Business Intelligence – How to manage company performance?

All companies rely on data to make strategic decisions to drive revenue.  I attended a panel discussion on the use of Business Intelligence at SDforum in Silicon Valley. It was an interesting discussion covering various aspects of Business Intelligence deployment.

How is Business Intelligence used in start-ups?

• Monitor customer activity and upsell and cross-sell products in a SaaS model
• Refine customer acquisition and retention strategy by observing customer behavior on websites
• Modify business strategy based on certain patterns of customer behavior
• Uncover surprises from customer behavior, analyze and test it again for closed loop feedback

Drawbacks of Business Intelligence

• Data addiction and assumptions based on a certain data pattern
• Lean towards  business strategies based on dashboard data instead of direct customer interaction to collect data
• Quality of data is somewhat unpredictable.  BI data skewed if customers implement the product/service incorrectly.

Cost effective – Inhouse or commercially available tools

• Hybrid approach of developing inhouse and using commercially available tools based on data needs
• Tradeoff between cost and data needs in choosing third party BI tools
• Inhouse development of BI tools takes away product development resources from the pool

How do companies build a data driven culture?

• Business Intelligence needs executive support and advocacy within a compnay to build a data driven culture
• Find simple metrics to illustrate a point to facilitate business decisions
• Executives must exhibit a passion for understanding customer behavior to alter business strategy
• Goal setting to alter the business decisions by choosing a few metrics
• BI reports with different levels of details, different frequencies provided to various internal organizations- CEO receives a summarized version, VP of product development receives more details etc.

I will conclude this post by saying that “Business Intelligence” needs “Human Intelligence” to interpret the data and leverage the reports to make appropriate business decisions.  The “Human Element” factor plays a vital role in the ultimate usefulness of BI tools to any company.

Venture funding for cleantech

In today’s economic conditions (2009), we often hear about the scarcity of funding for start-ups including the clean-tech industry.  I attended a clean-tech panel hosted by sdforum (http://www.sdforum.org) which explored the alternate funding strategies for start-ups in this space.  The panelists represented Silicon Valley Bank, Venrock,  TriplePoint Capital and Clean-tech Circle.

The funding scenario:  There has been a rapid decline in global clean-tech funding.  There were too many clean-tech companies funded in the past and the funding pace has tremendously slowed down in 2009.   It is a choppy market for angel funding and angel investors have retracted from funding long-cycle R&D projects. Some companies  are getting Venture Capital  funding, although the competition is stiff and the bar is set high.  Companies need to have compelling business plans and strong differentiation from their competitors.

Cleantech industry scenario:   The industry is attracting great talent from other industries for its growth and expansion in the next several years.  The solar industry has reached its capacity limit with too many players competing in this space  and consolidation is expected over the next several years with a few prominent and emerging leaders in the industry.  The geothermal area is still risky to be funded and is in infancy stage now.  On the other hand, biofuel industry is backed by the Government to grow over the next decade and the market is infinite for companies in this space.   Companies like Chevron, Shell and BP are well positioned to invest in cleantech projects.  Samsung is the latest entrant into the Solar field with its solar powered phone with other similar companies expected to join.

Alternative funding sources:   The stimulus money from the Government is creating some impact on the funding scene.  Capital intensive companies seek Government funding from the Dept of Energy, Solyndra received $535 million loan guarantee in March.  Venture Capitalists seem to have stronger relationships with the Government for funding cleantech projects.  Municipal Funding is an alternative funding source for cleantech startups to explore.  The panelists agreed that European Utility companies are good to partner with for cleantech investments.

It was an interesting panel shedding some optimism on obtaining funding in this gloomy economy and highlighting the alternative sources of funding for cleantech startups.  It was clear that biofuel companies with Government backing have tremendous growth potential in the next decade.

Create business opportunities in a recession

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There is a surge of entrepreneurs recently due to the recession.  The recent silicon valley event  “TiEcon 2009″ attracted a record number of attendees which prompted the headlines TiEcon halts recession.  It is encouraging to see many people, teens and adults alike, leaning towards building their own business with creativity and innovative ideas.  I have noticed many bright minds launching technology start-ups in the midst of recession in Silicon Valley.  Kudos to them !

I have observed that a lot of people are tapping into the unemployment pool to create their own business.  Needless to say, this large and growing pool in 2009,  presents opportunities for career coaches, resume writers, social media strategists for revamping their business.  However I have a word of caution about Internet advertisements luring people about opportunities to make money and most are scams.

Career coaches and resume writers have increased their visibility through their marketing efforts. They attend networking events for the unemployed to reach-out a large target audience.   Social media strategists have been marketing their services to individuals and businesses for branding and reaching out to people on linkedin,  facebook, twitter and other social networking sites.  Job search websites have grown by leaps and bounds and have incorporated web 2.0 features.

I think that keeping the unemployed target market in mind, there are great business opportunities to fulfill the needs of this segment.  There is a lot of room to create software products and services for this market.  I look at this from an other angle ….You create a job for yourself too !

Working Relationships in Start-up companies

There are many differences between working for a large company and a start-up.  Many of us have varied experiences in both work environments.  The goals of start-ups and established large companies are different and employees are well aware of these goals from day one.

Building a successful start-up company is dependent on the working relationships among the people who work tirelessly to attain goals.  Some of my thoughts on management issues in start-ups:

• In start-ups people often wear multiple hats due to resource limitations. Define the roles clearly with the right expectations and the main responsibilities associated with the role.

• The company executives should delegate various tasks and stay away from micromanagement.  They should focus on their core responsibilities.

• Increase motivation by assigning roles to different people based on their interests, skills-set and experience.

• Build a culture which encourages team building with mutual trust and respect.

• Frequent and relevant communication among people in different roles is vital in a start-up.

• Build an environment to encourage brainstorming sessions which often creates innovative ideas.

• Evaluate inputs from people in different roles before making key decisions that drive the company strategy and direction.

• Resolve conflicts effectively – understand the problem,  communicate well and exercise patience.

In conclusion, I think that building good rapport and team environment is extremely important in being successful for start-up companies.  A healthy working relationship fosters great teams with innovative ideas for the ultimate success of start-ups.