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CUSTOM RESEARCH

 Business Intelligence
 ADVANCED DATA ANALYSIS CAPABILITIES CRITICAL TO SUCCESS

 Consumer goods (CG) man...
BY KARA ROMANOW




                                                     FIGURE 1
                                        ...
Consumer Goods Technology
Cognizant




February 2010
1. Which are the areas of business in your organization where timely availability and interpretation of data is critical f...
3. Which are the supply chain planning & execution areas in your organization which have the greatest need for timely
   a...
4. Which of the following is the biggest barrier to leveraging data for supply chain planning & execution?

Biggest barrie...
6. Who is responsible for each of the following functions in your organization?


                                        ...
7. Who is responsible for getting insights from data in your organization?



                                            ...
8. How will you rate the confidence of business users in the information from the reporting & analytical systems environme...
9. How is Sales and Marketing data (POS data, syndicated data, sales data) leveraged in your organization?
   Rank on a sc...
11. How is data for Corporate functions (HR, Finance, Regulatory, etc.) leveraged in your organization?
   Rank on a scale...
12. At what stage is the initiative for leveraging data in your organization?

Stage: Initiative for Leveraging Data      ...
14. What is your position with the organization?

Position                                                %               ...
16. What is the nature of your company's business?
                                                                       ...
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Business Intelligence for Consumer Goods Companies

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Despite the focus that the Consumer Goods industry places on business intelligence and data insights, not many companies are truly leveraging this valuable resource to its full potential.

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Transcript of "Business Intelligence for Consumer Goods Companies"

  1. 1. CUSTOM RESEARCH Business Intelligence ADVANCED DATA ANALYSIS CAPABILITIES CRITICAL TO SUCCESS Consumer goods (CG) manufacturers are sur- business processes is data critical for decision down the usage of data by the type of analy- rounded by data, both internally-generated making, we heard supply chain planning, fol- sis leveraged for various business categories, transactional data as well as retailer-provided lowed by sales, then corporate reporting. No and then ranks it by how well it is being used. downstream data. How companies turn that surprises there, however, when we dig deeper Let’s start with the good news: the basics seem data into actionable insights is what sepa- into those functions, the top processes within to be in place with standard and ad hoc reports rates leaders from laggards. sales and marketing are trade promotions viewed as average to above average for sales This month, CGT partners with Cognizant and category management. The top areas for and marketing, supply chain and corporate to explore how data is used throughout var- supply chain are demand forecasting and functions. Pre-built reports for supply chain ious business processes, and what we found S&OP. These processes are the primary focus are ranked highest at 3.64, and ad hoc reports was a little disappointing. Despite the focus of most business and technology initiatives. for sales and marketing were next with a that the industry places on business intelli- They align with the move toward the cus- respectable 3.46. More advanced analytics, gence and data insights, not many compa- tomer and consumer in addition to the desire including optimization and modeling, rated nies are truly leveraging this valuable resource to become more demand driven. More tacti- substantially poorer, the lowest being predic- to its full potential. cal processes are secondary. tive analytics for sales and marketing at a 2, So now that we have established that data which we would expect to improve over the Is Data Leveraged Appropriately? is important, do business users utilize and next few years as the technology becomes With technology advancements over the last trust it? This is where there is definitely room more accessible. few years, CG companies have access to more for improvement. Only 19 percent of survey data at more granular levels of detail, but respondents rate the confidence of their busi- To read the research in its entirety, visit: where is it being used? When we ask to which ness users as “very high.” Figure 1 breaks www.consumergoods.com E X P E R T P E R S P E C T I V E • B Y PA R T H S . M U K H E R J E E , S E N I O R C O N S U LTA N T, C O G N I Z A N T ’ S D W B I & P M P R A C T I C E MARKETERS MOVE FROM THE 4 PS TO THE 3 PS As organizations shrug off the to information management and ment needs. Cognizant provided the PREMISE: Business users’ con- shackles of the recession and analysis. Therefore, organizations BICC strategic insight and skill sets fidence regarding information is regroup, technology and business are increasingly committing them- to support this global business intel- based on the premise of impec- processes are more closely inter- selves to a Data Warehouse and ligence capability. cable data quality. Data quality twined than ever before. IT leader- Business Intelligence Competency issues can not only create IT-busi- ship is redefining strategies to win Center (BICC), which requires spe- PROCESS: As with all success- ness disharmony but also result in the reset economy. As part of cific skill sets and enhanced focus ful initiatives, process is para- in large dollar losses. A large this overall strategy, organizations on talent management and partner- mount. Analyzing underlying data travel intermediary conducted a are enhancing sales and market- ships. Recently, a toy manufacturer and making it actionable will define data quality assessment of its cus- ing information management tech- needed to design a BICC across three success as organizations focus on tomer data, which resulted in nology. Cognizant recommends continents with detailed roles, new markets and try to predict cus- identification of more than 11 mil- organizing around three key areas: responsibilities, skills and recruit- tomers’ buying behavior. By imple- lion duplicates. At an average People, Process and Premise. menting a store-level analytics spend of $2.00 per target, the project, one major brewer gleaned organization saved $22 million in PEOPLE: Global product develop- targeted customer data in new its direct marketing expenses by ment, brand management and sales ways, enabling it to respond to cus- inspecting records and eliminat- necessitate a centralized approach tomer changes and needs. ing duplicates. 28 CGT | MARCH 2010 | CONSUMERGOODS.COM
  2. 2. BY KARA ROMANOW FIGURE 1 How successfully is data leveraged in each organizational area? USAGE Note: On a scale of 1-5, 3.17 with 1 being “very poor” , Reporting (pre-built) 3.64 3 being “average” and 3.41 5 being “very good”. 3.46 Next Steps Reporting (flexible and ad hoc) 3.20 3.11 With all of the emphasis placed on data why 3 aren’t the rankings higher? Unfortunately, Analytical (causal analysis) 2.80 2.55 barriers still exist and many of them just 2 haven’t been addressed. Figure 2 shows the Predictive analytics 2.41 (modeling, optimization, forecasting) 2.53 similar frustrations across sales and market- ing and supply chain: data mining to derive SALES & MARKETING S U P P LY C H A I N CO RP O R AT E (HR, FINANCE, ETC.) insights and data availability are the biggest challenges. Data timeliness is a bigger issue FIGURE 2 for sales and marketing since most of the Biggest Barriers to Leveraging Data in Each Organizational Area downstream data is sourced externally. BARRIER Ironically, data quality is more of an issue for supply chain processes, where most transac- Data mining to derive insights 36% 38% tional data is sourced internally. 26% Data availability 25% The most promising finding Data quality 9% 16% is that business and IT are User adoption 6% 10% working together and sharing Data timeliness 6% 13% responsibility for leveraging Insight delivery to users 6% 9% data and garnering insights. S U P P LY C H A I N SA L E S & M A R K E T I N G The good news here is that we are headed FIGURE 3 in the right direction and the industry rec- Who is responsible for the following functions? ognizes the need to improve in this area. All FUNCTION of our respondents have some sort of initia- tive in place to better leverage data, with 42 Data quality 34% 66% percent at the enterprise level and 32 percent 69% by department. The most promising finding Managing data and reporting infrastructure 31% is that business and IT are working together Providing requirements for 9% and sharing responsibility for leveraging data additional data and reports 91% and garnering insights. Few companies have Working with vendors who provide 75% 25% dedicated organizations, with the majority services and tools for reports leveraging business users with IT counter- 47% Leading data quality projects 53% parts and super users. Figure 3 shows the split in responsibility for Leading end-to-end data integration 59% to insights delivery projects 41% specific functions between business and IT, with IT taking the lead in managing infrastructure Final call on purchase of services 31% and tools for advanced analytics 69% and working with vendors, and the business Final call on purchase of services 59% primarily managing data quality, require- or tools for reporting 41% ments and advanced analytics projects. I T (CIO, CFO) B U S I N E S S (SALES, MARKETING, SUPPLY C HAIN) CONSUMERGOODS.COM | MARCH 2010 | CGT 29
  3. 3. Consumer Goods Technology Cognizant February 2010
  4. 4. 1. Which are the areas of business in your organization where timely availability and interpretation of data is critical for decision making? Please choose your top 3. Supply chain planning functions Areas of Business % Sales / Account team Supply chain planning functions (demand forecasting, sales & 84% 78% Corporate reporting operations planning, distribution planning, supply planning, 84% procurement planning) Marketing Sales / Account team (category insights) 78% 63% Supply chain execution / operations Corporate reporting (Top Management / Financial reporting) 63% 56% Other Marketing (Consumer insights) 56% Supply chain execution / operations (transportation management, warehouse management, inventory 41% 41% management) Other 0% 0% 2. Which are the sales and marketing areas in your organization which have the greatest need for timely availability and interpretation of data for decision making? Please choose your top 3. 3 Trade promotion planning & optimization Sales and Marketing Areas % Trade promotion planning & optimization 72% Category management Category management 69% Consumer promotion planning Consumer promotion planning 50% 72% 69% Assortment planning and Space optimization Assortment planning and Space optimization 44% Multi-channel planning Multi-channel planning 34% Other 13% Other 50% 44% 34% 13%
  5. 5. 3. Which are the supply chain planning & execution areas in your organization which have the greatest need for timely availability and interpretation of data for decision making? Please choose your top 3. Suppy Chain Planning & Execution Areas % Demand forecasting 75% Sales & operations planning & optimization 72% Inventory planning & optimization 53% Production planning 41% Procurement planning 22% Transportation planning 13% Warehouse management 0% Other 0% Demand forecasting 75% Sales & operations planning & optimization 72% Inventory planning & optimization Production planning Procurement planning 53% Transportation planning Warehouse management 41% Other 22% 13% 0% 0%
  6. 6. 4. Which of the following is the biggest barrier to leveraging data for supply chain planning & execution? Biggest barrier: Supply Chain Planning & Execution % Data mining Data mining to derive insights 35% Data availability 26% Data availability Data quality 16% Data quality User adoption 10% User adoption Data timeliness 6% Data timeliness Insight delivery to users 6% 35% Insight delivery to users 26% 16% 10% 6% 6% 5. Which of the following is the biggest barrier to leveraging data for sales and marketing functions? Biggest barrier: Sales and Marketing Functions gg g % Data mining to derive insights 38% Data availability 25% Data mining Data timeliness 13% Data quality 9% Data availability Insight delivery to users 9% Data timeliness User adoption 6% 38% Data quality Insight delivery to users 25% User adoption 13% 9% 9% 6%
  7. 7. 6. Who is responsible for each of the following functions in your organization? Business IT (CIO, CFO) (Sales, Marketing, Supply Chain) Responsible % % Data quality 34% 66% Managing the data and reporting infrastructure 69% 31% Providing 'requirements' for additional data and reports 9% 91% Working with vendors who provide services and tools for reports 75% 25% Leading data quality projects 47% 53% Leading end-to-end data integration to insights delivery projects 59% 41% Final call on purchase of services or tools for advanced analytics 31% 69% (modeling & optimization) Final call on purchase of services or tools for reporting 59% 41%
  8. 8. 7. Who is responsible for getting insights from data in your organization? Dedicated Business Users Super Users Organization IT Responsible % % % % Sales and Marketing functions (data refers to POS 44% 44% 13% 0% data, syndicated data, sales data) Supply Chain functions (data refers to 41% 34% 16% 9% transactional data - shipment, inventory, orders)
  9. 9. 8. How will you rate the confidence of business users in the information from the reporting & analytical systems environment? Confidence of Business Users % Very High: All business decisions are made based on this 19% Moderate to High: Business users take the information but get 59% it validated before using it for their important decisions Moderage to Low: Business users only use it for their routine decisions while prefer to use date from other sources for 22% critical decisions Very Low: They never use the information from these systems 0% for any meaningful decisions Cannot Say / Not Applicable 0% 59% Very High Moderate to High Moderage to Low Very Low Cannot Say / Not Applicable 22% 19% 0% 0%
  10. 10. 9. How is Sales and Marketing data (POS data, syndicated data, sales data) leveraged in your organization? Rank on a scaled of 1 to 5. (1 - Very Poor, 5 - Very Good) 1 - Very Poor 2 3 - Average 4 5 - Very Good Sales and Marketing data leveraged % % % % % Reporting - Prebuilt 4% 22% 39% 22% 13% Reporting - Flexible and adhoc p g 4% 13% 33% 33% 17% Analytical (causal analysis, Why) 8% 27% 31% 27% 8% Predictive analytics 48% 26% 11% 7% 7% (modeling, optimization, (modeling optimization forecasting) 10. How is Supply Chain data (transactional data - shipment, inventory, orders) leveraged in your organization? Rank on a scaled of 1 to 5. (1 - Very Poor, 5 - Very Good) 1 - Very Poor 2 3 - Average 4 5 - Very Good Supply Chain data leveraged % % % % % Reporting - Prebuilt 5% 14% 23% 32% 27% Reporting - Flexible and adhoc 5% 20% 35% 30% 10% Analytical (causal analysis, Why) 12% 24% 36% 28% 0% Predictive analytics 27% 36% 14% 14% 9% (modeling, optimization, forecasting)
  11. 11. 11. How is data for Corporate functions (HR, Finance, Regulatory, etc.) leveraged in your organization? Rank on a scaled of 1 to 5. (1 - Very Poor, 5 - Very Good) 1 - Very Poor 2 3 - Average 4 5 - Very Good Data for Corporate functions leveraged % % % % % Reporting - Prebuilt 0% 14% 50% 18% 18% Reporting - Flexible and adhoc p g 11% 28% 17% 28% 17% Analytical (causal analysis, Why) 20% 25% 35% 20% 0% Predictive analytics 18% 35% 24% 24% 0% (modeling, optimization, (modeling optimization forecasting)
  12. 12. 12. At what stage is the initiative for leveraging data in your organization? Stage: Initiative for Leveraging Data % Some projects from the enterprise roadmap are underway 42% Some projects are underway There is no enterprise level initiative; Data / BI / analytics are 32% There is no enterprise level initiative being undertaken in pockets Roadmap generated - sequence of projects planned 16% Roadmap generated Strategy or assessment 10% Strategy or assessment No plans 0% No plans 42% 32% 16% 10% 0% 13. Are you getting information in the right form and at the right time to make business decisions from your reporting and analytical systems environment? Information for Business Decisions % The information has to be further worked The information has to be further worked upon to make it in upon 42% There are too many systems the form where decisions can be taken There are too many systems and it adds to the confusion 29% 42% The environment enables our enterprise to have access to all relevant information The environment enables our enterprise to have access to all 13% I use my own data relevant information in a user friendly and timely manner 29% Cannot Say / Not Applicable I use my own data, most directly from the source data 10% systems, to make decisions Other Cannot Say / Not Applicable 6% Other 0% 13% 10% 6% 0%
  13. 13. 14. What is your position with the organization? Position % Senior Management Director / Manager 74% Vice President 13% Vice President Staff 10% Director / Manager Senior Management (e.g., President, CEO, CFO, COO) 3% 74% Staff 13% 10% 3% IT / Technology - related 15. What is your functional area of responsibility? Logistics / Supply Chain 30% Consumer Insights / Market Intelligence Functional area of responsibility % IT / Technology - related 30% Finance Logistics / Supply Chain 23% Marketing 23% Consumer Insights / Market Intelligence 17% Sales / Account Management Finance 10% Marketing 3% Product Development / Research Sales / Account Management 3% Other Product Development / Research 3% 17% Other 10% 10% 10% 3% 3% 3%
  14. 14. 16. What is the nature of your company's business? Food & Beverage Business % CPG Food & Beverage 42% 42% 42% Apparel, Footwear & Accessories CPG 42% Apparel, Footwear & Accessories 13% Durables & Household appliances Durables & Household appliances 0% OTC OTC 0% Other 3% Other 13% 0% 0% 3% 17. What was your company's annual revenue for 2009? 29% 2009 Revenue % Less than $ $100 million 3% 26% $100 million to $499 million 19% Less than $100 million $500 million to $1 billion 10% $100 million to $499 million 19% $1 billion to $5 billion 29% $500 million to $1 billion $5 billion to $10 billion 13% Over $10 billion 26% $1 billion to $5 billion 13% $5 billion to $10 billion 10% Over $10 billion 3%

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