Software Advice (www.SoftwareAdvice.com) helps people find the right software for their business. To discover why companies were shopping for a new business intelligence solution they spoke to buyers from thousands of companies and developed results based on 385 of their phone interactions over the last two years.
I am not going to relay the exhaustive findings of the entire report, I am strictly interested in the manufacturing industry, our specialty. If you are interested in more information I recommend you take a look at the report, Business Intelligence Software BuyerView 2014 by Abe Selig.
Below is a pie chart indicating the industries surveyed and the results of the sampling. Twelve percent of those surveyed were in the manufacturing industry.
For an in-depth understanding of this information I reached out to Abe (as the Managing Editor of Plotting Success, he analyzes and writes about BI trends and tools as well as supply chain management). I wanted to know what type of software the manufacturing industry respondents were currently using. Abe shared the following:
65.9 percent surveyed in the manufacturing industry were using systems such as an ERP or other manufacturing-specific software solution.
Since ERP (Enterprise Resource Planning) and manufacturing software was created for the manufacturing environment, I find them valuable and necessary tools. So why don’t the other 34.1 percent have the appropriate tools to conduct business? First of all, these tools can be quite costly to purchase and implement. Secondly, it requires widespread buy-in so these systems are effective and bring financial benefits. And lastly, manufacturing personnel may not have the luxury to shift their focus to training.
For organizations that have ERP or a manufacturing software solution, they most likely do not have a solid analytical tool. Most manufacturing systems were not created to analyze data but to to collect, store, manage and act on data from many business activities, including:
- Product planning, cost and development
- Manufacturing or service delivery
- Marketing and sales
- Inventory management
- Shipping and payment
Data analysis is very different than interpretation. Interpreting explains the data but does not compare it for future decision making. Profitability is not created from what we decide for today but what we can forecast for the future.
12.7 percent surveyed in manufacturing were already using BI software but were looking for a new solution.
For organizations that believe BI software is the answer to all their data problems: surprise! BI tools are only as good as the data gathered. So it is possible that these organizations are looking for manufacturing systems to feed data into their current BI.
Then there are organizations that are not satisfied with their current BI platform. It is common for some early adopters of Business Intelligence to feel that capabilities do not live up the expectation. This occurs for several reasons:
- Non-Adaptation of upgraded software versions
- Neglecting Continued partnership with software provider
- Not taking advantage of continual education and training
I am often surprised how many organizations will purchase a tool and not understand what it means to commit to its success. The tool is only as good as the organization that uses it. BI solutions must be nurtured. As industries, people, and processes change, so should the tools. The best Business Intelligence platforms keep up with the changes. But there are organizations that will not take the time for upgrades, foster software vendor relationships and ensure that IT personnel and end-users have continual training to leverage new and helpful features.
6.3 percent surveyed in manufacturing were using Excel (in tandem with something else)
This was surprising, as I would have expected more than 6.3 percent of manufacturing organizations were using Excel. From my own experience, end-users are very comfortable using Excel for Business Intelligence, and many executives ask for an analysis in Excel, believing that is the only way they might do their own “what if” scenarios.
8.5 percent were using disparate databases and combined the results in reporting software like Crystal Reports
Anyone who has ever tried to analyze data from Crystal Reports knows how difficult and time consuming it can be. Generally the reports are pretty standard so therefore the analyst transcribes the information into Excel. By the time this process is done, the data is already too old to use.
6.6 percent had no software in place
Conducting business without any analysis tools is dangerous. These organizations tend to lose, rather than make, money. It is difficult to contribute to the bottom line without understanding needs, the ability to determine problems before they happen or an accurate picture of inventory or sales.
With an overwhelming need for a tool that provided better data visualization, it was clear that the survey showed demand from business professionals, not IT professionals.
Prospective Buyers by Job Title
And when looking at where those surveyed fit within their organization, 17.6 percent of those surveyed were C-Level staff (including VPs), 39.4 percent were managerial (including directors), 24.4 percent were analysts and 18.6 percent fell under other.
Better data visualization is not the only factor that is important in the purchase of a BI platform.
A chart below shows the top reasons given for buying new BI software.
Top Reasons for Buying New BI Software
Nearly 35 percent of prospective BI software buyers included in the sample were using a CRM or an ERP system to gather, track and report on data, and were looking for a new solution to better analyze the data they were collecting.
Buyers are also looking for the following:
- Data consolidation from multiple sources into a single application
- Associative data searches
- Secure, real-time collaborative data
- Dashboards with state-of-the art graphics
- Flexibility and agility
- Access to data anytime and anywhere
- Accessing and analyzing capturing data from mobile devices
- Intuitive and sage self-service efficiency
As the manufacturing industry continues to grow and compete with one another, it will be imperative to embrace Business Intelligence. The ability to capture critical information on a timely basis is the key to determining Key Performance Indicators. Without metrics that can lead to successful Sales & Operations Planning, supply chain planning will be a guess rather than a stable part of the organizational planning process.
Software Advice helps people find the right BI and data visualization software for their business. To discover why companies were shopping for a new business intelligence solution they spoke to buyers from thousands of companies and developed results based on 385 of their phone interactions over the last two years.
By Cindy Balon Harder, from: http://visualdatagroup.com/2014/09/19/business-intelligence-and-manufacturing-a-perfect-team/
Throughout her 20+ year career, Cindy Balon Harder has had extensive experience in Marketing, Wholesale & Distribution, Supply Chain, and in developing Sales and Operations Planning processes. She is particularly familiar with the Consumer Products industry where she has participated in all aspects of the supply chain, from demand planning to warehouse distribution. Cindy is a Principal at Visual Data Group. Her main focus is Marketing, PR and Social Media, and Supply Chain consulting. See Cindy’s articles on EPM Channel here.