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In the FMCG Industry, BI Ensures Quick Wins

As companies in the fast-moving consumer goods (FMCG) industry find themselves in the eye of a perfect storm of online competition, consolidation and regulatory pressures they are looking towards business intelligence (BI) to improve their operations and make better decisions more quickly. It’s no secret that consumers are moving online, leaving brick-and-mortar stores to either deliver some type of added value or face becoming a pretty warehouse for picking up stores that were ordered online.

To respond, FMCG companies must act quickly. 

However, acting quickly might be difficult for some. Faced with enormous volumes of data it can be hard to move at the right pace, particularly when using the wrong tools. My experience is that an average middle manager in a FMCG company spends between 6 and 8 hours per day in Excel. When you see the volumes of data that need to be processed, you can quickly see this is becoming a bottleneck.

People shouldn’t be spending this much time on manual tasks.

BI is the solution. Where to begin?

BI can help companies reduce the amount of manual labour required for analytics. When we talk to customers about their performance gains from 3 to 6 months after a BI implementation, they see savings of several man days per month. 

BI is a tool that can be used by anyone: brand managers, retail managers, sales and marketing managers, purchasing and reordering managers as well as finance and controlling analysts and the management. In short, anyone needing answers hidden in business data.

But reducing the workload is just a small part of the overall benefits. By implementing BI, companies can look at data such as the most effective marketing channel for a given products, bottlenecks in the supply chain or the products most suitable for online sales. This information can be leveraged to cut costs, optimize your supply chain, find new revenue sources or improve competitive position. 

The benefits are clear. Where should you begin?

There is no single recipe. Companies have specific needs, different data sources and management priorities, so each project needs to be unique. 

However, there is one thing that is required for every successful project – management support. BI projects are rarely challenging in terms of technology. These are analytical projects and not IT projects. They are usually deployed in stages to solve specific business problems and they can deliver benefits as quickly as within 2 weeks. This is why BI projects need support from the users whose lives they will make easier.

Look at the benefits

BI implementation can improve many aspects of your business. These include inventory and procurement optimization, the ability to find and plan optimal logistics routes, centralized procurement or simply an edge in supplier negotiations. There are savings hidden everywhere. 

My favourite part of BI is how well-designed visualizations can help analysts quickly uncover roots to complex issues. An example I often use in my presentations is a visualisation that helps a company answer the question of why some stores are not stocked with a product that the company as a whole has a surplus of.

In the FMCG industry, BI can be used to for different scenarios, such as measuring the profitability of product categories and individual products, monitoring promotion performance, identifying missed opportunities and using quality forecasting. 

There are also more advanced scenarios available. For example, analysts can use BI to use profiles of popular retail locations and geographical analysis to find new locations that will be competitive without cannibalizing existing locations. These are important and complex challenges that can generate significant benefits to the company.

In short, there is no lack of benefits for FMCG companies rolling out a BI project. In my experience, full support of the management behind a project can ensure that the first benefits are delivered within a month after the implementation.

Milan Listeš, BI Department Manager, Adacta Zagreb

Milan is an experienced strategic thinker who is in love with data and analytics and determined to help companies make the best use of their data. Along with his industry experience and constant training in the field of BI, he is eager to share his knowledge at events at home and internationally.

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