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At a recent user event we held in Atlanta, we discussed data analytics and asked our customers what their thoughts were on the subject. Every single person in the room agreed, without exception, that accessing business data and using it to aid strategic decisions is incredibly important.
That’s not too surprising because, after all, these are companies that have not only invested in an MIS solution but have also taken the time to attend a user event. These are companies that appreciate the value of this type of software and know the positive impact it can have on their business.
But it seems that not every company is like that. A recent report from BCG showed that, although manufacturing executives understand the power of Big Data, and 72% reported that they rely on advanced data to improve productivity, only 17% claim to take advantage of data analytics.
And that’s a big shame. Because this is where the competitive advantage lies. It’s the analysis of the data that really aids strategic decision making, that helps you better understand your business, your industry, customers and trends. That will help you predict revenue and increase the productivity of your employees, software and machines.
In an effort to increase that 17% for our customers and readers, we decided to pick the brains of our experts here at Tharstern, and put together some advice and guidance for getting it right with data analytics.
What is not defined cannot be measured. What is not measured, cannot be improved. What is not improved, is always degraded. - William Thomson Kelvin.
Historically, data analysis has been focused on creating a set of reports, either physical or digital, which extract your data and set it out as a readable story of facts and figures. While this sort of analysis is an awesome tool for gaining mid-level data for your business, it can be pretty limited if you want to dig a bit deeper.
That’s why we believe that the future of data analysis lies in using Business Intelligence (BI) software to interrogate your data and visualize trends.
Up until recently, BI tools have been seen as somewhat inaccessible to many printers and converters because of the high cost associated with them. But as technology continues to develop, and prices drop drastically, we’ve seen the number of our customers using BI steadily increasing.
A brilliant example of this is the PowerBI tool from Microsoft, which is a very intuitive, easy on the eye solution and (this is the best bit) free with most Office 365 subscriptions.
Most BI tools generally connect to the data stored in your software using an API and can be used to analyze disparate databases of information such as estimates, orders and delivery times and then present them in a way that allows you to quickly visualize trends and glean insight into your business. You can create your own dashboards by specifying what data you want the tool to analyze, and specifying how you want that data to be displayed e.g. chart type, summaries, percentages or tables.
Because the dashboards are interactive, and instantly update whenever you change a filter or select a piece of information, they are fantastic for taking into meetings, especially strategic ones. No more printing out 10 copies of a report and not being able to answer a question about that data without going away and running a new report! You can simply pull up the interactive dashboards and go through the data in real-time.
You’ve created a dashboard that analyzes the profitability of each of your product types. It shows that roll labels were your most profitable product in 2021. But you don’t have to stop there – you can now drill into the data to identify the most popular subset. Was it vinyl? Polyester? Foil? Maybe it’s time to increase capacity in one of these areas and invest in new equipment!
You want to analyze how it’s going with your biggest customer to see how things have changed since the pandemic, so you create the below dashboard. The sales for 2019 are displayed in comparison to the sales for 2021, allowing you to instantly see that there’s been a big reduction, and that this continues month on month. It’s time to get some more eggs in that basket!
You have upcoming performance reviews with your sales reps, so you create a dashboard identifying who brought in the most profit and who met their targets. Time to appeal to their competitive nature!
You can also generate a BCG chart that gives you a graphical representation of your product portfolio and ranks your best- to worst- performing products, helping to guide business decisions on where to focus your efforts in the future.
For those of you that are new to the concept of BCG charts, the chart is split into four sections:
This is a fantastic way to work out which products and sectors you need to focus more on (your Stars), or which ones you might be better off dropping or even outsourcing (your Dogs and Question Marks). You can also use it to identify areas where you need to streamline and automate your production processes so you can increase your profit margins (your Cash Cows).
Since the BI dashboards allow for data comparison, you can use filters to get visual information for the number of previous orders per month, and drill down into the types of products sold, which customers placed orders, and so on. This means you can analyze trends from previous years and predict when jobs might increase so you can prepare for this.
For example, you might see from the analysis that the number of pull up banners ordered in November has increased from the month before for 3 years running, so you can plan ahead and order more materials in preparation.
Analyze your shop floor data to look at the average makeready times per period, and then drill into that data to show this information per operator. Carry out some trend analysis to see if you can identify any areas for improvement. Perhaps the night shift team are taking longer than the day shift – now you know this, you can look at why and maybe carry out more training to resolve it.
You could also analyze response time data to identify areas for improvement. For example, what is the average timescale between an order being placed and the order being shipped? How long are customers waiting for an estimate after their request? By identifying these trends, you can then work to automate more of the processes involved in this activity.
A couple of examples:
It was reported in 2018 that only 40% of large businesses were said to be using automation across the organization or have fully automated processes in at least one business function (McKinsey, 2018). So any opportunity to automate your workflow should be seized upon. You can use it to really stand out from the crowd and improve your customer experience!
It’s clear that there are significant opportunities to leverage the data within your MIS to learn more about your business, customers and processes so you can continually improve. And it’s the businesses that make use of BI tools to interrogate and analyze this data that are in the best position for success.
We hope you’ve found some inspiration from this article to get you started on your own data journey, and implement a Business Intelligence tool that will help you create more informed strategies and make smarter decisions.