By now, we’re sure most of you have installed or at least seen a compact fluorescent lightbulb (CFL). For reference, it would be the twisty, spiral one in the picture to the left and it’s slowly been replacing Edison’s old standby incandescent lightbulb. In fact, many countries, including the United States, are in the process of phasing out the old for the new.
There are a number of reasons to make the upgrade. CFLs last longer (8-15 times longer), aren’t as fragile, and use less power (1/5 – 1/3 as much as a regular bulb). This translates to cost savings in electricity, and makes the CFL much more efficient in almost every way.
Great right? Well, if you’re a gadget nerd like many of us here, you already know about that fourth lightbulb in the picture: LED bulbs. It’s brighter, last longer, uses less energy, and has a wider range of uses. Pick one of these up and you’ll be seeing around 10 times the energy efficiency of an incandescent bulb.
But wait! There’s more! Lightbulb scientists (bulbologists?) just made an LED bulb that’s 230% efficient, actually returning more light energy than the energy it takes to run it. At this rate, all we’ll need to do is make one of these give out full-spectrum light, strap it to a solar car, and we’ll have perpetual motion.
Everyone Loves Efficiency
Why so much progress for more efficient lightbulbs? Doing more with less with a growing world population will be key to keeping everyone out of the dark, and lightbulbs are so ubiquitous, making each one better will add up to huge savings in cost and energy.
In a growing business, it’s the same: small efficiency improvements will add up, and business intelligence is the tool to make this happen. Here are three efficiencies that can result from good business intelligence:
1. Efficiency of Compliance
How much time and effort would your company save if everyone entered in data correctly the very first time? No more hunting down data errors, or taking weeks to get going with a new system, or wasted time with reconciliation. This article illustrates the point, examining what happened to a 1200 person company when proper BI was implemented. For one, software updates went faster and more smoothly.
This way, any employee, from veteran to newbie, is driven to compliance with the CRM/ATS you might have in place.
2. Efficiency of Prioritization
Here’s a good model of what BI can do overall, taken from infogain.com:
The top left is often where it all starts: your company needs to know what it wants to do, and in what order, before it can do it. Good business intelligence will provide you with your priorities. Let’s take an example of prioritizing what clients to focus on:
Your BI should tell you which clients have been most or least efficient historically. In this mock client dashboard, Wal-Mart has the highest booked revenue in the past two years for your company, but efficiency is pretty low. So you have to work hard for this client, but you know it’ll pay off. Now look at JP Morgan: low revenue and low efficiency. Are you going to throw your man-power at this client in the next year when it’s clear it’s not really worth it?
BI can prioritize your companies goal so you can get the best buck for your bang.
3. Efficiency of Activities
This ERP white paper is a great read on the various ways BI can make a company more efficient. One of the best quotes comes toward the end:
“Sixty-five percent of IT leaders polled recently by CIO magazine say business intelligence and analytics have spurred a process change in the last year….For example, say a team was concerned about improving cash flow. They could set up a KPI for days sales outstanding (DSO), measure their existing DSO, then institute process changes—such as emailing invoices rather than putting them in the mail. Using the KPIs, they could then track the results of this effort.”
We’re big fans of KPIs here, and one of the goals of good BI is to give insight into the activities that really matter for your business, not the ones that don’t.
Your business intelligence tool should tell you what moves the needle for your bottom line. In the Staffing & Recruiting industry, key activities such as the number of Sendouts or Interviews directly affect the number of Placements made.
The ratios between these activities are the KPIs that one would need to focus on, and increasing the efficiency of the ratio is often equivalent to increasing the efficiency of your business. So is it taking too many resumes sent to get a placement? Good to know! Now you have an actionable problem to fix.
Good BI can save you time, energy, and money. Like a modern lightbulb, it might be a bit more costly up front, but it will save you a ton in the long run…and cast a bit more light on your company’s future. Yes, this entire post was just a lead up to a lightbulb pun.