Why Marketing Finds Business Intelligence Useless

Date: 12-07-2011
Author: Bit Software

During my years of industrial marketing and sales, I learned that there is a big difference between corporate information and Strategic Knowledge.

Corporate information usually consists of internal raw data while Strategic Knowledge is the business wisdom necessary to achieve profitable growth consistently.

Although internal data is necessary to manage logistic or tactical areas like, supply chain, manufacturing, accounts receivable, transportation, accounts payable or customer service; it’s far from enough to perform marketing and sales management jobs effectively, namely increasing market share, revenue and ultimately net profit.

The reason is simple, internal data is a by-product of the order entry system (ERP), designed to ship orders on time; not to build a strategic data base for marketing use.

Unfortunately, most Business Intelligence implementations populate sophisticated BI software with just internal raw data from the ERP. This is only half of the story because ERP data does not usually contain competitive or market intelligence.

This is the reason why BI usually does not provide the immediate strategic analysis and direction necessary to grow the businesses, leaving Marketing and Sales teams struggling to find the information they need to increase profitability.

Typically, after Sales or Marketing run BI reports several times and they keep seeing the wrong structure or hierarchy in their customers, markets and territories, they stop using BI and continue making decisions the old fashion way: based on intuition.

Can Companies Really Compete on Analytics?

Absolutely, Business Intelligence is much more than software. Business Intelligence should be a reliable, analytical process that transforms raw data into relevant, accurate and useable strategic knowledge.

Strategic Knowledge is the result of the seamless integration of internal transaction data with external market intelligence. This includes market & customer segmentation, channel structure, budget and sales projections, market share, growth, business opportunities, competitive analysis, profitability metrics, product innovation metrics and the ability to run instant P&L’s on any combination of these dimensions for any time period in the past, present or future (like budgets or business plans).

The key is to utilize the powerful business intelligence software available today to perform this integration and automate the process.

In my experience, the result of this full integration is always a change in the company’s culture, where instant access to strategic knowledge means that anyone who needs to know (normally marketing, sales, finance, R&D or management) can accurately answer extremely complex business questions within one minute. They can find the root cause of problems, right from the BI software, with no manual intervention of IT or business analysts, and take immediate action.

Being able to react to changes in the market-business-profit reality, faster and better than the competition, provides the company with a competitive advantage that invariably translates into increased market share, revenue and profit.

This is the most effective way to increase the return on the BI investment, normally so difficult to justify when BI supports just back office functions and not the strategic and profitable growth of the company.


by Bill Cabiro and Strat-Wise LLC

„Please visit their web site at www.strat-wise.com for additional articles and resources on the strategic use of Business Intelligence and Analytics”



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