Category Archives: SAP

Is Bench Strength a Valid Differentiator ?

By Karen Gildea , Managing Partner, Amick Brown

Just over five years ago, with four of my long-time colleagues, we started an IT consulting firm specializing in SAP and Business Intelligence.  Together we had led teams that designed and built an integrated BI solution for AT&T’s SAP implementation before being outsourced to a large consulting firm.  Over a 10 year period, we had developed and supported a system that served and was secured to hundreds of thousands of people.  This was no easy task and we learned a great deal along the way as building anything that serves a population that large with the varying security and usability requirements that go with it requires an enormous effort on many levels.  We knew and still know….that we have unique experience that other companies implementing large SAP BI solutions would benefit from.

So we left the large consulting firm and created Amick Brown – a certified small business, woman-owned business and minority-owned business.

We decided we would try to expand our business in the government sector.  The government has small business programs and set-asides for small business.  It is a lot of work to respond to a Request for Proposal with the government, but each time we respond we get better at representing what we have done and what we can do.  We are achieving success, but we are still sometimes questioned about our “bench strength” – in other words, the number of consultants we have employed. 

Because we have been the big company client and we have also been one of the big box resource providers as well, we have a perspective on bench strength that some others may not.

While many big companies or government agencies may feel that bench strength is an indicator of a company’s ability to provide resources when needed, what they really need to know is – can a company provide the specific expertise needed for their unique situation.  In order to truly gain the outcome desired from any new project, the specific expertise or experience of each consultant should be the focus. 

All consulting firms, big and small respond to the unique requirements of a company or agency similarly.  They determine the specific expertise and experience that is required, they look at their available resource pool to determine if that expertise is there and available, and if not they begin their search for that expertise in the market.  The resource pools of big and small consulting firms alike are also very similar in makeup – the respective pools invariably contain partner consultants as well as employees.

So – is bench strength really meaningful?  I say no.  A firm’s ability to evaluate and understand the project requirements and challenges, determine the expertise and experience required and then to identify the most qualified candidates to successfully respond is key.  As well, the firm should be vested in the long term success of their client.

A question we often get is “is your consultant an employee”?  Again I believe the question should be – who is the best candidate for the position?  We have found that the very best and most experienced consultants may be interested in coming on board to work on a project, but aren’t necessarily interested in changing “employment”.

There are numerous reasons why a consultant may not want or be able to be hired as an employee. Perhaps they are tied to their current company through an H1B visa, or personal relationship. It may be due to wanting the freedom to grow at the pace which they prefer.  It might even be about not wanting to lose accrued vacation at their current company.  If all federal and state requirements regarding payroll and payroll taxes are being adhered to, and if insurance and contracts are in place – does it really matter?

For every engagement, we assemble a team of the best experts with the most relevant experience for the unique requirements presented.  We hire consultants as permanent employees when it makes sense for all and subcontract when it does not.  Regardless of employee or subcontractor designation, the placement is done only after thorough cultural matching and a vested commitment to long term success.

Over the past 15+ years, we have worked with  many consultants and small business consulting companies.  We continue our relationships with only the best and through those relationships we are introduced to others of the same caliber.  For each consulting partner we ensure agreements are in place, insurance verified, and background checks done, and for those we are new to, full due diligence is completed. We work with only the verified best consultants and have developed long standing relationships for the ongoing success of all.  We provide a team that can rival any big box organization.

A consolidated bench of consultants with the specific expertise required is what will provide a successful project team – regardless of where the individual consultants come from.

bench strength

The reality is that the big box firms call smaller consulting firms on a regular basis to provide the expertise they need for their client projects.

After all, it really is all about gathering the best people to tackle the project.

bowl of goldfish

 

“Passionate on Analytics” , new book available

from Iver van de Zand

My book “Passionate On Analytics” is available now

Driven by a deep believe of the value of business analytics and business intelligence in the era of Digital Transformation, the book explains and comments with insights, best practices and strategic advices on how to apply analytics in the best possible way. 25 Years of analytics hands-on experience come together in one format that allows any analytics userHow proud can one be?

My first book titled “Passionate on Analytics” is now available from the Apple iBooks Store via this link.

Since I am evangelizing on interactive analytics every single day, I decided to create aninteractive ePub book. It contains over 60 best practice and tutorial videos, tons of valuable links and galleries and 33 extended articles providing insights on various analytics related topics.

Passionate on Analytics (206p) has 4 sections:

  1. Insights: 13 deep dive articles on various aspects of business analytics like industry specific approaches, embedded analytics and many more
  2. Strategy: 13 chapters talking analytics strategy related subjects and topics like defining your BI roadmap or the closed loop portfolio
  3. Best Practices: 10 expert sessions showing and demonstrating best practices in business analytics like using Hitherto charts, how to make a Pareto or visualization techniques
  4. Resources: a wealth (!) of resources on analytics

Please find below some screenshots.

I am very happy with the book with has brought up the best in me. Everything I learned, experienced or discussed during my 25 years tenure in business analytics, is expressed in this book. The book is fully interactive meaning you can tap pictures for background, swipe through galleries or start an tutorial video.

Special thanks goto Ty Miller, Timo Elliott, Patrick Vandeven and Waldemar Adams who I all admire a lot.

Iver

 

If the right people do not have the data they need, how can the intelligence be accurate?

By Ashith Bolar ,  Partner and Director AmBr Data Labs

Lack of user-acceptance is considered a failure of any new Information System — a rule that equally applies to a Business Intelligence initiative. And the astounding fact is that this is a very common occurrence. The reasons can be varied, such as the quality of data, the usefulness of the analytics provided by the system, or merely the user-interface being unfriendly.

However, what is not considered in assessing the success or failure of the system is the number of users who did not get access the system — an error of omission (pun intended). Typical IT projects finalize the initial set of end-users right at the inception of the project, and no later than the requirements phase. To manage the scope of the project, it is typical to keep a small and manageable initial user-base. However, I believe that this is a mistake!

I believe it is a mistake, that in trying to ensure the success of the project, the scope of the BI deployment should be restricted to a few. The true value of a BI enterprise is the crowd-sourced intelligence that you derive from it — and by this assertion: the more the merrier! Not only will a wider audience give us a better assessment of the success of our BI initiative, it will also ensure wider and quicker post-deployment enhancements.

Starting with a large audience of users has many challenges, least of which is managing the scope of the BI project. Given that a data warehouse typically contains sensitive data, one of the main concerns of a large user-base is data security — ensuring that only the right users get access to the right data. This concern leads to the usual decision of limiting the initial user-base to just the power-users, ones that require none or minimal data security.

pocker chips and aces

We see your challenge and raise you AccessOne©!

AccessOne is an information security software specifically designed for SAP™ Business Warehouse (SAP-BW). AccessOne allows you to build your access-control security in an easy excel-like matrix, and deploy it with a few clicks.  AccessOne can extract access information from your ECC system (be it role-based, structural authorizations, etc) or a traditional SoD ACL matrix, or even an excel file you created on your desktop. 

So that you can visualize AccessOne more completely–

A BI solution’s data security implementation is quite different from an OLTP system, even though they both try to achieve the same goal by means of a same set of parameters. The OLAP authorization mechanism works in the reverse direction of the procedures employed by an OLTP system.

See schematic below:

Take an example of an OLTP HR system / employee database. Here’s the sequence of events that occur when a user interacts with the system:

A1 1

Now consider its BI counterpart. The typical user request sequence goes something like this:

A1 2

Although, this is a simplified view, it’s easy to visualize the change in the mechanics of how authorization works between an OLTP and an OLAP system.

The power of AccessOne is in its ability to transform security parameters from the data structures that are designed for an OLTP system to the ones that are more suitable for an OLAP system. Moreover, AccessOne applies these authorization checks to any and all users of the SAP BI system. It will replicate your OLTP (ECC) system access parameters (role-based, structural, etc) into OLAP (SAP BW) system access parameters (analysis authorization). 

With this power, and with the guarantee that your BI system access is exactly the same as your ECC, you can now open up your BI system to all the ECC system users, be it power users, domain-specific users, supervisors, or individual-contributors.

Another power of AccessOne is “overriding” or “overloading” authorizations derived from OLTP. With a single access-control entry, you can override or overload (add to) the access of any user or user-group. For instance, if you have an end-user with limited access in the Finance ECC system, however you want to provide this user with extended access to the BW system on the finance cubes, this can be achieved by inserting a single access-control entry in the BI system.

In the following blog posts, we will examine some complicated yet typical case-studies to illustrate the power of AccessOne.

– Watch this Space –

 

 

25 years into a career and you are Outsourced – time to Panic or a Gift?

By Karen Gildea, Co-founder and Managing Partner
Amick Brown

Karen Gildea

Like so many of my peers, and by that I mean those that
started their careers years ago with the plan to remain at the same company until retirement, the news that outsourcing will end your career there is shocking to say the least.  When you must leave your company for whatever reason, and you aren’t really ready or old enough for retirement, it is quite distressing.  You look at the many millennials who seem to so comfortably pick up and move to a new company when they see a new opportunity and you think, “what do I know and what skills do I have that would enable me to start again somewhere?”

What felt like the worst thing that could happen to my career…….WASN’T.

I spent more than 25 years working at a company that was so large that there was an endless amount of potential in terms of jobs, career paths and the ability to climb the corporate ladder.  I loved my job as it was constantly changing and enabling me to grow.  I loved the people I worked with and through the years they became a kind of extended family.  This was my world – I never looked beyond it.

As I started to think about the situation at hand, some truths were evident. Through the years, I was afforded some very valuable training and experience.  I managed a team that was responsible for building and supporting 24 x 7 applications for a user base that numbered in the hundreds of thousands.  We learned, sometimes the hard way, that the right people, constant communication, process, documentation, and a strong focus on quality assurance and system performance are required for success.  When you are there not only to implement systems, but to support them, you learn to be very thoughtful about design, testing and user communication and training.  These are sometimes areas that are of little interest to those who implement and move on.  We had a roadmap and a long term view of the solutions we were building and we had a lot of experience that would ensure our success in getting there – but that was over.

Make a Plan, Work the Plan, Be Accountable

Together with some of my colleagues, we decided to start a small consulting business.  We realized that the skills and experience that we had acquired building and supporting SAP and BI solutions for such a large implementation would be of value somewhere.  We believed we could make this work….but at the same time we definitely had moments of concern.  We met and planned in our dining rooms.  We understood from our long-term and collective experience the value of developing a detailed project plan, holding people accountable, and then working the plan.

As Amick Brown became a reality, we knew we had the expertise in SAP and Business Intelligence, but what about running a business?  We had a lot to learn, but it turns out that there is a lot of help out there.

First, we found a mentor. This person had already done what we were trying to do.  Her business was in another state with a different focus so competition was not an issue.  She was a huge asset and we will be forever grateful.  We asked her endless questions, took copious notes and still reach out to her from time to time for advice.

We then took advantage of all of the resources we could identify.  The Small Business Administration provides immeasurable support to small businesses. Through the SBA, we connected with the Small Business Development Centers (SBDCs) in the three counties in our area.  The centers are there to provide training, counseling and support to small businesses.  We attended all of the training that we could about starting a business, marketing, payroll, legal issues, accounting, etc.  We also discovered the Procurement Technical Assistance Center (PTAC) which is another valuable resource that has a focus on government contracting.  We attended many PTAC training sessions where we learned about doing business with the various government agencies and responding to Requests for Proposals.  Most of the training we attended was free and when there was a cost, it was minimal.

We worked with our bank to obtain an SBA backed loan to support our start-up costs.  I can’t stress enough the value of a good banking relationship.  I have to give a shout out to Wells Fargo for being such a good business partner and providing such terrific support through the years.

WBENC-Logo

We pursued all of the certifications that were appropriate for us. We are a woman-owned business, we are a minority-owned business and we are a small business.  It is a lot of work to complete each application and it may be a bit overwhelming as you begin the process, but it is well worth the time.  Doors will be opened instead of closed because you are a supplier that holds a specific certification.

Conferences and business matchmaking events are one of the best places to learn and make connections.  We connected with people in other companies and government agencies, and identified additional useful resources to call upon when needed.  Each event helped us learn, grow and refine our marketing material and “elevator speech”.

Our first contracts were with companies we connected with through our already extensive network.  Though they were small contracts at first, it provided us the opportunity to build up our support systems that included HR and payroll services, legal support, accounting processes, web support and recruiting systems and processes.  Obviously, we grew very quickly beyond SAP Business Intelligence – a greater reach for our growing customer base.

panic buttongift icon

So, was outsourcing a panic situation or a gift? Here are the lessons learned:

  • Starting a business is completely possible. We found support everywhere we looked and people wanting to see us succeed.  We started with what we knew, and then looked for help and guidance for what we didn’t know.  Help is out there.
  • Relationships are everything – We understand that without good relationships with our clients, our employees, our subcontractors and our other business partners we won’t thrive. We will always do right by each of them.  They can count on us.
  • Continue to think long term – We make sure that we hire seasoned people who understand the long term impact of design, and in the event one of our hires needs additional assistance to ensure success we make sure it is provided. The long term success of our clients and the relationship we have with them is of utmost importance to us.
  • Be frugal – We have always had an eye on cost containment and we don’t spend money on things that don’t bring value. We are fairly modest with business purchases and we would rather offer better compensation and benefits packages to our employees and contractors – this way everybody wins.
  • Being a business owner is a completely rewarding and exciting experience. We have a renewed energy and enthusiasm toward all that we do.  We learn something new every day and life is good.

To date we have made the San Francisco Business Times Fast 100 list which lists the fastest growing privately held companies in the San Francisco Bay Area two years in a row and the Largest Women-Owned Business list three years in a row.  Our US focus is growing markets in the East and Central United States, as well as the West.  Our detailed plans, working them carefully, and staying accountable are making a new business success our reality.

Keep an eye on Amick Brown.  Good things are happening here!

2016 and Business Analytics: Be Prepared for a Smashing Year: Part One

by Iver van de Zand, SAP

The end of the year is always a time to reflect, but also a time to look ahead and think about what might be different or innovating next year.three-spheres

Reflecting on 2015, three things immediately come to mind:

  1. Interactive self-service business intelligence (BI) has definitely landed and earned its permanent place. Every top-100 customer I talked to has self-service business intelligence in its BI strategy plans.
  2. “Traditional” business analytics (as in managed reporting and dash boarding) is not sufficient anymore for full performance management. A closed loop portfolio of analytical, predictive, planning, and GRC information is becoming a necessity in today’s management of processes and business flows.
  3. The value of in-memory platforms is now being recognized by leading companies. They massively adopt in-memory platforms to not only run their core applications, but also to integrate business data and facilitate analytics.

Looking forward, I’m sure you’ll agree with me that analytics is heavily influenced by the readiness of organizations to adapt to change resulting from the Digital Transformation. Connected economies and networks, data that’s available at any moment at any level, and sensor techniques allowing for new business models—they all heavily influence our needs for insights. As such, they heavily influence the 2016 trends for business analytics.

Did Tableau Lose Its Head?

Recently, I did the Google search exercise for “BI Trends 2016″and was both shocked and amazed. Our friends from Tableau’s marketing department have succeeded in monopolizing  80% of the first 20 hits! However, if you read closely, you’ll notice they are all referring to the exact same article. (Though they all seem to be different articles, they all cover identical things.)

I was further shocked  by the lack of insights these identical articles cover.  My feeling is that the articles point out  BI trends for 2014 (or earlier). “Governance and self-service become best friends,” it says. Dear people from Tableau, self-service BI can only exist by the sake of data governance. If self-service BI is not governed properly, there is no sense for it. And the trend mentioned as “Data Integration gets Exciting”? This was something everybody focused upon in 2012.

Analytical Projections for 2016

So what can we expect for 2016? Personally, I can only reflect on what I see and hear when talking analytics with key customers every single day. For me, these discussions have provided food for thought. Listening to the plans that my customers have, I can extract five key trends for business analytics in 2016:

  1. Self-service BI will become a commodity
  2. Business will embrace the portfolio loop
  3. Companies will really analyze Big Data
  4. Cloud BI adoption will accelerate
  5. Operational BI footprint will grow

Let’s take a closer look at the first two trends in today’s blog.

  1. Self-Service BI Becomes Commodity

Governed self-service BI will further find its way to all echelons of organizations. And the reason is simple— business users finally have the opportunity to drive analytics in their organizations. While 2015 was the year of adopting self-service BI, 2016 will be the year of the massive roll-out. Self-service BI is becoming a commodity in 2016 with the number of business users growing rapidly. From a functional perspective, the success of self-service BI is greatly determined by its ability to:

●  Interact with the user. Self-service BI can be adopted quickly because end users are able to interact with massive amounts of structured and unstructured sources of information.

●  Make data and insights easily visible. Business users really recognize the value of making insights visible. The simple but clever idea of using visualizations and analyses to create your own stories (storytelling and infographics) is very successful. Nice examples are GEO-driven stories, dashboards , and D3 open- source visualizations. These, combined  with interactivity, make self-service BI a stunning combo. As I’ve mentioned before,  “our meetings will never be the same.” We can now use interactive, visualized insights to discuss and monitor the heartbeat of our company in real time!

●  Be agile with new and ever-changing data. A third success factor (what’s in a name J) to self-service BI is its agility. This agility is a huge value-add because it allows business users to really simply acquire and enrich new data and use it for analyses. Bear in mind, this also applies to Big Data using in-memory computing.

  1. Business Embraces the Portfolio LoopReal-time business wheel

I’ve made my point on the importance of the closed loop portfolio in earlier blogs. Every key customer I met last year who’s willing to embrace Digital Transformation is seeking an integrated and governed platform to analyze, plan, predict, and assess risks in a constant and permanent loop.

I use the word ‘integrated’ on purpose here, since here is where the difference is made—customers seek to have real-time integration between their business analytics, their detailed planning, and the predictive models that affect, for example, product mix or pricing strategy. The integration also needs to be on operational financials and towards risks and compliancy cases when needed.

Many of my customers have accomplished this on a near-integrated level that isn’t real time by using individual components that access each other’s data. Products like SAP Cloud for Analytics are revolutionary here since they provide the closed loop portfolio covering real-time, interactive integration on all mentioned areas. Markets have been waiting for this for quite some time and are eager to adopt. It allows them to interact with market fluctuations that speed up due to the Digital Transformation. You can look at the examples I described in a previous blog for the retailing sector to understand the scope of the closed loop portfolio.

Stay tuned for my next blog. I’ll discuss the other three trends I see for business analytics in 2016: analyzing Big Data, the acceleration of cloud BI, and  the growth of operational BI.

Follow me on Twitter @IverVandeZand.

Amick Brown is here for you.

 

The Real Business Intelligence

Ashith Bolar, Director of Research, Amick Brown

In the state of the art of computing, every company generates a large amount of data, and it goes without saying that every organization does some sort of data analysis on this data. Big and small companies invest in Business Intelligence in some shape or form. The ubiquity of big data infrastructures, such as those from SAP, as well as Hadoop and its various distributions also has enabled even smaller and medium sized businesses (SMB) to perform data analytics at scale.

glass wall meeting

Loosely speaking, Business Intelligence (BI) is a set of techniques and tools used to transform raw data into meaningful and actionable information. However, simply based on that definition, virtually every exercise in data analytics can be considered as Business Intelligence. The true value of a BI is only realized when the latest tools and technologies are applied in order to determine the historic, current and predictive views of the business.

One of the applications of BI is Predictive Analytics (PA). PA encompasses a large and fluid set of tools based on statistical and mathematical techniques to analyze historical data and subsequently build predictive models. The idea is that historical data contains patterns that, if recognized and correctly applied, can be used in predicting the future. This enables a company to predict and proactively respond to the future state of the business, say customer behavior, market conditions, etc.

growth graph

Take a look at your current BI system. Are you only analyzing  historical data, and at best enumerating the current state of your business? Or does your Business Intelligence platform help you model the future and enable you to predict the course of your business? Are you able to identify risks and opportunities well before they occur?

PA captures patterns and relationships among the various factors in your business, giving you a deeper perspective of risks or potentials associated with your current course of business. This enables you to make optimal changes to your business in order to make the most of the current and future market conditions.

Current technology offers very cost-effective means of Predictive Analytics that SMBs could implement with virtually no upfront cost.  SAP’s Predictive Analytics Software gives you a robust set of tools in this space. These tools run on your enterprise data and any supplementary data that you provide.

SAP’s Predictive Analytics Library (SAP-PAL) provides the following list of capabilities:

  • Predictive Modeling : automated set of tools to build predictive models
  • Predictive Scoring : identify and evaluate relevant variables in predicting
  • Predictive Model Management : enable end-users with limited knowledge of the science of predictive analytics to ask what-if questions
  • Predictive Network and Link Analysis : explore the links between your customers and network of strong social influencers with analytics
  • Predictive Data Management : automated data-set preparation for predictive modeling

Amick Brown can help you realize the predictive powers that you have with your SAP and BI platform provides you.

What is Design Thinking?

Contributed by Kaan Turnali, SAP
“Customer-centric design is about looking out from the inside—rather than outside in”

Today’s organizations face multifaceted problems that are part of increasingly complex business models. Continued expansion of global transactions, supported by partnerships that can span large ecosystems, create unique opportunities and unique challenges for businesses.

These challenges demand multidimensional solutions and require more than just basic applications of current products and services. This is where design thinking comes into play. By applying this framework, organizations can not only address everyday business problems and challenges but also gain a competitive edge.

To stay relevant, companies must innovate without disruption to drive growth and profitability. As Tim Brown, CEO of the design and innovation firm IDEO, puts it in a Forbes.com interview, “Design thinking is all about upgrading within constraints.”

What-Is-Design-Thinking

What Is Design Thinking
In its simplest form, design thinking is a process—applicable to all walks of life—of creating new and innovative ideas and solving problems. It is not limited to a specific industry or area of expertise.

It can be as effective in technology or education as it may be in services or manufacturing. It could result in new products and services for customers or improved processes and productivity gains for internal operations. If applied with equal fervor, it can even transform HR, finance, marketing, or operations teams—turning them into lean and agile profit centers.

The award-winning documentary Design & Thinking explores this idea and provides perspectives by well-known subject-matter experts in this space. The Hasso-Plattner-Institute (HPI) at the University of Potsdam School of Design Thinking, in Germany and the Hasso-Plattner-Institute of Design at Stanford University in California are the two leading educational institutions in this field.

Developed by IDEO founder David Kelley, design thinking is defined as “a human-centered approach to innovation that draws from the designer’s toolkit to integrate the needs of people, the possibilities of technology, and the requirements for business success.” Thus, the method focuses on three main elements of a product or solution: people, technology, and business. All of these aspects evolve around the customer.

The customer drives the current and future state of any business. Products and services, whether they are delivered to internal or external customers, must create intrinsic value and address specific business needs. This cannot be done unless the customer is an integral part of the entire product lifecycle—not an afterthought.

It is accepted that businesses, projects, or teams that lack customer focus are bound to fail. Design thinking makes the customer the main focal point of design for any solution. Plus, it consistently applies the values embraced by this approach, such as empathy, diversity, and ambiguity, as well as recognizing the importance of multidisciplinary teams. Many of these principles reflect ideas that stem from well-known principles and/or best practices. However, design thinking, in essence, incorporates them into a coherent and repeatable process.

Here are my interpretations of some of these principles. You can find others listed here.

  • Success comes from designing integrated solutions in which each part completes the system in whole—not designing fragmented pieces that make up a stack.
  • By getting closer to current or potential users and going beyond distant observation, we have a chance to design by looking out from the inside—rather than outside in.
  • Empathy opens up nerve endings so we can feel what it is like to be in another’s shoes—a prerequisite for customer-centric design. We need to get as frustrated as the users/customers so we can better understand the pain points.
  • By bringing multidisciplinary teams together at the table, we leverage the power of collective expertise.
  • Embracing ambiguity opens the door for human ingenuity—allowing us to chase opportunities for new ideas we would otherwise miss.
  • Promoting the philosophy of “fail early and often” is the key to harnessing the power of rapid prototypes and delivering proof of concepts that resonate and encourage feedback from actual users and customers.

This last one is the closest to my heart because it often reminds me of two famous quotes (available in several variations on the Web). First, there is Edison’s quote about failure and inventing the light bulb: “I have not failed, not once. I’ve discovered ten thousand ways that don’t work.” Then there is Frank Lloyd Wright’s insight “You can use an eraser on the drafting table or a sledgehammer on the construction site.”

To me, design thinking is a framework for ingenuity. It can generate excitement for new ideas, leading to solutions that address unmet needs. Just as business intelligence can be the enabler for faster, better-informed decisions, design thinking can be the driver for better-designed solutions for products and services.

I always argue that passion is the fire that ignites engagement by inspiring what is possible. In the context of business and technology, ideas create the demand for technology that can translate into solutions that drive growth and profitability.

Connect with me on Twitter (@KaanTurnali), LinkedIn and turnali.com

The Overwhelming Power of Analytics in Retailing and B2C: Part 2

Businessman Analyzing Graph

 

 

 

Contributed by  Iver van de Zand, SAP

Retailing and business-to-consumer (B2C) market requirements for online insights are relying heavily on the closed-loop portfolio. The permanent and online interaction of analytics towards rolling planning or predictive models applies all the time. As a follow up to Part One, today I’ll discuss the various ways analytics is applied in retailing and B2C. The situations below are far from exhaustive, but at least they provide insights into what I’ve experienced in various engagements with the retailing sector.

Retailing and B2C segments rely on real-time availability of data insights. Customer behavior, societal influences, the distribution column—they all fluctuate drastically and affect commercial behavior so intensely, that only real-time insights empower the retailer to monitor and adjust the closed loop portfolio. Needless to say, retailing and B2C require in-memory platforms, which provide the calculation and data handling power, plus the scalability, that are needed so badly.

At the base of getting insights are in-memory systems that track every single transaction done in the shops or online. An often-seen solution for this is called SAP Customer Activity Repository (CAR). SAP Customer Activity Repository is a foundation that collects transactional data that was previously spread over multiple independent applications in diverse formats.

Watch the SAP Customer Activity repository video HERE

The repository provides a common foundation and a harmonized, multichannel-transaction data model for all-consuming applications. Retailers can use SAP Customer Activity Repository to gradually transform their system landscapes from traditional database technology to the revolutionary, in-memory database technology.

Assuming the real-time platform and SAP Customer Activity Repository are available, what is the typical scope for this market segment’s insights using analytical components from the closed loop? Let’s have a look.

Basket Analyses

Basket analyses are the core insights that provide information about what people buy at what moment and at what location. We get insights into what is in their “basket.” The mix of products consumers buy is especially interesting. For example, a retailer can use real-time predictive models to predict whether a young female teenager buying red trousers might also be interested in purchasing accompanying earrings.

Sensor techniques can really help the shop employees to focus their advice specifically to the customer’s needs. Consider this shopping scenario:

  • Sensors inform an employee that a customer is picking a blue shirt, sized XXL from the rack.
  • Online analytics and predictive models immediately tell the employee on a mobile device that the customer took the wrong size (based on his buying history) from the rack.
  • The buying history then indicates that the customer typically buys three pieces at once.
  • The employee is also informed that the customer’s profile indicates he might be interested in buying jeans to go with the shirt he’s looking at (based on predictive models).
  • Finally, loyalty card information indicates that if the customer today buys four pieces, an extra bonus will be provided to his savings card.

All this information helps the employee interact with and sell to the customer.

Shop Performance

With shop performance, I mean the ability to use real-time, closed-loop analytics on anShop Performance
overseeing shop level. Sentiment analysis based on, for example, an impacting television show last evening where a popular boy’s band showed their new, hip-colored sneakers, might trigger the retailing group to discount a second article when customers buy similar sneakers. The agility here is crucial—sentiments are notified from social media analyses and action needs to be taken immediately.

Local influences could mean specific sizes of a product are sold very well in one place, but less well in other places. This might trigger shop management to re-allocate stock to other shops. The same thing applies to ranking capabilities—permanently monitoring top-bottom rankings per article, color-item or size is valuable, since the slightest social change (a big event in one specific city) might cause immediate changes in buying behavior locally.
Metrics

Customer Loyalty

Customer loyalty cards provide the retailer with a wealth of information if used well. The loyalty cards “identify” the person buying. We can see the consumers’ buying behavior, what they buy, and when. Tracking techniques (picking up  mobile devices’ signals when customers enter the store) show us in real time exactly where each customer spends their time in our shop, what is the route that customer typically follows, and what is their average visiting time.Retail

Retailers can go a step further by combining loyalty card information with the customer’s buying history and social media information. This further completes one profile, allowing the retailer to tailor make marketing initiatives on an individual level.

For example, I—as  customer X—might receive a special offer for a new external hard drive from a retailer, since combining data shows that I like audiophile equipment, buy music magazines (basket analyses) and spend quite some time at the electronics department when visiting that shop. The data insight is that I might need (or want) a storage device to store my music.

Customer loyalty cards might also bring great value to the customer retention program. Customers nowadays really quickly change their providers of goods because they are  enormously well informed.

Visitor Analysis

 

Weather Influences

Weather conditions greatly impact the buying behavior of customers. In general, windy weather has proven to have a highly negative impact on retail sales revenue. Making other general statements is difficult since a specific weather condition can have a positive effect on one type of retail, and a negative on another. Think about how cold weather might improve sales of books but negatively affect sales of handbags, for example. (A nice article focusing on the impact of temperature on shopping can be found at the Summit Blog.)

Likewise, a retail shop’s location—inbound or outbound—and its availability of underground parking are very important in rainy conditions. For retailers, it’s important  to realize that weather conditions have so much impact that they can’t be excluded from operational insights on shop performance. Thus, they must make them part of the closed loop portfolio.

Alternative Business Models

Retail and B2C markets are probably one of the most highly interesting market segments to follow. Why? Well, they’ll be under great change. The “Digital Transformation” age and the availability of information to both the retailer and the consumer are changing everything.

Consumers are not only wanting to know “everything” about their product, they are also shifting to buying (or should I say “renting”) a product experience rather than the product itself. For the latter, think about the accompanying services to a product that the retailer might want to offer. Have a look at this article from Forbes, which describes three trends for retail in the future—instant gratification, borrowing, and customization.

For me, there is enough food for thought to write a Part Three of the series on the overwhelming power of analytics within retailing and B2C. Stay tuned.

Follow me on Twitter – @IvervandeZand.

– See more at: http://blogs.sap.com/analytics/2016/01/06/the-overwhelming-power-of-analytics-in-retailing-and-b2c-part-two/#sthash.YIdYhjL9.dpuf

The Overwhelming Power of Analytics in Retailing and B2C: Part One

Women With Shopping Bags --- Image by © Tim Pannell/Corbis
Women With Shopping Bags — Image by © Tim Pannell/Corbis

Thank you to Iver van de Zand, SAP

Online grocery shopping and personalized bonus cards – we all face these incentives every day. Each is strongly driven by the overwhelming power of the analytics that are behind them. This article will share my experiences on these topics providing examples of retailing and B2C customer journeys that I have been a part of. The below examples are not at all exhaustive; they are also not about the future but are what happens, and are in production, today!

One thing that makes the retail market segment so interesting is the extreme sensitivity to community influences. A small thing might happen in society that can immediately affect buying behavior: today people are connected everywhere and at any moment. A simple anecdote on social media is shared so quickly that it can influence consumer choices instantly. One simple bad review about, for example, a yogurt brand, can raise or lower the selling of this product the next day. If the retailer wants to act upon these influences, he needs state of art Insights and online operational analytics.

Retailers are Analyzing You

Your bonus card, combined with your social media credentials, tell the retailer a whole lot more about you than you might realize. Analytics, clustering, and predictive modeling inform the retailer about your family composition, your eating and clothing preferences, how many children and pets you probably have and even what kind of holidays you like. By smartly combining your information with reference groups, the amount of trustworthy information a retailer can predict is huge.

Now imagine that the retailer recognizes you based on your cellphone signal when you enter the store. This information is linked online to your bonus card and social media credentials: “the retailer knows exactly who is in the store”. Then based on the same cellphone signal, the retailer can follow (!) you through the store using GEO coordinates. It means the retailer knows you are in front of the vegetable section, and also knows – based on the bonus card info – that you like carrots a lot. The electronic banner automatically flips and messages about a special offer on “carrots that taste very good with a new white wine that you might want to try”. A message targeted at you.

Imagine?? Well, forget about “imagine” – this is done today and you are part of it.

Supply Chain Challenges

Imagine this scenario. The latest game controllers are very popular, so our retailer decides to order additional stock from one of his vendors. Using buying behavior and predictive algorithms, the retailer knows he will sell the controllers. Early in the morning the stock manager receives a message that the vendor’s truck driver is stuck at the border and will be very late. Order intake quickly searches for alternative vendors and places an online order. That order will influence consumer prices and using business analytics the retailer can immediately predict the effect this price change will have on today’s revenue. It also automatically adjusts the retailer’s forecast and rolling plan, even from its subsidiaries if they exist. Using basket analyses, the new type of game controller might be influential to the selling of USB cables too so the retailer decides to order additional USB sticks and the system automatically adjusts distributed forecasts and rolling planning. Imagine? Not at all!

Product OffersMan holding gift bags --- Image by © Ocean/Corbis

Apart from understanding the buying behavior of a customer (using bonus cards and others), retailers spend a huge amount of effort in understanding where the demand will be. Trend forecast algorithms combine social media posts, web browsing behavior, and ad-buying data to predict what will cause a trend or buzz. Social media discussions on the clothing habits of a popular band might cause specific trousers to become popular. These sentiment analyses get even more complex if you realize that there is a heavy demographic component embedded together with economic indicators. Offerings on detective books will increase significantly if two things occur – the weather gets colder and at the same time a significant crime is discussed on social media.

In-Memory Computing and Interactive Insights Make the Difference

Retailers and B2Cs in today’s market dynamically follow and influence customer buying behavior. They have to because the consumer is so well informed and has so many alternatives for buying. Retailers have to act instantly on changing behavior. To do so the amount and complexity of information that needs to be analyzed is so big, only in-memory computing can handle it. Bear in mind that an individual retailer is never on its own but part of a brand, meaning individual shop performance is rolled-up to the corporate level. This corporate level manages online shop performance indicators, compares the various stores, and delegates rolling budgets down to the shops on a daily basis. These budgets vary daily given the changing demand analyses we talked about above.

These dynamics also require online interactive analytical capabilities. Information on buying and demand behavior varies daily and is analyzed permanently. Ever changing sources, unknown structures of new information, or simulation models require the analyst to interact with the data all the time.

In a future article, we will deep dive into some of the other use cases for business analytics in Retailing and B2C market spaces. One of them is basket analysis. Using predictive modeling combined with business analytics, it’s possible online to utilize the buying behavior of the consumer. These are techniques that are used today! Looking forward to share with you

– See more at: http://blogs.sap.com/analytics/2015/12/09/the-overwhelming-power-of-analytics-in-retailing-and-b2c-part-one/#sthash.ozusXrxq.dpuf

The Closed Loop portfolio in Analytics

The Closed Loop portfolio in Analytics

Authored by Iver van de Zand, SAP

We talked about the overwhelming power of analytics in Retail and B2C market-segments earlier and one of the topics discussed there, was the integration of operational business activities with operational analytics. In the example we saw the stock manager using analytics to change his stock-buying-behavior. He adjusted his order system by choosing another vendor and placing the order. Immediately his analytics are updated and he now requires to adjust his rolling planning or run a predictive simulation how the price-adjustment of his new stock might affect buying behavior of his customers. He might even want to adjust the governance rules with his new supplier or run a risk-assessment.

 

Below pictures visualizes the continuous integration of core business activities with business analytics, indicating examples of core processes with their accompanying analytical perspectives. These are just examples and not exhaustive at all.

 

Performance Management closed loop

Basically what the stock manager in our example needs, is a full – real-time – integration of business analytics with his core business activities over all aspects of his performance management domain. A predictive simulation of changing buying behavior lead to new analytical insights on product mix which might influence the companies’ budget and causes a risk analysis for new vendors.

To do so, a closed loop is required of following core components driven by the continuous flow of Discover – Plan – Inform – Anticipate:

  • online Analytics on big data with interactive user involvement
  • ability to adjust and monitor a rolling Planning for budgets, forecasts. A planning that that allows for delegation and distribution from corporate level into lower levels
  • GRC software to perform risk analyses on for example vendors or suppliers
  • online Predictive analyses components to apply predictive models like decision trees, forecasting models or other R algorithms. Predictive analyses allow to look for patterns in the data that “regular” analytics is not able to discover. The scope of predictive analytics is gigantic: think not only sentiment analyses for social media, but also basket analyses in retail markets, attrition rates in HR and many, many more.

 

This so-called closed loop of predictive analytics, planning and performance management, business analytics and GRC is NOT a sequential process at all. They interact randomly towards each other in real-time and at any moment needed. They are also dependent towards each other, since Digital Transformation requires us to be so agile, we have to constantly execute and collaborate on the interoperability of the components and monitor the outcome. Lastly, the closed loop platform interacts on core operational activities (real-time insights in operational data) and as such the analytics are defined as Operational Analytics.

Closed loop platforms more than anything else require business users to drive its content and purpose. They drive the agility to the platform that is so heavily needed in the Digital Transformation era. On the other hand the technical driven architects do make a difference too, since closed loop platforms are very sensitive to respect governance principles. A special role is allocated to the CFO or Office of Finance here; they will drive the bigger part of the Planning and Budgeting cycle.

One can imagine the calculation processes behind the closed loop platform are huge and therefor a business case for an in-memory system is a sine qua non.

Imagine the possibilities

Needless to say that the closed loop model applies to all industries and not only in the retail example that I used here. I can list plenty of examples here but just to name a few:

 

  • HR: attrition rates of employees
  • Banking & Insurance: customer segmentation, product basket analyses
  • Telco & Communications: churn and market segmentation nut also network utilization
  • Public Government: Fraud detection and  Risk-Mitigation
  • Hospital: personalized healthcare

Apart from imagining the possibilities per market segment, we can also change perspectives and look at the possibilities per role within companies applying the closed loop platform. Below picture provides capabilities the closed loop components could offer to various user communities. The potential is huge and extremely powerful when used in an integrated platform. This is also the weaker point of the closed loop platform: the components must be integrated not to miss their leveraging effect on each other.

A solution is available today

With its Cloud for Analytics offering, SAP is today the only provider with an integrated offering for the closed loop platform. Even more: SAP Cloud for Analytics is integrated in one tool offering analytics, planning, GRC and predictive capabilities. One tool?? …. Yes, one tool completely Cloud driven and utilizing the in-memory HANA Cloud Platform it is running on. One tool that seamlessly lets analytics and planning interact with each other. A tool where you can run your predictive models and analyses and visualize the outcome with the analytics section. A tool that allows access to both your on premise data, your Cloud data and/or Hadoop stored data. And lastly a tool with fully embedded collaboration techniques to share your insights with colleagues but also involve them with planning or others.  Our dream becomes reality.