We’ve all been there at some point. There is important information that we need to extract out of our business to make an informed decision on something. We could be trying to figure out if we have the proper production plan and required raw materials to cover our shipments to our customers/distributors for the next few months. We need to review account growth or shrinkage over the past year to determine where to focus in on and either grow or recover key accounts. Perhaps we need to understand if there is a specific product or product family that is consistently being shipped late so we can put together an action plan before we begin to lose revenue due to poor customer service. Whatever the actual situation is, you need to pull together key data and turn it into actionable information, and you need to do it quickly.
It’s a seemingly reasonable request that doesn’t sound like a big deal at first glance. However, after a little discussion you quickly realize that something seemingly trivial can quickly turn into a small project for one or more people in your organization that can take hours and sometimes days to pull together. You begin thinking to yourself “should reporting on this type of information really be this hard” and you may end up even just moving on without the information and making decisions based on gut-instinct or the unconfirmed consensus thoughts of those around you.
Many organizations face these types of issues on a daily basis, and they know there has to be a better way, but are not sure what steps to take to transform their organization into a more data-driven organization where decisions are made on data, not their guesses and assumptions.
This mode of operation has been “good enough” for a long time, and many companies may even continue to produce respectable results by continuing to operate this way. However, in this day in age where industries are consolidating and margins are being compressed, efficiency is becoming even more of an important factor in creating sustained growth. Making decisions based either on assumptions OR having people spend days pulling together information that should take minutes are both forms of inefficiency, and while you maintain the status quo, your competition is investing in increasing their capabilities and making more informed decisions with less effort.
So, how does one begin to make the dream of becoming data-driven, or even just having basic reporting capabilities become a reality? The answer can vary for different organizations, based on many factors such as what information systems you are already utilizing, however, following the steps below is a good place to start to build the foundation for becoming a more data-driven organization.
The Foundation for good reporting
- Data Consolidation
- Bring as many disparate data sources under one roof as possible and establish relationships between the data
- Manufacturers often have data strewn about in various siloed systems such as CRM, ERP, and maybe even some form of Manufacturing Execution System (MES) without any capability to get a consolidated view of this related information.
- Evaluate the key metrics and information critical to your business
- Before you can have information at your disposal at a moment’s notice, you need to put in the effort to understand which information is or could be critical and start from there
- Map key metrics to source data
- Metrics and KPI’s are always rooted in more transactional data. You need to map the metrics you wish to drive out of the system back to the source data to understand the places it will be critical to capture this data
- Build key data points into your processes
- Once you have identified the source data points, you need to evaluate your business processes and ensure that these data points are being created effectively from the execution of your processes
- Make this as frictionless for your users as possible via automation so that they are not becoming data-entry specialists
- In addition to making this frictionless for the users, it also improves the accuracy of the information by reducing manual entry related errors
- Build standard KPI’s and dashboards
- Once the data is being captured naturally from your processes, you can begin aggregating it into KPI’s to drive dashboards
- These should be built to give a high-level signal of the health of specific metrics to support the decision to take further action or not
- Build canned reports for underlying information
- Below every KPI should be detailed reports to help the user go deeper to understand the situation detail that the KPI is attempting to summarize
- Once these reports are created, they serve as a starting point for other related reports to be created for specific needs for your users and speed up the process for creating additional reporting capabilities
- Review metrics regularly and build additional data sources into your processes to drive further insight
Resulting Capabilities
Once you have a good foundation in place with respect to your defined KPI’s, metrics, and supporting processes in place, it helps to have a system capable of housing and reporting on all this consolidated information. This can take place in a modern CRM, ERP or Data Warehouse/Analytics system that has the right features. In most cases, a CRM system can make the most sense due to the need of sales and customer service both needing access to this information within their daily workflows to maximize their effectiveness. Also, these roles in many cases do not have access to the ERP system and not trained on how to navigate the many complexities of such a system. Also, in our experience only the largest organizations have a dedicated data warehouse and analytics system, and you can get the majority of this benefit from the robust reporting system of a modern CRM.
Having all of this in place then unlocks the following reporting/dashboard capabilities to allow you to quickly create, run, collaborate and distribute reports and dashboards to those needing it to make decisions.
- Create a report once, save it, and run it with live data any time in a matter of seconds
- Create a “subscription” to a report, and have it run on a schedule, such as daily, weekly, etc and have it sent to yourself or a specified group of users
- Add criteria to subscribed reports such that you can make them exception reports. To prevent your users from getting numbed to a bevy of reports that they receive everyday where they may never need to take action, add logic to the subscription to only send the report to users if it meets certain criteria. Suddenly you have an automated early warning system based on the scenario you want to alert someone to
- Utilize summary or row-level formulas built directly into the report. No more exporting to excel to build logic into reports
- Quickly add various graphs to reports to visually represent information in a more compelling way for your stakeholders
- Group reports with graphs/indicators together in a dashboard and customize the dashboard views for different groups in your organization such as sales, customer service, C-suite, etc to give them a quick glance into KPI’s and an indication of where to dig further if necessary
- Embed reports and graphs on customer account pages to aggregate information at a customer level and give reps/others the ability to quickly understand important information about the customer with a quick glance
End Result
- KPI’s that are always up to date and visible
- Underlying reports that allow you do dig deeper and drive insights into the health of the company’s operations
- Increased accuracy of reporting due to reduction of manual entry and report creation
- Timely information WHEN and WHERE a decision needs to be made
- Exceptions/Issues automatically detected and delivered to your inbox so you can take action
- Entire organization operating with a single version of the truth
When you look at the capabilities above, it’s easy to see how companies that make the investments to have them at their disposal will have a true competitive advantage in the amount and quality of information that they are able to operate their businesses and make critical business decisions with. While, on the other hand, the ones that don’t will still be asking “reporting shouldn’t be this hard, should it” while gradually losing their competitive advantage and ability to thrive in today’s marketplace.