Holding the customer´s imagination remains an elusive dream, write Srinivasa Rao and Saurabh Swarup in their white paper, "Business Intelligence and Retailing."
"Changing tastes and preferences, increasing competition, demographic shifts and the simple "Let´s try something new´ attitude have all been blamed for customer disloyalty," say the two researchers for Wipro Technologies. "No wonder retailers today are going that extra mile to reach and understand the customer." One way retailers are "getting their act together" is by streamlining the supply chain.
In yesterday´s Retail Strategies, we heard the views of Rao and Swarup concerning customer relationship management. Today, let´s see what they have to say about the supply chain.
Being champions of technology, the two suggest that data warehousing — data structured for the purpose of being analyzed — can significantly help improve a retailers´s relationship with suppliers.
Four applications of business intelligence in supply chain management and procurement are, they say: vendor performance analysis, inventory control, product movement and demand forecasting.
Vendor Performance Analysis Retailers can analyze the performance of every vendor, according to Rao and Swarup, on the basis of factors such as cost, delivery time, quality of the products delivered and payment lead time. Not only that, by using the proper technology, retailers also can analyze the role that suppliers play in outages of specific products.
Inventory Control The data warehouse makes it possible, say Rao and Swarup, for the retailer to generate reports on key inventory indicators such as levels and lot size, thereby helping in both operational and strategic decisions relating to inventory.
Product Movement On-time replenishment of products is critical for items that fly off the shelf. Business intelligence tools, the two researchers say, can help retailers analyze these movements and help predict when it´s time to re-order.
Demand Forecasing Finally, by using the business intelligence tool known as data mining — searching for patterns in your data — retailers can create complex demand forecasting models using factors such as sales figures, basic economic indicators and environmental conditions.
Tomorrow in Retail Strategies: what Rao and Swarup say about storefront operations
Srinivasa Rao is a technical manager with Wipro; Saurabh Swarup is a consultant to Wipro. Both work in the Business Intelligence and Data Warehousing Group.