Not all of us engage in cutting lumber as a hobby, but there is a lesson we can all draw from these activities: Sharpening the saw. Over time, the saw wears out and loses its effectiveness, making it harder to achieve clean cuts. So you take a small break to sharpen the saw and maintain its cutting edge.

Some enterprises can apply this lesson as well.

In 2023 I started working with the finance department of a top broker dealer that had a staff of 1000 employees. The firm grew rapidly and entered a new phase of business: one where they needed to sharpen the saw and allocate resources towards the most profitable projects.

“How can we keep ourselves profitable while we grow?” – Had the finance leaders on top of their mind.

Without maintaining a safe profitability while growing, it would be hard to keep investors on their side. This was one of the big goals of the finance team: grow while keeping costs on check.

The company made money with different services: Financial advisory services, Investment management, Automated trading platforms and Financial education and training programs.

“What services are scalable and profitable for us?” – was the key question of the finance leaders.

Some of these services required staff work. If the amount of work done by the staff is costing the firm too much in relation to the fee charged to clients, then the service is not scalable.

“Should we start charging on some services that we offer for free?” – Asked their finance leader.

In the search for an answer, they turned to data.

That’s when we started to work together. Our Power BI consulting services provide invaluable support in such situations. During our discussion, we set up the main goal: We agreed to build a business intelligence solution to offer insights on which service types consume the most staff work.

The solution?

Service’s Profitability Dashboard

Here was our working methodology:

(1) We conducted 10+ meetings to understand the user’s needs and agreed on the end benefits of the solution: unifying customer touchpoints to help them make informed decisions on how to help their clients, while sparing them from moments when they’re drowning in Excel.

(2) We created detailed requirements for the in-house engineering team, who were responsible to connect to case management software to pull data about all processors working on client’s services. Our requirements ensured we remove duplicates and eliminate bad records, ensuring a clean and curated dataset that facilitates reporting.

(3) Using Power BI, a market leading business intelligence tool, we built front-end reports with these main features: 

• Offer an overview of revenue by service and client.
• Identify which client’s and services are most profitable for the firm.
• Breaks down by service the amount of work done by staff over time.

This comprehensive analysis, facilitated by power bi consulting services, allowed finance leaders to gain deep understanding and actionable insights into the profitability of service lines.

Technology used for building the business intelligence solution: Microsoft Power BI, Azure Data Factory, Snowflake.

“Amazing! Can’t wait to show this to my colleagues!”

Said a finance leader while looking at the charts.

Using the insights from these reports, finance leaders discovered which services are more scalable and profitable:

• The training programs services were the least profitable, because the overall staff involvement was very high. So, the company took action and invested in new tools to automate the training, limiting the cost to a maximum of 4 FTE’s work.

• Another insight from the reports was that the most profitable client segment consisted of firms with 5-10 employees. These firms utilized the firm’s staff only sporadically but experienced higher business growth. As a result, the leaders decided to invest in building a new value proposition and marketing campaign to acquire these type of clients.

• Finally, another insight was that the onboarding service offered for free to every new client was not incurring as much costs as expected, while greatly improving the client satisfaction. The company decided to keep this service for free and include it in the value proposition: Free, Smooth Transition From Day Zero.

“We’ve been waiting for this for years!”

Said the finance leaders, excited that business decisions were starting to be driven more by data and less by gut feeling.