Managed analytics overview

MANAGED ANALYTICS AN OVERVIEW PRESENTATION

8th March 2010, The Strand, London

All organizations say that they want to serve their customers better, all organizations claim to have a robust strategy, Many state that they are aiming for market leadership. Very few actually achieve it. The

ones that do are the clever ones. They are driven by decisive leadership achieved through a deep understanding of demand for their products and services. They leverage the value of their data assets. They engage and excite their customers by understanding

and responding to their value agendas

KNOWLEDGE : LEADERSHIP : CHANGE

DATA IS STRATEGIC

(IT SHOULD BE RECOGNISED AS A CORE ASSET OF ANY ORGANISATION OR BUSINESS)

THE FUNDAMENTAL QUESTIONS ARE WHAT DOES IT TELL US ?, AND HOW DO WE ENABLE THE ORGANISATION TO ACT UPON THOSE INSIGHTS ?

1. SETTING THE CONTEXT: THE NEED AND THE OPPORTUNITY FOR ANALYTICS

Manufacturing

Service Support(Distrbn)

Sales&

MarketingGM Procure ITFinance & Admin

FUNCTIONS RANKED BY PROXIMITY TO THE CONSUMER

NU

MB

ER

(C

OS

T)

OF

EM

PLO

YE

ES

Current

1980s/90s

MA Context & the need for change….The Challenge….

ACROSS LARGE CORPORATES THE LAST TWENTY YEARS HAS SEEN A SIGNIFICANT SHIFT IN DISTRIBUTION OF MANPOWER AWAY FROM CONSUMERS INTO “BACK OFFICE” FUNCTIONS.

Many large companies have “lost touch and sight of” their consumer, becoming increasingly reliant of brand and distributive legacies to sustain revenue streams. The question is how can they address the imbalance?.

FUNCTIONS RANKED BY PROXIMITY TO THE CITIZEN

NU

MB

ER

(C

OS

T)

OF

EM

PLO

YE

ES

Current

1980s/90s

MA Context & the need for change….

AS A RESULT MANY FACE THE REALITY OF TWO GAPS. THIS IS THE CHALLENGE, THE OPPORTUNITY AND THE NEED FOR CHANGE

GAP 1 GAP 2

GAP 1 – Should be understood as the failure of historic investment in technology to deliver expected benefits

GAP 2 – Should be understood as the potential shortfall in front end engagement, resulting in product and service provision failing to meet consumers needs, the increasing likely hood of consumer migration (loss), and the opportunity for “new entrants” to exploit those gaps acquiring new consumers .

THE CHANNEL EXPLOSION

THE INFORMATION REVOLUTION

THE NEW DECISION MAKING

HEIRARCHIES

In the last decade there has been an exponential growth in the number and significance of both conventional and new media channels, with an accompanying shift to a pull (on demand) rather than a push environment

The economics of information have changed. The more information there is to filter the more expensive finding the right information becomes. The central challenge is not to provide more information to consumers, but how to ensure that they get the relevant information in the appropriate format at the right time.

There are new and emergent consumer decision making hierarchies. Alongside conventional media advertising and editorial parallel hierarchies are emerging around search and technology enabled word of mouth. When it comes to purchasing decisions these services can provide customers with the most important and relevant information far more efficiently.

Characterising market development….

THE WORLD HAS CHANGED - COMPANIES ARE FACING PROFOUND CHALLENGES AND CHANGES IN THE WAY THEY ATTRACT, RETAIN, DEVELOP THEIR CUSTOMERS

THE OLD SCHOOL

THE NEW SCHOOL

• SELLER CENTRIC •* SUPPLY AGENDA •

• CONSUMER CENTRIC •* DEMAND AGENDA •

1.

2.

These companies believe in the audience paradigm which can be expressed in three simple steps:

1.Advertisers (companies) send out messages to consumers 2.These messages get (somehow, sometime) into consumers heads (awareness)3.Consumers act on these messages. Some of this results in conversion to purchase.

These companies believe in the search and filter paradigm which can be expressed in three simple steps:

1.Consumers are always searching for better value from a different range of choices at different stages of their consumer lifecycle. 2.Consumers shift through the information they come across (proactive & reactive) They keep the bits that help them in their search for value, and discard the rest.3.Consumers act on these on those retained bits of information that they find the most useful and relevant to their needs at act on them when appropriate to their need state.

AUDIENCE PARADIGM

SEARCH & FILTER PARADIGM


CONSISTENT WITH SUCH DYNAMICS WE CAN DETERMINE TWO DIVERGENT PARADIGMS

COMPANY A

“THE OLD SCHOOL”

COMPANY B


COMPANY C


COMPANY D


COMPANY E


NEW CO COLLECTS OFFERS ACROSS COMPANIES A TO E, WHO ARE WORKING FROM A SUPPLY AGENDA

NEW CO UNDERSTANDS THE SEARCH & FILTER PARADIGM

NEW CO GROUPS CONSUMERS AND ACTIVELY ENGAGES IN ACCORDANCE TO THEIR VALUE AGENDAS

“New Entrants” exploit the weakness of “Supply

Agenda” Product Manufacturers capturing incremental value that

should have been available to them by developing strong

relationships (ownership) of their customer base

Recent examples of this trend range from the Car

Phone Warehouse, to Confused.com &

Compare the market.com, to Ocado, Expedia, Nesspresso Club, and Net a Porter

(now acquired by Richmont)

COMPANIES “MANUFACTURING” SIMILAR OR SUBSTITUTE PRODUCTS

RESULT:Falling SVA

RESULT:Increasing SVA

Characterising market development…

ACROSS MOST VERTICALS WE CAN IDENTIFY EXAMPLES WHERE THOSE RESPONDING TO SEARCH & FILTER ARE MAKING SUBSTANTIVE GAINS IN VALUE.

DATA WAREHOUSE(Focused on Compliance)

MANUFACTURINGTECHNOLOGY

FINANCEGENERAL MGNT

PRODUCT MARKETING

SALES transaction focused

(CRM Systems)

BRAND(event occasion)

MARKETING

SALESOpportunity focused(integrated systems)

DATA ANALYTICS

(Focused on the consumer)


SYPMTOMATIC WITH SUCH SITUATIONS ARE LOW LEVELS OF DATA UTILIZATION

Realigning the business pulling it into a consumer facing organization

MANUFACTURINGTECHNOLOGY

FINANCEGENERAL MGNT

In such cases data is simply stored as evidence of a historic transaction, in other cases it may just be discarded

1.

2.

SUCCESSFUL DEPLOYMENT OF ANALYTICS CAN DRIVE REALIGNMENT

MANAGING CUSTOMER

DATA

INTEGRITY INTELLIGENCE INSIGHT


BY BRINGING THE RIGHT TOOLS AND COMPETENCIES ORGANIZATIONS CAN START TO ACT ON FACT BASED INSIGHTS

Capture Cleanse Suppress Discover Enhance Generate ProvideDemonst

rateDeliver

ANALYZING CUSTOMER

DATA

APPLYING CUSTOMER

DATA

% Change in Shareholder Value (Increase in ROIC)

Deg

ree

of

Cu

sto

mer

Fo

cus

Market leadership position

Industry norm/average

Sub standard performers

INTEGRITY

INTELLIGENCE

INSIGHT

Embedding Customer Intelligence: Realizing Competitive Advantage


BY EMBEDDING AN ANALYTICS COMPETENCY COMPANIES CAN START TO MAKE SUBSTANTIVE GAINS IN VALUE (FULFILLING THEIR CONSUMER PROMISE)

Demand based strategies driven by solid (fact based) insights derived from actual data create energy, drive practical application, and enable leadership decisiveness. (and they get better – learning as the competence builds!)


TO SUMMARIZE THE NEED AND THE OPPORTUNITY FOR ANALYTICS

Consumers have been quicker to understand and to adapt to the benefits that technology and new on demand environments can deliver to them

Companies and organizations have been slower and in may cases have yet to harness the full potential of consumer centric (demand driven) business models.

Traditionally in corporate environments technological transformation has focused on cost and control (systems & servers)

Many large companies have “lost touch and sight of” their consumer, becoming over reliant on in bound traffic (brand & distributive legacies)

As a result “new entrants” have taken the impetus. Technologically savvy and consumer focused they have taken the lead it developing and realizing new business models

These companies have discovered and taken ownership of profit streams that traditionally were available (or could be controlled) by product manufacturers.

CONCLUSION

Many companies are more aware of the opportunity that analytics may offer in supporting the realignment of the business toward a more demand based operating model.


BUT COMPANIES SEEKING TO BECOME CONSUMER CENTRIC AND CAPTURE VALUE FACE A PROBLEM – WHERE TO GO FOR ADVICE

Technology Companies delivering “product” solutions

Agency Data Management Companies “batch” mining

Generalist Consultants“change” models

Strategy Consultants “strategic” frameworks

Marketing Services brand strategies

Data Sales Companies “external” variables

Creative Agencies “image” platforms

Consumer Research Companies panel & focus Studies

THE GAP

2. ESTABLISHING AN ANALYTICS FRAMEWORK: DISCIPLINES & TOOLS REQUIRED

WHAT IS MANAGED ANALYTICS : AND HOW CAN IT HELP?

Managed Analytics enables transformation by delivering fact based decision making through data driven insights. It combines advisory services, advanced quantitative analysis, proprietary algorithms and methods, and actionable strategic frameworks in a way that is focused on the delivery of outcome based action.The major challenge facing companies (organizations) today is that they have the data, but not the insight (or the framework or methodology to act upon it). Managed Analytics bridges this gap by allowing companies to leverage their data assets – with actions centered around the right insight companies can transform and create competitive advantage.It recognizes that at a given time a customer’s needs relate to a customer’s circumstance. A change in those circumstances triggers a change in customer behaviour, which is reflected in demand for different (new) products or services.

OUTTURN

By determining and tracking those Demand Triggers, and learning how they combine and interact, customer specific needs can be fed to the front end of the organization and acted on in the appropriate way.

In this way organizations become demand driven, by being able to understand and respond to a customers needs for product and services at a particular point in time.

Rather than needing organizational change to implement the approach, it delivers change across the organization as a result of its implementation.

MA Capabilities….

An Analytics approach does three things - It is consumer focused transformation

A DATAAGNOSTIC &

BLENDER Provide and utilize over

1,700 external data variables for consumers, 37 for

businesses

AN INSIGHT GENERATOR &

REALIZER We provide a logical and

sequential series of software tools, balanced with

conventional consumer research processes

A BUSINESS ENABLER &

TRANSFORMER Provide and embed

actionable outcomes that enable enhanced service delivery ( better service

delivery for customers at greater efficiency)

Managed Analytics delivers rock solid insights that enable actionable outcomes, that generate energy, activation, and leadership

decisiveness within the client organization. It drives change from the point of customer interaction

A total solution to customer transformation

AND IMPORTANTLY WHAT IT IS NOT

An Analytics methodology does not seek to sell a prescriptive “black box” (technology product) to the client on a limited understanding of the business issue. Instead it works with the client to define and understand the business issue and then to bring the appropriate bespoke technology to its complete solution. Use of External Data The approach does deploy external (commercially traded) data variables. At present, there are some 17,000 data variables available from a range of suppliers (utilization subject to limitation in accordance with the Data Protection Act). MA is data (supplier) agnostic: it works with the client to determine which external data sets are most important for the client’s business need. Once this is determined it can advise and support through negotiations on data purchase (ensuring value) and supply.

Differentiation versus other suppliers We don’t consider ourselves to be a technology company – that would be too narrow. We consider ourselves unique both in the holistic nature of the disciplines employed and the compelling outcomes we can deliver. The extension of the application into delivery and display of outcomes at the point of need, and the integration of a communications platform further differentiate the “end to end” solution that Managed Analytics offers.

MA Framework…..3 Stages……

The Analytics proposition works with the client to provide, demonstrate and deliver strategic business solutions

DETERMINE the Business

Case

DRIVE delivery of

Opportunity

EMBED The Strategic

Solution

THE MANAGED ANALYTICS PROCESS

PROVIDE DEMONSTRATE DELIVER

This the Proof of Concept Preliminary Phase which provides the Business case for implementation. It establishes a “working” scorecard, prototype application and workflow

This demonstrator secondary phase actively engages with the front end of the organization. By going live and delivering tangible results it facilitates calibration of the application

Having proven the case and established credentials, the business is now in a position to “roll out” a scalable solution.

The three-step methodology enables fast realization of benefits within minimal disruption to existing systems architecture and ongoing operational processes and workflows. Fit for purpose solutions are realized and delivered as web based applications to the front end of the organization. Results and outcomes are delivered in an easy to understand easy to act on manner that supports and enables change in working practise.

DATA BLENDING

(combining)

Functional Tasks

PROVIDEDEMONSTRATE

DELIVER

MA Frame work…

It involves 5 core and interrelated tasks – the focus is always on quality and applicability of the intelligence

DATA MATCHING(External Data Variables)

Functional Tasks

CAPTURECLEANSESUPPRESS

CONSULTING SKILLSOrganizational DevelopmentFinancial Analysis (ABC)Competitive FrameworksStrategy DevelopmentOperational Improvement

Documents

Managed analytics overview