Help Us Help You Create Real Value with KPIs that Matter
Every business, from driveway lemonade stands to multi-billion dollar corporations, manage Key Performance Indicators, or KPIs, in some way or another. For the lemonade stand, it may be as simple as cups of lemonade per day. Conversely, for larger businesses, there may be a myriad of metrics that could provide valuable insight to managing the business. The trouble is most of these metrics are buried beneath endless spreadsheets of data. There is a good reason top business schools are pushing students to learn data analytics; the process of mining data and organizing it into a format that can be digested and acted upon is an art form. However, every business is different, and data analysts cannot provide you with truly valuable insights unless you tell them what makes your business unique. Understanding which metrics or KPIs are significant is often the most difficult part of the process, so developing this skill will be imperative to the future health of your business.
Here at ArcherPoint, we are constantly learning about and developing tools to support businesses using their Dynamics NAV data to create meaningful KPIs. By leveraging products such as Microsoft Power BI and Jet Reporting, our team of analysts, consultants, and developers can turn your pile of obscure data into a finely tuned, data-reporting machine. Instead of waiting hours for an employee to pull a report just so you can stare blankly at their pivot table, imagine opening your desktop to a find rich, beautiful array of interactive, real-time data reports presented in a manner that even the kid at the driveway lemonade stand could understand.
This sounds great in theory, but what can you do to make it a reality? To discover what KPIs can create real value, you will first you have to take a look inside your business in a way you may not have done before. Outlined below are a few steps to get you started.
Make Sure Your Version of NAV Is Up To Date
As your business grows, it is important to make sure that your NAV is prepared to take it to the next level. Many companies flinch at the up-front cost of implementing or upgrading an ERP system. However, it is a common misconception that ERP is simply an expense, and may be cheaper than you think. Instead, it should be thought of a strategic investment that saves you money at the end of the day. If you don’t believe me, check out this article on how a NAV upgrade can actually be cheaper than a cell phone.
Make a List
Begin to take note of the numbers you look at every week. What metrics are constantly on your mind? These are the first that should be converted to analytical tools. You will be surprised at the deep insights even basic metrics can yield when plugged into an advanced analytics tool. Not only will having these KPIs on hand save your time, it will also free up your employees from the hours they usually spend aggregating the data and running the reports, allowing them to create value for your business elsewhere.
Ease Into It
Unless you want to get wet, it is generally a good idea to pull the boat as close to the dock as you can get it before you make the jump. The same principle applies to your analytics. Having this new information on hand can be very exciting, and for good reason. However, before you decide to go overboard you’re your data, consider your employees. This could represent a major shift in the way they handle their business, so by replacing basic reports at first, the organization can get used to a new way of doing things without taking on too much at once.
Talk to your top performing employees to see what their best practices are in their job. People are more willing to buy into an idea that they have helped build themselves, and will appreciate the time you took to consider their ideas. Most importantly, they will most likely be able to offer new perspective on facets of your operation you may never thought of exploring.
After your company becomes comfortable with these basic reports, begin to look for metrics that have the greatest effect on your bottom line. Revenue and costs are the most basic building blocks of any business and can be broken up into defined chunks, like individual products for example. By tracking revenue and performance of these smaller pieces, you may be surprised to see what trends begin to emerge. Microsoft Power BI is an excellent tool for comparing these numbers side by side by using real time data from your Dynamics NAV.
Let it Evolve, But Keep it Clean
Maintain your analytical tools the same way a master gardener cultivates their garden; to have a high yielding garden means that you may have to remove perfectly good plants to let the stronger ones grow. Like that garden, your business has limited resources, and you probably have a similar screening process with the products or services you offer. Be honest about which ones are truly making a difference, and find ways to improve them. For the ones that you do not find yourself using, get rid of them. Too much information can be just as harmful as not enough, and knowing which charts to cut is just as important as knowing which ones to grow.
To find out more about how ArcherPoint can help your business use data to their advantage, read about our Business Process Improvement methodology.