RETAIL METRICS THAT MATTER. Part 3: Internal Business Collaboration & Analytics in Today s Retail Enterprise

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1 Part 3: Internal Business Collaboration & Analytics in Today s Retail Enterprise

2 INTRODUCTION Retailers are transforming their businesses to be able to recognise, analyse and respond to consumers rapidly evolving preferences and behaviours. This four-part series highlights results from a survey of retail executives representing a cross-section of verticals and company sizes. Each part gives a brief overview of specific metrics that are top of mind for retailers who are striving to transform their businesses into nimble, collaborative organisations with the goal to better position themselves in today s market. PART 1: How Retailers are Managing Today s Business Priorities and Challenges PART 2: Factors Impacting Overall Growth: Economy, Budgeting, Globalisation PART 3: Internal Business Collaboration & Analytics in Today s Retail Enterprise PART 4: Inventory Fulfilment & Technology Investments The data provides insight into their business priorities, factors impacting growth, technology requirements, and other challenges these executives are facing in today s market. For a more in-depth analysis of these results, be sure to read the full survey, Metrics that Matter to Retail CXOS offered at the end of this ebook. 2

3 PART 3 Internal Business Collaboration & Analytics in Today s Retail Enterprise 3

4 What key areas have you recently become more involved in strategically within the company? Omni-channel retail requires the bringing together of data and functionality from different channels to create an integrated and seamless environment for customers. To be successful, this strategy requires cross-functional collaboration to ensure the data, the people and the systems are all on the same page. Retailers must be across the systems and the data as well as activities that were once considered the sole responsibility of IT to ensure they understand their customer and can meet their demands. As a result, many retail executives have seen their roles expand to include areas such as: business intelligence & analysis, mobile computing and other areas of IT strategy. Data collection and analysis/ Business Intelligence Mobile advancements Marketing and promotions plans Profit and revenue growth Risk management Sales strategies IT priorities Supply chain and merchandising priorities Investment and growth opportunities Financial accountability 51% 43% 42% 40% 37% 36% 33% 31% 29% 28% 51% of retail executives have become involved in data collection and analysis/business intelligence PCI compliance Business forecasting Pricing strategies 27% 27% 19% 4

5 How often do your business units collaborate today? Most retail executives realise that a focus on collaboration can build significant business advantage. It s no surprise that nearly half of business executives report that their company s business units collaborate on a weekly basis, with a quarter collaborating daily. However, to achieve a truly collaborative environment, retailers must integrate their suppliers and partners. Improved visibility throughout the entire supply chain will lead to better planning, execution and performance. Weekly 46% Daily 23% 46% of retail executives report that company business units collaborate on a weekly basis Monthly Quarterly Annually There is minimal collaboration among business units 23% 5% 1% 2% 5

6 Are you using dashboards or scorecards today? Retail executives today recognise the value of dashboards or scorecards to monitor performance. They see significant opportunity to use the data they already own to manage their businesses and better understand their customers. But only 28% report they are using these tools effectively. Top strategies that retailers are implementing to address more effective data usage include creating a dedicated data insights team; using enhanced analytical techniques such as simulation, optimisation and predictive analytics; and changing the way data and analytics are presented to management. Yes, but we could be doing a better job utilising them 56% 28% Yes, and we are utilising them effectively 84% of companies use dashboards but only 28% report using these tools effectively 10% No, we have no plans to implement dashboards or scorecards 6% No, but we are looking into it 6

7 Which business goals are you focusing on in your dashboards? Retail executives use dashboards most often to monitor the development of new products or the elimination of outdated items. Other common uses include outlining plans to enter new markets, leave existing ones, and monitor financial information and key performance indicators. All of these uses enable retail executives to closely monitor progress toward corporate priorities and business goals. Development of new product lines or eliminating older ones Outlining plans to enter new markets or leave existing ones Financial information/ Key Performance Indicators (KPIs) 49% 43% 42% 49% of retailers use dashboards to focus on developing new product lines or eliminating older ones Capital allocation decisions Weighing M&A possibilities 24% 23% 7

8 How would you rate your business maturity in the area of business intelligence? Retail executives see the value in using business intelligence to help build efficiencies, spot areas for cost savings and identify new growth opportunities. However their level of maturity in using BI and analytics is quite low. Nearly half of retailers have the tools in place but see the need to expand their capabilities, while a quarter report they are just starting to consider BI and have a long way to go. We have implemented BI and analytics in some areas, but need to add more capabilities 48% 26% We have just started utilising BI and analytics. We have a long way to go 48% of retailers have implemented BI and analytics in some areas but see the need to expand capabilities 17% BI and analytics play a key role in most, if not all, business decisions We don t see a need for BI and analytics 3% 6% We need to get started with BI and analytics 8

9 What types of analytics are you using? Business intelligence tools are being applied to improve operations, promotion, merchandising and other focus areas. Up to three quarters of retail executives have applied sales and finance analytics technology, closely followed by web and customer analytics. Surprisingly, supply chain analytics has seen the lowest rate of adoption with not even half having implemented such technology. Sales analytics Financial analytics HAVE IN 2014 PLANNING TO ADD IN 2015 N/A 74% 24% 2% 74% 22% 4% 45% of retailers plan to add social media analytics in 2015 Web analytics Customer analytics External markets analytics Marketing analytics Assortment/Inventory analytics Merchandising analytics Social media analytics Supply chain analytics 64% 27% 9% 63% 35% 2% 51% 35% 14% 50% 44% 6% 50% 43% 7% 49% 40% 11% 49% 45% 6% 46% 42% 12% 9

10 Want to Know More? Be sure to check out all the ebooks in this series: Part 1: How Retailers are Managing Today s Business Priorities and Challenges Part 2: Factors Impacting Overall Growth: Economy, Budgeting, Globalisation Part 3: Internal Business Collaboration & Analytics in Today s Retail Enterprise Part 4: Inventory Fulfilment & Technology Investments Read the Complete Survey 10

11 Level King Street Sydney NSW info@uxceclipse.com ABOUT UXC ECLIPSE Microsoft Dynamics Gold Partner UXC Eclipse is the Retail ERP Specialist. The preferred implementation partner for large and complex retail solutions, UXC Eclipse offers business consulting and project management, applications development, corporate performance management and business process management. Speak to UXC Eclipse about how their integrated Microsoft Retail offerings are delivering true omni-channel retailing globally with mobile POS, full e-commerce, retail warehouse management and logistics, sales/marketing and social listening. Solutions are available on-premise or in the cloud all with a customer retention rate above 97% and delivered to the highest levels of customer service. < 11