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Managing with Analytics at Procter & Gamble

In: Business and Management

Submitted By orangevol
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CI Perp Note 2 for Managing with Analytics at Procter & Gamble

In today’s companies, the analytics software plays the important role and guides the future activities to a great extent.

The analytics software is the useful tool and great supporter for organization to reduce workload, increase the productivity and create competitive advantages. The analytics software helps organization knows exactly what customers want and their purchasing power, which will assist the company makes best decisions whether big or small every day. What is more, the analytics software works like an effective predictor, which will help organization look forward to the future scenario and make the best plan. Also the software is the key business enabler that advances technology tools, strategic development, collaboration and decision making. Finally, the analytics software is like a centralized service, which presented some noteworthy opportunities for improvement across the organization, such as P&G.

The work of analytics cannot be charge by the third party because the third party should not make important decision for the company as well as it does not understand the business of the company well enough to create innovation. So the analytics should be kept in house. When the analytics software is used in the development and implementation of the organization, it will meet some difficulties. Firstly, the technology works for business activities and the company has to invest in the business needs and solutions. Therefore, the company should train its employees in not only the technology and techniques, but also train them in transformation of their behavior. Secondly, achieving the real-time availability of information and then lead to real time decisions is useful for the company. But it will need a lot of work. Finally, when the P&G embarked on the wave 1 of the compacted detergents, the team found that it is difficulty to collect data to measure the consumer response to the new formulations; the usual data sources, scanner data from large retailers and Nielsen, were difficult to interpret; many retail outlets still had inventory of the non-compacted detergent so customers were still able to purchase the old one; and several competitors introduced compacted versions at the same time. All these problems and difficulties need the analytics of data to provide a clearer picture.

P&G has been successful in using analytics in some fields so far. By analyzing the trends of consumer purchasing, the company has designed the products, powder laundry detergents, which occupies a great amount of market share in the whole world. Not only innovate the new products, the analytics tool helps the company concern about the packaging, water use and transportation would be beneficial to environment. In addition, the success analytics deals with the problems of wave 1 and forecast the future activities for the company.

Even the analytics tools help the company succeed in some fields, it still has some challenges. A change in forecast had a much broader impact than just a modification. If the forecasts were not changed but results increased, P&G would be unable to meet demand and could demand and could damage relationships with retailers and customers. Moreover, an overly aggressive forecast would leave manufacturing with excess raw material, workers and inventory.

However, even the forecasts cannot give the right direction to the company all the time, the company should increase the forecasts by a few percent because it is not only a trend that the company use the statistical models to do the business, but also a great help in development and implementation of the company.

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