Getting started on operational metrics
Turning your business intelligence focus inward can help you identify key performance indicators beyond sales, marketing, and revenue. Tools you may already have, including Microsoft SQL Server and Microsoft Office Excel, can do the job.
 | Any business needs to look at both internal and external measures to gauge its health. |  | | Alan Walker
Hitachi Consulting,
London financial services practice | |
|
Society trains us to compare ourselves to others, whether in academics or in business. And so we tend to benchmark our companies against our competitors using external metrics such as sales and revenue. But a focus on internal metrics—measuring operational activities to track either progress or problems—can bring significant savings and better processes.
"People are starting to do operational business intelligence more often," says Alan Walker, who leads Hitachi Consulting's financial services practice in London. "Any business needs to look at both internal and external measures to gauge its health." The key questions are: Where to start? What do you measure? And what should you use to measure it?
Start with corporate goals
Experts in operational business intelligence consistently echo the same message: Identify the measurements that match your corporate objectives before you consider technology. If you want to gain a competitive advantage by getting new products to market, then you should measure how many ideas you're generating, how long they take to become products, and who is generating the most and best ideas.
Indeed, the range of potential internal metrics is extensive, ranging from procurement and finance to human resources and operations. Some examples:
| • | Environmental impact. More companies are reporting to their investors how "green" they are. To do this, they're tracking emissions from their factories and what they're doing to decrease that output. |
| • | Loss prevention. If pilferage or quality issues plague your factory or warehouse, you can analyze factors such as time of day, names and numbers of employees on-site, or on which machines problems seem to occur. The results could show you whether it's a training, maintenance, or even criminal issue. |
| • | Help desk calls. Tracking these may help you determine appropriate staffing levels, identify problems with internal software, or highlight training shortcomings among the technical support staff. |
There's a common element in many of these examples. To get the most out of any metrics, you need to compare them against other metrics. That's where BI tools come in. By consolidating information from multiple sources into a data repository, you can analyze results more efficiently and intelligently.
When you're just starting out, it's not necessary to invest in new and unfamiliar tools. Many midsize companies are already using the BI capabilities included in Microsoft SQL Server 2005 and Microsoft Office Excel. "That's one of the reasons that more companies are tracking operational BI metrics," says Dan Hooper, vice president of sales and marketing at Dallas-based Integrated Services Inc., a Microsoft Gold Certified Partner.
For more information on this topic, see "How analytics can help manage your staff," "Make the data count in your data warehouse," and "How IT can be a good BI partner" for more insights into how operational BI can help you.
 | Silicon Valley-based freelancer Howard Baldwin writes regularly for the Microsoft Midsize Business Center. His work has also appeared on AllBusiness.com and in CIO. |
