Tuesday 13 October 2015

The whole world is talking about business analytics....



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.