Category Archives: Big Data

170. Boost Your Corporate Analytics IQ

Poor ROI For Analytics Investments?

Corporate America (distributors included) is overwhelmingly NOT getting results from new analytical insights. Test your company’s Analytics IQ against:

  1. The number of analytical-dimension tools that you have
  2. The buy-In rate for new insights
  3. Your success rate at turning insights into results

The 4 Lenses: Financial + Three Service-Profit-Chain

Everybody uses financial analytics (lens 1). Distributors should also get/invent analytics for the three dimensions within the “Service Profit Chain”(SPC) (Google the term.) The SPC simplified: best quality people (lens 2) deliver service (lens 3), that yields(customer retention) profits (lens 4).  

The SPC outlines how Costco can pay (v. Sam’s/Walmart) 141% more per employee to get 157% more sales and margin dollars. And, how Costco also has legendary customer loyalty, and better sales growth – while selling at a measly margin of 13%.

These four analytical lenses each have blind spots. For example: “Inventory management” from a financial perspective stresses “Turn-and-earn” with minimal “dead and excess stock investments”. But, service-value and people-productivity lenses spotlight “fill-rates”.

Best fill-rates (tuned to a target-customer niche) from one location reduce outages which:

  1. Erode service-value
  2. Cause small-dollar, back-orders and interbranch, split-shipments
  3. These, in turn, boost transactional costs while lowering productivity and morale.

Seek the best total-economic balance!                           

And, Sell More!   

Financial thinking stresses pumping sales (and margin dollars) for economies of buying and operational fixed costs. Plus, get those fatter rebates from best-bribing vendors.   

But, service analytics asks:

  1. Grow sales from which target customers with what unique, service-value proposition? Selling commodities to all customers with standard service creates no service-value equity.  
  2. And, do all employees know the most net-profitable (potential) target-customers? And, how/why they should allocate extra service-hustle to them?       

Customer Profitability Analytics (CPA) Informs All 4 Lenses, But…

Most distributors are 110% focused on financial-belief activities. CPA reveals that some big, and many small customers, are unprofitable. Then, those who are incented on any sales/margin volume, resist. Why low buy-in for insight-plays that logically will deliver greater wins for all?  

Four Nobel Prize winners (over the past 40 years) have proven that our brains are riddled with cognitive biases. Stubborn, short-cut, data-free beliefs win over longer-term realities.    

For More on 4-Lens, Big, All-Win Gains:  

Book an initial (free) C-suite, virtual session with me (bruce@merrifield.com). And, for Waypoint Analytics clients, join me at the workshop in Phoenix on November 7th (link below).    

WayPoint Institute 2019

165. Cool Digital Tools Aren’t A Profit-Growth Strategy (Part B)

Two Digital-Selling-Tool Paths

  • Invest in better digital-selling tools for all customers to (hopefully) use. 
  • Visit your most net-profitable customers to identify pain-points that can be reduced by applying off-the-shelf, digital tools. These may be one-off, custom solutions. Or, the solution may work with modifications for other same niche-need big customers. 

Consider these two contrasting case studies. Which path is a focused, profitable-growth strategy?

Case One: An APP for All

Consumers are besieged with APP offers. So, a contractor-supply distributor creates an APP that does two things: placing orders via your mobile phone, and getting fast delivery (options) from an Uber-type delivery partner. Results were weak. Why? The CEO wasn’t sure (yet).

My Questions to the CEO:

#1. For upfront customer research. What criteria were used to identify and visit 3-5 accounts most apt to use the APP? Then, did you brainstorm with them about:

  • How valuable this APP might be and why specifically?
  • For what percent of job scenarios would the delivery option be most beneficial?
  • What extra fee would the contractor pay for different delivery response times? 
  • If the prospects were excited, how could the APP be further improved? 

*Remember to be open to serendipitous insights*

#2. Post-mortem questions about APP 1.0 to a broader group of visited accounts:

  • How did you hear, (if you did), about the APP and its intended benefits?
  • Why did you not use it?
  • Is there any value within this ideaspace that can be re-developed? 
  • If an APP 2.0 has more promise, what additional marketing/education will be needed for wider adoption?

The team had done negligible pre and post-APP launch market research. (Will APP 2.0 happen? Stay tuned to future blogs.)  

CASE TWO: An App For One, Mongo Customer

The CEO of another contractor-supply distributor called on a huge account to explore buying-process “friction” possibilities. The customer had a niche doing a few standard jobs in big-contract quantities. Each job needed a fixed kit of SKUs with occasional tweaks. The two honchos oversaw the co-creation of a custom APP with order buttons for the standard kits. The contractor CEO insisted that everyone use the APP. Sales to the customer doubled and both parties realized other economic benefits.  

Bottom Line: Find and co-create digital solutions with best customers first.  

*Second of several case study comparisons.

164. Cool Digital Tools Aren’t A Profit-Growth Strategy

Two Digital Selling Tool Paths

  • Invest in better digital selling tools for all customers to (hopefully) use.  
  • Visit your most net-profitable customers to identify their buying journey pain-points to remove with digital solutions.    

Here are two contrasting case studies. Which one is a focused, profitable-growth strategy?

Continue reading 164. Cool Digital Tools Aren’t A Profit-Growth Strategy

162. Your Coach for Mastering E-Skills?

THE AMBITIOUS HAVE COACHES!

Many big-time jocks have personal coaches and analytics services. (Coaches for executives use 360-feedback surveys).

Most pro sports teams now invest in high-speed video, stats, and development coaches – for all players. Veteran starters with contracts often decline the help (why mess with success?), but rookies (and little leaguers) are devouring video-based analysis. The underlying goal is fast-as-possible “mastery”.   

Continue reading 162. Your Coach for Mastering E-Skills?

161. How Digital Disruptors (Will) Skim Distributor Sales

Digital-Disruptors are Multiplying!

Today: digital disruptors are attacking most industries. In ’95, a few startups invaded easiest B2C product categories with their own homemade digital tools. Today, raiders are targeting every “buying-journey experience” with off-the-shelf digital tools from cloud providers. Barriers to buying-journey innovation have fallen for both startups and your firm.  

Continue reading 161. How Digital Disruptors (Will) Skim Distributor Sales