By Sanjay Khatnani, Managing Partner, J2 Solutions
In January, we launched the first in a three-part series on the powerful applications of data to support a successful and thriving business. Our last post centered on the idea of using data to build your customer base, drive loyalty and contribute to the top line. Today, we’ll zero in on bottom-line benefits, with an emphasis on streamlining operations and improving internal processes.
Business data allows you to truly understand the dynamics of your business—the ins and outs of your various operations—and make improvements that deliver meaningful results. With a complete view of your internal processes, you can course-correct where needed to preserve resources, save time and trim expenses.
Here are three ways you can use data to drive internal improvements to grow your bottom line:
Refine operations:
Your data can give you a clear picture of your internal operations—what’s going well, what’s not and where improvements are needed. The fact is, any business process that generates data is one that can be measured, analyzed and refined. A plant manager can use data to track machine performance or delivery routes, while the marketing team can track campaign performance or pinpoint underperforming marketing channels, for example.
Your data can help you create more streamlined and efficient ways of running your business. Use it to control and change existing processes, implement new processes, identify strengths and weaknesses and allocate (or reallocate) resources intelligently. Add real-time data analytics to the mix and you’ve got immediate insights into what is happening at every stage of your various business processes—so you can swiftly and efficiently affect profitable change.
Improve employee performance:
Your organization is only as good as your people—and you cannot improve what you cannot measure. Big data can hold tremendous value in helping you fuel productivity while enabling a flexible approach to leadership. It can reveal gaps and areas of opportunity within your workforce, help you track emerging trends and give your managers the insights they need to tailor their management approach accordingly. When you slice and dice your employee-related data, you’ll be able to see where employees are lacking individually or as a whole, compare and contrast team performance across the organization and even use it to inform hiring decisions.
What’s more, you can leverage your business data to create tangible goals with clear targets, which gives employees a clearer sense of purpose and drives stronger engagement. Your data can help you build a culture of transparency and accountability, which will, in turn, promote a more efficient and productive workforce.
Improve supplier management and identify distribution of spend:
Data can supercharge your procurement team, providing them with ammunition to effectively contract suppliers with fact-based insights, such as current market pricing, historical performance and risk, rather than merely deploying surface-level factors such as price, a friendly relationship or intuition. You can use data to see where your money is going. Granularly examine your spend, identify areas for sourcing consolidation and aggregate your category spend to negotiate bulk supplier agreements with contractually favorable and measurable terms and conditions.
Put in simpler terms, your data can not only ensure visibility into total spend and serve as a powerful tool in your negotiation toolbox, but also provide metrics that drive supplier performance.
Businesses that embrace data-driven processes are nearly 20 times* more likely to improve their ROI than those that don’t. If you’re not tapping into your troves of data to inform business decisions, you’re missing tremendous opportunities to drive top- and bottom-line growth.
What are you waiting for?
*https://financesonline.com/technology-statistics/