Competing on Analytics
The guessing game is over. If you are not competing on analytics you will soon not be competing at all. We are quickly moving to a time when we can know who does what, when, and how, and why they do it. Money Ball – starring Brad Pitt, tells the story of how Major League Baseball was dragged into the modern age by realizing that intuition, experience, and instinct were not enough! Data and analytics told the real story. If that is true for baseball it is certainly true for your business as well.
Here are some things every business should be tracking. How much is a deal worth? What is the average time it takes to make a deal? What is the true profitability after all expenses including your labor? Many entrepreneurs subtract the cost of materials from what they charge and consider that profit. By failing to factor in their own time I have seen situations where people are in effect working for a couple of dollars an hour! What do people buy when and what do those patterns reveal? I am sure that Walmart stocks up on chicken soup during flu season because they know that is when they sell the most chicken soup. What are your predictable patterns?
When I ran analytics for close ratio on incoming calls in a business I was running years ago I discovered a 30% differential based purely on who was answering the fun. In effect, I was playing Russian roulette with potential business. Knowing this, we were able to study, train, and emulate the success of our highest closer so that everyone could achieve the same high results. Stop guessing at what is happening and run some numbers. You might be surprised.
- Measure don’t guess
- Data and analytics are vital to being successful in the new world
- Know the true numbers on every deal and product sold