It's not uncommon for retailers to invest in Business Intelligence (BI) and Corporate Performance Management (CPM) software, only to be bitterly disappointed. These tools are purchased in the belief that they can be used by end-users, independently, to gain timely and efficient access to data. The reality is that they are often no more than raw components that bring with them an IT overhead of programming, integration and support.
Here, Nigel Illingworth, Retail Assist's Product Director for the Merret supply chain solution and Dominic Policella, Managing Director of BOARD, challenge the current BI paradigm, advocate the 'retail-ready' approach, and suggest ways of getting maximum benefit from BI and CPM tools.
Look for integration
Many BI systems are sold as toolsets, comprising disparate modules such as budgeting, reporting and dashboard, on the promise that the created model will be just right for the business requirements. In reality, these modules-often the result of company and product acquisitions-can come with huge integration issues, long project timescales, high costs and little flexibility to support change. So, retailers should look to have everything in one integrated environment.
Ease of use is critical
"Most BI platforms are difficult to use, technical and inflexible," says Nigel Illingworth. "As a result, they are often kept in the hands of a small number of power users and technicians rather than the wider business community who should be their consumers and beneficiaries."
A BI tool needs to be intuitive to use, and to provide fast and accurate answers to organisations that are starved of information. This is where programming-free environments come into their own, offering rapid familiarity to end-users and enabling them to operate independently.
If the solution is modular, it may take some time to model data and craft reports. The best approach is to buy a system that comes with existing reports 'out of the box', tailored to the retail industry. Even if not precisely what you require, this will facilitate much faster report creation and deliver faster business benefit.
Nigel Illingworth observes: "BI tools are very valuable to a fast-moving industry sector such as retail, where it's necessary to look constantly at how the business is performing, monitor the effects of sales campaigns, benchmark market penetration and measure store and product profitability. A generic tool is simply not up to the job, so retailers should look for BI systems that come with the appropriate retail 'wrapper' that both delivers standard, retail-ready reports and offers easy customisation."
Focus on KPIs and exceptions
It's important to differentiate data that you need for information purposes only from data that can be used to make a difference and instigate change. Use of BI should be driven by key performance indicators (KPIs), with emphasis put on highlighting exceptions. KPI thresholds should be easy to define and display, with graphical representations such as gauges, traffic lights, colour coding and maps. At the same time as revealing the big picture, BI tools need to drill down to pockets of problem performance. An example would be to look at stores that aren't performing, then to drill down to the lack-lustre products within those stores.
One version of the truth
"BI can represent a single, audited source of information, one version of the truth and, as such, is critical to a business," explains Dominic Policella. It should support both analytical and real-time data and deliver a 'scorecard' encompassing different areas of the business, (Financial, Operational, Sales, Customer). It should also be able to alert users when certain business criteria have been hit, notifying them by e-mail or text message, without the need to be connected to the system.