Jun 11, 2014

Analytics for The Small Business: Mission Possible

Small business usually has to be very smart  to compete on the market. "Smart" includes not only the personal quality of people running it but also, with growing importance, the ability to analyze business data. The sad truth is that these businesses are left behind by the majority of analytics vendors and the owners struggle to find solutions to meet their needs. The question is what are these solutions that could meet the demand.

Before going any further, stop on the definition of small business and how different is it from the other types. There are accepted definitions that put in this category all enterprises with less than 50 employees. There is also "micro business"with less than 10 employees but the definitions vary with the demography of the country. There is also the turnover consideration. "Small" is different in US, Europe and India. For the clarity sake I will assume "small"refers to companies with less than 30 employees, 10 on average and operating in Europe.

Being small business does not necessarily mean being simpler business. In fact, the level of complexity is similar to the larger companies and this is not a surprise. The ordering and storing of goods for example go through the same processes and face same challenges of order quantity, minimizing storage costs and providing acceptable level of service. The small business requires analytics to meet same levels of promptness, in-depth and sophistication as larger business but there is one problem - the price. The providers of Business Intelligence and other analytical solutions are understandably focused on bigger clients as for the almost same efforts they could ask higher price. Licensing fees are considerable and usually are the stopping factor.

It is not all that bad though. Small business have some good options.
Number one among them is MS Excel, as you might guess. Excel can host relatively large data sets and provides variety of tools to extract meaning from it. It is readily available as it is already in place on the PCs, it is cheap, offers great possibilities for automation and is sort of a standard for data exchange. The entry skill level is relatively low and there are plenty of ways to acquire new ones - courses, web pages, forums, etc. In case data is too big to be efficiently handled in Excel, there is MS Access which also comes in  the office package (Professional version of it). The downside is that efficient and full-scale use of Excel requires better skills with it and some functionality are not easy to implement. However, there seems to be large pool of Excel experts who can set up and support small businesses in their Excel applications. Similar to Excel are the open-source and free spreadsheet solutions as OpenOffice which are not that sophisticated but could cover some basic needs.

Another option are the free solutions - databases and BI, e.g. MySQL, MS SQLExpress (databases) and Pentaho, Spago (BI). They are usually good for the basic stuff at least and are not hardware greedy. A good expert could build a good solution without any money spent on licenses. However, developing and supporting solutions with them could be a nightmare even for trained professionals and experts tend to be expensive. This type of solutions require good and more expensive experts.

A viable option for some companies could be the hosted BI solutions. There are some companies that offer to host the data and the application for an affordable monthly fee after the initial investment in development of the solution. The downside is the data is not on a local machine but uploaded regularly to the host and some owners could have some issues with the data confidentiality. It is not an issue but some people tend not to have complete trust in the technology.

An option for some purposes are some free versions of commercial software. These are usually restricted in functionality and/or in accessibility. For example, QlikView has a free version but it runs on one PC only which is a problem for sharing results with other team members. Some of these software (QlikView included) have some higher requirements for the skill level. Tableau Public is another example for free and good tool but there are still some limitations for full-fledged company analytics.

There are many analytics-centered applications that offer good prices. Some are good for the small business and worth looking into, e.g. Tableau, but still have their limitations. A major one is the storage of the data and its transfer to the the analytical application - storage is somewhere else and there has to be a dedicated transfer procedure to feed them.

My number one solutions for the small business remains  Excel as a best combination of scalability, functionality, integration options, TCO and costs for development and support. Packaged with MS Access it could be the backbone of business for a long time. My second choice would be the hosted applications with their low costs and lack of efforts for hardware and other support. Among the main consideration for small business solutions I would list the vision of the company - who they are, what they need to know to power their success and how they see themselves in the future.

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