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Make Smarter Business Decisions with Data Analytics
Have you made decisions that didn’t turn out to the ‘right’ decision in hindsight? Do you wonder if there are ways to make better business decisions? Do you wish you could ‘connect the dots’ in your business to make better decisions? The biggest dilemmas business big and small face stem from nagging questions like “Are we doing everything we can to be more successful? How can we be more efficient? How can we be more profitable?” If your answer is not in the affirmative, your competitive position may be weak and your bottom line may be affected.
I recently had the opportunity to speak with Eddie Hughes, the Director of Analytics and Insights at the SAS Institute, who has worked with a number of midmarket companies to help them make smarter business decisions. The SAS Institute is the largest privately-held software company, and has been in the data analytics field for over 40 years. The interview was on the Midmarket Radio Solution Series podcast.
The first thing I wondered aloud was whether data analytics was just for big companies with big data sets and lots of complexity. He set me straight rather quickly by pointing out that insights from data, whether big or small, can help businesses of all sizes make better decisions. While this is true even for small companies doing analysis with MSExcel, using more sophisticated analysis packages provides more and better insights. With the explosion of data, all industries are compelled to look at leveraging the data for competitive advantage.
Many midmarket business leaders make decisions based on their past experience or gut. Eddie cited the example of Oberweis Dairy in Illinois which used the analytics packages from SAS to augment their experiential knowledge. Oberweis makes ice cream that is sold in its own retail stores as well as through grocery stores. Since ice cream is generally consumed based on the weather on a particular day (hot days are better than cold ones!) or even time, they knew that the atmospheric temperature was the principal factor driving demand for ice cream. When Oberweis analysed the data from their sales and production, they found that while temperature was a major factor in ice cream consumption, the humidity was an equally important factor. The analysis confirmed the effect of temperature on ice cream sales but identified another factor – humidity - which they had not considered.
Midsize companies avoid spending money on big-ticket products or services unless they are convinced there will be an adequate return on their investment or significant operational improvement. Data analytics packages used to be out of the reach of most midsize companies because of their price and complexity. Eddie pointed out that a lot has changed with the advent of the cloud and SaaS (software as a service) models, making it very affordable for midsize companies to use data analytics packages. Moreover, the advancement in the packaging, integration and deployment of the packages have made them very user friendly.
He talked about self-serve analytics packages that a person in marketing or HR could ‘throw’ a bunch of available data into the tool and get back some correlation and trends. You no longer need to hire an expert in statistics to get the benefits of such tools. Eddie added, “As an IT organization, enabling your internal customers, those business users, the ability to have the self-service analytics is critical for lots of reasons. It helps you and it helps them, gives you that return on investment much quicker, makes them happier and you've now set them up for success.” Many packages now come with governance built into them to ensure access only to authorized personnel. These new analytical tools are user-friendly and anyone can use them with a little basic training. Eddie pointed out that in today’s fast-paced market it’s a matter of keeping up or being left out. He added, “Lots of folks are using it (data analytics) for competitive advantage and the choice not to, actually puts you at a disadvantage nowadays.”
Eddie discussed the case of a North Carolina real estate management company, Twiddy & Company, which achieved a 15% reduction in the cost of contractors by optimizing the number of contractors and task allocation through data analysis. You can listen to the case study and the full interview entitled ‘Make Smarter Business Decisions with Business Analytics’, with Eddie on Midmarket Radio at www.midmarket.org/midmarketradio/eddiehughes. You can also download a whitepaper on self-service analytics at www.sas.com/midmarketradio.
Ram Iyer is the President of the Midmarket Institute at Princeton and the host of the Midmarket Radio Solution Series. You can listen to midmarket CEO and CIO interviews at www.midmarket.org/midmarketradio/. You can also download them on iTunes and Stitcher by searching for “MidmarketRadio”.