Beyond the ERP System: Step 2 to Becoming a Data-Driven Retail Organization

October 27, 2014

It's like cattle herding for your data sources… minus the cowboy boots.

In my last post, I wrote about the very important first step of becoming a data-driven retail company: figuring out what you want to measure. If you aren't focusing on the right KPIs, your entire company vision could be skewed. It's critical to not only look at what you've done (your lagging indicators), but what will be affecting you in the future (your leading indicators) of not only your retail company, but the entire retail industry. A recent TARGIT eBook breaks down the differences and helps you map out the most important KPIs for your company -- no matter what industry.

Once you have that part figured out, it's time for step two to becoming a data-driven retail organization.

Step 2: Data source wrangling

Retail businesses process massive amounts of information, with every customer transaction, every purchase order, every return, and every exchange generating new records and data that require processing and interpreting.

Many of those records are processed through the Enterprise Resource Planning (ERP) solution. ERPs do a great job of collecting and organizing data, and are a critical data source for your business intelligence solution. But how a company does business and makes money is influenced by more data than just your ERP solution is able to provide.

Let's go back to my supermarket example that I previously wrote about. As you could see, food waste has a great impact on how good a supermarket does business. In a traditional way of thinking, the food waste will affect the profit and loss on a daily basis in a supermarket, but in the long perspective it might also be a competitive advantage in terms of CSR (Corporate Social Responsibility). How a store handles waste could change the way the customers think and -- more importantly -- feel about the company. Who doesn't love a feel good story? This will improve customer loyalty and revenue. There must be a way to measure this, right? Correct!

Data-driven businesses use all of the useful data that's available to them, regardless of the source, and that means looking at other platforms in the organization besides just your ERP sytem. Here are some examples of the data sources I'm talking about, all of which would be relevant for your business intelligence for retail:

Customer Relationship Management (CRM) data
Point-of-sale data
Data from ecommerce modules on company websites
Supply Chain Management (SCM) data
Google Analytics data
Marketing automation data
Market data from external data sources
Social media
Data from Excel files, etc.

All of this data is relevant for gaining a comprehensive view of your what's happening at your retail company. A successful BI solution pulls a combination of key data from the different data sources, and presents it to you in a user friendly front-end tool that gives you the power to observe, analyze, and make educated decisions and actions. In other words, it does all the hard work for you, collecting different data from disparate sources and delivers it to you in a concise, easily understood report or analyses. In this way, you can think of your business intelligence solution as a cowboy and your data sources as the cows. It's the cowboy's job to wrangle all those cows together, and keep them safe and organized.

cattle-herding

Business intelligence takes all of that data from the back-end and beyond -- connecting multiple data sources when necessary both inside and outside of the organization -- crunches the numbers, and delivers a dashboard, report, or analyses that gives actionable insight into company health. Analytics allow you to drill into raw numbers or transactional data and make comparisons, in turn allowing you to better predict future analytics and trends.

Stay tuned for step three for becoming a data-driven retail organization in my next post. In the meantime, feel free to contact me for more information on ways to become data-driven and I'll be happy to get you started.

See how TARGIT helps major construction and industrial equipment provider Kelly Tractor monitor business trends and facilitate the decision making process. Read their TARGIT success story.

Can't wait to get your hands on the five steps to becoming a data-driven retail organization? Lucky for you, you can download the eBook version right now.

Jesper Lillelund

Vice President of EMEA Sales

I have a great passion for new ways of thinking and improving business using data. Let's talk about how data can positively impact your numbers. I joined TARGIT in 2014 as Vice President of Sales, EMEA. I have more than 28 years of total business experience mainly within retail, e-commerce, and telecom. I have a great passion for new ways of thinking and improving bus..

KPI

Retail