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Just about every business stands to gain a competitive advantage by adopting business intelligence (BI) tools. Doing so, however, requires further justification than that. One way to gauge the effectiveness of your BI strategy is to gauge the return on investment (ROI) it’s generating.
For those wondering about the connection between ROI and business intelligence, here are a few answers.
Get a Better Feel for KPIs
Tracking key performance indicators (KPIs) is one of the most basic functions of business intelligence tools. No matter your industry, there are certain metrics that are going to be important to your enterprise’s bottom line.
Business intelligence allows users to query data and create dashboards displaying their findings, then embed these dashboards into shared workflows. These dashboards typically provide visualizations of some of the most essential KPIs for a company at a glance.
Every chart and dashboard provides an opportunity for employees to drill down into data, not only monitoring KPIs over time but asking, “Why is this the way it is?”
What Are Your Goals for Implementing BI Tools?
Not all companies are going to have the same goals for their BI tools. While there’s always a case for the importance of ROI, it’s also essential to holistically evaluate the purpose of analytics.
Yes, you ultimately want your BI tools to lead to improved operations. But what are the other goals? Maybe you want to get a clearer understanding of your ideal customer profiles. Or, it’s possible you need to recognize emerging trends in your industry. Those are both concepts that should lead to positive ROI results. The implications of those discoveries, however, go much deeper than just driving revenue.
ROI isn’t always straightforward. It’s easiest to measure and justify ROI when it comes in the form of boosted sales numbers. But this isn’t the only way a BI tool can benefit an organization. There are also strategic and qualitative benefits that can be gleaned thanks to BI. For instance, identifying long-term industry trends isn’t something that can easily be quantified in a report. However, seeing those formations ahead of the competition can lead to long-term success that would’ve never happened otherwise.
Are You Using Real-Time Analytics?
Real-time analytics can be very useful for certain circumstances and industries. This is where data is reflected in BI reporting and dashboards throughout the process of collection. These are a few examples of when real-time analytics can be super useful to organizations and provides clear ROI:
- Logistics companies and manufacturers have to deal with an incredible number of moving parts. This can lead to massive inefficiencies, since humans aren’t always capable of adequately keeping up with everything. Real-time analytics can show exactly where things are going wrong in the moment, which can then allow a human decision-maker to decide how to remedy the issue.
- Sales are an important revenue driver for online retailers. For instance, Amazon sold 175 million products during its Prime Day sale in 2019. While this was a clear success for the company, it could have also ended in disaster had there been major issues during the sale. Being able to identify problems as they happen can help online sellers keep sales flowing during their most important times.
How Much Work and Time Does It Require to Get Answers?
Time is money. ROI deteriorates the longer it takes for employees to get the answers they need. When they can get actionable insights in little time, on the other hand, it vastly improves the ROI of the BI tool.
Providers like ThoughtSpot offer tools like a relational search engine, which can reduce the time and effort it takes for non-specialists to obtain insights. It functions similarly to a search engine, but for data inquiries. The less hassle and time it takes decision-makers to get the information they need, the better ROI your organization will see.
Business intelligence tools can be used for lots of things. But it’s always important to consider how those functions will contribute to the bottom line of your enterprise.