If you’re interested in learning about business analytics, or what analytics can do for your business, grab a coffee and let’s have that conversation.
At first, thinking about business analytics can seem quite vague. Analytics in general is a broad field that involves the use of data analysis and statistical techniques to gain insights for a business to be able to make informed decisions.
Before Business Analytics
Not so many years ago a small business would start off by asking their friends and family if a business idea was a solid concept. Let’s call this asking for validation from your “warm market“.
That entrepreneur, freelancer or small business owner would then “analyze” the responses from their warm market and make decisions. Unfortunately, while the business owners’ heart was in the right place by doing it this way, the scope and reach of this test was very limited and potentially fatal.
As of January 2022, the estimated percentage of new business failures within the first five years was often cited to be around 50% or more. Business failure rates are influenced by numerous factors, and these estimates can be subject to fluctuations based on economic conditions, industry trends, and other variables.
To help influence your success in a positive way and possibly change the above statistics to lead to a very different outcome, contact us for help with Business Analytics
GenXtra Communications, we’re here to help.
Think of the word “analytics” as having its root origin in the word “analyze”. Properly applied business analytics can help define your business products and services, help with finances, marketing, branding and so more. If you have a specific question, the data is available, you just need to learn how to use it.
Business Analytics: Beyond Your Warm Market
Business analytics play a critical role in helping businesses make informed decisions, optimize processes, and gain a competitive edge. Let’s go back to keeping it simple for how.
John wants to open a pizza shop. His family has always told him that his pizza was the best. So based on what his warm market has stated, John spends a tremendous amount of money to open his pizza shop. Unfortunately, instead of flourishing, he is just getting himself into more debt. In addition, he is spending 20 hours a day trying to develop his dream business.
What analytics could have done for John instead.
He could have used analytical data to determine the precise location for his pizza shop. For example, study the demographic information of select zip codes to understand how large or small his target customer base is.
He could have narrowed down his list of potentially prosperous locations and then studied the competitive analytics to understand how saturated an area is with existing pizza shops, or in fact, how much in need a select area is for a good pizza shop.
Whatever the topic that relates to your need for analytics is, the answer is available.
Business Analytics Benefits
Here are several ways in which business analytics can benefit your business:
- Data-Driven Decision Making:
- Analytics enables businesses to base their decisions on data and insights rather than intuition alone. This leads to more informed and strategic decision-making. For example, John determining the precise location for his pizza shop to be successful.
- Performance Monitoring:
- Businesses can use analytics to monitor key performance indicators (KPIs) and track the performance of various processes. This helps in identifying areas of improvement and optimization. John can determine how long it takes to make pizzas and find ways to improve the speed of this process.
- Customer Insights:
- Analytics allows businesses to understand customer behavior, preferences, and trends. This information can be used to tailor products and services, improve customer satisfaction, and enhance the overall customer experience. John can determine that while Aunt Becky loves his pineapple, mushroom and BBQ sauce combination pizza, unfortunately, the majority of his customers do not. Hence, john can stop spending money on stocking ingredients that are never used based on data from sales.
- Forecasting and Predictive Analysis:
- Analytics can be used for forecasting future trends and making predictions based on historical data. This helps businesses anticipate market changes, demand fluctuations, and other factors that may impact operations. John can determine that he is growing at a rate of 20% per month and predict if his stock levels need to change, if he needs to hire more employees and more.
- Cost Optimization:
- By analyzing operational data, businesses can identify inefficiencies and cost-saving opportunities. This might involve optimizing supply chain processes, reducing waste, or improving resource allocation. John and his pizza shop is doing great! Now he can demonstrate this to his suppliers and negotiate better rates to lower his costs of goods.
- Market Segmentation:
- Analytics helps businesses segment their target market based on various criteria. This allows for more targeted marketing efforts, personalized messaging, and improved customer engagement. John is doing well, and the customer flow is steady, but, is he really reaching everyone? John may need to do a sports inspired campaign for the college that is 3 miles away (since he also analyzed the amount of potential students that would come to his pizza shop). John may need to create a special delivery system to get more business from the local business areas that love his pizza, but just do not have the time to drive to his store. You get the idea.
- Risk Management:
- Analytics can assist businesses in identifying and managing risks. This includes financial risks, cybersecurity threats, and other potential challenges that could impact the stability and security of the business. Oh no, John’s phone system is not dependable and he is missing calls! John determines that a UCaaS Phone System is better and guess what? It too has important analytics built in as well. John now knows what his mean time to answer a call is (how long a customer waits on hold), how many calls are missed completely and so much more.
- Competitive Advantage:
- Leveraging analytics can provide a competitive advantage by allowing businesses to stay ahead of industry trends, understand competitor strategies, and adapt quickly to changes in the business environment. John has really grown. He now has multiple locations and things are really going well! Now, John and his wife Jane (yes, John is happily married now yay!) are spending their time focusing on the customer experience. They know that this is critical next step to their business growth. Since their UCaaS phone system helped with their success, they have moved on to the next level and have a powerful CCaaS Phone System contact center.
- Employee Productivity and Engagement:
- Analytics can be used in human resources to assess employee performance, identify training needs, and enhance overall workforce productivity and engagement. John and Jane, along with their store managers, can effectively ensure their workflow management is stellar in all ways.
- Supply Chain Optimization:
- Analytics helps in optimizing supply chain processes by improving inventory management, reducing lead times, and enhancing overall efficiency. John is happy, Jane is happy and their customers are happy! John and Jane now have two kids and the sweetest dog that you’ll ever meet!
Business Analytics Summary
In summary, analytics empowers businesses to turn raw data into actionable insights, driving improvements in various aspects of operations, strategy, and customer satisfaction. The specific applications of analytics will depend on the industry, business goals, and the types of data available. As always, contact us for help or to get a quote for our services.
