What If and Sensitivity Analysis – Henry’s Secret Weapon of Business Intelligence
If you read this blog, you probably know that I talk about my business colleagues and use their issues as learning opportunities. Today, I’m going to talk about my friend Henry and why I recommended he consider analysis. I’m not talking about psychotherapy. I’m talking about ‘what if’ and sensitivity analysis. I recommended a business intelligence solution with easy-to-use sensitivity and ‘what if’ analysis features because these features provide the foundation for critical focus to ensure that no activity, strategy or goal is misdirected.
This functionality isn’t available as a standard feature in most Business Intelligence or Corporate Performance Management products, but it should be. You need this clarity to drive confident decisions. It’s a good thing Henry took my suggestion. Now, he can share ‘what if’ scenarios with team members to consider all appropriate processes, departments, funding requirements and schedules. He can consider competitive response and take swift action to counter market competition. He can accurately predict sales and revenue targets and understand the impact of pricing or other changes on his profit margin and bottom line.
I think Henry owes me dinner! He is a hero to his boss and that’s not easy to accomplish. He can choose the right option to ensure business success for new products, service offerings and resource allocation, budget reduction or pricing or labor costs. He can predict and forecast results without risk and select the option that is the most appropriate for business success. He can collaborate with his team, share options and choices and make decisions with full visibility into the impact of those decisions.