there is an increasing number of BI solutions in the market.
To choose the right one, you have to be very specific about your business requirements and the goals you want to achieve.
However, keep these things in mind before making a decision:
- Give enough time researching various solutions until you find the best-fit
- Scalability and user-friendliness
- The security level provided
- Continued support from the provider
The second prohibition is the high costs. It is not only the purchasing price but also the scaling and training costs. However, choosing the right one can guarantee a high ROI, making the investment worth it.
2. Data Skills Gap
Apart from implementation costs and difficulties, business users often struggle even after successful BI implementation.
The reasons being
- They don’t understand software operations
- They don’t trust the data
- Reports are not organized in a familiar manner
“Everybody needs data literacy, because data is everywhere. It’s the new currency, it’s the language of the business” – says Priyanka Jain, data science expert.
For the software to be effective as a tool, it is necessary to remove the skill gap. Therefore, organizations need to ensure proper training and build trust in the employees.
3. Poor Data Quality
According to an IBM study, incorrect and poorly analyzed data causes a loss of over three trillion dollars every year, harming the business economy.
The low-quality data causes productivity loss and impacts overall ROI. Larger companies tend to undergo huge losses due to high reliance on data analytics. American businesses are reported to lose over 109 billion dollars every year due to inaccurate data practices.
Also, the amount of data produced in our digital world is overwhelming. BI helps in gathering and analyzing this data. But chances are, the data most relevant to us might get buried deep and lost as a result, wasting time and resources.
To avoid such situations, businesses should look for DQM (data quality management) tools, a set of practices aiming at maintaining high-quality information.
4. Lack of a Clear Strategy
One of the most important aspects of a successful business intelligence implementation is having a clear-cut strategy. Many businesses lag because they don’t have one.
Without a clear plan, the data is scattered. It might present unclear versions of truth and hinder the quality of your data, leading to ineffective business decisions. In contrast, having a powerful strategy makes data quality a priority.
By creating the right BI strategy, you create a map of how you will use data in your company for helping your organisation make data-driven decisions. It will include identifying goals, planning a budget and choosing the right software.
Here’s a quick guide to help you make a good one:
- Define your goals. Narrow down your needs by properly defining the goals you want to achieve with your data, such as what insights your business needs? Or what KPIs do you want to track?
- Plan a budget. Planning a budget beforehand will help you not get swayed by the shiny features of expensive software that you might not need. Stay realistic and buy the right one.
- Compare vendors. Look for vendors and compare their features with the features you want in your software. Checking their ratings can help you with that.
- Request demos. After shortlisting vendors, ask for demos. In order to be sure, you need a trial of the system to check its performance. Make sure it has all the features you need.
- Plan user training and workshops. Once you have found the best-suited solution for your business, it’s time to train and educate the people who will deal with it. Make sure to give them enough time to learn.
5. Analyzing data from different data sources
Modern BI collects data from multiple data sources. However, there are some problems associated with this process.
One significant problem is heterogeneous data. Different data sources store data in different ways and in different formats. To get required information, you may need to collect data from various ERP systems, CRM systems, files, e-commerce databases and web APIs etc. This collected data can be unstructured or semi-structured, not providing the required information.
Another problem that issues forth is data integration. The different data sources used to collect data need to be integrated with the larger integration workflow, which is a complex and time taking process. Adding more data sources makes the problem more complex. To avoid data integration issues, choose a solution that can automate integration methods saving you time to focus on relevant areas.
Getting data from multiple sources becomes difficult as your business grows. The integration process may slow down if you don’t plan carefully for scalability and efficiency. To overcome scalability challenges, techniques like Massively Parallel Processing (MPP) can be helpful.
Also read Challenges faced by SaaS solutions.
Implementing business intelligence is a project in itself and may take months before there is a significant ROI. However, many businesses adopt innovative ways to use BI by choosing the right solution; reducing costs and improving profits.
Click Supista to get the right solution for your business today, with the best team of data analysts on your side.