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Quantum Retailon Retail Decision Analytics

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Retail Decision Analytics

• Industry Drivers

• The Quantum Universe

• Evolution of Analytics

• Success Factors

• Results Driven Transformation

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Complexity

1,683 storesx

=134,640,000 decisions80,000 SKUS

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Industry Drivers

• Business complexity

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• Data Proliferation

• Alignment of strategy and execution

• ROI driven investment

• The vision exceeds the technology

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Evolution of Analytics

Single solution analytics vs. Holistic multi-objective optimizationAnalytics lead processes vs. Imbedded systemsIntegrated analytics vs. Architected platforms and processesAnalytics for insight vs. Analytics for decisions and actionHistorical reviews vs. Predictive capabilitiesAggregates, averages, smoothing vs. Product/location/customer precisionUsers focused on business analysis vs. Users focused on business outcomesTheoretical expected outcomes vs. Measurable results

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Entire contents © 2010, Quantum Retail Technology, Inc.

Quantum…

NounPhysics:The smallest discrete quantity of some physical property that a system can possess

The small details create significant change

AdjectiveSudden and significant: a quantum increase in revenue.

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The Quantum Universe

• Quantum Physics – the laws governing the movement and interaction of small things

• Granular• Emergence• Interactions• Living systems• Learning systems• The whole is greater than

the sum of the parts

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Quantum Principles

• Real time• Predictive• Business strategy lead• Goal seeking• Actionable• Continuously monitors product behavior• A shared pool of knowledge• Self improving

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Integrating the Silos

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Entire contents © 2010, Quantum Retail Technology, Inc.

Integrating the Silos

• Merchandise Planning• Product Fulfillment• BI integrates insight

and action

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Success Factors

• Reframe the Question

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• Use insight to predict the future

• Put it in business context with your strategies

• Ensure it is actionable

• Deliver the results

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The Question

• Taking what is traditionally BI and using it as a constraint or variable in the larger and more complex equation of how to optimize my business….

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• Given what I know about my customer, my product, my supply chain, how do I make the most profitable inventory movement and placement decisions….knowing there are 135M different decisions to be made.

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The Context/Strategy

• Define the strategy: roles, goals, and constraints• Put it in business context• Continuously analyze behavior and use it to predict • Imbed in technology, not just the process• Creates visibility in business context• Provides all information

necessary for decision

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Entire contents © 2010, Quantum Retail Technology, Inc.

Product Strategy Screen

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Marks & Spencer

Problems:• Scalability • Customers want high availability • Waste is high as a result • Localized market variance• Huge variation in store sizesStrategy: Maximize Profit Subject to…Results:• Increased profit, sales units and $$ • Improved service-level and turns, more visibility • Increased supply chain efficiency• Redefined business practices for driving sales and profit

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Entire contents © 2010, Quantum Retail Technology, Inc.

The Actions

• Real-time and continuous• Exception driven• Guided decisions• Driven by and executed at

the lowest level• Still allows for expert input – Merchants not

mathematicians• Integrated – data and feedback loops

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Entire contents © 2010, Quantum Retail Technology, Inc.

HQ Screen

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New Look

Problems:• Complexity of an extended range, new channels,

and new markets, lifecycles as short as 6 weeks to maintain freshness

• Missed sales from poor localized fulfillment• No visibility to lost sales, item performance,

localized/international needs, or profitable distributions

Strategy: Maximize full price sales subject to…Results:• Increase sales by 2% and profit by 4%• 98% acceptance of system guided decisions• Grew business by 20% in one year without add’l inventory or heads

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Entire contents © 2010, Quantum Retail Technology, Inc.

The Results

• Measurable• Confidence• Adaptive• Learning• Improve over time

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Entire contents © 2010, Quantum Retail Technology, Inc.

Recap

• The Question

• Predictive

• The context and strategy

• Action

• Results

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Questions?

Thank you for your time!

For more information on Quantum’s approach to analytics visit:

www.quantumretail.com

Or contact me at: vicki.raport@quantumretail.com