Using Business Intelligence to Increase Company Efficiency
Together, business and intelligence are what create a powerful, profitable corporation.
By Erik Kass, Director of Product Management for Mid-market ERP Products, Sage
Business intelligence is a combination of two of the most important words that any company can know. The first, "business," is the lifeblood of a company. "Business" is about what a company does, what its employees and executives do, the goods or services that it produces, and the way that interacts with other companies in its sector. The second, "intelligence," means using knowledge and skills to optimize all of the factors that go into creating a successful company.
Together, business and intelligence are what create a powerful, profitable corporation.
Business intelligence is more than just a concept, however. Business intelligence is a tangible thing, a type of software designed to find and analyze flaws in a business' data collection strategy and then solve them to create a more efficient, knowledgeable operation. It does this in a number of ways.
1. BI can help measure company progress.
Business intelligence applications can be used to create a hierarchical performance metric, which analyses how a business performs across several key sectors. These sectors can include time, cost, resources, scope, quality and actions. The performance metric is designed to keep track of various markers that are important to shareholders, executives, employees, and customers and ensure that the company remains healthy, efficient, and profitable. Should the company fall short of any of the metrics, the problem can be diagnosed and solved before it evolves into a much bigger mess.
2. BI can create company benchmarks.
Benchmarking is the process of comparing one company's progress across certain important factors with industry best practices. Business intelligence can help a company rise far above industry benchmarks by increasing speed and decreasing costs. Benchmarking allows companies to quickly and easily spot the areas where they may be falling short of their competition. Benchmarking also helps companies identify the rivals that are the most likely to pose a threat, which can help a business stay motivated to do its best.
3. BI can uncover hidden, forgotten, or lost data.
Business knowledge discovery is a process that involves mining data from archives and hard drives long forgotten in dusty warehouses or buried beneath hundreds of newer files in a computer system. One of business intelligence's primary functions is to better organize and manage this data -- and all future data -- so as to allow a company instantaneous access to records from almost any date, year, or time, regarding anything from efficiency to sales to profits to losses. Having access to this additional data is crucial in helping a company avoid past mistakes and learn from previous strategies, leaders, and techniques.
4. BI can help with enterprise reporting.
As information technology has grown rapidly over the last decade, there has been an increased need for businesses to compile their operations, finances and other information in one document, preferably on a computer where it can be easily accessed and edited. Business intelligence systems can help create these documents by querying information from difficult logical models -- for example, human resources and capital improvements -- to create a single readable document. These enterprise reports put a wealth of information about the company's health at the fingertips of employees and executives alike.
5. BI promotes collaboration within a business.
Prior to ERP and BI systems, many departments of a company often had only limited interaction with one another. People working in human resources, for example, might have had very little to do with people working in information technology. As a result, many calculations and data entry jobs were unnecessarily performed twice or more by different departments that simply weren't communicating with one another to work as efficiently as possible. By integrating data from different departments and streamlining communication between business elements, BI makes a company exponentially more collaborative and efficient.
6. BI leads to better knowledge management.
Business intelligence is just one of a number of software applications that can be used collaboratively to increase business efficiency. One of the main perks of business intelligence is that it prompts a company to be more mindful of its knowledge management -- that is, where and how it stores all of the knowledge it accrues over decades of working in an industry. Just as children look to their parents for guidance and advice, new management leaders can look to data stored by their predecessors to benefit from the wisdom they've accumulated over their long and successful careers.
The Final Word
All in all, business intelligence is a powerful tool that helps companies eliminate unnecessary steps, take advantage of all of their resources, and become infinitely more efficient -- all of which leads to increased profits, a better market share, and a more successful company overall.
Erik Kass is the director of product management for mid-market ERP products at Sage, including Sage Accpac, MAS 90, and MAS 500. He is responsible for managing the product line life cycle from strategic planning to tactical activities. Erik manages a team of product managers responsible for specifying market requirements for current and future products. He holds a Master in Computer Science degree from the Eindhoven University of Technology (the Netherlands) and an MBA from Simon Fraser University (Canada).