It’s a common situation in many companies: processes are often kept in place without insight into their efficiencies or contributions to overarching business objectives.
That’s because workers are too busy with their daily activities to have time to reflect, so they fall back on the tired philosophy of “that’s how it’s always been done.”
But for those companies that do put into place operational intelligence – using analytics to obtain visibility to connect operational metrics with corporate strategies and performance – the returns can be eye-opening.
Companies that use operational intelligence most effectively perform better than other firms in closing new accounts, operational output and cost savings, according to a recent research report from Aberdeen Group.
The research finds that the top pressures driving companies to focus on operational intelligence are:
- Operational inefficiencies (43%)
- Too many business decisions based on inaccurate/incomplete data (37%)
- Shortening the window of time for making critical decisions (30%)
- Customers demanding timely and accurate responses to queries (23%)
“As greater volumes of data become available and customers become more analytically literate, it is unsurprising that they would come to expect a more transparent and rapid feedback loop with organizations,” the research report notes. “All of these pressures together represent the challenges nagging at the minds of operational decision makers and fueling the motivation to seek out technology solutions.”
The top performing companies are more likely than average performers and laggards to apply big data analytics to the operations of customer-facing departments. Seventy-six percent of the top performing companies use operational intelligence to monitor and analyze customer service.
The companies that are top performing have achieved superior performance related to customer-facing operations:
- 90% have reported customer satisfaction during the most recent fiscal year
- 91% have had an on-time customer response rate during the most recent fiscal year
- 36% have had an increase in conversion of leads into qualified prospects
“Operational intelligence helps organizations immediately recognize customer issues, as might be indicated by an uptick in customer complaints or a rash of departures,” the report notes. “Representatives can be briefed on developing problems so they are equipped to optimally work with customers. Scrutiny of daily activities of the service department helps drive the superior customer retention rate (of top performing companies).”
Moreover, more than half (56%) of the top performing companies use operational intelligence to monitor and analyze the sales process.
“Operational intelligence helps decision makers monitor deals at all stages of the funnel, “according to the report. “If prospects are consistently lost at a particular point in the sales pipeline, operational intelligence will reveal the leak and provide the insight needed to plug it”
The successful use of operational intelligence allow the top performing companies to post a 32% increase in new accounts sold over the past 12 months compared to a 7% increase for average performing companies and a 3% decrease for laggards, the report notes.
Moreover, the top performing companies have achieved a 25% increase in cash generated from operations.
“Across all departments and business functions, operational intelligence helps maximize output by identifying consistent inefficiencies or incipient issues and alerting the proper decision makers,” the report notes. “For example, a plant floor manager could be made aware of a machine with a low uptime and use operational intelligence to identify the root cause of the problem.”
The top performing companies in the survey average a 17% improvement (reduction) in total operating costs.
“Successful operational intelligence can be the difference between an organization that just keeps the gears turning and a well-oiled machine,” the report concludes. “Best-in-class adopters of operational intelligence solutions answer internal and market pressures while achieving operational excellence and growing their business.”
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