Ray Wang just posted an awesome and insightful article about how to approach the use of software to improve business in these tight times. I especially loved the last 2 suggestions quoted below, because it captured the essence of SaaS BI – a byte sized approach to tracking metrics:
- Choose your entry points to add business value. It makes no sense to boil the ocean. Today’s analytic solutions require bite-sized entry points. Clients often start with analysis of metrics and KPI by department and work their way to cross-departmental initiatives. Advanced customers focus on external entry points such as customers and partners. (see Figure 1.)
- Define the metrics that matter. Begin with the end in mind. This Coveyism always rings true in transformational activities. Metrics should be aligned with your entry points. Quantify the baseline and determine the effort. Adjust your ROI targets to align resources with efforts to move the needle. (see Figure 2.)
Ray Wang’s Figure 2 below:
At Dreamforce (Salesforce.com’s annual user event) PivotLink did just that. We launched a Sales Analysis Accelerator with 54 KPIs that were organized around 3 areas where we heard B2B companies wanted to improve sales:
- Sales Performance (How is Sales performing on high level indicators?)
- Pipeline Velocity (How is sales executing?)
- Lead to Opportunity metrics (Sales and Marketing coordination)
In a related event, I was talking to a Sales Operations manager who said that she wanted to first have a discussion with the executives on tracking metrics, how will they define the metrics and get the buy in first before implementing the SaaS BI solution. It is so refreshing to hear such conversations instead of “how will we implement technology”. This is SaaS at work – we take care of technology and free up the customer to focus on business.
Ray Wang’s advice is spot in. It is time we in business started small on well-considered, measurable metrics and that have impact, rather than boiling the ocean with an “Enterprise BI” approach. There is a flip side to this that strategy management folks will point out – you can improve one metric by making some other metric worse. That is why the metrics need to be well-considered.
PivotLink’s customers do this regularly. A very large company measures on-time delivery with PivotLink. They identified that moving the needle on just this one metric will save them millions. Another PivotLink customer, DMA, has a fantastic analytical discipline. They have aggregated data and ranked the customers they serve on order management metric and have come up with ROI models. They advise their customers, for example, on how much an X% improvement in # of consolidated orders will save them. They not only measure the key metrics meticulously but have the rigor to first think about the business impact and the ability to act on the analytic information before resourcing the technical implementation.
Great response Ajay! I have used several “guiding principles” in my career and two of them closely parallel some of you comments. Those 2 guiding principles are: 1) start small and grow by chunking (don’t boil the ocean); and 2) never push a solution in search of a problem.
I think both of these GPs are reflected in your comment, “…first have a discussion with the executives on tracking metrics, how will they define the metrics and get the buy in first before implementing the SaaS BI solution. It is so refreshing to hear such conversations instead of “how will we implement technology”.”
I think the lessons we’ve learned from Agile Software Development apply equally to implementations as well as the working relationships we develop and sustain with our customers. It is an iterative process served well by Pivotlink.