Intelligence Management is a term that we could literally translate as "intelligent management" and that refers to the way to manage an organization or a problem based on the analysis of information and "knowledge management" to obtain the best result.
It is not a specific methodology although it uses a methodology, and it is not a computer application although it uses computer tools. We could say that Intelligence Management is an "approach" in the management model, given that:
· "Focuses" on certain crucial aspects of management such as Core Business (business model),
· Best Practices (best practices),
· key variables and procedures,
· systematization of information
· and processes decision-making.
With all this, what is intended is to systematize a management model that allows optimizing the corporate performance of the organization or of the management areas in which it is applied.
Fue a partir de 1989 cuando Howard Dresner de Gartner Group popularizó el concepto de Business Intelligence, como un paraguas bajo el cual tenían cabida una serie de conceptos y métodos a implementar en las organizaciones orientados a lograr una toma de decisiones más eficientes soportadas sobre una aplicación informática tipo DSS. Desde entonces a nuestros días, han sido numerosas las acepciones que bajo el término “Intelligence” han aparecido, si bien con el propósito de identificar una u otra solución en particular bien fuera metodológica o informática: Business Intelligence, Customer Intelligence Management System, Intelligence Competitive, Corporate Intelligence, Market Intelligence, Strategic Intelligence, etc.
As we say, Intelligence Management is a management approach aimed at obtaining high performance from management at the corporate level, for which a management model is systematized that focuses on the different aspects of management that are crucial.
Core Business
First, it is necessary to know very well the "core business" (business model), that is, to know how business is generated.
They are basically two concepts:
What we sell and what they buy from us (it should be the same)
how we sell it
Breaking down these two concepts will provide us with a deep understanding of why our customers buy from us and, therefore, we can deepen our offer in this regard. As an anecdote, I will mention that during my long career as a consultant, on many occasions I have asked company managers what do our clients buy from us? Why do they buy from us ?, and on many occasions they have not been able to give me an answer that has not even been satisfactory for themselves.
Best practices
The second point on which to focus are the “ best practices ” of both the company itself and the sector. We can find them in documents, procedures and in people, both from the company and external. Let's see a concrete example on how to take advantage of them.
My job is often to develop a business methodology. To do this, I try to extract the best practices from the sales team, which, in general, is composed (suppose) by two very good salespeople, one of whom is more methodical and the other more “artist”, four salesmen who more or less make sales, and two salespeople who cover a area and serve customers. The company has knowledge of how it should sell its product and service, but where is that knowledge? In the minds of sellers. We should be able to get the arguments, the way to refute objections, to close deals, from the entire sales team, evaluate which ones are more efficient, and train everyone with the same sales techniques. The result is that we will have a more homogeneous and efficient sales team in its performance, thanks to the fact that we are exploiting the best commercial practices of the company.
Key Variables and Procedures
The third focus is the key variables and procedures, which, ultimately, we can translate as what is really important.
Often we end up calling too many things important, making it very difficult to pay attention to what is really important. I will give the example of a company that consumes some six thousand tons per year of aluminum foil as raw material. Order orders were placed two months in advance of the supply date and the price was set by the London Metal Exchange (LME) on the day the order was placed plus a fixed price prepared per unit by the manufacturer. All in all, it got a very good final price and better than that of the competitors. However, the company understood that the price of metal was a key variable in their business and that by paying more attention to it they could further improve the purchase price.
An online service was contracted that provided the prices of metals in the LME in almost real time; reported on the operation of futures markets; A small simulator was developed in Excel to evaluate the order orders to be made according to various quotes, and a model was made that estimated the foreseeable consumer demand in the coming months. With all this, the purchasing manager had all the necessary information to be able to close the purchase orders at the best price during the month. The company managed to improve its purchase price in this raw material by about 6%.
Systematization of Information
The fourth focus that we consider is the systematization of information. All companies have computer systems and data, lots of data. In fact, many times we have the feeling that we cannot even take a look at all the listings that may come out of the computer due to lack of time. And yet we also have the feeling that what we want to know, we cannot know or it is excessively expensive. We have data, which is the empirical expression of a fact, but we lack the information that is the explanation and understanding of that data.
This happens because we have focused on the IT application, ERP, CRM, BI, etc. instead of putting it in the management model to be implemented. We talk about parameterizing the application and we introduce the customers, products, prices, etc. and, with this, we can place orders, make invoices, etc. and we have data.
But, these data do not explain how sales are achieved or why one product sells more than another. It is necessary, therefore, that the tool that is incorporated, not only the corresponding "parameterization" but also the management model that we develop and that makes us understand the business.
To illustrate what we mean, we will present the case of a company in the construction sector that had CRM and that the sales representatives registered all the procedures in this application. Ultimately, the utility they derived from him was little more than an agenda. They had a lot of data regarding appointments, offers, etc. but it was not possible to understand how an operation was closed. We defined a commercial methodology that established the different phases that the management went through from the moment a possible work was located until it was closed, specifying in each phase what objectives the commercial should achieve. The methodology allowed the salesperson to have a clear “guide” on how to undertake an operation, and to know at all times in which phase of the sale they were.The Commercial Director was informed of the exact situation in which each possible operation was, so that he could give precise instructions in each case. It was possible to know the relationship between localized works vs offers presented vs closed offers, and sales were increased thanks to an increase in activity, increased offers presented and efficiency in closing them.
The process of decision making
The last focus is the decision-making process or how decisions are made. We all know that more often than we should, decisions are not made based on a rigorous analysis of the information or according to a process that leads us to the most appropriate decision. We are used to basing our decisions on our particular perception supported by the much experience we accumulate and, in fact, most of the decisions that we make are good. But could he have made a better decision? One whose result was better than he obtained? Probably yes.
A case that is very eloquent and that occurs frequently in this regard is the way in which companies decide to manufacture a new product. Many, despite having R&D departments and / or technical offices dedicated to it, lack a clear procedure for the development of new products. Finally, the decision depends more on the idea of the manager, the perception of the commercial department, the opinion of some prominent clients, or more or less a consensus among all. And making a decision in this way means achieving a certain percentage of success. This was the case of a company in the ceramic sector in which a procedure was implemented for the generation of new products that we can summarize as follows:
· One, to determine the needs for new products based on market needs and products that are in decline within their life cycle (these variables were monitored);
· Two, define the attributes that the new product must contain (utilities, formats, textures and colors, cost and sale prices, etc.);
· Three, develop at least three proposals for each possible model;
· Four, filter the proposals according to a product committee that evaluates them against the definition of the required product;
· Five, redesign of the product proposals incorporating the modifications coming from the product committee;
· Six, evaluation of the commercial success of the new product proposals (target market, competing products of the competition, price levels, possible behavior of the product depending on the product in a similar portfolio, sales forecast, etc);
· Seven, product test with clients, with a specific questionnaire that assesses the different attributes and commercial aspects;
· eight; final approval by the product committee.
Once it has been decided which new products to incorporate, it is up to the marketing and sales department to plan its launch. With this procedure, the company tripled the success it obtained in new product development processes.
From the foregoing, we can easily foresee that developing a management model from the perspective of Intelligence Management can provide us with a more efficient management and consequently obtain better results. As with any change, it is not easy to implement it, but once the company has become accustomed to working under these criteria, an improvement in its competitiveness becomes evident as the performance of corporate performance has improved significantly.
