A fully integrated analytics operating model can help consumer packaged goods (CPG) companies focus commercial analytics resources on high-value processes to grow market share and sustain profit margins. Market and economic uncertainty is making it difficult for CPG companies to achieve sustainable growth. Value-driven consumers are more demanding than ever before, and retailers are increasingly pushing private labels and looking for ways to control the consumer relationship. Additionally, “big data” has left many marketing and sales organizations with an information overload, yielding little insight into how to win consumer loyalty. This uncertain environment requires CPG companies to make faster, better-informed commercial decisions and take concrete action to improve market performance. In this point of view, Accenture outlines an approach that can help CPG companies improve their commercial analytics capability to generate significant value. June 27, 2012

1. Moving from Insights to Action
Building a Competitive Advantage with Commercial Analytics in CPG

2. 2

3. Consumer packaged goods (CPG) companies level means that analytic solutions or 1. Developing a cross-functional,
are under pressure from all sides, capabilities reside in pockets across the integrated analytics vision: CPG
struggling to achieve sustainable growth organization with no strategic framework manufacturers need an integrated
during significant market and economic or principles to coordinate and prioritize commercial analytics vision and
uncertainty (Figure 1). Mobile, value-driven them. This whack-a-mole approach allows processes aligned around the shopper
consumers are more demanding than ever, point solutions and data sets to proliferate to enable consistent decisions through
and their tastes and paths to purchase as potential synergies are ignored. The lack the company to maximize results.
shift more rapidly, making it challenging of integration leads to incremental gains Cross-functional analytics enable the
for consumer goods manufacturers to stay but not leaps in performance or insight. organization to balance competing
relevant to the shopper. CPG manufacturers Finally, insufficient analytic talent, a lack objectives and priorities to increase
also feel increased pressure from retailers of rigorous value realization processes, and overall impact for the company.
that push private label products and look subpar technology enablers also undercut
to control the consumer relationship; the impact of analytics. 2. Prioritizing analytics to create value:
witness Wal-Mart’s “Get-on-the-Shelf” Focusing analytics on high-value
crowdsourcing initiative to put new, Continuing on this path is far too expensive commercial processes, specifically
consumer-requested products in its stores. and time consuming for companies those related to sensing and satisfying
Additionally, “big data” has left many that need new avenues of growth and demand, will support market share
marketing and sales organizations with a higher efficiency in their enterprise and growth. Using consistent criteria and
bad case of information overload but too commercial functions. Consequently, CPG lenses to prioritize market-relevant
little insight about how to win consumers’ companies that Accenture serves are analytic investments will allow
loyalty. increasingly concerned about how to make companies to move the needle on sales.
the most of their investments in analytics
This uncertain environment requires and build analytic capabilities. That concern 3. “Operationalizing” analytics
companies to make faster, better-informed is well placed: Our research into high throughout the enterprise: Executives
commercial decisions and take concrete performance in the CPG industry revealed need to embed analytics throughout
action to improve market performance. that having analytical capability that drives the enterprise and improve timeliness
Employing analytics solutions can make actionable insight is a differentiating, of insights and accessibility to them
such decisions and actions easier, yet distinctive capability of high performers by decision makers. Analytics by
many CPG companies struggle with how in the sector.1 More importantly, our themselves don’t generate value. It
to execute an analytics strategy that recent survey of executives responsible takes a governance structure, processes,
clearly generates value. Our recent survey for analytics in CPG companies revealed metrics and technology support to
of how CPG leaders use analytics found that the majority of companies are not facilitate wider use of analytics and to
that while the majority of respondents prioritizing analytic capabilities consistent expedite movement from analysis and
thought they were analytic “leaders,” only with where Accenture typically sees the insights to actions that connect with
12 percent rated their ability to execute most value (price, promotion, assortment, shoppers and result in growth.
as “exceptional” (see sidebar). The issue retail execution).
Given all the challenges CPG companies
is figuring out why that gap between
Clearly executives are invested in and are facing the timing could not be
intention and execution exists, and then
motivated to use analytic solutions, but better for them to proceed on all three
finding ways to close it.
need to refine their execution to derive of these fronts.
Internal impediments frequently prevent maximum impact. This report details three
Executing an analytics strategy that
companies from reaping the full benefits actions companies should consider to
integrates and prioritizes analytic
of analytics. A lack of sponsorship and improve analytic capability and impact.
efforts across the enterprise, and builds
governance of analytics at the enterprise
the capabilities and infrastructure to
operationalize analytics, will allow CPG
companies to extract more value from
investment in analytics, and become more
responsive and relevant to consumers.
1 Shaping High Performance in Consumer Goods,
http://www.accenture.com/us-en/Pages/
insightachieving-high-performance-food-non-
alcoholic-beverage-industry.aspx.
3

4. Figure 1. A Tough Environment for CPG: Decisions and Actions Requiring Integrated Analytics
Strategic Commercial Planning Digital Consumer Interaction Sales Force Effectiveness
• How do we focus on the variance between • How can we effectively interact with the • Why is our sales volume and
plan vs. actual and take specific actions? new digital consumer across different profitability down?
• How does taking actions in the field and digital channels? • How do I achieve my sales targets in
corporate change our financial forecast? • How can we achieve relevance and emerging markets?
• How can strategic commercial planning increase conversion rates in our digital • How do we collaborate between
improve profitability? marketing activities? corporate and field on actions such as
• What is the role we need to play in the contracting deals, monitoring metrics,
social media environment? promotional programs, pricing, etc.?
• What is the business case to start direct • What actions must we take to improve
channel (eCommerce) operations? volume and profitability?
Marketing & Trade Spend
• What marketing/promotional mix do
we have to choose from?
• In what way can we prioritize our Shelf to Cash
trade spend allocation? • How do we manage product supply
• How do we optimize our spend across issues on an exception basis?
current and new brands/products and/ • What actions must we take strategically
or geographies to maximize the ROI? Executive Management and in the field to improve on-shelf
availability?
• What performance metrics should • How do we use the historical data to
we focus on? get a better demand and supply chain
planning process?
Trade Promotion
• How do we understand causes of
Effectiveness
performance issues?
• What are our top- and bottom-performing
brands and promotional product groups?
• How do we become more agile Retail Partner Driven
• What are the causes of poor promotional
in adapting faster to changes in
performance? • How can we manage periodic
consumer and shopper behavior? changes in the terms of the deals?
• What actions can we take to make
changes to promotional strategies like • Are traders satisfied with timeliness
• What actions should we take to
pricing, display, etc. to get sales lift? of payment?
improve performance?
• Is it possible to reduce claims for
customer dissatisfaction?
• How can we rate the effectiveness
of our:
- Marketing
- ales force
S
- rade programs
T
- upply chain
S
©2012 Accenture
All rights reserved.
4

5. Accenture’s Research in
What Makes Analytics
Work
Accenture recently completed a global
research effort to understand how CPG
companies are using analytics, where
they are in their journey to make their
organizations more analytic-driven, what
results they have seen to date and the
focus of future investments. We surveyed
over 75 CPG executives with responsibility
or oversight of analytics in organizations
with revenues of more than $2 billion. The
results of this survey were published in the
summer of 2012 in the report Commercial
Analytics: Using Insights to Take Action.
Figure 2. Analytics Maturity Curve: The Analytics Evolution
High performers change the game by understanding what has happened and what will happen.
Migrating fom What Happened to What’s the Best Possible Outcome
What’s the best that can happen? Optimization
Predictive Analytics
What will happen next? Predictive (the “so what”…and the “now what”)
Modeling
What if these trends continue? Forecasting Future orientated and source
of competitive advantage
Competitive Statistical
Why is this happening? Analysis
Advantage
Alerts What actions are needed?
Descriptive Analytics
Query
Drilldown Where exactly is the problem? (the “what”)
Ad Hoc
Reports How many, how often, where?
“Rearview mirror” –
provides foundation and insight
Std.
Reports What happened?
Degree of Intelligence
©2012 Accenture
All rights reserved.
5

6. 1. Developing a Cross-Functional,
Integrated Analytics Vision
The Costs of Taming the “You’ve got to think Yet CPG companies do not have the
resources to undertake all possible
Data Monster about big things while analytics; they have to focus efforts on the
Feel like too much time and money are you’re doing small right type of analytics. Most CPG companies
already have significant descriptive analytic
spent looking at or searching for data to
better manage your business? You are not
things, so that all the capabilities—analysis that accurately
depicts what happened in a specific market,
alone—not by a long shot. Consider that: small things go in the channel or consumer group. Far fewer have
• Information workers waste 3.5 hours per right direction.” advanced analytics that detect or predict
an unmet consumer need (Figure 2). One
week on searches that don’t yield useful
- Alvin Toffler, author and scientist objective for CPG companies is to be more
information. Assuming an average salary
strategic and make conscious decisions to
of $60,000, the cost of ineffective search It’s easy for companies to lose sight of the
use analytics that align to their strategy
is $5,251 per worker per year. For 1,000 forest for the trees when developing and
and support the known drivers of actual
workers the cost is $5.25 million.2 executing an analytics strategy. Toffler’s
business value.
advice remains relevant; CPG companies
• The big data market is expected to grow
need to keep the end goal—generating Companies are clearly struggling with
from $3.2 billion in 2010 to $16.9 billion in
business value—in mind when making coordinating various analytic efforts,
2015 according to one firm. This represents
choices and decisions about the types and and few have an integrated analytics
a compound annual growth rate (CAGR) of
volume of analytical efforts they undertake. vision grounded in business value.
40 percent or about seven times that of the
While proliferation of analytics efforts
overall information and communications It is easy to get distracted from that end
is expensive, the conundrum is that
technology (ICT) market.3 goal because the demand for analytics is
companies are seeing some incremental
increasing from within and outside the
• Fifty-three percent of large retailers value in one-off analytic efforts, so they
company walls. Amazon and Google use
indicate that customer analysis is difficult question if integrating analytics is actually
predictive analytic capabilities to serve
due to enormity of data from different needed.
consumers every day, and consumers
channels.4
expect the same customer-centricity We believe that it is worth the effort. From
from CPG manufacturers. There is also an organizational perspective, the lack of
increasing internal demand for analytics integration and prioritization of analytics
due to growing financial oversight and risk efforts weakens the ability to make
management requirements. In short, the consistent decisions that maximize results
demand and potential to use analytics are and resonate with the needs of shoppers
expanding, driven by the rapid explosion of and consumers. There are also funding and
data, cheaper processing power available sponsorship issues: Who is driving the
through the cloud and the desire to not fall integrated vision—the supply side, demand
behind competitors. side, finance? And where does the funding
come from?
To address the cost and organizational
issues, we believe that developing an
2 © Copyright IDC. Source: The Hidden Costs
of Information Work dated March 2005.
integrated analytics vision will multiply the
value generated from analytics investments,
3 © Copyright IDC. Source: Worldwide Big Data as well as streamline analytic operations.
Technology and Services 2012-2015 Forecast.
4 Sahir Anand, VP & Principal Analyst Aberdeen
Research, Key Technologies Will Help Develop
Success Through Customer-Centricity, 2011.
6

7. A Lot of Analytic Activity, in Too Needed: An Integrated Analytics
Many Places Vision to Generate Value
A lot of analytic activity is driven by the So the good news is that companies are
desire, or even need, to keep up with “big using analytics more and more, but efforts
data.” Companies have more data than ever, remain fragmented and largely independent.
in all kinds of structured and unstructured In such an environment the potential
forms. The combination of traditional business impact of analytics is diminished—
channels and sales data, syndicated data from any insights are viewed through a small lens
external providers, and a tsunami of social rather than one that would capture a wide-
media metrics and data streams has resulted angle, panoramic view.
in an abundance of data, perhaps more than
companies even need. What’s needed is an integrated vision
for analytics so that priorities can be
Managing so many data streams is difficult, set and investments made taking into
and made harder still when data and the account and balancing various functions’
analytics applied to them are fragmented objectives to optimize business results.
across different functions and not readily The same holds true for data collection,
visible or usable by others. It is not harmonization and management. The whole
uncommon for teams in the same company— of commercial analytics requires a shift
or even brand teams working from the same in mindset from internal to the use and
office—to purchase similar data sets from the integration of internal and external data.
same provider and not realize it. Different Integrated, accessible data will provide
teams might ask for similar data in slightly a uniform foundation for analysis—one
different formats. The results are higher costs version of the truth—thus avoiding the
and a lot of effort put into data compilation “apples and oranges” problem when two
and harmonization, not analysis (see sidebar). teams use different data sets and different
analytic applications. Figure 3 identifies
A similar challenge exists with uncoordinated the components of an integrated analytics
analytic initiatives. At any given moment model that can be leveraged by commercial
most CPG companies have several analytic functions.
efforts underway. Some are focused on
data management, others are focused on
commercial reporting and still others are
focused on more advanced analytic areas
such as pricing. There are operational analytic
efforts as well, documenting the efficiency of
manufacturing and supply chain processes.
What usually doesn’t exist is synergy among
them. A recent report found that only 30
percent of marketers feel they integrate data
from sales, service and marketing into a single
management framework. 5
5 Forrester Research Inc., Global Marketing
Leadership Online Study: Four Steps to Tackle the
Shift to the Customer Life Cycle, (June 2011).
7

8. Figure 3. High Performance CPG Analytics Blueprint
Operational Excellence
Integrated Analytics Platform
Shopper Analytics Sell to Shopper
Shopper Experience & Service
Brand Portfolio, Price & Channel Retail
Digital Assortment
Marketing Promotion Management Execution Merchandise & Sales Execution
Analytics & Space
Analytics Analytics Analytics Analytics
Analytics
Marketing & Advertising
Execution
Commercial Reporting
Web & eCommerce
Next Generation Demand
Data Repository
Loyalty Management
Evaluation
Integrated Demand Data
Data Integration & Harmonization Supply to Shopper
Consumer Retailer Data ERP Data Trade Data Forecasting & Replenishment
Data
Mfg. + Retailer Point of Sale
Loyalty Data Deals/
Shipments Contracts Store Brand & Item Innovation
Transactional Log
Shopper
Segmentation Inventory
Deductions/ Facilities Management
Syndicated Data Invoice Payments
Social Data
DSR Provider Data
External Data Internal Data
©2012 Accenture
All rights reserved.
An overriding goal is for company leaders 1. What is the business need for the With an integrated vision of data
to develop an integrated commercial vision analytics proposed? How does it enhance management and analytics, efforts can
for analytics, one that coordinates analytics or complement what we are doing be rescaled appropriately, saving time and
across the enterprise and with external already? effort. Articulating a clear strategic focus
channels and data providers. This exercise for analytics, as well as adopting a common
not only yields cost efficiencies by revealing 2. How would investing in data or analytics approach to evaluating and shaping
and eliminating duplicative efforts, it has solutions lead to a better understanding analytic activity, can impose order on the
the added benefit of forcing managers to of consumers? chaos that exists in many companies.
focus on goals and results of analytics, 3. Are there interdependencies across
not data compilation. Further, companies functions, providing the potential to
can better balance their use of descriptive leverage analytics broadly?
analytics of historic business results with
more predictive analytic insights that 4. What alternative data sources exist, and
uncover future market opportunities. what are the pros and cons of each?
Developing an integrated analytic vision 5. Have we investigated whether the data
that is grounded in value-generating exists in-house already?
solutions requires leadership to answer
questions such as:
8

9. 2. Prioritizing Analytics to Create Value
“The right information consumers’ purchase aspirations. To do so
CPG companies need to focus analytics
The largest opportunity may be in applying
analytics to sales and customer processes
at the right time can squarely on data and processes tied to that have traditionally relied more on art
change your life.” demand generation and fulfillment. and instinct than science. Today, we can
build on the experience of executives with
Prioritizing Analytics to Respond to greater and more consistent application of
– Stewart Brand,
Demand Signals and Increase Sales analytics throughout marketing and sales
technology innovator and futurist
So what to focus on first? In our experience decisions to improve results. For example,
With so much data and so many analytic brand teams should use analytics to optimize
investments in analytics should be prioritized
solutions available it can be difficult to the marketing mix, as well as assess in-
based upon value creation potential, with
cut through the noise and figure out what store execution, digital strategies and sales
analytics shown to increase sales and/or profit
data and analytics really generate value performance. Putting processes in place to
margins getting top billing. The value tree in
and grow share. Ideally, companies would ensure the flow of information and insight
Figure 4 reveals the potential performance
focus on analytics that are shown to across and within commercial capabilities
improvement that analytics can deliver when
identify products that consumers want, the such as those detailed in Figure 5 will
focused on commercial activities.
marketing that works best to engage them, expedite decisions and actions to deliver
and the most productive channel to satisfy significant business benefits.
Figure 4. Analytic Capabilities and Benefit Ranges
Financial CPG Value Analytic Potential
Lever Drivers Capabilities Benefit (%M)*
Price Pricing • Pricing & Profit Analytics
Marketing Effectiveness • Marketing Return on Investment
Sales Media Effectiveness • Media Mix Optimization
Campaign Effectiveness • Campaign Investment &
Tactics Optimization
Volume • Consumer Segmentation & Profiling $200 - $700M (2-7%)
Portfolio & Mix
• Assortment Optimization
Space & Adjacency • Demand Forecasting & Replenishment Analytics
• Commercial Intelligence
Channel Partner Performance • Broker Performance Management
• Distributor Performance Management
Promotional Execution and • Sales Force Optimization Analytics
Program Compliance • Commercial Intelligence
Discounts and Allowances • Assortment Optimization
Discounts &
Allowances Supplier Performance • Supply Chain Optimization Analytics
Cost of Sales $18 - $180M (0.1-1%)
Material Costs Raw Materials • Commodity Pricing Analytics
Conversion Costs Manufacturing • Manufacturing Excellence Analytics
Distribution Transportation • Assortment Optimization
Warehousing • Cost to Serve Analytics
Operating Costs • Sales Force Optimization Analytics
Sales Force Sales Force • Employee Performance Analytics
• Trade Promotion Analytics $5 - $25M (1-5%)
Trade Spend Efficiency
Promotion
Consumer Promotion • Marketing Analytics
• Digital Analytics
IT IT Cost Avoidance • Reduced Redundancy in Data/Tools, Managed Service
R&D Effectiveness • R&D Discovery Analytics
R&D
• Innovation Diagnosis & Optimization
• Lean Six Sigma Process Improvement
Working Capital Inventory Inventory • Forecasting & Replenishment Analytics $12 - $18M (2-3%)
©2012 Accenture * Based on a representative consumer goods products
All rights reserved. manufacturing enterprise with an annual T/O of $10BN 9

10. Consistently applying analytics to
sales and customer processes and
decisions across the company—from the
boardroom to sales force—represents the
largest opportunity to improve market
performance, and investments in these
analytics should be prioritized accordingly.
10

11. Value Creation from We believe analytics could quickly benefit
CPG manufacturers in each of these areas.
7. Retail Execution Analytics. Analytics
can help identify and drive consistent
Demand Side Analytics 1. Shopper Analytics. Analytics can help
execution of the highest value in-store
activities, and also promote efficient and
Demand signal repository (DSR) solutions manufacturers gain deeper shopper reliable collection of retail performance
and demand signal analytics use rich item/ insight, identifying what high value data. A flexible toolset of analytics can
day/store-level data and distributor data to consumers buy, their intent and how to enable manufacturers and retailers to
guide and direct manufacturers, suppliers increase share of basket. These insights in optimize merchandising activity.
and channel partners with precision alerts turn can guide both product development
and exception flags. Robust inventory and and promotional allocation mix. In addition to sales processes, applying
supply chain analytics that generate real- analytics to supply chain activities
time insights and reporting can help CPG 2. Brand Marketing Analytics. can improve shopper relevance
companies avoid the waste and inefficiency Brand marketing analytics can help and performance. While many CPG
that result from excess inventory, organizations understand which products manufacturers have developed DSRs
inaccurate forecasting and irrelevant are most relevant to the consumers, of some sort, the analytics used in
assortment. Several large CPG companies become more efficient in managing conjunction with DSRs may not be as
have quantified the benefits of having spend, focus campaigns, manage brand robust as those applied elsewhere in
advanced DSR solutions: equity, and ultimately increase consumer the organization. That’s unfortunate,
awareness and drive trial and continued because superb demand-side analytics of
• Unilever saw a 40 percent improvement consumption. replenishment and inventory optimization,
in 7-day forecasts.6 or commodity price forecasting, can have a
3. Digital Analytics. Just as with traditional
• Del Monte reduced inventory rates by campaigns, analysis of digital marketing significant flow-through effect on overall
27 percent in two years, decreasing pallet and sales initiatives as well as consumer- performance. Companies that have focused
space requirements in retailer distribution generated content can help companies their analytics investments on demand are
centers by up to 65 percent.7 find the right mix of promotional and reaping substantial rewards (see sidebar).
informative content to engage consumers
with relevant messages and offers. To standardize and
4. Portfolio, Assortment and Space optimize use of
Analytics. Offering the optimal portfolio analytics across
depends upon deep understanding of
shopper needs and analyzing in-store the value chain,
activity. This optimization includes retiring
products that don’t meet needs and
companies should
developing products that address gaps. consider centralizing
5. Price and Promotion Analytics. the management
Analytics can help manufacturers become of analytics, just as
much more sophisticated in managing
pricing across the value chain. This would they do with other
include shelf-based pricing, price to
distributor and price to retailer as well
shared services. This
as optimization of promotional spend—a would make premium
massive expenditure for CPG companies.
analytics services both
6. Channel Management Analytics. cost effective and
Analytics can help identify which channel
partners actually provide the best return more accessible.
on manufacturer investment. While a
strong personal relationship with channel
partners is always positive, it may not
always translate to added sales. Analytics
6 See Demand sensing software helps Unilever, can provide the evidence to recalibrate
www.ft.com, March 18, 2011.
customer strategy.
7 See Gaining ground, http://www.inboundlogistics.
com/cms/article/gaining-ground/ January 2011.
11

12. Figure 5. CPG Analytic Framework: High Performers Prioritize and Sequence High Value Analytics Opportunities
Brand Digital Portfolio, Price & Channel Retail
Marketing Analytics Assortment Promotion Management Execution
Analytics & Space Analytics Analytics Analytics
Analytics
Brand Clickstream Portfolio Cost to Serve Customer Broker
Strength & Analyses Optimization & Margin Profitability Performance
Awareness Leakage Management
Marketing Visitor Tracking Assortment Base Volume Retailer Distributor
Return on & Segmentation Optimization & Price Segmentation Performance
Investment Elasticity Management
Media Mix Closed-Loop Space Shelf Price Distributor Predictive
Optimization Marketing Optimization Threshold Segmentation Demand
(Traditional Analyses & Gap Sensing
+ Digital) Optimization at Shelf
Media Cross-Channel/ Adjacency/ Retailer Sales Channel Route
Audit and Multi-Format Bracket Resource Optimization
Secondary
Performance Analytics Pricing Allocation
Placement (Direct/
Broker/Dist.)
Campaign Lifetime Demand-Based Promotion Sales Force In-Store
Investment Value Store Clustering Allocation Size & Activity
& Tactics Analysis Optimization Structure Optimization
Optimization
Consumer Promotion Trading Retailer
Sentiment Event & Partner Compliance
Calendar Collaboration Monitoring
Optimization
©2012 Accenture
All rights reserved.
12

13. 3. Operationalizing Analytics Throughout
the Enterprise
“If you cannot What’s needed to make the integrated
vision a reality and capture the highest
Fragmented pockets of initiatives also make
it challenging to build an industrialized
measure it, you return on analytic investments? A large capability. Yet, timely access to such
cannot improve it.” part of the answer lies in building processes
and enablers that operationalize analytics
analytic capability and insights is necessary
to develop strategies for growth and
– Lord Kelvin William Thompson, effectively. Most companies we serve have achieve operating excellence.
mathematical physicist and engineer a range of analytic skill and will, yet it’s fair
to say that analytics are not truly embedded To ensure that timely access, companies
in their organizations nor is the use of need an end-to-end operating model
analytics promoted, measured or rewarded that embeds analytics throughout the
consistently. The consequence is that enterprise. New structures, processes and
some areas have deep analytic capability enablers such as those identified in Figure
(finance, obviously, or R&D) while others 6 can help a company operationalize
do not, creating an internal dissonance. analytics and ingrain analytics as part of a
company’s culture.
Figure 6. Core Capabilities to Bring Insight to Action
From Inputs... Enablers ...To Outcomes
Sponsorship & Leadership
The process to obtain executive sponsorship and
senior leadership commitment to the analytics vision
Organization & Talent Management
The people, their skill sets and the organizational structure
The rules and procedures to manage, gather, integrate
and extract data from internal and external sources
needed to support analytic transformation Process to assess the value of the analytic insights
as well as track the benefits realized over time
Data Management & Analytics
Process Management
Process by which business leaders
leverage insights to execute
Value Realization
treatment strategies
Insight Management
Statistical process by which
management scientists analyze
data and uncover insights
Service & Technology Management
The tech environments needed to enable analytic execution as well as the
service levels and service contracts needed to support the organization
Capability Development
The industrialization of individual analytic capabilities
as Company XYZ moves up the analytics maturity scale
Data to Insights Insights to Actions Actions to Results
©2012 Accenture
All rights reserved.
13

14. Analytics as a Managed issues or variances may crop up so it’s
easier to spot them, but a large part of
• New processes such as insight
management could focus investment on
Service: One Path to moving from insight to action is more building a small group of statisticians
Increase Speed-to-Value structured communication of and clear
accountability to use findings.
and scientists skilled in interpreting
analyses to generate insights. This group
The consumer division of a global life could also capture and prioritize insight
To make accountability clear and action requests (and ensure elimination of
sciences leader realized it needed to
more certain, companies could consider duplicative requests). Equipped with the
improve its analytics capabilities to
centralizing the management of analytics, right tools and capabilities the team
capture “a single version of the truth”
just as they do with other services. Local should be able to analyze data to detect
to develop more relevant marketing
variants in the type and volume of analytics and/or predict marketplace trends.
and sales campaigns. Accenture helped
will continue to exist, and are needed to
refine the company’s data strategy and
ensure market relevance. However, if the • Enhanced process management
proposed improvements to how the data
overall intensity and maturity of analytic capabilities are critical to ensuring that
and insights were communicated to
needs are great, a centrally managed, insights are acted upon. The process
increase the probability that the insights
shared service model could standardize and management team collaborates with
would be acted on. The solution, supplied
optimize use of analytics while reducing the business to develop and execute a
under a managed services arrangement,
costs and duplication across geographies. plan that turns insights to action and
includes a new interactive portal serving
Gartner expects the convergence of market impact. Process managers also
2,400 users across Europe, a report service
services with software and infrastructure play an important communication role,
bureau that generates more than 100
to cause significant changes in sourcing syndicating insights to relevant parties
reports, and a hosted client data center to
strategies, driven by new offerings delivered and functions to ensure a higher level of
ensure accurate, standardized data. The
“as a service.” 8 Our direct experience is cross-functional use and consistency.
subscription-based analytics service delivers
that an analytics service model is already
insights on sales related to more than Some processes such as Customer
being used and frequently leverages the
500,000 customers, 30,000 SKUs and 150 Relationship Management (CRM) are
capabilities of external service providers
brands. The new capabilities integrate data already very analytic-driven. Yet an
(see sidebar).
from noncompatible sources to provide a enhanced toolset and access to more
single source of information used by the Embedding Analytics in Core and resources could provide more support for
entire business. Managers can now extract Enabling Processes the day-to-day decisions the CRM team
better insights faster, collaborate more makes. What’s more, teams that use
easily, and leverage advanced reporting and Operationalizing analytics also depends upon resources like Insight Managers could
predictive analytics to serve markets better. embedding analytics in a range of processes strengthen ties to and synergies with
and functions. The goal would be to provide other parts of the organization such as
Leadership, Sponsorship and employees with reliable analytic resources R&D or Channel Management, helping
Organization of Analytics and tools with which to complete their build enterprise-wide, industrialized
work, and facilitate the evolution to a more analytic capability.
Currently few companies have one point analytic organization.
of accountability to make decisions
regarding investments in data or analytics • Traditional HR processes such as
or manage analytic initiatives, hence talent management and capability
the duplication and lack of integration development will need to be refined
discussed earlier. Leadership and clarity to reflect the stronger emphasis placed
are needed to formalize accountability on analytics use and competency.
for moving from insights to action, while Job descriptions, hiring policies, skills
also supporting local markets’ need for development curricula, and career
discreet analytic efforts at times. Clarifying paths and levels can support analytics
who should receive insights from analysis, transformation. Workforce planning
how frequently and in what format and scheduling as well as employee
sounds obvious. Yet often great analysis engagement and performance feedback
is performed and then left to die on the processes are crucial to developing and 8 Source: Gartner, Predicts 2012: IT Services Sourcing
vine because ultimate responsibility to retaining analytic talent given the current Strategies and Execution Demand Proactive Diligence,
shortage of candidates with relevant 1st Dec 2011
act on analytic insights—both negative
and positive exceptions and unexpected analytics capability.9 Accenture’s experts 9 See Harris, et al. How to Organize Analytic Talent,
patterns—is not clear. Some of the in building analytic-driven organizations (November 2009), http://www.accenture.com/
have offered strategies to close the SiteCollectionDocuments/PDF/Accenture_Organize_
challenge is simply anticipating where
Analytical_Talent.pdf.
analytics gap (see sidebar).
14

15. Service and Technology drivers and key assumptions, and measure
Management and report on value realization over time. Implementing a formal
Technology is a key enabler of becoming
Members of the value realization team
would necessarily collaborate with business
value realization
an analytic-driven company. CPG firms leaders and the insight management group process is key to
need world-class data integration,
harmonization and management to harness
to agree on performance baselines and
develop the business case for analytics.
moving from insights
“big data,” yet many are struggling with to performance-
how to synthesize and store the volumes Fortunately, CPG companies do not need to
of data they already have so that it is go it alone when attempting to operationalize enhancing action. A
accessible, useful, flexible and secure. analytics. Third-party options exist to support
development or management of most of these
value realization team
CPG companies understandably want to capabilities. The key for CPG companies is can assess benefits
leverage their legacy systems while also
taking advantage of new capabilities and
to identify providers who have the industry,
functional and technology expertise needed
and costs of analytics,
solutions. In many cases the best answer to help them manage data and quickly identify value drivers
is to adopt a hybrid technology approach
that blends legacy systems and new
expand analytics capability. Taking advantage
of hosted, outsourced or managed service
and key assumptions,
enabling technologies such as in memory options can be the quickest route to becoming and measure and report
computing, cloud services and mobility
solutions. Flexible, open platforms and
a more analytic company and capturing the
full value of investments in analytics.
on value realization
technologies are better able to apply
Conclusion
over time to ensure that
analytic applications to “big data” stores
and generate predictive insights about returns on analytics are
CPG companies face many challenges in
consumers, growth opportunities and
market dynamics.10 P&G reported that new
today’s uncertain economic environment, positive.
including how to cost effectively develop
data warehouses allowed one user to trim
deeper analytic capability that improves
the time it took to perform some analytic
market performance. While many
tasks from 20 hours to a few minutes.11
companies use analytics, most struggle to The Quest to Build
Industrialization and Value execute an analytics strategy that results
Realization in effective and efficient decisions and Analytical Capability
clear action because they are immersed in Talent-powered analytical organizations
As analytics become more integrated compiling data and conducting fragmented aren’t just distinguished by the quality of
and embedded, companies will have a analysis. Getting out of the “analysis their analytical talent: it’s their ability to
foundation on which to build a deeper paralysis” trap and turning insights unleash their analysts’ talents to maximize
and broader analytics competency. Yet to action requires a more integrated, and continually expand the company’s
ensuring that the investments in analytics streamlined approach to managing analytical capabilities. To create a talent-
generate positive returns requires an and consistently extracting value from powered analytical organization executive
ongoing obsession with value capture. In investments in analytics. Adopting a fully sponsors need to do the following:
operational terms, that obsession can be integrated analytics operating model would
satisfied by implementing an objective help companies focus analytic resources 1. Define specific analytical talent needs that
value realization process. This process on high-value processes and activities— are clearly tied to the organization strategy.
would assess the benefits and costs of those that grow market share and sustain
investments in analytics, identify value profit margins. Accenture’s work with CPG 2. Remain on the lookout to discover top
companies in developing and implementing sources of analytical talent within and
10 See Accenture’s POV on CPG technology data strategies and analytics solutions outside the firm.
enablers, http://www.accenture.com/
convinced us that the future and market
SiteCollectionDocuments/PDF/Accenture- 3. Develop analytical talent continuously,
Technology-Investments-Boost-Consumer- advantage belong to companies who
in junior to senior team members to
Packaged-Goods-Performance.pdf#zoom=50. harness the power of both.
deepen “bench strength.”
11 “Time to Rebuild: P&G Gains POS Insights with
New Data Warehouse Solution” (April 2012), http:// 4. Deploy analytical talent wisely by
www.consumergoods-digital.com/consumergoodste creating the best possible match
chnology/201204#pg17.
between analysts’ skills and business
12 Accenture Institute for High Performance, Counting demands.12
on Analytical Talent, 2010.
15

16. About Accenture Shaping the Future of High Authors
Performance in Consumer Goods
Accenture is a global management Robert Berkey
consulting, technology services and Our Consumer Goods & Services industry Director—Consumer Goods & Services,
outsourcing company, with more than professionals around the world work Commercial Analytics
249,000 people serving clients in more than with companies in the food, beverages, robert.e.berkey@accenture.com
120 countries. Combining unparalleled agribusiness, home and personal care, +1 917 817 5923
experience, comprehensive capabilities consumer health, fashion and luxury,
across all industries and business functions, Kenneth Dickman
and tobacco segments. With decades of
and extensive research on the world’s Executive Director, Marketing & Sales
experience working with the world’s most
most successful companies, Accenture Transformation, Accenture CRM
successful companies, we help clients
collaborates with clients to help them kenneth.dickman@accenture.com
manage scale and complexity, transform
become high-performance businesses and +1 312 961 1930
global operating models to effectively
governments. The company generated net serve emerging and mature markets, and Massimo Casiraghi
revenues of US$25.5 billion for the fiscal drive growth through evolving market Executive Director—Accenture Analytics
year ended Aug. 31, 2011. Its home page conditions. We provide end-to-end massimo.casiraghi@accenture.com
is www.accenture.com. services as well as individual consulting, +39 335 6327699
technology and outsourcing offerings in
the areas of Commercial Services, Speed Julio Hernandez
to Customer, ERP Transformation and Executive Director—Accenture Analytics
Integrated Business Solutions. To read our julio.j.hernandez@accenture.com
proprietary industry research and insights, +1 404 307 5363
visit www.accenture.com/ConsumerGoods.
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