Making an Impact

what benefits can cg firms obtain through integrating sales and marketing efforts?
The greatest benefit is perhaps the most difficult to quantify, and that is the ability for an organization to harmonize their entire go-to-market strategy. Once a firm can get all respective marketing and sales roles aligned, and integrate its processes with a common software platform, the benefits are huge. Companies can expect fewer "off strategy" decisions, greater speed-to-market, higher new product success rates, lower administrative costs, and many other benefits.

I think it is important to clarify the scope of this topic. At SAP, we help CG firms manage the entire go-to-market process. We see this starting with the Brand Management discipline where they essentially determine the brand strategy and set the direction for the four P's: product, price, place and promotion. This information and direction needs to automatically flow over to the Category Management discipline, where it is refined and taken to an account-specific level. This output then needs to be integrated with the Trade Promotion and account planning processes, which should then feed the Retail Execution process.By having all the related roles on an integrated platform it becomes much easier to execute a strategy consistently and quickly.

What are some steps executives should take to better analyze and report upon A growing volume of data?
Executives should consider this matter on three fronts. The first is data quality and integrity, keeping in mind that important adage -- "garbage in, garbage out." Here some questions you should ask. Do I have good source data? Is it real-time, or at least the latest version? Is it properly aligned? Companies should strive for one version of the truth with quality data. This is becoming more critical and more difficult with the growing volume and sources.

The second area of focus is the cost side of the equation. The cost of achieving data quality can be very high. One way to avoid this is to use truly integrated software solutions. Anticipating the explosion of RFID signals is important, but it doesn't necessarily mean just buying an enormous data warehouse. A software system that is designed to receive these signals and then "automatically" utilize them can be very effective in both managing information and keeping costs to a minimum.

The third area is the user experience. Data is worthless unless it is turned into actionable insights that are easily discovered. Users should not have to go hunting for the proverbial needle in the hay stack. Today's technology can direct actionable insights to users on an exception basis, so that they can sort through the data and focus on critical information.

To maximize market opportunities, many CG firms are moving towards a Demand Driven Supply Network. What tools are needed to make this happen?
I think the operative words here are "moving towards". While I see DDSN as an evolutionary journey upon which the best-run companies are already embarking, I also think that any company can begin approaching DDSN with some of the tools that they already have, and then add more as they evolve.

Essentially, companies need to extend the breadth of their visibility; from customer to supplier, and the depth of visibility from order to pallet, case and ultimately down to the item. Tools that enable this are RFID, portals, event management and analytics. The pursuit is worthwhile, but it can lead to complex software landscape. Executives should approach this effort strategically with the goal of a fully integrated environment that can mitigate risk and complexity, and improve the impact of each critical component across the entire supply network.

Companies must also collapse response times; blending planning and execution together. This requires significant process changes and discipline in execution, whether it is order management, production or simply picking, packing and shipping. Once the basics are mastered, advanced practices like Lean Manufacturing, Six Sigma and Postponement can bring even greater results. While sales forecasts are still important, short-term "responsive" planning that reacts quickly, even within hours, should be the goal. If done right, it can complement existing Vendor Managed Inventory and Sales & Operations Planning processes.

What steps should CG executives take TO improve forecast accuracy and become a better supplier to retail partners?
While I agree with this statement, I also would argue that it should be "redefining" versus "refining". I am still astounded by the way some firms approach forecasting. The first thing to recognize is that "you can't manage what you can't measure". People should begin by honestly assessing how the organization is currently doing with regard to collaborative forecasting at all levels, and compare it with the very best-run companies.

The next step should be to recognize that the world as we know it is changing fast, and that existing processes must adapt or else. What happens when companies look to improve their forecasting process and discover that their technology platform is inadequate? What if their software systems cannot leverage RFID signals, or they cannot quickly adapt to changes in demand signals without borrowing from Peter to pay Paul? Let's say they determine that they can and should adjust forecasts every day. Can their organization handle that?

Executives need to rethink not just their forecast processes, but also their entire supply chain model and software platforms. They really need to pursue an adaptive or demand-driven supply network. This is not an overnight exercise, and it requires a lot of change, but I see the best-run consumer products companies making the investment.

New products fail 50 percent of the time. how can CG firms better manage their new product development and launch process?
This is an important question and, depending on how you define "fail", the statistics can look even worse. For many companies the New Product Development and Introduction (NPDI) process is perhaps their most important success factor.

I think of this challenge in three ways. First, companies must innovate and keep pace with consumer preferences or they risk becoming obsolete over time. Second, all companies have limited resources, so money earmarked for NPDI must be invested wisely and efficiently. Third, speed to market is absolutely critical.
AMR Research recently conducted a study and found that only 31 percent of companies surveyed felt that their NPDI processes were strategically and financially under control, and it's no wonder when only 52 percent maintain formal metrics. It supports the point that one can't manage what one can't measure. These are frightening statistics, especially if shareholders ever find out.

The problem is that many companies lack an overall process for NPDI. SAP defines NPDI as the business process extending from the identification of a product opportunity to the market launch and everything in between. By definition, this process crosses the entire enterprise, and that is why it is so difficult to control. It is critical that the responsibility for a corporate NPDI process resides with a senior level executive with responsibility and foresight to deploy integrated enterprise-wide software systems that are designed to support the entire NPDI process.