Information Needs of the Business have to be focused
Therefore, it is really, really important to analyze the information needs based on the business processes. Questions like “which goal do you want to achive” as well as “which process to you want to analyze” should be asked at the beginning. Next, it is necessary to think about the measurement of these goals. Sometimes it easy to define a set of key performance indicators as well as dimensional elements but sometimes it can be very hard. The problem is not the definition; it is the recording of the needed data. I will give an example how business goals can be defined as well as measured and monitored through data.
Example 1: Online Trader Wants to Increase Sales of Toothpaste
The example bases on a big online trader which wants to increase the revenue of a specific product. The product in this example is toothpaste. But it could be any other product too. The reason behind this business decision is that the online trader signed a big deal with the vendor of the toothpaste and the profit per each is twice as high before. The purchase department informed the online shop management team that the deal is signed and the advertisement should begin. The only action the shop management team does is a better positioning of the product on the website. In their opinion, that should be enough for selling more than before. The management has heart of the special contract and defines that the sales have to be 50% higher in the next six months than the months in the last year. The shop management team creates a dashboard with the sales and orders of the product toothpaste of the specific vendor and visualizes the data based on the order date and compares the kpis of this year`s month with the kpis of last year.
Example 2: Manufacturing Company wants a fall back strategy in procurement
This example bases on a manufacturing company, which produces engines. The Revenue and earnings are quite good are increase from year to year. The Company sells engines for luxury cars where the demand is steady over the years and does not depend on the economic growth of the whole market. The Management wants to save the status quo and identified the material as threat. The company depends largely on their suppliers because all components are not self-produced.
The management wants to have a clear understanding, which parts of the engines do have only one supplier or a supplier share higher than 70 percent. In addition, the managers want to have the average delivery time of each component. After the evaluation, the Management wants to have an ABC-Cluster with the suppliers the Company depends most on. These suppliers will be monitored for bad economic bevahiour on a “watchlist”. In addition, the procurement department receives the order to find alternative suppliers for the specific components.
Example 3: Textile Manufacturer wants to decrease complaints at top products
This example bases on a textile manufacturer, which sells his clothes via different stores which the company does not own. The product strategy was defined by the management. Products which are “strategic” products and contribute to high revenues and earnings have to be “perfect” goods. The complaint rate has to be at “0”.
What you need is to identify the specific products. Which are the most important products for the company based on revenue and earnings in which period? After that, you have to bring the amount of complaints to amount of orders and built the measure complaint rate.
The examples to describe are quite easy. In real life, it is sometimes really hard to bring the data in one Dashboard so that the actions and ideas can be supervised. There are a lot of more examples possible to show but I think you got it. Data have to answer the Business questions and have to support the business in taking decisions into actions. If your data is not requested by the business, you failed.
About Tobias Riedner
Tobias Riedner foundet WYCDWD.com in 2015. He works and worked as innovator, consultant, analyst and educator in the fields of business intelligence and data warehousing. He learned a lot from the best consultants, managers und educators in the past and shares his knowledge worldwide. He works for a steady growing traditional company which is a leader in industry 4.0.