SMEs Struggle with Data Analysis

July 22, 2013 by Ralf Haassengier 0

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“Usually the data isn’t prepared properly at all, it’s merely listed” says cormeta managing director Holger Behrens.

“The boss still does the monitoring in person here” is an assertion that no doubt applies to many small businesses and midsize companies. And although it may initially sound positive, it isn’t always a good thing in reality. Too much raw data needs to be examined, and analyzing it takes too much time. Because company management in the midmarket is usually heavily involved with operations, decisions are often made on hunches and instinct. This may work in some cases. But if speed is required, poorly analyzed data can literally kill new opportunities.

Particularly in the midmarket, there is great pressure to be innovative – and the ability to analyze business data in detail is helpful wherever innovation is required. We therefore need to ask: How can small businesses and midsize companies make progress in their speed, competitiveness, efficiency, and precision for decision making? For more precise decisions, you need lots of data, for example. But then the lack of speed becomes a problem. The company management doesn’t have time to wade through mountains of raw data. Another aggravating factor is that the management depends on the cooperation of the IT department to deal with the issue. Many midsize companies tie up unnecessary resources with gathering data, and these resources then don’t get to do their core tasks.

Raw data is useless

Yet the problem is more serious than that. Because of the tremendous amount of time required to generate reports, the number and range of reports has to be limited. Usually, the management only wants to see a few of them and at certain fixed times. Additional drawbacks are that not all processes are mapped and the information often isn’t up-to-date. It’s just as bad if the data isn’t prepared due to time pressure. “Usually the data isn’t prepared properly at all, it’s merely listed,” explains Holger Behrens, member of the executive board at cormeta AG, headquartered in Ettlingen, Germany. “In general, we can say that although small businesses and midsize companies retain data, they’re nowhere near having ‘bite-size’ information that they can use for extracting findings for strategic decisions.”

Overwhelmed by raw data

Fears about too much complexity

Faster decisions

 

Next page: Overwhelmed by raw data

And Behrens knows what he’s talking about, because cormeta – an SAP channel partner – has specialized in software solutions for the midmarket for more than 20 years, focusing particularly on technical trade and wholesale, the process industry (food and pharmaceuticals), and the textile industry. Midsize companies are overwhelmed by raw data that they then have to read and interpret. This has an impact on their flexibility and corporate strategy. It’s a vicious circle. Either companies set up their own internal or externally contracted controlling departments – or they make business analytics easier for themselves in another way.

“A good number haven’t even realized how fast business intelligence can be conducted in the midmarket to get insightful charts and key figures,” Behrens says. Here, he has in mind a software solution that is not just restricted to standard reports: “Such software enables the boss and every department to generate their reports and analyses at any time. A structuring tool in the form of a business intelligence solution is utterly indispensable.”

Difficulties to understand how to measure the investment

When a company is faced with the choice of hiring more staff or implementing a software solution, it will inevitably consider the costs. Behrens believes this is a reason why many midsize companies are hesitant when it comes to putting comprehensive business intelligence in place. “Usually, midmarket organizations find it difficult to understand how to measure the investment. It is important to tap the benefits of modern business analytics consistently. Put pointedly: What costs more? Three student employees or a system that churns out the necessary information at any time and as often as required after a few minutes?” Behrens asks.

Next page: Feed SAP BusinessObjects from different data sources

Behrens also wants to allay his customers’ fears about too much complexity: “With currently available solutions such as SAP BusinessObjects, anyone can perform business analytics in a straightforward way.” As the service provider, cormeta works with the customer to create the portfolio of individual analyses and reports. According to Behrens, modern business analytics software should be easy to connect, so that it can extract data from sources in all areas of the organization. However, not all companies start from the same baseline. Their common denominator is standard PC hardware. “Then it only depends on the data sources. We can feed SAP BusinessObjects from different data sources. It doesn’t matter whether the figures come from Excel spreadsheets or an ERP system,” Behrens says.

cormeta itself offers SAP Business All-in-One solutions such as TRADEsprint, which is aimed at wholesale trade. With TRADEsprint and other ERP systems, it is already possible to create simplified reports. In combination with SAP BusinessObjects, much more in-depth business analysis becomes possible. Analyses can then be performed in real time. As a result, the company management always knows exactly what’s happening. Early analysis enables timely intervention and prompt adoption of countermeasures. When information is extracted from raw data, it is especially important that it is displayed clearly. Working in a familiar environment – for example, with Microsoft Office – should also still be possible. Then dashboards can, for instance, be incorporated into PowerPoint presentations easily.

More reality than ever before

Before a midsize company opts for business analytics using SAP BusinessObjects, it naturally wants to know what will be possible with the solution. “Decisions become more precise, because the diversity of the information that can be retrieved is enormous. Standard queries are just as possible as analyses of customer structures, the average duration of goods deliveries, and the like,” Behrens says. Even text analyses can be hooked up to it, enabling searches for feedback in social media networks such as Facebook or in online retail platforms.

Next page: In-memory technology as an accelerator

A further positive factor is that business analytics can be performed away from a desk. This means that, especially at management level, decisions can be made much faster. For example: The boss is negotiating prices at a supplier and needs sound arguments quickly. On her smartphone or tablet PC, she finds clearly formatted information from production, sales, or purchasing while the meeting is still going on. It doesn’t matter whether the device is Android or Apple.

In-memory technology as an accelerator

Although direct access to the data brings benefits in terms of time, BI can become even better. Whether managers are at a branch office or in their car, they want to see results right away. Complex processing – that is, of big data – takes a while. The speed of the processors and their ability to process huge quantities of data mean that hard drive systems can no longer keep up. So it’s better if the data is already available in the RAM. Today, using in-memory solutions, it’s possible to load all data into the RAM so it can be processed there. This enables simulations and forecasts, in other words, everything that can be labeled predictive analytics – a big advantage when a company needs to test out various strategies and decisions in advance to check whether the corporate goals can be reached. “Using fast analyses, an organization can identify and eradicate its weaknesses, and be tougher in the face of competition,” Behrens concludes.

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