Complexity Management: A New Approach for Using Advanced Analytics 3.27
Join Melissa Drew, the Retail/Manufacturing Sourcing Group Chair on Monday, March 27th at 12:00 Noon at for at KPMG at 345 Park Avenue, New York for a presentation.
Complexity Management: A New Approach For Using Advanced Analytics To Increase Profits
Managing Complexity, our clients want to do it, our clients need to do it, and now you can help them achieve it!
Product companies today are facing an unprecedented level of complexity. Over the years, we've seen the number of active products multiply due to the fast pace of innovation and dynamic customer demand. We've also seen a proliferation of customer channels - including more direct shipments directly to end users. Even worse, we've seen service conditions get more difficult and costly to satisfy - and sales growth that has not kept pace with the rate of change to these portfolios. Experience has shown us that companies can have unprofitable SKUs making up as much as 30% of their portfolios and even a larger percentage of unprofitable customers.
Unfortunately, measuring "true profitability" at the SKU, customer or transaction level is beyond most companies' financial reporting systems. Top line metrics like Gross Margin do not account for total costs throughout the full lifecycle of each product or customer - including the use of capital. Also, most companies do not have the analytic capacity to understand the root causes of unprofitability. This presents a lack of insight that can lead to reactive and destructive decisions: Abandoning the wrong products, over-investing the wrong customers, or overlooking pragmatic decisions that can take the portfolio to its peak of profitability.
A point of view
Leading consumer-driven companies are finding new ways to manage complexity by leveraging data and analytics. Leaders are developing advanced tools, and powerful analytic engines, that are providing new insights about how to reach the full potential of their portfolios. Because of this, companies are able to define precisely where they are making and losing profits (all the way down to each individual order), the unique conditions that are causing these results, the specific "levers" that can be used to improve performance (beyond cutting SKUs), and the impact of every single option. As a result, these leaders are finding new ways to improve profits - which, in many cases, can be greater than 10%.
In this session, we will share the distinct differences between the leading companies that manage complexity as a competitive advantage - and the rest of the pack. We will showcase methods and tools (including advanced data science techniques) that are having the biggest impact, and share some actual case study examples.
As a result, audience members will become more aware of how these new tools and approaches can have a significant and immediate impact on their business.
Meet Our Presenters
Chandra Sekhar, Director, KPMG
Chris Gottlieb, Managing Partner, KPMG