The Next Big Thing
The acceptance of business analytics as the "next big thing" in IT is making huge inroads -- and not just in the consumer goods arena. The State of Texas, for instance, uses predictive analytics to reduce the "tax gap" between the tax owed and the amount collected, and have played an important role in recovering more than $400 million in unpaid taxes since 1998.
Retailers use predictive analytics to identify product "shrinkage" (a reduction in inventory primarily due to shoplifting and employee theft). Multiple police departments nationwide are using predictive analytics to identify key patterns in crime data -- such as incident reports, crime tips, and calls for police assistance -- to make effective officer-deployment decisions. Children's Memorial Research Center (the research arm of Children's Memorial Hospital) has gained unique insights into tumor classification and treatment strategies through predictive analytics. Additionally, the Center uses predictive analytics to discover previously overlooked relationships contained in volumes of biomedical literature.
The Pendulum Swings
Consumer goods manufacturers and retailers have begun to realize that the pendulum of power has swung toward the consumer, who is more savvy and demanding than in decades past. To adapt to the maturity of the consumer, they will have to utilize analytics and information to improve performance.
Vendors such as Information Resources Inc. (IRI) address these challenges with analytic solutions that move toward the requirements of having information in real time and adapting to shorter time cycles. However, IRI will have to prove that it can bring these analytics and intelligence into their organizations. Ventana Research believes that IRI's analytic solutions can help CPG manufacturers and retailers to mature, but IRI will have to convince the industry and executives to embrace its new portfolio.
Mold that Matters
Monterey Mushrooms Inc. recently announced that it is using SPSS technology to more effectively run all facets of its business from its facilities across the United States, Canada and Mexico.
Monterey Mushrooms is the largest grower/shipper and marketer of fresh mushrooms in the United States. Established in 1971 as a single-farm operation, it has grown to an international, multi-facility company. It currently operates 14 facilities around the world.
Today, this multi-site business is headquartered in Watsonville, California, and has production, sales and administrative offices internationally. Monterey is the country's largest and only national marketer of fresh mushrooms, supplying products for sale to supermarkets, foodservice and ingredient manufacture operations, and for preparation of processed, canned and frozen mushroom products.
In 1999, the company furthered its expansion into the Midwestern and Southeastern regions via the acquisition of mushroom farms in Princeton, Illinois, and Orlando, Florida. Monterey also continued its expansion in the Pacific Northwest via contracted pounds from Canada -- all pounds are packed and distributed under the Monterey Mushrooms label.
Monterey Mushrooms has incorporated SPSS technology into many of its daily operations and it has had an immediate impact on the business. "If we uninstalled the SPSS product line we have in place today, many areas of our operations would be impacted as our ability to deliver meaningful information would be greatly impaired. We rely on this software every day," says Andrew Burnham, Monterey Mushrooms' senior programmer/analyst, who is responsible for deploying SPSS' software at the company.
Areas of the company affected by SPSS technology included sales reporting, payroll balancing, freight distribution, human resources and asset management/general ledger reporting, just to name a few.
"With this software, employees are spending a lot less time waiting for reports and gathering information, and more time analyzing the business and making the necessary changes to meet their business goals," says Burnham.
I See Data
Monterey Mushrooms President and Chief Executive Officer Shah Kazemi is so pleased with SPSS software that he had it implemented for all senior-level personnel to help them better understand their revenues and margins. The software allows Monterey Mushrooms users to view and interact with customized reports, which are all based on the same information, to help the users make the right decisions quickly.
"Because of SPSS, we're able to see our data as we've never seen it before," adds Burnham. "We're able to view it from different angles and perspectives. That allows us to better analyze our margin of profitability and highlight exceptions quickly, which, in turn, allows us to make better business decisions."