To
put it simply, being able to extract data from various possible sources of a
business process and presenting it or arranging the data in a way that enables
management/executives to take better decisions and foster growth of the
organisation.
For
example, when one buys a book on Amazon, what amazon does is it studies and
records the pattern of a buyer. Using this record, Amazon suggests the other
buyers' what are the other books that readers bought along-with this particular
book. What are the books which sell most with the key words we use in Amazon's
search engine. By doing so, it is boosting its sales :)
So
we think the best analytics is one which helps you decide what works and what
doesn't work for your organisation and makes your organisation adapt more of
what works :)
Small
businesses should measure atleast following three metrics:
1)
Revenue. What campaign is working, which products are being well received by
the customers, which salesman's method are working and replicate the same
amongst all rest. But it needs to be dynamic. If something better is
identified, then everything needs to move towards the better
2)
Profitability. This number shows a businessman how well the operations of his
business are performing. Are there huge inventories of finished goods or to do
work in case of service organisation. Are there regular breakdowns, what are
the costs of operations to achieve a particular level of sales
3)
Bank balance. Even if the sales numbers are growing and profitability statement
shows a great picture, if your bank balance is not healthy, then you are not
realising your debtors. You are not negotiating a good credit period with your
vendors. You are incurring higher finance costs.
Thank
you for a patient reading.
Pozitiv
Partners is a fast growing consulting firm based out of Bangalore. Pozitiv aims
to work with visionary businesses and provide smart and practical solutions.