There's an old joke about economists: If you laid each one end to end, they would never reach a conclusion. So, just as there is no consensus about when this economic downturn began, there's also none about when it will end.
This begs the question: What do you do in the meantime? Once the frenzy has somewhat abated, plan to embark on projects that position your company to come out of the downturn swinging.
Leslie Ament, Research Director and Managing Partner of Hypatia Research LLC (and newly designated channel expert for Customer Analytics and Insight on the B-Eye Network), suggests three activities to put on your agenda for the year.
Consolidate Your Channels. A downturn is a perfect time to focus on standardizing your data model. "I worked with one company that sold the same products through multiple channels — online, catalog, in-store and even B2B," Ament says. "But each channel had its own database." This siloed structure gave company executives no insight into the multi-channel impact of their advertising or into customer segmentation.
A retailer might have a small business customer who buys office supplies online but goes into the store for electronic devices to see first-hand how they work. "If the company consolidates all of its business units on datamarts or a data warehouse using a consistent data model, they'll capture all the same data about customers in the same structure and make it easier to analyze the information for both downstream and upstream decision-making," Ament says.
Look for Gaps in Customer Data. Take the time to improve your insight into customer demographics, both on a micro and macro level. Ament recommends using services from Dun & Bradstreet, Acxiom, Experian or others to fill the gaps about your customers.
On a micro level, look at specific demographic information about your customers to mesh with what you already have. On a macro level, use aggregated information from these services to create attitudinal and psychographic data about potential customers with similar demographics.
"Use the segmentation profile to predict the success rate of a particular advertising campaign," Ament says. Knowing this data has ramifications all the way up and down the supply chain, because you can better predict inventory requirements to reduce stock-outs or overstocks, sales and profitability.
Take Time to Collaborate. Ament urges executives — no matter whether they are in finance, IT or operations — to work together to develop a better sense of each group's business requirements so subsequent BI analysis will make more sense.
She tells the story of a hospital's finance department that found out through BI analysis that some physicians were ordering $200 hip-replacement devices, while others were ordering ones that cost $700. Putting the cheaper devices in less active patients in their 80s made sense because their life expectancy was shorter than the device's. With younger or extremely active patients, the longer-lasting, more-expensive devices were more effective and would improve range of motion and quality of life.
"Understanding how and why data is segmented a certain way helps you make the best decision for the patient, rather than having the finance department make decisions based solely on cost," Ament says.
The result of all this interim work should be a leaner, more efficient way to conduct business intelligence analysis just when you need it most — when business is improving and transaction data is flowing smoothly once again.
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