Every business needs to gather information and to make informeddecisions based upon it. In-house systems can provide an operational insightfrom the data they produce if this can be consolidated, analysed and presented in the way that the business needs.
If data can then be turned into meaningful information, itcan highlight areas of success and failure, and reveal whether the business hasits supply and demand in balance. Most importantly, the right information canreveal where improvements can, and need to, be made.
Our experience of working with retailers reveals that theyfall into two camps: those who require only top-level detail, and those whowant to know the DNA of everyone and everything that makes up the business.
Some retailers are highly season-driven and others run with morestable stock lines. Differences apart, they are united by the need forflexibility and responsiveness and by the imperative to understand theirbusiness and react to change appropriately.
Getting information right is a challenge. Businessesinvariably generate too much or too little. The starting point should be somecorporate soul-searching. Retailers need to define what type of business theyare and what they need to know about themselves. Having established theirwants and needs (not an easy task, as business functions and IT often work todifferent agendas), only then can they build a consensus view of what is required.
Whilst Business Intelligence represents the only reliablebasis upon which to make decisions, (provided it is reacted to and usedeffectively), expectations need to be realistic. Just as systems dont make a badretailer good, the right business information will not be generated if thebusiness doesnt know where it is going.
Todays systems can create a wealth of data, but this willonly become meaningful information if it is aligned with the processes that thebusiness has erected to support its key performance indicators. We often comeacross a lack of clarity at all these levels: the KPIs, the processes tosupport them, and the information to report on them.
So how does data turn into information, and then into BusinessIntelligence? Retailers often believe that they have the tools they need to produce Business Intelligence, whereas in fact they are simply generating data. In-houseapplications such as supply chain and merchandising may accurately recordpoint-of-sale transactions and stock movements, but this is not enough.
Where a number of systems are operated, each will independentlyproduce reports. To get a true picture of the business, its important tointegrate different data sources and consolidate the data and reports that eachproduces, at the same time filtering out unwanted elements.
Retailers seem to be at one of three stages of development.The first is where each function relies upon a plethora of paper-based reportsand spreadsheets that have evolved over time. Often build to meet specificneeds, they rarely keep pace with the business. Their flexibility is theirdownfall and they can be the source of disconnects and misunderstandings asindividuals model data differently and arrive at different answers.
At a more sophisticated level, the retailer may have createdinterfaces from In-house systems to external Business Intelligence products, based on data extraction. Whilst this is an improvement on the spreadsheet and paper-based model, system interfacing can absorb management time and createconfusion.
The third and most desirable stage is to embed Business Intelligenceas an integrated and universal function. This enables users to gain reliabledata directly from their mainstream applications.
Under this scenario, disparate data sources are broughttogether and programmed to produce a true snapshot of business performance,across the piece. By eliminating data fragmentation and providing answersbased on correlation, cross-referencing and number-crunching in a way that nohuman can, Business Intelligence offers clear pointers to performance improvement in a quick and easy way.
About the Author:
Alan Morris is Managing Director of retail-only solutions and service provider, Retail Assist. He can be contacted at
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