Small businesses today are in survival mode.

That’s the stark conclusion from a recent blog post “Small-business optimism rises-but so does stress,” by Rieva Lesonsky. She cited a recent American Express OPEN® Small Business Monitor survey.

Forty-one percent of those surveyed said their focus for the next six months will be maintaining current sources of income; just 26 percent are focused on growth—the lowest number in the history of the Monitor survey.

How can you, as an entrepreneur, survive while maintaining current sources of income?

Business Intelligence.

Business Intelligence: Not Just For Large Enterprises
Business Intelligence software and implementation. That’s a phrase to scare the b’jeezus out of any self-respecting small business-person working in survival mode. You can just see six figures burning up before your eyes in an endless implementation project.

Better leave that to the Wal-Marts and Dells of the world, right?
Cloud computing has come to the rescue, giving small companies access to low-cost, instantly implementable BI solutions in a software-as-a-service model. But how exactly can a Business Intelligence tool help you, the small manufacturer, wholesaler or retailer, weather the current economic storm?
It allows you to make decisions based on facts rather than hunches.

BI-enabled decision-making is a three step process:
- Let’s monitor and identify key problem areas,
- Let’s analyze these issues to identify root cuases, and finally,
- Let’s make corrective decisions, execute the decision, and measure the results.

Monitoring
You first have to define the success indicators of your company’s key processes, such as sales, average sale, frequency of sales, number of customers, outstanding invoices. Then you monitor these indicators to see if there are any shortfalls in your indicators.

Analysis
You then need to analyze what are the causes of the shortfalls. For example, if sales are down, you need to determine if it’s because of poor performance in a particular region, a particular client, or a particular product. Or you might have an inventory problem because your customers are returning a certain product due to a fault in that particular product.

Decision
Finally, and most importantly, is the decision. You have to determine what course of action to take to improve the situation, get all parties on the same page, implement the solution, and ensure proper follow-through.

For example, if there’s a cash-flow problem, instead of borrowing money, you can now identify what’s causing the cash-flow problem. This could be poor collections or excess inventory.
- You can then implement a creative collections policy or just-in-time delivery solution.
- As a small-business owner your normal response would have been to go out and close more sales.
- That’s one possible solution, albeit a high-effort, low-return option considering we’re not out of the economic woods yet.

However, with a BI tool you can now accurately focus on things that are completely in your control, but were previously hard to gauge, such as expenses, outstanding invoices, collections and suppliers performance.

Cost Of BI Tools
While you and your small-business colleagues might not necessarily be in retrenchment mode, you’re definitely not on a buying spree.

As a matter of fact, like me, you’ve probably forgotten what a buying spree is like.

So why even consider a BI tool? Aren’t they expensive to purchase, and even more expensive and time-consuming to implement? What about all those hidden costs like BI consultants, training, IT maintenance, and hardware costs?

That’s where instant BI via a Software-as-a-service comes into play. Business Intelligence in the Cloud is enabling companies to save up to 90% on traditional BI projects.

As William Laurent said in his recent DashBoard Insight Article on BI in the Cloud:

On-demand BI means on-demand licensing; this results in tremendous cost savings for companies that have for years squandered money on software and licenses that filled a niche role or were not as heavily used as anticipated.

It also results in a tremendous cost advantage for you who are in survival mode and would have never considered acquiring a BI solution using the old model.

Conclusion: while you are trying to stay afloat until the storm has passed, the least you can do is give yourself an advantage by acquiring a tool that allows you to monitor, analyze and make the corrective decisions necessary to give your company a fighting chance to survive, and thrive, for the long-run.

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