The traditional view of businesses has focused on conducting analyses to make decisions based on an incomplete view of business processes, leaving aside the interactions that characterize a system that must act and be seen as a whole, not as the simple sum of its parts.
This traditional view, in which a management report is composed of the sum of the reports presented by each department, leads to a strategic plan that, even without being implemented at the corporate level, suggests results that will be disastrous for the company.
This is where analyzing problems from a systemic perspective plays a fundamental role at the business level, dimensioning causal relationships, with their generating factors and their consequences, allowing us to analyze how these elements are coordinated with each other in order to achieve a common goal.
This reason justifies the importance of competitive intelligence as a fundamental and structural part of a strategic planning process, considering that its results are used to develop production plans, sales budgets, cash flow projections and other structural analyses aimed at building not only a strategic plan, but a true strategy aimed at generating value for the company.
Traditional business analysis models
There are multiple models that allow for the analysis of a company, from Porter’s 5 Forces model to SWOT analysis. However, all of these end up taking a snapshot of the company at a specific point in time, and based on this, they begin to make predictions about its behavior.
To this end, it is common to see planners defining an optimistic scenario, a realistic scenario, and a negative scenario, in order to subsequently conduct the corresponding analyses and present their figures and models to management.
However, in the information age, and with the use of predictive models, fed from external systems and making use of systems dynamics, it is possible to build a tool that allows for the analysis of the three scenarios and comparisons to be made simultaneously, enabling more precise analyses to be carried out than in the past.
The importance of a systemic view
This is of no use if the integrity of business processes and the holistic view with which they should be approached are left aside. We believe that a scheme should be proposed that aims to strengthen each of the company’s areas of expertise and take advantage of the company’s most important source of knowledge: its own human capital.
Under the above premise, we can assume that the company is a living organism that interacts with its environment and receives feedback from it, in order to grow and strengthen itself within a network. In the midst of this process, the organism evolves and, in order to do so in the best possible way, must constantly analyze its environment.
To this end, the techniques and methodologies on which competitive intelligence is based are defined, thus becoming de facto the sense of sight and hearing of our organism. Thanks to these, marketing and production strategies can be defined that promote the generation of business value, all coordinated in a harmonious way by the financial and administrative plan of the organization.
Benefits of systemic business analytics
Under this scheme, then, it is clear that structural analyses of projects can be carried out and decisions as transcendental as the following can be made:
- How efficient are we in the use of working capital, compared to the competition?
- How effective are our inventory turnover strategies, considering the current needs of our customers?
In general, systemic business analytics allows companies to:
- Make more informed and data-driven decisions.
- Improve the efficiency and effectiveness of processes.
- Develop new growth and expansion strategies.
- Adapt to changes in the environment more effectively.
Systemic business analytics is a fundamental tool for companies that seek to achieve success in a competitive and changing environment. By adopting this approach, companies can improve their ability to understand how their business works and make decisions that allow them to achieve their goals.