Business Intelligence for C-Suite
Nowadays, it’s rare to find a business hierarchy that doesn’t include some sort of executive team or board of directors. In fact, most organizations include more than just the CEO and CFO. There is now: COO, CTO, CMO, CSO, and so on.
Giant corporations rely on their C-suite team to keep them updated on the crucial processes of the company in order to stay afloat and ahead of the competition. Finance, employees, clients, projects, and profitability are all core elements of a business that need constant attention.
However, if a high-level executive doesn’t know how to interpret the data, how can any company develop and grow? For instance, the role of the CFO is to evaluate crucial data to ensure high profitability and revenue.
While the COO is in charge of projects and daily operations, which requires the role to analyze project performance and employee productivity.
Without the ability to slice and dice this data, how is any organization supposed to envision success and growth?
Business intelligence has often been overlooked as a solution to most, if not all, business problems. Data, reports, and analysis are fundamental ingredients of a business to monitor progress, innovation, even declining factors. Without the correct tool to take all this information into a chronological narration, it just becomes a bunch of useless numbers and words.
A BI tool is the key to professional success, especially when it comes to leaders of companies looking for quick turnaround and current data.
Stay Ahead or Fall Behind
When it comes to business intelligence, more often than not it’s a lack of understanding BI and data analytics that make leaders feel hesitant to move forward.
In regards to taking on new challenges and finding adequate technological solutions, those with C-Suite leadership simply just don’t have the time. They're more focused on pressing matters that have urgent consequences, they leave it to the IT department to decipher complex reports and find solutions for development.
On top of not having the necessary time to oversee the launch of an effective software development, the price tag that comes with a BI tool can deter many companies from investing. The broken connection between the demand for an efficient platform and a solid financial foundation is hard to overcome.
As a result, companies stay in a stagnant bubble never reaching their full potential. And thus the never ending circle of stationary growth continues.
The learning curve can be long - just as it is with any new technology - and can be hard to find the right team to accept this change, but the after effects will be nothing short of positive.
Before Business Intelligence
The best way to understand the concept of business intelligence is to tell a tale. This story begins and ends at a fictional law firm called Mitchell & Associates.
The Chief Operating Officer, Oliver Stone manages the daily operations of Mitchell & Associates. It may only be a medium sized business with 80 employees, but as a services-based company, handling the multiple time entries has become tricky - even though it has a solid foundation with an ERP.
A top key performance indicator (KPI) that Mr. Stone must focus on is the billable ratio, in other words, how much profit is being generated by customer projects. These are inputted into “time entries” that provide the billable ratio.
The company’s ERP has done wonders for the COO, but the limitations have been obvious the past few years, especially when the volume of time entries can exceed 6000. And that’s just a mid-sized firm.
Another KPI is the daily revenue (time entries x the hourly rate), which is used to calculate how much the firm is earning within a day. In order to reach weekly, monthly, and yearly financial objectives, it’s imperative to keep track of the daily revenue.
Are there enough employees to handle projects and clients? Is the company charging a profitable rate? Do we have enough projects for employees? Do we need to grow staff for the incoming demand? There’s a lot to analyze.
With all these questions in mind, Mr. Stone had to do some research. He discovered that during the summer months, the ratio of employees to projects was unequal. There just wasn’t enough work to keep everyone busy. However, come September, project load increased immensely and everything was back to normal.
That being said, while developing a contingency plan, he ran into a problem. He was unable to ensure that this pattern of work was a yearly occurrence due to lack of historical data. Oliver Stone didn’t know if he should plan the following year in the same manner.
His ERP data was limited in extensive analysis. He was able to do a daily and monthly analysis and see the year before, but the visibility of specific days is lost and only recorded on a monthly basis.
If he wanted to move forward with his plans and prepare the business for success, he realized that the only solution was a business intelligence platform.
After Business Intelligence
Business intelligence for executives like COO Oliver Stone can be a lifesaving tool not only for future trends but also for insight into a data warehouse where C-level executives can access data on an instantaneous basis to ensure their quick decisions have merit.
Let’s take a look at how Oliver Stone’s professional life changed for the better with a business intelligence software.
The Perfect Hire
At the beginning of the year, Mr. Stone needed to know the precise month he should hire new lawyers. Based on experience and how much training is involved, they must be prepared for the firm’s biggest month. Thanks to his new business intelligence platform he was able to manipulate historical data that showed that September was the busiest month the past few years.
The smart COO knew that he had to start hiring new employees by March to get them ready for new projects by September, considering it takes about six months for new lawyers to jump into their role.
The data warehouse within business intelligence showed that he needed to be patient as starting around the end of the summer, work will start up again. He realized the lack of client demands would guide the firm to invest more time in training and adapting employees to upcoming projects.
A BI tool provides users with full visibility of more than three years and can be drilled down to clearly highlight the day, week, and month on customized graphs. These trends can then be sliced and diced by period to create an easily digestible comparison chart.
Through these graphs, someone like Oliver Stone can access employees’ work hours and track the billable hours. He can then manage operations by reporting on employees working over-time or even under-time. The COO can also manage project progress based on each employee's time entries and whether it's for internal or external projects. Eventually, leading to a more efficient workforce.
While it may appear invasive to launch a business intelligence software that appears to spy on workers, its goal isn’t at the expense of people. Rather, it will showcase a company’s strengths and weaknesses. Are there too many employees and not enough work? Are they currently being trained? Is the low revenue due to more juniors working at a lower hourly rate?
Basic Economic Gain
A company’s #1 objective is to be profitable. Without recurring revenue, there’s no company to build off other important objectives.
Business intelligence for executives helps leaders keep track of daily revenue. For a product company this is based purely on how much inventory is sold per day. In terms of a service company, this is based on the hourly rate and project opportunity.
Mr. Stone has a daily objective of $35,000.00. Thanks to BI he can analyze each project’s progress based on its profitability from hourly rate and amount of employees working on it. Are there too many employees and not enough work to go around? Or are there too many people working overtime to finish projects?
This ties into the client success team as well. Not all clients pay the same rate. Loyal clients may have a discount, while others demand a senior employee at a much higher rate. All of these intrincies are monitored on a daily basis via data and reports to keep the profitability on track.
A tool like business intelligence is imperative to stay on top of competition as technology advances. Whether you’re a COO, CFO, CEO, CMO, or a crucial part of the executive team, software is never a detrimental decision.
For more information on business intelligence and how it can develop your position within a company, contact us today.