Planning and Forecasting Solutions for a Retail Organisation

OVERVIEW

T he name of the Retail group is synonymous with the growth of Middle-East as

an economic super power. With more than 1800 stores spanning across 10
different political geographies is considered to be a behemoth in retail in any
measuring stick. They also have the distinction of being spread Indian Sub-continent,
Africa and Middle East.

The Group provides a value driven product range for the entire family through a
diverse portfolio of core retail brands including a host of home grown brands.

Though enormous in scope, the physical, logistical and organizational dimensions of

managing the everyday growing store network across Middle Eastern countries was a
big task in its own terms.
Increase in number of stores was definitely reflecting on the increased number of
promotional activities- especially when it was done on primarily a store based manner
and then regional manner. The large chunk of man hours wasted in planning and
realizing the sales activities and achieving its defined target was something that the
top management couldnt ignore to be noticed.

Business Need

The Organization was managing the Planning/Budgeting process using Excel (Manual),
it used to take 5 months to complete financial, statutory &management reporting in a
financial cycle.

Processes were person dependent with no visibility & no collaboration with planning
and budgeting. In turn affected the communication considering the size of the chain.

The Profitability was calculated on a store-wise basis, which accounts to 1800.

The Budgeting was mainly looked in by the Territory Heads and the Concepts (a
combination of different stores based on demographical requirements) were managed
by the Regional Heads. SO the gap in budget meeting the in ground needs were too far
from close.

Planning of events and promotional activities were always on a store level.

Promotional activity with all the human resources and materials included, used to take
15 days in the planning and execution level.
 Due to such practices and processes, they had the following limitations:

Data Uniformity was not achieved due to geographical and operational diversity.

Consolidation of budget and business plans were an area of concern due to

geographical and currency variations.

Transfer of budget files between Territories and Concepts was a manual process,
which was taking time.

Lack of Sensitivity analysis.

Top Down/ Bottom Up approach is not possible in Excel, which was being used for the
same.

Daily phasing of Sales was manual process, again time consuming, mainly due to the
currency variations.

Overwriting of estimates with actual was taking more than required man hours.

Multi-currency environment was contributing to the time consumption in all the

processes.

THE SOLUTION

The well placed solution for all the chaos into the running of such a large group was
obviously the IBM tools. The Capable and efficient corporate planning solution from
IBM was the choice of the retailer for bringing the much needed efficiency in planning
the entire sales cycles and other related activities into the organizational culture.

IBM provides organizations with a performance management solution that enables a

line of sight to improve outcomes. IBM solutions for financial and operational
performance management enhances organizations capability to perform key
processes, such as planning, budgeting and forecasting. IBM solution to the challenges
described here supports the execution of performance in an integrated, collaborative,
connected, concerted manner in order to impact change and get better results.

Cognos TM1

The Immediate benefits were visible as all the areas with concerns were covered
promptly by the IBM Cognos TM1. They were:

Data uniformity is established due to single phase of interaction.

Data security is observed.

 Data Consolidation process is simplified throughout the 1800 stores.

Planning and Budgeting concerns in lines of currency, multiple touch-points,

geographies, occasions were addressed by developing patterns which could be
replicated in considerable number of regions..

THE BENEFITS
Transparency of Data is established for required number of users.

Budgeting concerns were addressed.

Based on the forecasting through the historical data mining Planning of sales and
promotional activities have been accelerated to few hours to on the go from 15 day
cycle.

Currency is converted to the standard currency on a daily basis for better

functionality.

All the processes- which were being done on a manual level have been automated.

The over writing of estimates with the actual have been reduced considerably due to
better prediction with the time consumed being the minimum.

Store based events planning and sales activities are being copied in other stores with
similar demography and other influencing factors due to the centralization of
information.

The IBM Cognos TM1 functionality coupled with the proper understanding of the
Retail Giants existing issues enabled Veracitiz to get a complete solution for the
existing issues. Adding to that, the out of the box benefits happened through the
performance optimization resulted in operational efficiency. The customer centric
nature of the company took a leap and obviously that reflected in sales numbers.