Why Your Company Can’t Afford to Overlook Business Intelligence

Right decisions need the right information

Running a business means making decisions. Running a successful business means making the right decisions at the right time. The right decisions are the informed decisions. While some successful decisions may have been taken based entirely on intuition, “gut feeling”, individual experience or deep knowledge of a certain industry, most of them have been driven, or at least supported, by verifiable information.

The timing is also essential in the process. In smaller companies or startups, which can compete with bigger players mostly with their agility and innovativeness, the ability to make decisions swiftly can be a key success factor. The right move, if done too late, does not provide the advantages.

Business Intelligence is what provides trustworthy, verifiable, quantitative information or insights and enables making better decisions, faster.

Despite its proven advantages, many SMEs and startups hesitate to embrace BI due to common misconceptions. Concerns often revolve around cost, complexity, and the perceived need for large-scale data. It is important to dispel these myths to understand the true potential of BI.

Common objections to Business Intelligence investment

“It’s too expensive”

The perception of Business Intelligence as prohibitively costly is a common barrier to adoption. Indeed, there have been many cases of data warehouse initiatives which run over time and over the budget. Apparently, most of these cases relate to large organisations with complex organisational structures and projects with poorly defined goals and too many stakeholders with conflicting interests. SMEs or startups, even the large ones, are not comparable to this category. Yet, many businesses hesitate because of the upfront costs associated with implementing BI solutions. However, this view often neglects the long-term benefits, especially the financial ones. The ROI from BI tools can be substantial, due to the cost-saving opportunities and the potential for significantly enhanced operational efficiency.

“Our existing systems suffice”

Some companies believe that their current systems and processes are adequate, seeing no urgent need to invest in BI. This mindset can be dangerously complacent. While current systems might manage basic data processing and reporting, they often lack the advanced analytical capabilities of modern BI tools. It is true that most of the modern applications, be it a CRM, inventory management, or anything else, come with some dashboards or reports. The problem is they are dispersed. The information spread across the applications and effectively isolated from the other pieces. It is often enough for day to day operation of each of the departments. It is not enough to get an overview at a higher level and drive strategic rather than operational decisions.

“It’s overly complex”

A common misconception about BI is that it is inherently complex and difficult to use, particularly for those without a technical background. Modern BI tools are designed with user accessibility in mind, featuring intuitive interfaces, straightforward reporting tools, and user-friendly dashboards. The most complex elements of the system are data integrations – but these are only as complex, as complex is your organisation and the toolset you already use. Yes, setting things up properly is better to be done by an experienced expert.

Common Misconceptions about Business Intelligence

“Business Intelligence is for large corporations only”

A prevalent misconception is that BI is the exclusive domain of large corporations, with its benefits seemingly out of reach for smaller entities. This typically comes together with the prejudice about prohibitive costs. This is a fallacy. There’s a variety of BI solutions, one is not limited to those designed for the largest organisations. Today’s BI tools are scalable and can be tailored to fit the needs and budgets of smaller businesses. The flexibility of these tools allows them to be deployed in environments without the resources of large corporations.

“It requires extensive IT expertise”

It’s the contrary: a properly implemented BI system lowers the barrier to working with the data. Yes, it does require expertise to build or to set it up. It’s better (and cheaper, in the long term) to delegate this part to the experts. However, modern BI systems do not require much of technical knowledge to use. Their purpose is to deliver insights to the non-technical or data-savvy audience and make the use of the data widespread. Operating the BI tools is not more sophisticated than using Excel. Actually, modern BI tools often give an easier and more intuitive way of doing things, while offering far more capabilities than Excel.

“BI benefits only IT or data teams”

There’s a narrow perception that BI’s utility is confined to IT or specialised data teams. In reality, BI’s utility extends across an entire organisation. As already said: BI enables different departments to have a unified view of information – from marketing and sales to finance and human resources – to make informed decisions backed by data. 

Yes, the IT or data teams will profit additionally: they will not be continuously bothered by repeatable requests like “Could you pull these data from system X / database and send me an Excel spreadsheet?” or “We urgently need to have the report of [put some vaguely defined metric here] daily/weekly/monthly per X and Y”. The answers to such questions will be available immediately to everyone who needs them answered. The software developers could then focus on building software, the data team could focus on delivering value beyond simple Excel spreadsheets.

The costs of not having Business Intelligence

The costs of wrong decisions

To assess the benefits of having a well-functioning BI one must answer a few questions:

• What can be the cost of making wrong, suboptimal or delayed decisions?
• How much time is spent collecting the data and information for the decision-making process?
• Do we trust the data we obtain from the existing process?
• How much time and effort does it cost to verify their correctness and to fix the errors?

A suboptimal decision on an operational level may mean a suboptimal allocation of resources or extra operating costs. A wrong decision on a strategic level may lead to losing a business opportunity or a competitive advantage.

The costs of inefficiencies and manual work

Let’s say that to make a single decision you spend 2 hours to get the data you need, import them to Excel and then analyse. How many such decisions do you make per week and month? This can easily add up to tens of hours monthly. One of the managers we spoke with admitted: “I spend on average 1 day per week pulling in and analysing the data”. How much does an hour of your time cost? What could you have done if you didn’t spend this time crafting Excel spreadsheets?

Sure thing, you can delegate these boring tasks. Still, someone else will have to do it. Another manager said: “We use Excel, and we have a dedicated person to collect the data and put them into Excel spreadsheets. It happens that we have to wait for the data, it may even take a few weeks if she is sick or on leave”. How much this employee would cost per year? Can you afford a few weeks delay in getting the report you need today?

The ROI

Depending on your business domain, company size and scale of operations these extra costs (or losses) can easily add up to tens of thousands EUR per year or even exceed the 100k EUR per year mark. It is comparable with the costs of investment in a modern self-service Business Intelligence.

But the most important benefits cannot be directly expressed in currency. The real gain is that properly rolled out BI systems introduce a qualitative change in the organisation. The availability of insights and ease of working with the data promote informed decision-making at all levels. This, in turn, lets improve the operations of the organisation, both on operational and strategic levels.

Are you ready to make the change, but not sure how to make the first step? Still not convinced that BI can benefit your organisation? Reach out to us and we will provide you with expert advice.