If mid-marketers establish strong data governance and make better use of their ERP and other systems, they can integrate operational and financial planning to more effectively manage performance, according to a July report by Deloitte Insights, “How Analytics and Forecasting Can Help Mid-market Companies Manage Performance,” highlighted in The Wall Street Journal.
One highly-effective tool Deloitte recommends is a one-page “pulse report,” which shows key metrics for tracking revenue, operating performance and working capital. Key metrics should be tracked on a weekly or even a daily basis, as less mature and less capitalized mid-market companies may need to adjust their plans rapidly.
“A basic, but nimble, financial modeling tool with a simplified form of scenario or sensitivity planning can go a long way in providing the information necessary to evaluate the extent of a financial hole, understand the impact of action plans and communicate with key stakeholders,” according to the report.
It’s imperative to have a business planning function that integrates various entities within the organization so the company can be ready to react when actual results fall short of the plan, Deloitte said. A C-suite executive should drive this process integration to bridge the gap between the finance department, sales and supply chain.
“C-suite executives can help address this issue by deciding what data to use, and interpreting it to facilitate company-wide decision-making,” the authors wrote.
In addition, many mid-market companies with tight IT budgets are deploying lower-cost cloud-based analytics solutions, according to Aberdeen Group’s 2013 report, “Analytics and Big Data for the Mid-Market.” Such solutions are also typically more straight-forward to implement than on-premise solutions.
Since one solution typically can’t meet all of the analytics requirements within organizations, mid-market companies should focus first on deploying solutions that help them improve customer engagement, as that’s one of the fastest ways to generate return on investment for analytic projects, Aberdeen reports.
In their research, the authors found that 59% of mid-market companies focus on improving their understanding of their customer’s behavior, demands, likes, dislikes and buying habits.
“This makes analytic solutions that can combine historical transaction records with customer profiling and social media chatter particularly enticing,” the authors wrote. “Other popular use cases for analytics involve optimizing specific business units or job functions, such as marketing or product development.”