One of the biggest problems for small businesses is that there is a mess of data out there that’s hard to make the best use of — for a price that isn’t astronomical. Companies often collect a lot of information that just sits there.
The problem is that “data is collected and stored in multiple systems, requiring users to access different systems to get the information they need. Worse, often it is difficult to see relationships between activities that may be occurring in one department that affect another,” according to a report by Steve Schneider, co-founder of OnDemandIQ, a hosted business intelligence solution.
Increasingly, to solve the problem, small businesses are turning to business intelligence tools, specifically hosting of all its business applications using software as a service (SaaS). (The term SaaS is often used interchangeably with ‘hosted’ services and also ‘on demand’ services.) For small businesses, one of the applications rising in popularity is the hosted software dashboard, which takes the data from separate systems and puts it all in one place, organizing it in an easily understood way. Experts liken this to a car’s dashboard, in how it neatly puts everything in its place and emphasizes what’s important at the time.
The price to untangle your mess
Small businesses are finding that to get traditional business intelligence (BI) tools to solve their problems can zap resources in terms of both of time and money when it comes to development and maintenance.
BI software can cost you thousands of dollars up front, not including consulting services and the hardware — so expensive that typically small businesses didn’t even go there. But with the hosted model, you subscribe to the software and pay the hosting company on a monthly or quarterly basis. Costs are about one-tenth of what they would be otherwise.
The way hosted business intelligence works is that companies provide pre-build solutions to handle data collected from different sources, such as Excel files, sales transactions, account information, and activity data.
What dashboards, in particular, do is allow small businesses to reap the same benefits for data integration from multiple sources, get customized views, and automated reporting, just as the big Fortune 500 firms do. Some more sophisticated dashboards can be programmed to show information relevant to each user.
How to best use
A lot of the success with SaaS is in sales organizations, considering that a lot of sales people are incentivized based on how they perform. If they can understand every day and every week, how performance compares with business goals, or how it matches up to the same period in a prior quarter or year, they can change tactics and strategy if need be.
With a dashboard, a CEO, for example, doesn’t have to spend hours on the phone each week with investors getting them up to speed on the latest company numbers. He can connect them to the dashboard and they’ll be able to pull up the same metrics he has. CEOs have a tendency to spend way too much time managing upwards and this can be a tremendous timesaving device.
Don’t try to do too much with a dashboard. Schneider says that a lot of solutions like this fail because they try to do too much. Keep it simple and stick to only a few metrics that the employees want to use. Otherwise, if there is too much on the dashboard, then no one will want to use it.
Businesses with very customized and specific requirements may not be the best SaaS customers because the hosted solutions typically meet the needs of about 80 percent of their customers.
Some small businesses have a fear of data leaving the house, says David Hatch, the business intelligence research director at the Aberdeen Group, a technology research company. The key is to make sure your data is hosted securely, using a recognized provider. To that end make sure your provider offers secure data center along with encryption technology.
No matter what, there will be some challenges. “You’ll have to go to multiple providers as there is not one provider for every single application,” warns Yankee Group analyst Gary Chen, “and there will be some hurdles in the integration, getting all these to talk to each other.”