RSR Research: Is There Significant New Demand for Retail BI?
By Brian Kilcourse, Managing Partner
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.
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?
- Is There Significant New Demand for Retail
BI? – RSR Research
- RSR Research Survey: Driving a Return to
Simplicity and Transparency with Real-time Business Intelligence – RSR