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3 posts from February 2015

25 February 2015

When the only tool you have is a hammer…Is this why compelling business intelligence is so hard to do for real?

The saying goes; if the only tool you have is a hammer then everything starts to look like a nail. Think of it in the following way. Does your IT function have a preference for a particular tool set? Do your systems integrators support that preference. You can bet your software vendor passionately and pro-actively supports that pre-disposition.

So if your business users pose the question ‘Can our application support this new requirement?’, what do you suspect the likely answer will be? Often the application can extend to support that requirement. But at what cost? Is a better question ‘should this application support this new requirement’?

For me, the point is that substantial investments in BI are often handicapped by a one size and one-speed model that no-one would accept as a consumer. For example, it’s continually surprising to see the number of projects that seek to engage the business with a rapid, iterative, agile, prototyping phase built on a heavy-duty, control-oriented, deeply integrated application.

Why is it so unusual to see prototyping done in an appropriate tool before transitioning to the heavy duty machinery? Why is it so normal to ask users to do data discovery in what are financial planning tools? Why are so many BI applications purchased under the IT radar?

Perhaps managing a broader tool set might not be as big a problem as just having the wrong tools to do a good job...

If you would like to discuss these issues, or the impact of emerging technology or data and analytics on your industry, then contact our Data & Analytics team.

18 February 2015

Getting out of a jam with data

Last week I left plenty of time to get to an appointment but once I got in my car, there was gridlock every which way I turned. Now I’m not one to sit in a traffic jam at the best of times, but this was absolute carnage.

I have a bog standard Sat Nav which I use most of the time. I know I can rely on it to get me from A to B, and also that it underestimates the time by about 20% and has a penchant for taking me the very shortest way which is generally right through a city centre or across a farmer’s field. As I sat in the traffic with the minutes counting up I thought, ‘there must be another way’.

So I pulled over and downloaded a community driven Sat Nav app on my smart phone. This relies on crowdsourcing – the data collected by the community using the app – to direct you by the optimal route. It alerts you to obstructions and speed traps that users have flagged, can find you the cheapest petrol station on route and allows your family and friends to track your arrival time. When you think about it, it’s a brilliant yet simple idea and puts my traditional Sat Nav in the dark ages.

Yet it did make me think about some questions. Am I happy to be tracked and hand over my location data to a third party? How is this third party using my data and am I comfortable with this? Does the area that I am using it in have the critical mass of users required to give an accurate experience? Do I really want my phone to control yet another aspect of my life?

Well in this instance I favoured a stress free driving experience and let the app guide me away from the jams and through the empty back streets. And in case you are wondering…yes I did make my appointment on time.

If you would like to discuss these issues, or the impact of emerging technology or data and analytics on your industry, then contact our Data & Analytics team.

05 February 2015

Making sense of hundreds of KPIs – what is really driving the performance of your retail network?

Do I have the right staff in the right place at the right time? Should I allocate more effort to keeping accurate stock or interacting with customers? How do I decide between dozens of trade-offs every day?

As any store manager will acknowledge, running efficient operations can be challenging. Whether you are selling grocery goods or mortgages, you could be required to keep an eye over hundreds of performance metrics.

Which of these metrics are actually driving your sales or profitability?

Traditionally this question would be answered from an accounting perspective. However, how do you account for the multitude of operational and behavioural aspects that don’t show up on the profit and loss statement. For example, the connection between staff satisfaction and store performance is less clear cut but could potentially make a big difference to profitability. Over time talented store managers intuitively learn how to drive profitability by focusing on the appropriate operational metrics. Yet it isn’t realistic to expect such level of intuition from every store manager.

This is where analytics is becoming particularly effective. More and more retailers are using analytics to distil hundreds of metrics into a set of operational levers with a proven statistical link to profitability. For example, if profitability is not the key objective for your organisation, any other metric can be used.

Store managers can pull the proven levers to impact store performance. Of course, no two stores are the same – analytics can be used to create a tailored plan for each individual store and get a sense of how much they would increase the profitability by focusing on the right levers.

What does it take to gain such insight?

The first challenge is pooling all your data together to quantify every aspect of running a sample of stores. Many companies don’t expect to find much data but vast amounts of data tend to be generated as a by-product of other processes.

The second challenge is related to using the right statistical tools and powerful hardware to crunch the data. Spreadsheets typically can’t cope with this.

While these challenges are significant for many businesses, the benefits more than outweigh them. Your data might be hiding operational improvement worth of millions of pounds, and this is at your finger tips

How do you analyse retail data? Feel free to share your thoughts here or discuss this topic with us privately.

If you would like to discuss these issues, or the impact of emerging technology or data and analytics on your industry, then contact our Data & Analytics team.