Are We Underutilizing Data to Optimize Business Operations?

Recently updated on December 4th, 2024 at 09:15 am

Predictive and prescriptive analytics and accounting automation seem exciting for forward-thinking leaders like you. And why not. They’re great for utilizing your data to its full potential.

Data is everywhere and you’re aware that the amount of data generated by modern businesses is scarcely conceivable. And that amount keeps growing. Of course, financial data is valuable, especially from your business perspective.

After all, financial data tells a lot about your company’s revenue, expense, profit and loss, and more. You must tap into this data to make decisions, gain actionable insights, and accelerate business outcomes. But how do you use this data? How to find valuable insights from it? And how to build ROI with it?

Unveiling the Hidden Gems for Insights That Matter

95% of businesses acknowledge the challenge of using unstructured data.

You may be sitting on an untapped gold mine of financial data and often don’t realize it. It’s ok, everyone cannot swim in a data lake. Result? Insights from unstructured, unused “dark data” are floating around in siloed and remain unutilized. It’s difficult to gain a competitive edge without actively using data.

Given these hurdles, what’s the best way to manage dark data?

Harness the power of data management strategies and advanced financial analysis software to identify and seamlessly manage dark data while ensuring security and compliance. Being data-driven is vitally important; neglecting predictive data analytics and financial intelligence can directly lead to missed opportunities.

7 out of the 10 most valuable enterprises are taking a data-driven approach to make decisions. From Apple to Microsoft, from Facebook to Amazon—they all rely on data to drive their key decision-making processes. But here’s a catch – these are large enterprises, is it the same for small and mid-sized businesses?

Small and Medium Businesses are Optimizing Business Performance with Financial Intelligence

58% of companies are using data automation for reporting and planning ahead.

Data automation is revolutionizing the world of financial intelligence in 2024. Small and medium businesses are turning to advanced financial analysis software to examine data, identify trends, uncover new growth opportunities, enhance decision-making, and keep business at the forefront of innovation.

“Every company today is a data and tech company, whether it realizes it or not.”

Dr. Katia Walsh, Chief Global Strategy and AI Officer, Levi Strauss & Co.

Next-gen data analytics and financial intelligence enable data-driven decision-making, a pivotal factor in optimizing business performance. By translating data into intelligence, you gain insights that inform strategic decisions. And if something needs improvement, it will stand out like a sore thumb.

It’s all about simple. Simple to visualize, simple to analyze, and simple to explain.

Real-world Example of How Financial Intelligence Keeps Businesses Competitive

There is a growing need for data analytics and business intelligence in retail and hospitality industry to optimize business performance, enhance customer experience, and drive growth. Let’s take a closer look at how advanced financial analysis software for retail is changing the game.

Lowe’s, a US-based home improvement retailer, uses BI to centralize financial data, thereby accelerating data-driven decision-making. They discover deeper insights into customer behavior, online vs in-store revenue, product assortment, average transaction value, purchasing trends, and sustainability scores.

A Promising World of Data Automation and Financial Intelligence: All are Welcome

Data is empowering businesses to do what they do best. Here’s the power of data automation and financial intelligence and its robust features, enabling you to stay ahead in the game.

Improvement Opportunity

The improvement opportunity module paves your path to success. This feature allows you to systematically review and comprehend areas in need of enhancement. By comparing data across various factors, you can make well-informed decisions to optimize business operations and performance.

To streamline the process, this feature allows you to set threshold variables, focusing on key performance indicators crucial for your business—Revenue, Cost of Goods Sold (COGS), and Operating Expenses. The Improvement Opportunity console comprises:

Overview – Provides a complete visualization for revenue, COGS, and operating expenses.

Top Contributors – Highlights the top five GL accounts contributing significantly to the total revenue.

Key Variations – Enables you to identify key variations in GL accounts based on the configured threshold.

Concluding Observations – Indicates the percentage-wise increase or decrease in revenue, COGS, or operating expenses compared to specified parameters.

You can set filters such as month, location, and period to assess improvement opportunities and operational performance. It allows you to edit the executive summary and key observations as per your requirements. Plus, you can set filters for the prior month, year-to-date (YTD), prior year same month, and budget for data comparison.

We understand that strategic decisions are a collaborative effort, this solution facilitates easy sharing of a detailed Improvement Opportunity report to all stakeholders playing a key role in making strategic decisions. This comprehensive functionality ensures that your business can pinpoint areas of improvement, fostering a data-driven approach to keep your operations agile, competitive, and responsive.

Sustainability Index

Financial sustainability is the bedrock upon which successful businesses thrive. The sustainability index offered by this solution emerges as a valuable tool to measure your business ability to stay profitable over time.

This feature provides insights beyond profitability as the module analyzes how efficiently you achieve profits in comparison to a predefined benchmark or set budget as a benchmark, represented as a “sustainability score.”

You can compare actual revenue, gross profit, and net profit with benchmark to know overall financial health. Trend analysis allows you to spot patterns in your financial performance.

Dig Deeper and Go Further – Making It Through Comprehensive Assessment of Your Business Sustainability

Month Selection: Analyze specific months to track progress and seasonal trends.

Self-Breakdown: See how different areas of your business are performing.

Budget Benchmark: Compare your performance against a budget to see your financial efficiency.

Business Rank

This module is a visual snapshot of your business performance compared to local competitors, providing ranking based on revenue, profit margins, and overall standing. The “compare with” feature allows for insightful comparisons at entity, group, brand, and industry level, empowering you to identify improvement areas and make data-driven decision-making.

Compliance

This submodule keeps a watchful eye on property tax, payroll tax, sales tax, 1099, fees, county tax, withholding tax, environmental and safety compliance, and others.

It provides a visual representation of set compliances within an entity, offering a comprehensive view through graphs. You can conveniently access compliance data by selecting ‘My Compliance’ to view compliance status.

Get customizable notifications through your preferred method – mobile app, email, or text message to stay ahead of deadline

Focus on what you do best – customer acquisition, enhancing employee productivity, and growing business.

Taking the Lead with Data-driven Decision-making

So now you know! Data is the key that unlocks business outcomes. Having the data is one thing, knowing how to use it is another. Take the strategic step to turn your data into intelligence to reach your desired outcomes and keep up with the fast-paced advancement in technology. It can help lower costs and increase profits, but also reduce risks.

This approach creates new opportunities to optimize your business operations and performance. By combining financial data from various and using an advanced financial intelligence tool to derive insights from them, you will be able to make your business operations more efficient, adaptive, and transparent. It increases your ability to anticipate and meet your customers’ ever-changing needs.

Frequently Asked Questions

What is a data management strategy?

Businesses struggle to utilize data to its full potential. Data management strategy is your business roadmap for using data efficiently to make decisions and optimize business performance.

With a data management strategy in place, you can avoid many of the pitfalls associated with data handling, including incompatible, duplicate or missing data, poorly documented data sources, and low business value, resource-intensive processes.

What are the types of data analytics?

Descriptive, Predictive, and Prescriptive are three fundamental types of data analytics.

When is the right time for me to turn data into intelligence?

Turning data into intelligence is not just for once or for any special event, it is a continuous process. You should not take your concentration off from core business function to analyze data. With financial intelligence by your side, you can connect the dots between action and desired outcomes and make data-driven decisions with confidence.

What is data-driven decision-making?

It is a process of using facts and data based on your company’s key performance indicators (KPIs) and transforming that data into actionable insights. You need to realize the full value of financial data to make data-driven decisions.

Data-driven decision-making include the following steps:

Know your vision to have the best data management strategy.

Find financial intelligence tools and data sources (mainly from accounting software) that you will use to collect and analyze financial data.

Organize your data on customized dashboard of financial intelligence tool to improve data visualization and make effective business decisions.

Gain actionable insights from the tool

Draw conclusions about what you see and share findings with decision makers.

How efficient data utilization and visualization can make me a better decision maker?

Visual elements like charts, diagrams, maps, and others go beyond presenting numbers to tell a story. You can spot trends, patterns, exceptions, and opportunities more quickly, and then make informed business decisions with actionable insights.

Modern Business Intelligence tools analyze and visualize large data sets in a blink. It will help you build interesting visual stories and reveal insights that will make your business more efficient and profitable in the future.

Published on: 24 June 2024

Author

John Bugh

John Bugh is Chief Revenue Officer for PathQuest, responsible for the strategic direction, planning, vision, growth, and performance of the company’s marketing, branding, and revenue streams.

As a seasoned professional with over 35 years of experience in executive sales, marketing, and operational leadership, John has worked to build high-performing leadership-teams that have a demonstrated track record of accelerating growth, increasing revenue, establishing sustainability, and improving profitability.