In the face of unstable market and economic conditions, companies need to use a number of measures to stay ahead of the market. Forecasting is one effective tool.
Prescriptive analytics allows companies to use past behavior to predict future activity. Businesses that make an effort to forecast future trends have an unquestionable advantage. Not only will it put you several steps ahead of your competitors, but it will also help you stay agile during uncertain times. As a result, forecasting is an established component of a business’ strategy planning.
Business Intelligence software can assist businesses in shaping growth strategies and can increase the efficiency and effectiveness of forecasting. Here's how.
1. Accuracy
Tech Republic notes that revenue forecasting should answer questions relating to what you’re going to sell, to whom you’re going to sell it and when you will make the sale. Accuracy of your data and forecasts is key in order to put the right product in front of the right customer at the right time, as well as optimise procurement and distribution to increase profitability.
Business Intelligence software solutions are known for their ability to operate in real-time and give you the most up-to-date data. By having an accurate snapshot of your historical sales patterns, you are able to accurately project future revenue, sales and customers to keep you ahead of the market.
2. Comprehensiveness
The existence of multiple data storage locations is common within businesses. Typically, businesses use different applications to process different types of data, and because of this, data is stored in different locations, such as ERPs, CRMs, spreadsheets and more. When the time comes to build reports and forecasts, it is not uncommon for sales managers to lose track of certain information, because they simply don’t remember where some data is stored. Therefore the quality of their reports and forecasts suffers.
Business Intelligence software is equipped with the ability to store data from multiple sources in one location. And if, for instance, data is not stored in the program, it can be imported quite easily and saved within the database. This will enable sales managers to build comprehensive, high value reports.
3. Timeliness
All too often, sales managers spend weeks building sales forecasts. The lack of a single data repository causes sales managers to spend days tracking down information and compiling them, prolonging a process that could have been done within minutes if supported with the right technology. With BI software in hand, you can store many different types of data in one location.
Aside from this, BI software is equipped with simple interfaces and configurable functionalities to enable users to understand the system and use it efficiently. As a result, data compilation is expedited, allowing sales managers to draw insights quickly and produce timely forecasts.
4. Clarity
The most important aspect of reporting is its clarity and readability. Some sales managers, to save time, present reports the way it was built, without simplifying it for non-technical readers. Business leaders and board members are then unable to comprehend the report and the meeting accomplishes little or nothing. A report may be complex, but its output should have the capability to mask this complexity by presenting the data in a simple and easy to comprehend manner.
BI tools are focused on delivering clear reports using simple visual representations that can present the data in a simple manner. With clear reports, it will be easier for sales managers to draw out existing trends and project future trends. Subsequently, your forecasts will also be presented clearly, enabling business leaders to quickly comprehend it and take action.
Overall, Business Intelligence tools have been proven to increase the accuracy, clarity, and comprehensiveness of data and the timeliness of the forecasting process, to ultimately deliver high-quality forecasts.
