Analytics-Based Planning

Rapid developments in technology along with economic and marketplace changes continue to put pressure on the salesforce to adopt new approaches to customer planning, trade operations and account management. Most of, if not all, sales teams are facing the following challenges:

Pressure from retailers asking for shopper insights from their suppliers

• A desire on part of both retailers and consumer products (CP) executives to improve the ROI of promotions by focusing on post event analysis and trade promotion optimization
• Awareness that internal teams should put more efforts on analyzing base business versus incremental lift
• Understanding and dealing with big data given a lack of skillsets, inappropriate technology and outdated processes

The fallout from these trends is landing solely on the heads of the salesforce as account teams struggle to deal with internal and external demands for answers to these challenges. The result is that CP companies are being forced to make a choice between continuing business as usual or changing their operations to acknowledge and address current trends.

As these trends accelerate, both retailers and CP manufacturers are wondering what to do. Retailers readily admit that they have no idea how to deal with these dynamics and are turning to their suppliers for answers; so failing to address these dynamics could put additional pressure on your customer relationships. The other option is to determine whether your company is ready to build the capabilities necessary to deliver the next generation of customer planning, oftentimes referred to as analytics-based planning.

While many CP executives acknowledge the need to build analytics-based planning capabilities, many resulting programs suffer common and sometimes fatal errors by:

• Approaching analytics-based planning from a technological perspective
• Including all accounts in the initiative
• Building the capability at headquarters level only
• Overlooking the organizational issues associated with the transformation
• Failing to identify and/or agree on information requirements

To avoid these pitfalls, it is important to take a step back and formulate a holistic and strategic approach to building analytics-based planning capabilities. Over the last 12 months, several successful transformations began by focusing on the desired end state then constructing a roadmap to move the organization toward that goal. All of these programs have incorporated the following steps:

• Defining what the organization means by the term “analytics-based planning” and which accounts should be included in the initiative
• Agreeing on the KPIs and critical data for insights required to address both internal and customer requirements
• Beginning the transformation by incorporating planning and reporting processes to deliver the analytics and insights to the right audience
• Underpinning the capability with the appropriate technology solution

This methodology effectively addresses many of the issues that typically derail projects focused on establishing analytics-based planning. However, the core benefit of this approach is that it quickly determines whether the company is ready for analytics-based planning by getting stakeholder agreement and involvement up front before any changes or investments are made.  

If that alignment can in fact be achieved, there is a good chance that your program will be successful — ensuring that your sales teams will weather the challenges of the changing environment, coming out on top of their competition while building improved relationships with their customers.