Will Your BI Lead to Real ROI?Getting actual return on investment from your business intelligence solution

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They vary wildly on cost, set up & maintenance time, breadth of features, and user interface. Some are built to cater to Fortune 500 companies, others tailored to small & medium-sized businesses and startups. But there is one thing that all business intelligence (BI) solutions have in common: at the end of the day, they are supposed to make you money.

If you are considering implementing a BI solution at your company, or even if you have already been running with one for a while, it’s important to make sure the return on investment (ROI) of your chosen solution is positive since many BI solutions will cost you large amounts of time and energy in addition to the monetary cost. For example, if your IT team spends a month setting it up, or if you need an analytics specialist in order to make sense of the data your solution collects, that should be factored in your ROI calculations as well. Will your BI eventually pay for itself, and then some?

This white paper will illustrate the ways a BI solution should show real-world ROI within a week,

within a month, within a quarter, and within a year of implementation.

Not all BI solutions are created equal.

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REVENUE

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Within a Week...

How do you know if a BI solution will show immediate return on investment?

One easy way to tell is if your investment is low cost from the start. Many BI solutions on the market today can cost thousands to hundreds of thousands in setup fees and ongoing maintenance. A 2010 post on Forrester Blogs estimated that with some BI systems, to produce a single report can cost an average of $1,840...and this was for a fairly basic report.* Let’s hope that this one report increased revenue at that business by at least that much!

Choosing an affordable BI solution for your company, especially for Small to Medium-sized Businesses (SMBs), will speak a lot to the actual ROI you see. Likewise, be wary of how much time and energy goes into setting up and maintaining your BI solution. Do you need to manually update your business analytics? Do you need to retain an analyst to help you make sense of the data? How often are you or your IT team on tech support with your BI solutions provider?

Ideally, you want a small investment in analytics to move the revenue needle dramatically. Remember, ROI is a ratio: the cost of your BI solution can tip that ratio in your favor.

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1. Low setup and maintenance costs.

*http://blogs.forrester.com/business_process/2010/01/bottom-up-and-top-down-approaches-to-estimating-cost-for-a-single-bi-report.html

Gain from Investment - Cost of InvestmentCost of Investment

Return on Investment (ROI):

Within a Week...

You should be making sure your data quality is high or near perfect. Simply put, the better your data is, the better analyses you and your BI solution can perform, and the better the insights into how to improve your business.

The alternative? Keeping with bad data leads to bad analytics and faulty conclusions, and the end result is exactly the opposite of business intelligence. In fact, a combination of poor data quality and lack of visibility into data quality issues was cited as the number one reason for overrunning project costs in a Bloor Research survey.* Does this sound familiar to your business?

How much of your productivity is wasted chasing down and correcting errors in your data? Are you able to achieve 100% data accuracy? Although it sounds difficult, it’s not an intractable problem. Your BI solution will help you in the following best practices that might be difficult to perform manually:

1. Pick your battles - Not all data errors are equal. Ask your team to spend time fixing errors that are relevant to your Key Performance Indicators (KPIs) first for the biggest improvements.

2. Make data quality a KPI - Place emphasis on data quality as a KPI to change the culture of your company into a data-driven one.

3. Fix with “smart guesses” - Use historical data, for example your average margin or average value of a deal, for fields that have missing data.

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2. Monitor and correct data errors.

*http://www.it-director.com/technology/data_mgmt/paper.php?paper=953&download=600a4b5cad5ad79d76cc-0-0

Within a Week...

You probably have a lot of historical data to sift through (unless you had the foresight to employ a BI solution when you started using your CRM). Once that data is connected/imported, your BI solution should give you immediate analysis of past trends and why they occurred.

Visibility is one of the biggest benefits of business intelligence for the simple fact that seeing what moves the needle at your company is the first step to actually moving it. A perfect example is a historical analysis of your marketing campaigns.

The Monthly Newsletter in the left example saw more total Opportunities than the Monthly E-Book, so you always thought it was a better Marketing campaign. Actually, your BI is showing that the conversion rate for the latter was higher than the former, so actually the E-book was the more efficient and effective one.

This visibility will hugely benefit present and future data as well, but being able to have a clear view back can result in changes to your company today that will increase revenue.

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3. Clear view of historical trends in your data.

Quick Case Study

HireMinds, a recruiting firm based in Cambridge, MA, needed better visibility into their data:

“It was impossible to predict the productivity of employees, especially rookies. Even when I could get the data, it wasn’t reliable and I had to have it reorganized and fact checked. We were taking interview data and manually doing division on it...it was crazy.” - David Hayes, CEO

After implementing InsightSquared: - Presentations up 90% - Interviews up 139% - Revenue up 45%

Within a Month...

Your team conducts a lot of activity in order to close a deal, but are they being efficient in their efforts? This is where insight into your Activity Ratios can provide the answers that will help you determine where best to put your team’s time and determine problem areas in your sales process.

For example, your BI solution should be able to show how efficiently your team is working Opportunities for each client.

In this chart, the ratio of Calls to Deals shows how many phone calls it usually takes to close a deal for each client. The lower the ratio, the more efficient you are. Hence, “Perry Ellis” has the highest Call:Deal ratio, yet is closing the same amount of deals as other clients. Knowing this, your company can see ROI by focusing effort on more “efficient” clients - the ones with Opportunities you’re more likely to close.

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4. Know the relationship between your Activities.

“Your  BI  solution  should  be  able  to  show  how  ef5iciently  your   team   is   working  Opportunities   for   each  client.”

Within a Month...

Do you know how long it takes your business to get from identifying a deal to actually closing the deal? What about all the stages in between? How about by different pivots and slices?

Most businesses have some sense of their Sales Cycle, but a good BI solution should provide a much more comprehensive and configurable view that can return more real-world value.

In the example above, it seems the month of May and August saw a lengthy Prop Phase that lengthened the

overall Sales Cycle. Once you can diagnose a problem area, you can drill down to the employee level:

Turns out that Millard Fillmore had a very long Prop Phase in May. It might be time to have a chat with him to see what happened here and what you can do to prevent it from happening again. When you’re able to identify blockages and bottlenecks in your Sales Cycle in this way, it’s easy to see how this would directly impact your bottom line.

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5. Understand your Sales Cycle.

Within a Month...

Within the first month of implementing your business intelligence solution, you should be hitting your stride in how you take in your daily dose of information. Do you like to wrap up the day by checking out the numbers, or do you like to review the previous day’s data with your morning cup of coffee?

Nightly Emailed Reports can make this a breeze by putting BI right in your inbox. Having access in this way increases your employees’ engagement with analytics, which then increases data accuracy as more eyes are on the numbers each day. Thus, you are able to gain more ROI from the CRM system you’re already paying for.

After a month of looking at your data daily, you will sense the trends of your sales cycle and become aware of problem areas faster. Shifting your company’s culture to being data-centric can be a huge win as the more eyes are looking at your data everyday, the more likely your company will gain actionable insights that increase revenue.

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6. Easily summarize & digest your daily Activities.

Within a Quarter...

How much is one of your deals worth to your business on average? If your BI solution can help you save just one deal in danger of being lost, would it pay for itself? A good solution should be able to do this many times over by preventing deals from slipping through the cracks.

A good indicator of a deal in danger is the number of activities taking place on the opportunity within a set period of time. You can call this the momentum of the open opportunity. If the momentum drops near zero, you know that this particular deal hasn’t gotten much

attention recently and perhaps needs a little more TLC.

Here, the bubbles in red are the ones with zero momentum. At a glance, you can see which deals have stalled. Maybe you know about all of them, but then again, maybe there is one that just somehow got off your radar. With this sort of visualization, drill-down capability, and automation, your employees will no longer have to scour for every deal in danger and you’ll have the potential to save a deal you might have lost before your BI implementation.

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7. Save a deal in danger of being lost.

“If  your  BI  solution  can  help  you   save   just   one   deal   in  danger  of  being   lost,  would  it  pay  for  itself?”

Within a Quarter...

A lot of companies might be familiar with the end-of-quarter scramble to put together reports and presentations for post-mortems. Hours, even days, can be spent cobbling together not only the metrics that defined the last quarter, but also making them look consumable and presentable enough for your employees, clients, managers and investors. What if you never had to do that mad scramble again?

Make sure your BI solution has all your end of quarter reporting needs covered. If you have always on, always updated reporting, you’ll be ready to present at any time without sinking hours into the task.

If your BI solution already has clear, attractive charts built in, you can do away with spending time with Excel and Powerpoint. Saving this much time can often be invaluable ROI.

Below are examples of a Sales Trend chart (left) and a Win/Loss Summary chart that are automatically generated and updated in real-time to different data sources.

Time is money. Save as much of both as you can for maximum ROI.

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8. Never waste time pulling quarterly reports.

Before you spend hundreds of thousands of dollars hiring a data analyst (or even a team of analysts) to run and deliver your reports, you might want to consider how much a good BI solution might be able to do first. The better the automation and clarity of your BI solution, the less man-power your business might ultimately need.

This way, there isn’t a gatekeeper to the data; employees won’t need to wait until your data analyst has time to pull the report they want, in the format they want, and to tell them what they’re looking at. Ideally, your BI solution is automatically populated with the data from your CRM, eliminating the need for importing/exporting data manually, and your data is presented to you in clear, easy to read charts and dashboards. This gets your analytics out of the hands of the few and into the hands of the many. With more employees seeing and understanding your data, the more efficient your business can be.

It’s not unheard of for even small companies to spend upwards of 20-30 hours a month at $50/hour to

outsource report building. These reports are still in Excel, still hard to read, and still prone to error. Make sure your BI solution can eliminate these pain points and automate your analysis, so you spend less time pulling reports and more time using them to make better business decisions.

Within a Quarter...

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9. Eliminate the need for data analysts.

Quick Stat:

Less  than  0.2%  of  InsightSquared  customers  export  reports  to  Excel.*

*Of over 100+ companies using InsightSquared in Q1 of 2012.

Within a Year...

In a year, you won’t know how you did business previous to having solid business intelligence. Now you’re a data driven business that has a culture around making decisions based on real evidence, not guesses. BI will continue to show ROI in various ways:

• New employees will have easy, comprehensive access to your company’s historical data, including the track record of veterans. With a clear look back at what has moved the needle most at your company, they can hit the ground running and learn from your top performers without lengthy training sessions.

• Poor performing employees will be vetted quicker as their individual score cards and activity ratios will show exactly how well they are doing.

• With month-over-month and year-over-year data accessible at a click, you will have much more accurate sales forecasts. You’ll see how your pipeline is trending and be able to make small

adjustments early and easily instead of large painful adjustments at the last minute.

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10. You become a data-driven business.

Quick Case Study

The Bowdoin Group is a recruiting firm based in Wellesley, MA and founded in 1994.

Within 2 months of implementing their business intelligence solution, they saw:

• 136% increase in Leads• 26% increase in Phone Activity• 2% increase in Conversations• 9% increase in Job Orders• 23% increase in Appointments Made• 64% increase in Placements Made

Start getting real ROI from BI, today.

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Get a free 2-week trial with InsightSquared.

✓ Data Quality Monitoring✓ Activity Tracking✓ Sales Trending✓ Goal Tracking✓ Sales Forecasting✓ KPI Analysis✓ Employee Scorecards✓ Stage Tracking✓ Activity Ratio Trending✓ Nightly Emails✓ Win/Loss Analysis✓ Opportunity Analysis✓ Campaign Tracking

www.insightsquared.com/ROI/