From BI tools to intelligent business alignment
What is a Business Intelligence?
In our experience, when people talk Business Intelligence, they are often talking about a series of dashboards with a range of standard business KPIs, including Sales, Margin, Inventory, Availability, Customer Penetration, Average Basket, etc. But is this really intelligence? What do people do as a result of these KPIs? Are they meaningful to achieving company objectives and do they support the long-term strategy? Dashboards often create more questions than answers. We see the KPI… it’s going up or down versus budget or comparison… but WHY?
In this article, we illustrate datasapiens' approach to business intelligence by means of a case study. Once size doesn’t fit all. We start with the strategy, align measures that reflect the achievement of the strategic goals, support KPIs free-flow analytics to understand the “why?”, and disseminate at each level of the organisation to ensure alignment.
Start with the strategy.
datasapiens worked with a client to develop their customer strategy. The first step was a Customer Behaviour Audit that revealed a number of key findings, some of these are summarised below.
Sales were strong, but Price per Unit was declining.
20% of customers accounted for 70% of sales. This is fairly typical; however, the majority of customers were aging and more price sensitive, while most of the spend came from younger, more affluent customers.
The dynamics of the divisions varied; one was driving the price decline, while another was driven by promotional activity.
The client went on to develop their customer strategy.
Retain the most loyal customers by delivering on price where it matters.
Expand the repertoire of opportunity shoppers.
Attract new, younger, more affluent shoppers through volume promotion.
Define the levers and the measures.
A few key initiatives were created to drive enduring action in the pursuit of these strategic goals.
KVI (Known Value Item) pricing and better value options to support price sensitive customers.
Leverage promotional success to cross sell to complimentary items from basic needs and routine purchases.
Reinforce the national advertising campaigns with focussed deals and aggressive price to drive footfall and attract new, younger customers.
Once the initiatives were defined, measures were put in place to track their success and associated impact on customer behaviour and business performance. These measures were aligned throughout the organisation, from the board to the shopfloor. Further, each level of the organisation was incentivised based upon these results.
The impact was dramatic, with store managers easily able to manage the performance of their sales teams vs. budget and their individual P&L. These performances rolled up to districts, regions, and the board. But it wasn’t just the operations hierarchy; the same applied to the commercial and marketing teams, delivering campaigns, offers, price, and commercial terms for the stores.
Understanding Why?
The alignment, measures and reporting were great, the focus was transformed. However, to make this a real success, decision makers across the business needed to understand the why. You can’t get this from a dashboard – you need free-flow analytics available at the point of decision.
Our solution is simple. datasapiens solutions contain 100% disaggregated data, which means that all data is always available for analysis by decision makers. So not only is all data available, but insights are also fast and easy to use, and access is available to all who need it, 24/7, as defined by the client.
In this example, the organisation is engaged, from store managers to buyers, suppliers, and the board. Everyday.
Conclusion
Retail moves fast. Thousands of daily decisions, crucial for growth – from purchasing and pricing through to customer management – frequently rely on BI dashboards that often generate more questions than answers.
At datasapiens, we believe that you need to start with the strategy. With the strategy in place, define key initiatives that will deliver the strategic direction on a sustainable basis, and then measure progress throughout the organisation. True Business Intelligence needs to be disseminated at the point of decision across the organisation, allowing individuals to make meaningful decisions in a timely manner, and thereby accelerate action on behalf of the customer and business alike.
Get in touch if you’d like to learn more about how datasapiens empowers insightful decisions for everyone, quickly and effectively.