CEO To Rainmaker
CEO To Rainmaker
Episode # 84, Your Business Intelligence System Could Be Your Secret Weapon
Knowledge management transforms business outcomes by organizing critical data into actionable insights. Women business owners are leveraging these systems to fuel incredible growth, with women-owned businesses growing at twice the rate of male-owned businesses from 2019-2023.
• 14 million women-owned businesses in the US (39% of privately owned businesses)
• These businesses employ 12.2 million people with combined revenue of $2.7 trillion
• California hosts 23% of all women-owned businesses in America (1.5 million)
• Knowledge management combines data, information systems, and analysis
• Effective systems deliver the right data to the right person at the right time
• Create a plan identifying key knowledge points about your business
• Implement systems consolidating internal and external data
• Establish quality control procedures to ensure accurate data
• Experiment with data to find hidden opportunities
• Dedicate 2-3 hours weekly to analyzing business data
• Look for unexpected patterns like unusual customer demographics
• Use technology including AI tools to gain insights
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Hi folks, gene Valdez here, producer and host of the CDO to Rainmaker podcast, a show designed to improve the skills, the executive skills, of the owners of small privately owned businesses. Our skill topic this month is knowledge management, a skill extremely crucial to posting great profits and achieving long-term sustainability for your business. March is Women's History Month and in light of that, I would like to skew this or congratulate women in the business sector of our society. But this podcast is not gender specific. But I would like to focus on all of the women business owners out there today and I'd just like to dazzle you with a few stats. In the US, there are 14 million businesses that are privately owned by women, which represents about 39% of the total privately owned businesses in the United States States. These 14 million businesses employ 12.2 million. That is a huge number and, get this, their consolidated revenue is 2.7 trillion. So women in the business arena and business ownership and entrepreneurship is a staggering force. From 2019 to 2023, the growth in women's business doubled that of those that were started by males. So the prospects for women having a larger percentage of ownership in the United States is going even higher. If we look at it at the local level and confine it to California. 23% of all businesses privately owned in America, 23% are in California. That represents 1.5 million businesses. 94% of the businesses in California employ less than 20 employees. And one final piece of data for you the ethnic breakdown of the privately owned women businesses in America is 82% white, 3% black, 6% Hispanic and 10% Asian. So congratulations to all women that are contributing to the business aspects of our society and employ a lot of people and are generating a lot of revenue.
Speaker 1:So our skill topic, as I mentioned, is knowledge management. So let me peel the onion a little bit. Let's talk in everyday language Do you manage your business from the seat of your pants or do you have some semblance of knowledge systems in place? The former will cause you to close your business if you have no knowledge systems, and the latter will allow you to achieve all of your business goals. It should be a no-brainer right. The issue is do you have a knowledge management system in place? Does it need to be improved, or do you not have one at all? Or maybe you have something that's similar to it, but you call it by another name.
Speaker 1:It has often been said in business that knowledge is power. That is profoundly true. Knowledge management is. It's like the combination of data, information systems and knowledge. Knowledge it can best be described as getting the right data to the right person in the right form at the right time to make the right business decisions. That's a lot of rights to get it right, not easy. So let's get to the meat. What should a business owner do to create a knowledge management program or improve an existing one? These are just the basics.
Speaker 1:This is a very complex subject. You need to develop a plan that lists and this is really important that lists what key knowledge points about your business that you want to have it organized and managed. A few examples what are the reasons why your customers buy from you? What are the reasons why your customers buy from you? What are your exact unit costs of the services and products you're offering to the marketplace? Where do I find these key knowledge points? Internally, inside your business or externally? Inside your business or externally? Key knowledge points.
Speaker 1:Number two you design and implement a system that consolidates all the data, whether it's internal or external, as I mentioned, to allow for some in-depth analysis. Now you may say, gene, I don't have time for that, I'm just so busy getting the work out, but you need to be a detective about your business. What's making it tick? So some external examples might include what are the mechanisms you're using to capture and incorporate Internet data? The Internet is littered with information about your industry, about your competition. Do you know how to access that? Do you use it? It is so easy to obtain information these days. You just got to know where to go.
Speaker 1:Number three establish procedures and controls that ensure that your data is of high quality. In plain language, bad data leads to bad business decisions. Examples check your accounting systems. Check your bookkeeping systems. Are they fraught with errors? Are they spot on recognizing all of the transactions that occur in your business in the proper, generally accepted accounting principles manner? Check your CRM customer relationship software. Are you capturing as much information about your customer as you would like to? If you don't have a CRM software program, you need to get one. You need to know the pulse, the personality, the demographics, the psychographics of every customer that's buying from you. It's critical information. Number four, and here's my favorite one Experiment with the data.
Speaker 1:Look for some pearls or hidden nuggets that you normally would not pay attention to. That could lead to more opportunities. Some examples what are your top selling products? Of everything that you have to offer, what sells the most? Why, if you raise your prices, will you have a correlated decrease in unit sales, or will sales stay flat or might they even go up? Is there any weird demographics of people that are buying your products? Weird might be. Maybe you think your target market is young people ages 25 to 40. And when, in fact, as you're digging through your information systems and you find a little nugget, you come to the astounding conclusion that 20% of your business is bought by senior citizens. Why? Why is that happening? Are you missing something here? Why is that happening? Are you missing something here? What do you do to lead your employees to be more productive? There's another hidden nugget. And say they're more productive the last three months than they were the prior three months. Did you do something deliberately? Did it happen by accident? Something happened? Why? Why are they more productive? Again, these are just examples of nuggets. What time of day do you sell the most products or services? Why Be a detective, search for clues in your business that you normally wouldn't analyze, and these could be very, very minor issues, but in the overall scheme of things, they could be huge.
Speaker 1:So, in summary, the goal of knowledge management, or business intelligence, is to find insights let's underline that word insights insights that will improve your business. Insights could lead to improve existing products or services or the development of new, brand new products or services, or servicing your customer better, crowding out your competition. Knowledge management it seems like a very simple notion, but I can tell you from my personal experience that many of the clients that I work with are lacking in this area, and their business results show it. So think of it this way you invest a ton of time and energy into your business and you want to get the highest return possible on your business. In order to do that, you need to kind of like tinker around with your business, looking for little nuggets, as I mentioned, that would improve your business that you hadn't thought of, and that is free. That just comes from creativity, curiosity, orderliness of your knowledge, information systems.
Speaker 1:You need to surround yourself with as many sources of information as you possibly can to make your business better organize the information, look at the data, make decisions based on that data and here's the funny thing it changes every year. So something that's going to work in 2025 and work spectacularly for you. There's no guarantee that that strategy will work for you in 2026. Looking at the environment, your competition, your competitors, and assimilate that into your knowledge management program, and then use that information to manage your business better. That's really very simple. Hard work, though, and you have to set aside the time. So you should be spending at least a couple hours, two or three hours, a week analyzing your data, looking at your knowledge management system for clues as to what you're not doing as well as you thought that you should be and what are some things that you could do to make your company better. So that's a wrap for today.
Speaker 1:Knowledge is power, no matter where you get it. You have to obtain knowledge and convert it into a knowledge management system. You can't operate in a cave, and with technology being the way it is today, there is no shortage of information. Being the way it is today, there is no shortage of information. Now, some of it may be redundant and some of it may not be as easy to access, but the emergence of artificial intelligence and chat GTP will allow you to get quick answers to your data. As an example you might determine ask chat GPT why are my sales not as high as they should be? And is there a correlation between pricing and selling? See what the response is? Because, ultimately, pricing generates the sales and sales generates the cash to cover your expenses and after that, as your profit.
Speaker 1:Everything starts with the pricing of your products. Are you using reasonably sophisticated pricing strategies? And, if you're not, seek help. I liken to the fact that every time I go to as an example, every time I go to a upscale dinner house, the pricing is extremely high. You know, steak 50 bucks, baked potato 10 bucks, and yet they're always packed. Why is that always packed? Why is that? If you were to drop the prices, would there be less customers? If you raise the prices, would there be less customers If you kept the prices the same? We don't know, but this is something that you could work with in your company. Is what is my pricing strategy? And I'm just picking pricing as an example. So it just astounds me that how the super-duper expensive restaurants are always jam-packed. And maybe it's because the owners know that there's a certain target market that they're catering to. Because the owners know that there's a certain target market that they're catering to, so they convert their marketing and selling strategies to attract the type of target market that can afford their prices.
Speaker 1:You can do the same thing for your product or service, but you need to have data, you need to have knowledge, management of your data, your systems, and it's limitless. You could have fun with it. Start every day today and say I'm going to learn something new about my business that I didn't know last week. Even if it's a minor, trivial detail, who knows where it leads you to? And the whole idea is for you to compete and survive and achieve sustainability over your competitors, because they should be doing the same thing and your customers are their prospects. Well, that's a wrap, everyone. Congratulations to women. March is your month. You're making a tremendous accomplishment and you, you have achieved tremendous accomplishments in the area of business. You've come a long way and I see it increasing. So with that, I'll let you go. If you want to access, access my podcast. All the major podcast directors carry me. If you want to visit me on YouTube, there will also be a video on this particular show. So that's it. Thank you very much and we will see you next month. Bye-bye now.