Why is it important for companies to invest in building a comprehensive data and analytics platform?
In a previous article, we explored the difference between Business Analytics and Business Intelligence and how their synergy can be crucial for the benefits a company can gain. The combination of data and strategy translates into a positive boost for business decisions because there is no Business Intelligence (or BI) without a story to tell… thanks to data.
The benefits of Business Intelligence”.
Let’s start by saying that a good business intelligence system can change the fate of a company as it impacts the life and growth of the organization itself. This is because the ease of accessing and interpreting information significantly improves the decisions every company must make, as well as its performance. But what concrete benefits can adopting business intelligence bring, and how costly can it be not to have it?
As we have already explored, Business Intelligence is focused on descriptive analysis, historical, and current data. Among the benefits that the adoption of BI can bring, there are tangible ones such as economic benefits, including increased revenue, reduced costs, customer acquisition, and customer retention. However, the economic aspect is nothing without the so-called intangible benefits, which improve business performance, making it highly competitive even compared to rivals. Better customer service, improved public relations, better perception of the company by customers, shareholders, and the public in general, and increased competitive effectiveness. All of these aspects are not something we can physically touch but rather experience, just as the customer feels when they begin to get to know the company, starting to breathe in its values, strength, and mission. The natural consequence will be a deeper attachment to the company and all that it offers to the customer. Care, dedication, listening. These are characteristics that make anyone who possesses them a better person. This is what happens to every customer who begins to know the brand, not only because it has what they need but especially because they understand it, embrace it, and accompany it through the purchasing process, which inevitably becomes something more. Because of this, not having a good Business Intelligence system could pose risks. Let’s understand together what those are.
Lack of a good Business Intelligence system: the risks
Let’s assume that the company does not use a BI system. The consequences of not using one are truly surprising. Analyzing data with fragmentation, incompleteness, lack of proper documentation and validation leads to a vision that is far from strategic, impacting the future growth of the business. Then there’s the dissatisfaction among top managers, who are tasked with making decisions and engaging in long-term planning, which erupts in all its magnitude, making it increasingly difficult to obtain real and useful data. Due to the issues just described, it is easy to find disagreement within the company, especially from those who need to make cross-functional decisions or focus on specific business planning actions, as they struggle to obtain and analyze the necessary data. Therefore, the company tends to “navigate blindly,” caught between chaos and business choices… where it’s not the brain, but the gut, that guides decisions. This is why taking the risk is never a good idea.
Business Intelligence: the price to pay for not having it.
Business Intelligence yes or Business Intelligence no?
Nothing is created, nothing is destroyed, everything is transformed.
Antoine-Laurent Lavoisier, an 18th-century French chemist and physicist, spoke like this in one of his laws of mechanics. Never has such a current and fitting phrase been more true. This is because, returning to the initial question, everything in life evolves, and evolution, as we know, leads to new possibilities for discovery, as well as new savings and/or profits for the company. So why use the BI formula, and what return does it offer the company? The savings are certainly significant, and the optimization is unparalleled.
Below, we present some aspects where the use or non-use of BI makes a difference.
- Lack of control: having a clear understanding of what is happening within the company through data is essential to maintaining control of the company itself. Without control, nothing can be approached with judgment and awareness.
- Inability to predict market trends: in order to have a reliable model of the business’s performance, it is necessary to predict the trends of the reference market to always meet demand. To do this, tools such as Business Intelligence and Business Analytics are essential, as they rely on the data generated by the company to make a future estimate of what is to come… something not to be taken lightly, considering that forecasts made with real numbers help in the futuristic management of events.
- Not knowing your customers and why they buy from us: studying the customer, examining their characteristics as well as their expectations, allows the company’s various departments to align their decisions with the customer’s needs and desires. Getting closer to the customer helps establish an increasingly empathetic and special relationship. Only in this way will the customer tend to remain loyal… over time.
- Acting on instinct: “Instinct dictates duty, and intelligence provides the excuses to evade it” (Marcel Proust). But how satisfying is it for every human being, especially at certain moments in life, to follow their instincts? Yet, it doesn’t always pay off; in fact, decisions made impulsively, driven by emotion, can lead to wrong assessments. And the data? Well, data is the only numbers capable of making predictions and decisions… always and only based on analysis, not just of a particular business sector, but from the mash-up of all sectors working in connection, which help avoid risks and various unforeseen events.
Business Intelligence: current situation and predictive analysis.
It has been a true temporal transformation, characterized by the shift from past analysis to predictive analysis. This is the journey that Business Intelligence has undertaken over the years, a history marked by a truly substantial revolution. Change is essential when considering the functionalities of a predictive tool: analysis of the past, evolution into the future. In other words, it is no longer just historical, but the creation of a model of the phenomenon that has been analyzed. The life of a business depends on many factors. One of the most important, even though many still don’t realize it, is a good Business Intelligence formula, the one that reduces approximation while enhancing the outcome.
