As customer expectations change beyond the Covid-19 pandemic, it’s come into stark focus that most businesses need to re-evaluate the way they plan and run their operations.
However, according to a recent report by IDC – Why Integrated Business Planning is the Linchpin – the majority (63 per cent) of retailers don’t see innovation as a priority. A further 27 per cent are digitally determined, and are focusing on innovation, while the final 10 per cent are already digitally mature and are reaping the benefits.
Maintaining outdated legacy systems and disparate processes can no longer be seen as ‘good enough’ by business leaders that were already struggling before the pandemic hit. With an even more competitive environment brewing in 2021, now is the time to better integrate operations into a smoother, more visible model.
The key to this is known as Integrated Business Planning (IBP), according to Fabio Lovesio, Head of Industry Solutions at decision-making platform vendor Board International.
“IBP is not a mere change of technology, but a change of paradigm,” said Lovesio.
“A company’s culture must change since more reliable data will be available for analysis and action. More people can be involved in decision-making through effective workflow-based interactions, with an exploration of alternative plans becoming the norm.”
This ‘ideal state’, as Lovesio calls it, doesn’t come easily – it requires discipline and perception of the company as a whole, rather than as a group of disjointed departments with some dotted lines connecting their actions.
However, this method of business planning can deliver two key benefits: the end of data silos, and an increase in the speed of prototyping and exploring new ideas due to an ability to simulate all relevant data at once.
“Typically, insights that would prove highly useful in decision-making remain locked away in multiple spreadsheets and stand-alone planning and analytics solutions that cannot talk to one another effectively,” Lovesio said.
“As a result, leaders have limited visibility of critical performance data and the relationship between it, making it difficult to spot trends or quickly and accurately simulate the broader impact of their plans – leading to a reliance on ‘gut feel’ and historical experience when making decisions.”
Two industries that would benefit greatly from this are that of fashion retail and manufacturing. Multichannel fashion retailers need to be able to react quickly to trends and external changes – any indecision can result in the loss of market share.
For example, sportswear brand Puma utilised Board’s decision-making platform to better understand its supply chain and better react to seasonal trends, after its leadership noticed it was struggling to accurately make forecasts, and had no real-time data.
“For us, this challenging journey wasn’t a mere project. Rather, it was a program, a new path towards an end-to-end budgeting, planning, and forecasting process,” said Puma’s head of program portfolio management and commercial processes.
“With Board we have significantly increased the accuracy and speed of our forecasting, and are now in the position to continuously balance supply and demand… [It’s given] us a clear competitive edge.”
Manufacturers, on the other hand, can benefit from having a more singular view of their often complex supply chain. Being able to see what one delay means for the broader network is critical in diagnosing the scope of the problem and in mitigating its effects.
But, as retail moves toward an omni-channel model, and customers increasingly want online and bricks-and-mortar operations to be more integrated, being able to track inventory levels across a retailer’s network, as well as anticipate upcoming shipments and deliveries, can be incredibly useful across the industry.
Download the “IDC Retail Digital Transformation – Why Integrated Business Planning is the linchpin” whitepaper from the Board International website to find out more about the benefits of Integrated Business Planning and analytics in retail.