Through a special arrangement, presented here for discussion is a summary of a current article from Retail Paradox, Retail Systems Research's weekly analysis on emerging issues facing retailers.
Even as retailers' access to information has grown, the ability to turn that information into actionable tasks has languished. Fractured planning processes have been joined by fractured execution mandates and siloed processes as inhibitors to retailing success, most especially in selling environments. Awash in reports, emails, portals and standards, operators are more challenged than ever to execute on a unified set of corporate priorities. Retailers are calling for a return to simplicity, cooperation and transparency, even as they call for more speed in decision-cycles in all phases of operations.
RSR believes that actionable information derived from real-time business intelligence (BI) is critical to driving success. Retailers have come to understand that process is important and are moving from a "whatever it takes" mode to something more engineered: process driven by actionable information. Closing the loop between operational systems and BI is important because the "lag time to action" is getting shorter all the time. Retailers believe the potential of real-time or near-real-time business intelligence is enormous, but recognize they have a long way to go in realizing that potential (Figure 1).
Are Retailers Ready to Spend on BI?
In virtually every benchmark study
RSR has conducted over the past two years, retailers have expressed a need
to add new Business Intelligence (BI) capabilities to their existing technology
portfolio. Their goal is to leverage existing information assets to bring actionable
information directly into the hands of operational decision-makers.
Historically, BI has been delivered primarily to C-level and finance executives in a variety of forms including spreadsheets, reports, and emails. While it may have helped keep the corporation on track financially, it did little to support the actual running of the business. Data was delivered after the fact, too late for anything but forensic analysis. As we have seen in our research, many retailers now have plans to deliver real-time, actionable BI into the hands of new line-of-business users.
The global economic downturn has only increased the appetite for new BI. Customer demand has become far less predictable, and scarce capital resources demand retailers make the best possible use of their inventory and payroll investments. Mid-tier retailers in particular, who have not historically perceived a need for sophistication, have seen the need for change. They now recognize the need for more detail and granularity. It is not a stretch to say this data is critical for their survival.
Just as the old generation of BI served to silo and compartmentalize retail, even as it supported business growth, the new generation of BI will serve as a key supporter of a more holistic and transparent growing retail enterprise.
Discussion Questions: Is there significant new demand for retail business intelligence? Are any newer issues hampering BI investments? How do retailers view the current versus potential contribution of near real-time business intelligence to their business success?