BI Insight

Editor's Note

Background

A major home video distribution company sought Systech’s assistance to bolster their category leadership for the DVD category in the retail scenario. They required retailer specific solutions and comparable insights across many retailers and markets.

Objective

The objective of the Category Management project is to provide the data foundation, both strategically and technically, for the overall Category Management Application and subsequent releases, the better forecasting and allocation of new releases, and fixture level assortment planning and merchandising. The approach targeted the most influential variables within a category manager’s span of control: Adjacencies, Aisle Flow, Planogram Configuration, and SKU Assortment in an effort to simplify the consumer shopping experience.

Challenges

Data

• Highly disparate sources of data made it difficult to get a holistic view
• Lack of visibility into financial performance, channel sales and inventory across 13 territories outside US

Incentives

• Category management functions between the retailer and the distributor across the globe was not aligned
• Different promotions and plannogramming at various retailers across different locations made it difficult to perform an efficient analysis

Process

• Standardization of master/reference data across multiple categories
• Required definition of goals, metrics and incentives

Technology

• Required timelines and quality of analysis on large volumes of granular data
• Needed access into significant number of resources to crunch data, gather insights and make it actionable

Solution

Systech worked with the client to develop Enterprise Data Architecture to Integrate Data and applications residing in 13 different sources across many countries. Informatica was configured for the ETL process to extract data from source & populate the data mart. Systech’s seamless data exchange through automation, resulted in minimal manual intervention. Conversions and interfaces were also built from existing and legacy systems to a flexible platform, and migration was managed without any disruptions to the users. To make the deployment efficient, Systech adopted a Phased Approach (by territory)

Systech also designed, developed & implemented the data warehouse, the reporting & Dashboard applications to provide information on Sales, inventory, promotion, assortment planning, merchandizing, market share by retailer, by SKU, by time, by region using MicroStrategy. Defining key business drivers and KPIs to achieve deeper insights into the product was also facilitated.

Product-specific configuration principles were developed to be implemented when new DVDs were introduced into the strategic assortment structure. In addition, Systech developed a fully automated assortment tool that integrated configuration principles with market forecasting to optimize space allocation on an account level.

The category management application was developed in an onsite – offshore model.

The underpinning category strategy set by Systech was to increase footfall into the category, by improving relevance, as well as to simplify the customer shopping experience, through improved layouts, product range segmentation and product presentation.

Results & Benefits

Assortment Planning and Merchandising

•  Assisted in determining which products should be in distribution at specific stores during specific time frames
•  Assisted in determining which, and when, to discontinue an item
•  Helped the buyer determine which assortment of products will best maximize and capitalize on seasonal changes and events like holidays.
•  Matched consumer demographic and psycho-graphic traits to store level assortment
•  Determined incremental gain obtained thrrough cross selling synergy, or diminished sales resulting from cannibalization
•  Helped understand correlations between qualitative activities, such as fixtures and displays, and quantitative results such as sales dollars and unit sales
•  Helped understand cross-merchandising patterns and opportunities, such as selling DVD’s near DVD players
•  Assessed planogram performance in maximizing store sales and/or category profits

Market Share Analysis

•  Assisted in determining the performance of retailers and products across different geographic areas such as the West coast, Midwest, Los Angeles, etc.
•  Evaluated the performance of retailers and products across different channels such as grocery, mass merchant, specialty
•  Assisted in ranking and assessing the performance of vendor sales for specific products across retailers
•  Helped compare the retailer’s sales performance against another part of the market, or across the market as a whole.
•  Assessed the opportunities of expanding the retailers’ footprint into new markets, categories, or channels.
•  Evaluated Market Share across studio, brand, genre, format, top selling DVD

Sales and Inventory Analysis

•  Assisted in analyzing POS sales performance based on product, vendor, store, division, or time frame
•  Evaluated sales, profit, and distribution share across the retailer categories
•  Assisteded in ranking, contrasting, and evaluating the sales, profits, and related performance of specific products across brands or franchises
•  Helped understand how to maximize sales performance based on the physical store layout and store type
•  Assisted the retailer in managing out-of-stocks, as well as assessing opportunity cost
•  Helped the retailer manage inventory capacities at both the warehouse and store level
•  Assisted in planning initial forecasts, as well as replenishments order requirements
•  Evaluated the impact on category profits by analyzing shrink and loss prevention
•  Helped better manage the inventory process by monitoring the product movement

Promotion and Event Analysis

• Assisted in determining increases or decreases in sales resulting from promoting two or more items together
• Evaluated the sales, profit, or distribution or a new item launch or re-priced item
• Determined the impact to product and category performance in conjunction with the price elasticity
• Assisted in assessing the performance of specific retail promotional tactics and combination of Ad Price, Display, Price Points, etc.
• Assessed the performance of special events such as a sporting event tie-in, celebrity store signing, etc.
• Determined the performance of special pack configurations, such as dual packs, premium packs, special editions, limited editions, etc.
• Understood the impact and value add of promotional themes and circular themes
• Assessed the impact of product placement in an advertisement or Sunday circular
• Compared and analysed retailer promotional price point against competitor promotional price points

The majority of concepts developed through this project have been implemented by retailers, leading in all cases to double digit improvement in performance for both the DVD category as a whole, and the whole DVD distribution enterprise.

Systech Corner Assortment Planning and Merchandising, category management, Data Foundation, Market Share Analysis, Promotion and Event Analysis, Sales and Inventory Analysis

A primer on collaborative strategies and technology solutions in Supply Chain Management

Supply Chain solutions are becoming increasingly popular in the recent trend of cost-cutting and corporate optimization.  Across the board, organizations are rushing to implement supply chain management solutions, but what options exist, and what conditions make the difference between incredible efficiencies and unnecessary expenditures? First of all, it may be worthwhile to understand the solution that an organization seeks for its supply chain.

Supply chains exist in every organization and therefore, any solution that is being contemplated should only increase the efficiencies in the supply chain.

To begin with, there are three key areas that need to be understood:

1. Business Partners in the supply chain
   1. Who are they?
   2. What role do they play in the overall chain?
   3. What is the value that they provide?
   4. What level of cooperation can I get from them in improving efficiencies in my supply chain?
2. Business Process for the supply chain
   1. What are the inefficiencies in my current business process?
   2. What opportunities do I have to remove these inefficiencies?
   3. Where do I need cooperation from my business partners?
   4. What bargaining power do I have to demand this cooperation?
3. Application of Technology
   1. How can I best leverage commonly available technology to improve by business process?
   2. What applications should I use?
   3. Do I make or buy these applications?

Business Partners in the Supply Chain

Increasingly organizations have started involving all the business partners in crafting a coordinated supply chain solution. The Collaborative Planning, Forecasting and Replenishment (CPFR) initiative of the Voluntary Inter industry Commerce Standards (VICS) is a case in point. CPFR outlines processes, guidelines and standards for member organizations (also the business partners) that can reduce the complexity of the collaboration.

 Business Process for the Supply Chain

 True supply chain management invariably involves the business processes of diverse business partners. Without commonly understood and adopted business process, any supply chain will fall apart. But to ensure that the business process is uniformly adopted across the supply chain, business partners need to understand the value they will derive in adopting a unified business process.

In many instances, what appears to be a process optimization for one organization may not have an optimizing effect when the entire supply chain is considered. An illustration of this is the improper adoption of Just in Time (JIT) inventory. Some organizations approached JIT by asking suppliers to carry and deliver the inventory as and when needed. This seemed to reduce inventory for these organizations but quickly it became evident that inventory remained a problem, as did the carrying costs associated with it, when you consider the entire supply chain.  Just In Time cost methodologies have proven to be a hopelessly vicious cycle: costs shifted to partners within the supply chain were passed back to the organizations with increased product cost.

 Collaborative planning would mean that all business partners work together, share information and plan each others requirements so that the supply chain is indeed, truly optimized.   For example retailers are now willing to part with POS (Point of Sale) information to their suppliers who can then use it to better understand customer buying patterns and trends. This then leads to better planning on part of the supplier and higher turnover of inventory for the retailer, because the right goods are stocked at the right time.

 Application of Technology

 Any modification to the business process to optimize the supply chain should keep in mind the technology that is currently available. In many instances, tremendous efficiencies can be achieved by merely introducing a new technology to the supply chain, without modifying the business process. In other instances, business process engineers have to work in collaboration with Technologists to understand how commonly available technology can be craftily incorporated into business process to derive competitive advantage. In some other cases, one may have to adopt existing applications, simply because they have become industry standards.

The Role of Technology in Supply Chain Optimization

 There are no universal solutions/applications available off-the-shelf that can manage your supply chain. In almost all the cases, it is a combination of applications that help manage the supply chain. Some of the commonly available applications that are used to manage the supply chain are:

1. Enterprise Resource Planning (ERP) Systems: These are designed to centralize all transactions through one core application.  This helps to manage operations and to ensure that there is a 360-degree view of the organization.
2. Demand Planning Solutions: Designed specifically to forecast demand in advance for production/purchasing departments to plan their activities. Work in conjunction with Business Intelligence solutions and feed forecast/planning information to ERP Systems.
3. Business Intelligence Solutions: Facilitate informed decision-making by providing analysis of current and historical information. Provide input for all departments of the business.
4. Customer Relationship Management (CRM) Systems: Provide a 360-degree view of the customer by capturing all client interactions such as products sold, support provided and customer enquiries. This ensures that the customer gets consistent service from the organization. Feeds into CRM Analytics solution and BI Solutions.
5. CRM Analytics Solutions: Helps in understanding customer interactions and consumer behavior. Provide inputs for marketing to understand customer segments and product preferences, which then influences demand planning.
6. Global Distribution Systems: Helps in management and movement of goods and services. A key to ensuring customer satisfaction while helping improve and plan sales and distribution activities.
7. E-Procurement Solutions: Aids in the search for procurement of goods and services. Organizations spend significant amount of resources on procuring direct and indirect materials.  These sourcing and vendor selection issues can be substantially reduced by putting in place a right e-procurement solution.

 As we can see, Supply Chain Solution is not an off-the-shelf product. It is a coordinated consolidation of various applications and solutions that have been seamlessly integrated to perform a variety of functions across the supply chain.

Approaching Supply Chain Optimization

Decision making for better supply chain management is inescapable, no matter how good a technology solution one might have. There are strategic as well as operational decisions to be made for the supply chain. Strategic decisions have an impact in the long term and invariably involve changes to the business process. Operational decisions are more immediate and have an impact on day-to-day operations with little impact on business processes.

 To effectively solve the supply chain optimization issues, an overall strategy needs to be developed.  Involving technology solution providers can be of immense help, since they can bring in their knowledge of currently available technology and its application to business processes.

Typically, the entire strategy cannot be implemented at the same time due to resource limitations and organizational impact.  Therefore, opportunities for improvement need to be ranked based on relative contribution to supply chain efficiency and effort required.  This will provide the road map for implementing the various components for improvement.

 The best place to start would obviously be the area that is most fundamental to the business and will provide the maximum impact to business value. Other solutions can be built around this base solution. Even so, it is important to understand the business partners in the upstream and downstream of the supply chain, and collaborate with them in developing and implementing the solution.

Conclusion

 To summarize, Supply Chain Management solutions involve:

1. All Business partners in the supply chain
2. Business processes in the complete supply chain rather than just the individual organization
3. A combination of various technology solutions that are seamlessly integrated to provide complete visibility to the supply chain

 The starting point for implementing Supply Chain Solutions is to develop a high-level strategy that will provide the roadmap for the organization. This should be developed in collaboration with all of the business partners involved in the supply chain. Business areas with the greatest potential for return on investment should be targeted for implementing the appropriate solutions. 

Featured Article Business Intelligence, Corporate Optimization, cost cutting, CPG & Retail, CRM Analytics, Demand Planning, E-Procurement, Enterprize resource planning, Global Distribution System, Supply Chain Management, supply Chain Optimization

MicroStrategy Announces Beta Release of iPhone Apps Development Platform

MicroStrategy® Incorporated (Nasdaq: MSTR), a leading worldwide provider of business intelligence (BI) software, today announced that it will offer a mobile application platform for developing and deploying iPhone Apps.

MicroStrategy Mobile for iPhone offers a new way to develop and deploy iPhone Apps that is faster, easier, and more maintainable than using traditional Integrated Development Environments. MicroStrategy Mobile for iPhone offers the following benefits:

• Reduces the time to develop new iPhone Apps − MicroStrategy’s mobile app platform includes the infrastructure needed to support each new iPhone App, so application developers only need to focus on creating the user experience and not on the back-end infrastructure.
• Easy for non-developers to create professional iPhone − MicroStrategy’s iPhone applications do not require any coding. Using MicroStrategy’s mobile app platform, iPhone Apps are assembled in a point-and-click fashion. App creators can choose from an array of finely-designed, iPhone-optimized displays and controls.
• Easy for companies to rapidly deploy iPhone App updates − MicroStrategy’s mobile app platform uses an on-demand form of application deployment called “in-stream” deployment. As soon as new or updated applications are ready, they are instantly available to iPhone users directly from MicroStrategy’s mobile app platform.

“Utilizing platforms that can easily assemble applications on mobile computing environments like Apple iPhone is the wave of the future,” said Mark Smith, CEO and EVP Research, Ventana Research. “MicroStrategy’s release of its new platform and capabilities will not only help to deliver world-class BI to Apple iPhone, but also make the assembly and publishing of a broader set of information-class applications much simpler to accomplish.”

Mobile BI applications represent a new breed of business applications that are simple-to-use, highly focused, and available whenever and wherever business is conducted. Business people no longer need to delay decision-making due to a lack of information or delay executing a transaction simply because they are away from their desks. Mobile applications delivered through Smart phones such as the iPhone have the potential to revolutionize business processes across every industry.

For example, mobile BI applications can:

• Provide executives with real-time performance information 24 hours a day
• Enable claims adjusters to complete claims immediately on site
• Empower sales associates to offer discounts and cross-sell recommendations at the moment of the sale
• Provide regional managers the ability to manage their stores, restaurants, bank branches, and other retail outlets
• Deliver management information and guidance to franchise owners
• Give plant managers up-to-the-minute data on plant operations
• Allow inventory managers to reorder stock while managing the warehouse floor
• Provide health care professionals with immediate access to patient test results

“MicroStrategy’s new mobile app platform will allow us to develop the vast majority of our iPhone Apps without coding,” said Terry Adams, Senior Director at Herbalife. “MicroStrategy’s platform approach to mobile application development will allow us to develop a series of business apps for the iPhone quickly and with less effort than building them from scratch using the Apple SDK.”

“MicroStrategy’s many years of experience in providing scalable, enterprise-class platform technology enables us to deliver a mobile application platform that is both industrial-strength and highly flexible,” said Sanju Bansal, MicroStrategy COO. “Our new mobile app platform gives companies the flexibility to create a broad array of intuitive business applications that seamlessly access back-end databases and systems, and delivers the same high performance and ease of management and administration that is expected from MicroStrategy.”

MicroStrategy is currently accepting applications for inclusion in its MicroStrategy Mobile for iPhone beta program

This BI Insight news item contains information from a recent press release by the company mentioned.

Oracle Upgrades CRM, Enhances Enterprise Forecasting Abilities

At a time when Gartner predicts companies will become obsessed with measuring the ROI of IT investments, Oracle has just upgraded its cloud-based customer relationship management system (CRM) to include advanced business analytics and forecasting abilities to better measure and increase enterprise productivity.

The emphasis with this new version of its customer relationship management system is on making money, or maximizing the potential to make money. And while Oracle says the new features will enhance productive selling time, the real value is the ‘deep’ information about the enterprise and its partners that it provides.

Enhanced Enterprise Forecasting

That information can come from many sources and channels. However, the bottom line here is the ability for enterprises to not only make general forecasts about future enterprise performance, but to give in-depth analysis of what channels are performing well.

Although there are a number of other upgrades, it is the forecasting abilities have really taken a step forward. Release 17 is now able to take historical and current forecasts, put them together with real time information and make new forecasts of ideal-world scenarios, actual achievements and quota forecasts.

It also aims to pull all the information covering the productivity of teams and team members together including what each team member is contributing to revenues and who amongst enterprise partners are performing.

Digging deep, it analyzes current and future deal registrations, fund and sales pipelines and in doing so enables users to identify top-performing partners and how they will perform in the future.

User Enhancements

Behind all this are a number of new user enhancements that make the cloud-based Release 17 more user-friendly. The new interface has increased the amount of information that can be displayed with users able to customize it for size and easy navigation to specified information.

The interface acts as a head-up display. This is customizable by the user making lists easier to manage and presents all the information about partners or clients on a single screen through which users can mine as deep as they need for the information they require.

Data migration has also been enhanced with automated data loading and migration. On one hand is Oracle Data Loader On Demand, which enables users to move large quantities of information around Release 17, and on the other, Oracle Migration Tool On Demand can export and import configuration details from one Release 17 environment to another.

Other new usability features include:

• Automation of business process through workflows
• New HTML editor for email marketing tool
• Customizable client contact pages

Release 17 also comes with support for three additional languages including Portuguese and Norwegian on top of the 17 that it already supports. Oracle has also released an edition specifically for the life sciences.

This BI Insight news item contains information from a recent press release by the company mentioned.

Microsoft unveils SQL 2008 update, finally SQL 2008 R2 can support larger implementations

Microsoft has released to manufacturing Microsoft SQL Server 2008 R2, the new version of its relational database management system software, the company announced Wednesday.

The software, a major update of the SQL Server 2008 code base, has been in development for almost two years. Thus far, the developer version of the software has been downloaded more than 300,000 times, according to the company.

The R2 version updates the SQL Server 2008 in a number of ways, said Mark Linton, director within Microsoft’s application platform group.

One notable feature is the scale. A single SQL Server 2008 instance can now be run on up to 256 logical processors. Previously, a SQL Server instance could only scale up to 64 logical processors. It will also run on as much as two terabytes of working memory. This will pave the way for more large scale, enterprise deployments, Linton said.

The software also has been updated to work better in Microsoft’s Hyper-V virtualized environments. For instance, the virtualized instance of the software can be migrated from one server to another while continuing to run.

The software’s administration software has been updated as well. A new feature, called Utility Control Point, enables database administrators to manage the policies of entire farms of SQL Servers from a single console. “Through one control point, you can administrator your entire infrastructure through a standardized set of policies and tools,” Linton said.

The software also helps other Microsoft products in providing users with “self-service business intelligence,” Linton said. The software can provide live data for a new Microsoft Excel data analysis add-on call PowerPivot, which was designed to manipulate “millions of rows of data” quickly.

This BI Insight news item contains information from a recent press release by the company mentioned.

Industry News Apple, CRM, Enterprise Forecasting Abilities, iPad, iphone, iPhone App Development Platform, Microsoft, MicroStrategy, oracle, SQL 2008, SQL 2008 R2