Business analytics used to be a very geeky endeavor practiced by hard-core IT people skilled in the arcane arts of data access, data mining, data analysis, and, of course, data warehousing. Those days are largely gone — and so are the reams of lovely spreadsheets they spawned.
While the goals of business analytics (BA) remain the same — to gather and interpret data to make better business decisions, optimize processes and pursue new opportunities — the tools are now far more user-friendly, useful and plentiful than they were 10 years ago.
Many of today's BA tools deliver information online rather than in static reports, typically providing executive dashboards that show high-level measurements of corporate performance with a few mouse clicks. Dashboards allow senior executives, as well as sales and marketing people, to drill down to details by, for example, clicking on a chart to see the numbers behind it.
Sure, businesses are still gathering and interpreting historical data, but now they can do so instantly online — mixing and matching various corporate data, blending in external data and creating reports and snapshots of market trends, customer buying patterns and so on ... all in the pursuit of information that can be turned into growth and profitability. In the process, business analytics and intelligence are moving beyond analyzing what happened in the past to trying to predict and influence the future.
CRM, Business Intelligence and Analytics
In the Web-driven age, businesses want information that is instantaneous, more useful, more convenient, and more user-friendly, said Forrester analyst Jim Kobielus.
In a recent Forester report, "The Forrester Wave: CRM Suites Customer Service Solutions, Q3 2010," Kobielus and fellow analyst Bill Band state that a growing range of customer relationship management (CRM) vendors have incorporated deep analytics features into their customer service capabilities.
The Forrester report reveals that most of the vendors provide embedded, out-of-the-box business intelligence (BI) features such as reporting, query, online analytical processing, dashboarding, scorecarding, and key performance indicators (KPI) prebuilt to support their customer service applications.
That's no surprise, said Kobielus, as these core BI features enable enterprises everywhere to keep track of how well they’re providing customer service across diverse CRM interaction channels and to identify opportunities to improve satisfaction, retention, upsell, agent productivity and other key metrics.
"Vendors such as Oracle, Microsoft, SAP and Pegasystems/Chordiant offer embedded predictive models to drive real-time 'next-best-offer' recommendations in call centers and portal-based customer service scenarios," said Kobielus.
Open Source Business Intelligence
A good BI tool or suite makes the difference between acting on facts and assumptions, which can drastically influence sales and profitability, said George Mehok, CIO of Revol Wireless, which uses the open source Jaspersoft BI suite from Jaspersoft.
"Our most pervasive use of our BI toolkit is KPI reporting and dashboarding," said Mehok, noting that the hyper-competitive nature of the wireless industry forces Revol to track its performance at various levels, including company, region, store and employee.
"Every report or dashboard includes a KPI or other metrics to compare performance to targets — and that keeps us all focused on accountability," said Mehok.
Revol also uses analytics to uncover opportunities, validate assumptions and solve problems associated with its sales, marketing and customer service performance.
"For example, we were able to identify ways to make our e-commerce purchasing process more effective using data analytics," said Mehok.
The result was a 25 to 35 percent improvement in Web-based credit card approvals on www.revol.com. "That improvement has translated into increased sales and ultimately more satisfied customers," he said.
Another key area for analytics is targeted marketing.
"We utilize our Jaspersoft BI tools to identify customer groups that are likely to be interested in new products or services," he said. "We then create targeted marketing campaigns and promotional offers exclusive to the customers we have identified."
Mehok said such data analytics not only allows Revol to identify target customers, but to track and analyze the effectiveness of the campaigns and then implement what the company has learned in future campaigns.
"This continuous improvement process enables us to better tailor promotional offers with specific customer groups, thus increasing profitability," he said.
The major bottom-line for Revol: BI analytics gives the company information that was not previously available.
"We can track sales trends at a level that was impossible without this software," said Mehok. "We can access information in near real-time across all sales channels. This allows our sales and marketing teams to more quickly respond to competitive threats and measure the effectiveness of new product introductions."