You have heard it all before – the jargon from big companies trying to sell you expensive software that you are fairly sure you do not need and anyway, what is Business Intelligence (BI)?
We would like to take this opportunity to introduce ourselves and give you a very quick overview of the benefits of investing in BI or Financial Performance Management (FPM) software and briefly outline the functions we think you will find useful in running your company.
Data everywhere, Intelligence nowhere
If this sounds familiar, you are probably struggling with spreadsheets prepared for you every month by your line managers. Problems with spreadsheets arise when people add or subtract columns or rows or have differing interpretations as to what goes where. Often, the data is out of date by the time it gets to you and late deadliners make your month-end, not to mention your year-end, a nightmare.
A BI solution will gather, store and provide instant access to mission critical information. It will enable you to make better business decisions by considerably improving the speed at which you can calculate and consolidate your data and allow you to make comparisons in seconds.
Pinpointing profit and loss
If you do not have accurate and timely information, it is very difficult to analyse operational effectiveness. We all know that we need to keep our costs low to maximise our profits and stay ahead of the competition and we all probably have a general idea as to where our profit losses are occurring. However, we need to stop guessing and start knowing; your BI solution will help you to identify areas that are failing to meet objectives and encountering cost overruns, allowing you to make mid-course adjustments to correct the situation.
Currency conversions
Depending on the scope of your operations or projects, accurate and timely data is critical, but so is accurate and up-to-date currency conversion. Your BI solution will provide a powerful engine for high-speed calculations and automated currency conversions with exchange difference capture. This allows you to monitor actual costs and expenditures in a fluctuating environment, keep a close eye on profit margins and make any needed budget adjustments.
Forecasting and scenario analysis
Because your BI solution integrates your data from multiple sources, and because it has a built-in standard validation function, your forecasting is based on reliable, historic data. This produces highly accurate forecasts for your decision-makers.
But your BI solution can take forecasting and strategic planning to a whole new level using scenario analysis. This means that you can ask as many “what if?” questions as you like. If your operations are dependent on the price of petrol or you’re concerned about volatile material costs, these are all factors which can be run as queries to give you almost immediate answers to questions which directly affect your profitability. It allows you to see where you can create efficiencies without negatively affecting your core business or service and provides a strong foundation for informed strategic planning.