Call
it the unintended consequence of information revolution.
With the advent of the Internet, businesses world over
are waking up to a new challenge posed by this information
gluttonywhat to do with the ocean of data provided by
various activities like marketing, sales, and HR. And,
as the business environment gets more and more competitive,
owing to increased globalization and fierce cost-cutting,
there is no way companies can afford to overlook the
importance of managing this data influx. However, the
question is, how to organize, analyze, and reap the
benefits of information scattered across various divisions
of a business enterprise? The answer is: Business Intelligence
(BI)technology which collectively encompasses customer,
supplier, organization, and enterprise intelligence,
allows business entities to gather, organize, distribute
and act on critical business information.
It
is not that data mining and analyzing is a new thing
for companies. In US, industrial giants like GE and
P&G have been slicing and dicing data to analyze
customer demand and growth pattern for long. However,
it was not as extensively used as it is used today.
What perhaps explains the sudden growth in information
inflow, and hence the urgency to act, is the shift in
focus of businesses from being product-centric towards
becoming customer-centric. As customer increasingly
occupies the central place around which companies formulate
their business strategies, managing data such as customer
profile, buying habits, past experiences in purchasing
etc., becomes crucial. Industries where managing information
has gained importance are banking and financial services,
cellular services, FMCG, and retailing. For instance,
consumer goods manufacturing companies would use BI
to find out what its top selling brands are and their
contribution to the bottom line, which are the most
profitable selling points, where it can go for launching
a new, premium brand (actually done by Goodlass Nerolac
Paints when it launched All Scapes, a premium paint
brand). Similarly, banking and financial services companies
would like to identify their most loyal customers, launching
an effective promotional campaign and its impact on
profitability, and so on; for instance, a bank's customer
may have savings account, credit card, and a housing
loan with the same bank but the bank may not be able to target this customer while launching credit card-related
campaign or cater to all his or her needs better, if
it does not have a tool which allows it to identify
the target customer. One of the major advantages of
BI is that it helps eliminate the element of guessing
in planning in organizations and hence brings in a sort
of analytical approach to all the strategic initiatives
taken by the company, whether marketing, finance or
sales. For example, a company's salesforce might be
collecting hundreds of feedbacks from customers, and
so with its customer care division and marketing division.
The key challenge for the company then is how to transform
these data into the one that can be fitted for analysis
and help in drawing a meaningful conclusion. George
Varghese, Head - Marketing, SAS India (a significant
player in BI software market), opines, "A key advantage
of BI is that it strives to manage the onslaught of
data flood and eliminate `gut feel' with empirical data
analysis."
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