{"id":137208,"date":"2024-06-10T16:23:13","date_gmt":"2024-06-10T14:23:13","guid":{"rendered":"https:\/\/www.jedox.com\/?p=137208"},"modified":"2025-05-12T09:32:47","modified_gmt":"2025-05-12T07:32:47","slug":"key-driver-analysis","status":"publish","type":"post","link":"https:\/\/www.jedox.com\/en\/blog\/key-driver-analysis\/","title":{"rendered":"Key driver analysis \u2013 the heart of the digital twin"},"content":{"rendered":"<p><strong>Identifying the things that contribute to performance helps organizations achieve their goals. Key driver analysis, augmented by AI, reveals critical factors for success and turns raw data into actionable insight.<\/strong><\/p>\n<div class=\"jdx-what-is-highlight\">\n<h2 id=\"what-is\">What is key driver analysis?<\/h2>\n<p>Key driver analysis is a way of identifying the most important factors \u2013 or drivers \u2013 that influence organizational performance. The aim is to understand these drivers and how they work together towards an end goal. It helps organizations to understand which levers they can pull to achieve their goals.<\/p>\n<p>Identifying key drivers requires the integration of all sorts of organizational data, from financial information to data from operations, HR, and other departments. Understanding and modeling this data can help create a digital twin that can be used to simulate scenarios and understand how different internal and external drivers will affect performance, to plot outcomes and plan for success.<\/p>\n<\/div>\n<h2 id=\"examples\">Examples of key drivers<\/h2>\n<p>Here are some examples of financial drivers that could be important for an organization:<\/p>\n<ul>\n<li>Volume<\/li>\n<li>Average order value<\/li>\n<li>Customer acquisition cost<\/li>\n<\/ul>\n<p>But analyzing financial data in isolation could ignore important operational aspects that also affect performance. Examples of operational drivers are:<\/p>\n<ul>\n<li>Service levels<\/li>\n<li>Delivery times<\/li>\n<li>Employee turnover<\/li>\n<\/ul>\n<p>Linking financial and operational drivers helps organizations to form a more complete understanding of how they contribute to performance, but it ignores external drivers that could also have a significant impact. Examples of external drivers are:<\/p>\n<ul>\n<li>Interest rates<\/li>\n<li>Currency exchange rates<\/li>\n<li>Raw material pricing<\/li>\n<\/ul>\n<p>For the best possible understanding of what contributes to performance as many internal and external drivers should be considered as possible.<\/p>\n<p>For example, if a bike hire company is trying to understand its key drivers, it may be useful to consider how operational drivers, like the availability of bikes, play their part in performance. It should also consider important external drivers like seasonality, foot traffic, or proximity to public transport.<\/p>\n<h2 id=\"data\">Data gathering, integration and quality<\/h2>\n<p>Gathering and preparing the data required for key driver analysis can be a time-consuming process, with different formats and reporting schedules to homogenize. It\u2019s also the type of work that is prone to human error.<\/p>\n<p>Organizations that automatically integrate their data to create a single source of truth find it easier to identify key drivers of performance. Automation saves time, eliminates errors, and provides a unified platform for collaboration.<\/p>\n<p>Innovative technologies like AI, machine learning, and natural language processing have widened the scope of processes that can be automated. The <a href=\"https:\/\/knowledgebase.jedox.com\/jedox\/ai\/ai-data-prep-wizard.htm\" target=\"_blank\" rel=\"noopener\">Jedox AIssisted\u2122 Data Preparation Wizard<\/a> uses AI to cleanse and prepare data for key driver analysis. Explore the <a href=\"https:\/\/www.jedox.com\/en\/blog\/potential-of-hyperautomation\/\">potential of hyperautomation<\/a>.<\/p>\n<p><a href=\"https:\/\/www.jedox.com\/en\/resources\/ebook-finances-emerging-superpowers\/\" target=\"_blank\" rel=\"noopener\"><img decoding=\"async\" class=\"lazyload related-content-image alignnone wp-image-139280 size-full\" src=\"https:\/\/www.jedox.com\/wp-content\/uploads\/2024\/07\/smfi-finance-emerging-superpowers-whitepaper-1200x630-en-20240722_dc.jpg\" data-orig-src=\"https:\/\/www.jedox.com\/wp-content\/uploads\/2024\/07\/smfi-finance-emerging-superpowers-whitepaper-1200x630-en-20240722_dc.jpg\" alt=\"\" width=\"1200\" height=\"630\" srcset=\"data:image\/svg+xml,%3Csvg%20xmlns%3D%27http%3A%2F%2Fwww.w3.org%2F2000%2Fsvg%27%20width%3D%271200%27%20height%3D%27630%27%20viewBox%3D%270%200%201200%20630%27%3E%3Crect%20width%3D%271200%27%20height%3D%27630%27%20fill-opacity%3D%220%22%2F%3E%3C%2Fsvg%3E\" data-srcset=\"https:\/\/www.jedox.com\/wp-content\/uploads\/2024\/07\/smfi-finance-emerging-superpowers-whitepaper-1200x630-en-20240722_dc-200x105.jpg 200w, https:\/\/www.jedox.com\/wp-content\/uploads\/2024\/07\/smfi-finance-emerging-superpowers-whitepaper-1200x630-en-20240722_dc-400x210.jpg 400w, https:\/\/www.jedox.com\/wp-content\/uploads\/2024\/07\/smfi-finance-emerging-superpowers-whitepaper-1200x630-en-20240722_dc-600x315.jpg 600w, https:\/\/www.jedox.com\/wp-content\/uploads\/2024\/07\/smfi-finance-emerging-superpowers-whitepaper-1200x630-en-20240722_dc-768x403.jpg 768w, https:\/\/www.jedox.com\/wp-content\/uploads\/2024\/07\/smfi-finance-emerging-superpowers-whitepaper-1200x630-en-20240722_dc-800x420.jpg 800w, https:\/\/www.jedox.com\/wp-content\/uploads\/2024\/07\/smfi-finance-emerging-superpowers-whitepaper-1200x630-en-20240722_dc.jpg 1200w\" data-sizes=\"auto\" data-orig-sizes=\"(max-width: 1200px) 100vw, 1200px\" \/><\/a><\/p>\n<h2 id=\"ai\">AI-enhanced analysis<\/h2>\n<p>Statistical techniques such as correlation analysis, regression analysis, or variance analysis can be used to identify drivers. These methods help quantify the relationship between variables and the outcome.<\/p>\n<p>Analysis can be a cumbersome and time-consuming process when working with disconnected spreadsheets and different source systems.<\/p>\n<p>The <a href=\"https:\/\/knowledgebase.jedox.com\/jedox\/ai\/ai-driver-analysis-wizard.htm\" target=\"_blank\" rel=\"noopener\">Jedox AIssisted\u2122 Driver Analysis Wizard<\/a> identifies and maps the key drivers of performance, identifying patterns, trends, and anomalies. It also provides a measure of confidence in the prediction expressed as a percentage. It\u2019s easy to understand how these calculations are made and have confidence in the information provided.<\/p>\n<h2 id=\"trust\">Trust the past, plan the future, achieve the target<\/h2>\n<p>A digital twin informed by a firm grasp of internal and external drivers helps organizations understand the impact of changes, model endless scenarios, and plan for success.<\/p>\n<p>The <a href=\"https:\/\/knowledgebase.jedox.com\/jedox\/ai\/ai-driver-based-wizard.htm\" target=\"_blank\" rel=\"noopener\">Jedox AIssisted\u2122 Driver-Based Prediction Wizard<\/a> brings greater accuracy to forecasts based on key driver analysis. It\u2019s easy to imagine best-case, worst-case, and any other scenario.<\/p>\n<p>Henkell Freixenet, the world\u2019s leading producer of sparkling wine, found that forecasting with automated AI algorithms proved to be 91% accurate. Pop the cork on the <a href=\"https:\/\/www.jedox.com\/en\/customers\/henkell-freixenet\/\">Henkell Freixenet success story<\/a> to find out more.<\/p>\n<div class=\"video-shortcode\"><iframe title=\"Autonomous finance is transforming FP&amp;A\" src=\"https:\/\/player.vimeo.com\/video\/1004039575?dnt=1&amp;app_id=122963\" width=\"1440\" height=\"810\" frameborder=\"0\" allow=\"autoplay; fullscreen; picture-in-picture; clipboard-write\"><\/iframe><\/div>\n<h2 id=\"insight\">Key driver analysis unlocks insight<\/h2>\n<p>Key driver analysis helps organizations understand what it takes to reach their goals. Understanding key internal and external drivers, how they work together, and how they can be influenced helps them plan for success.<\/p>\n<p>As part of the transition to <a href=\"https:\/\/www.jedox.com\/en\/blog\/autonomous-finance-in-organizations\/\">autonomous finance<\/a>, forward-thinking organizations are starting to use AI and machine learning to automate, integrate, analyze, and predict smarter with greater ease.<\/p>\n<p>Transform your organization\u2019s understanding of performance with advanced key driver analysis. Find out more about <a href=\"https:\/\/www.jedox.com\/en\/platform\/ai\/\">Jedox AIssisted\u2122 Planning Solutions<\/a>.<\/p>\n<p>To find out how to succeed with your key driver analysis and how Jedox can help you do it, <a href=\"https:\/\/www.jedox.com\/en\/demo\/\">request a demo today<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Identifying the things that contribute to performance helps organizations achieve their goals. Key driver analysis, augmented by AI, reveals critical factors for success and turns raw data into actionable insight.<\/p>\n","protected":false},"author":133,"featured_media":137246,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1],"tags":[23205],"class_list":["post-137208","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-knowledge","tag-autonomous-finance"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.jedox.com\/en\/wp-json\/wp\/v2\/posts\/137208","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.jedox.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.jedox.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.jedox.com\/en\/wp-json\/wp\/v2\/users\/133"}],"replies":[{"embeddable":true,"href":"https:\/\/www.jedox.com\/en\/wp-json\/wp\/v2\/comments?post=137208"}],"version-history":[{"count":0,"href":"https:\/\/www.jedox.com\/en\/wp-json\/wp\/v2\/posts\/137208\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.jedox.com\/en\/wp-json\/wp\/v2\/media\/137246"}],"wp:attachment":[{"href":"https:\/\/www.jedox.com\/en\/wp-json\/wp\/v2\/media?parent=137208"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.jedox.com\/en\/wp-json\/wp\/v2\/categories?post=137208"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.jedox.com\/en\/wp-json\/wp\/v2\/tags?post=137208"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}