When you run a small business, sometimes it feels like you’re David battling Goliath. Industries like banking, healthcare, and insurance are especially competitive, making it difficult for smaller companies to gain a foothold. However, there is one thing that small business owners can do to increase their share of the market: Invest in data analytics and business intelligence.
Business intelligence and data analytics help small businesses streamline daily operations, run leanly, and provide better products to their customers. Focusing on these two strategies will improve the services you offer locally and give your business room to grow.
Data Analytics and Business Intelligence: What’s the Difference?
To understand how data analytics and business intelligence (BI) can benefit your business, it’s important to know exactly what these systems do.
Data Analytics is the process of analyzing big data to identify patterns and make data-driven decisions. However, data analytics is only a very small piece of the puzzle. If you want your small business to run as efficiently as possible, then you also need a comprehensive business intelligence plan.
Business intelligence (or BI) is a broad system of data tracking tools that help you make the most of your data analysis. This system includes technologies like data visualization, reporting, and user-friendly platforms that let you interact with the data in innovative ways.
So data analytics is just one part of a larger BI strategy. These systems work in tandem to help your business succeed. Without a BI roadmap, it would be difficult to organize the data and make use of it. You’d generate insights but wouldn’t know which actions to take in response. Likewise, without data analytics, a BI system is incomplete. You’d have to guess which decisions are right for your business rather than basing these decisions on reliable data.
By improving both your data analytics and BI strategies, you’ll maximize your small business resources and set your enterprise up for future growth.
How Data Analytics Benefits Small Businesses
There are many subcategories of data analytics that small businesses will find useful, including:
- Consumer analytics: You can collect and analyze information about your customers to improve the services you offer and foster greater customer loyalty. Having a complete picture of your customer’s behavior and needs makes it easy to see what steps will earn trust and draw interest in your product. Data preparation and blending is a key part of this strategy, as it helps you organize all of this information and find hidden patterns.
- Spatial analytics: Make your business run more smoothly by improving your office layout and organization. Spatial analysis deals specifically with how people behave in a given area. You can collect data about how your customers move through your store and place certain products at prime locations with great foot traffic. You could also analyze how well your staff navigates the office and make adjustments based on their preferred workflows. An organized office is a happy, productive office.
- Fraud preventive analytics: You can analyze past fraudulent incidents and identify vulnerabilities in your system. Small businesses in particular cannot afford to lose any money to fraud, as it has a major impact on financial results. You can stop many of these incidents before they happen using advanced preventative analytics technologies, including machine learning.
- Predictive analytics: Use data to pivot in new business directions and improve efficiency. In the past, predictive modeling was expensive and time-consuming. It was beyond the budget and expertise of small businesses. Today, you have access to state-of-the-art predictive models and tools at a low cost. Moreover, you can hire an IT firm to perform predictive analytics for you, saving you time and effort.
Data analytics also improves small business logistics. With the right analytics tools, you will:
- Save money: If you hire an analytics firm, you’ll have access to expensive data analytics tools at a fraction of the cost. You can also use data analytics to find areas where you can safely cut spending without compromising the quality of your products or customer satisfaction.
- Save time: You won’t have to crunch numbers manually or keep long spreadsheets up to date. Many of today’s best data analytics tools are fully automated and intuitive to use.
- Stretch limited space and resources: There’s no need to hire an in-house IT staff to perform data analysis. Offshore data analytics offers you the same results and don’t take up any space in your office.
- Scale up or down quickly: Using data analysis, you can decide what your next business move should be. This allows you to stay ahead of market trends. With cloud-based data analytics tools, you can change locations without losing any important data. It’s a portable solution that can expand or contract according to your needs.
The Benefits of Business Intelligence for Small Enterprises
Many of the benefits of data analytics for small businesses also apply to business intelligence. However, there are also a few benefits that are unique to BI that will help your business really succeed. Those advantages are:
- Identifying hidden inefficiencies: When you create a new BI system from scratch, you have to perform a full business audit. This will help you find problem areas that you may have missed over the years. Every business benefits from an occasional operational audit, but small business will notice the biggest difference after the audit is complete. Even the smallest changes to your system will have a ripple effect throughout the entire company.
- Generating better data visualizations: Collecting and processing data isn’t useful if only a few people in your company understand what the data means. Visualizations encourage your staff to interact with the data. They don’t just see a series of random numbers–they see what these numbers actually mean.
- Creating a better data culture in the workplace: The problem many small businesses face is that their staff feel ambivalent about data analytics. Why should a sales representative care about predictive modeling? Apathy leads to poor data governance, as your staff won’t care enough to upload data properly. When you make a BI user portal, it’s easier for your staff to manage data. They become part of the process because they know how to use these tools themselves. It makes data empowering, not confusing.
- Selecting the right analytics tools: An effective BI strategy suggests the best tools to use for your business’ specific needs. You won’t pay for services you don’t use.
How to Maximize Data Analytics and BI
Small businesses don’t have access to the same resources as Fortune 500 companies. While a huge conglomerate can hire dozens of analytics experts to work on-premise full time, a small business usually doesn’t have this luxury.
However, you can get all of the same benefits of data analytics for your small business when you outsource the process. A data analytics firm will walk you through every step of the process, from performing a BI audit and coming up with an effective BI strategy to teaching your staff how to use data visualization tools and process data.
If you’re ready to make the most of data analytics and BI, contact Tek Leaders today. We create custom BI strategies and data analytics tools for our customers based on their unique needs. If you have more questions about the benefits of BI and data analytics for small businesses, you can reach us by email directly.