Future Proofing the Organization
through Analytics
Collection of Viewpoints
Content
1) Future Proofing the Organization through Analytics
2) Customer Viewpoints
Business Analytics to Deliver Certainty
Interview: Adi Mehta, Citi TTS
3) Increased Business Agility through Outsourcing
Analytics: An Industry Perspective
4) Industry Perspectives
Boosting Business in Retail - Analytics to
Drive Customer Loyalty & Increased RoI
Interview: N Mallikarjun Sarma , Head – Knowledge Services, TCS
Future Proofing the
Organization through
Analytics
Abid Ali Z Neemuchwala
Global Head - BPO Services, Tata Consultancy Services
The global economy today compels organizations to operate under unparalleled competitive and regulatory
pressures. Be it a bank or a retail chain or a manufacturing company, decisions and future planning need to be
based on insights and predictions from accurate data. Business analytics enables fact-based, insight-driven decision
making to manage their strategic, operating and financial performance, and create shareholder value.
For many years, companies have had access to all kinds of data; but did not have an established process to interpret
and predict that is so critical to business planners today. As companies continue to be short-skilled in this analytics
expertise, they are beginning to realize the value of outsourcing research and analytics services to skilled service
providers. Analytics and research outsourcing has never been about cost and labor arbitrage, but about access to
highly skilled statisticians with industry knowledge who can develop insights using data. This combined with
specialized tools and technology and capabilities to deliver business value as a strategic provider could create a
scalable knowledge and analytics hub.
As organizations across industries grapple with similar macro-economic and competitive pressures, quite often
there is commonality to be found in the overall decision support required across industries. Organizations seek
finance and revenue analytics, risk analytics, customer insights, and supply chain analytics leading to higher asset
utilization, improved cash flows, optimal deployment of available resources and lower risk. It is important that the
nuances specific to these industries are factored in, in providing the decision support though – as an example biostatistics help reduce drug safety risk which is very specialized for the pharma industry where as actuaries help
manage risk for insurance companies.
One of the earliest adopters of analytics was the retail industry. With its focus on customer behavior, the retail
industry has relied on analytics to face up to challenges such as increasing competition, shrinking margins and a
mature customer base. Analytics has now become a dominant tool in the retailers’ repertoire. It has helped the
retailer identify the customer base, understand and predict the customers’ needs – sometimes before the customer
realizes it – and even find innovative means to retain customer loyalty.
Banking and financial services (BFS) were the other early adopters of outsourced analytics services. Given the socioeconomic environment they have had to deal with increased regulatory and compliance issues compared to the
other industries. Analytics has been a key tool for bankers to deal with these issues, as it helps banks manage risks
and cater to their changing customer base. In the financial services and the insurance world, analytics helps focus
on improving the customer experience and predictive analytics is significant in fraud detection, claims
management and underwriting.
Consumer focused industries such as Insurance, Telecom, Utilities, Healthcare, Media and others have taken a leaf
out of retail, and started leveraging analytics extensively. As some of these industries have increasingly become
comfortable with outsourcing, their adoption of analytics outsourcing has also increased.
Decision makers in business do not rely on intuition and past knowledge alone. In order to not only understand
trends but predict customer and market behavior for the future with certainty, analytics married with expertise and
skills to help decision making is critical. A critical factor beyond just basic skills of analysis is the domain knowledge.
A thorough understanding of the industry and its opportunities and challenges can make analytics go a long way
in impacting the business value to the customer.
Thus, talent management is an important aspect of building a scalable analytics operation. Being able to hire talent
with basic statistics skills and then invest in building deep industry knowledge in specific industries with training
on tools and formal methods in statistical analytics enables a provider to build scale. Providing opportunities for
analysts to move across different analytics processes and parts of the value chain helps broaden their abilities in
decision making and provides growth path to help with retaining key talent within the organization.
Tools and technology play an important role in analytics, but require investments that lead to better business
execution and ultimately business process improvement and optimization. Platform based analytics solutions
provide not just the capex savings, but also the pre-built content and fully managed platform provide faster
implementation turnaround time and rapid time-to-value. It also helps integrate multiple requirements across a
particular industry needs. The TCS customer analytics solution, for example, offers a 360 degree view of customer
behavior at all stages of the customer lifecycle, thereby helping retail clients offer enhanced customer experience
and customer value to their clients.
To summarize, a partner with proven processes, domain expertise, cutting edge technology and strong talent
management can lead the customer to great success. At TCS that is exactly what we have tried to do, breaking the
myth that analytics is a niche activity best done inhouse!
Customer Viewpoints
Business Analytics to
Deliver Certainty
Adi Mehta, – Citi TTS
(Interview)
1.
Looking back, what were the business challenges that you saw in 2008 and how have they changed
through the Global Financial Crisis?
As a global bank, our vision was to sustain momentum, preserve capital and liquidity, reduce holdings and
mitigate credit costs. With operations in over 100+ countries, we have always given strong focus to P/L
management. There is at all times, tremendous pressure to minimize costs to stay ahead of the competition. To
this end, there are at any given point, a number of ongoing projects and initiatives to streamline operations
and to identify areas contributing towards improvement in overall profitability. At this time, we got great
support from Karan Kanchan and his Business Analytics team
2.
How did you choose your partners in creation of the Business Analytics KPO?
We wanted to partner with someone with sound understanding of actionable insights relevant and useful for
operations leadership of a global bank of our scale. Our key criteria for supplier selection was the ability to
understand, analyse and interpret a large number of operational metrics and indentify a handful of promising
leads which would be utilized to scope and drive various initiatives across our various branches.
3.
What were your primary reasons to choose TCS as your partner? How did the partnership evolve?
TCS has been a partner for Citi since 2000 for technology & operations, and has made an invaluable
contribution to our bottom-line. We were looking forward to deriving a strong competitive advantage and
they already had considerable expertise in developing and running global operational reviews.
As an organization that understands the nuances of transaction banking, they possess sound understanding
of our businesses, operational practices and vision.
Our engagement today extends to a wide gamut of analytics services ranging from budgeting support,
predictive analytics, financial analytics, expense analytics, data management and quality assurance.
4.
How would you rate the engagement & governance structure that you have put in place for the
relationship?
TCS Business Analytics team has been completely transparent as far as delivery certainty is concerned. They
have utilized a lot of their expertise in conceptualizing, designing and delivering a multi pronged analytics
model that today plays an important role in helping us meet our business goals. Their insights continuously
help identify specific areas requiring focused productivity management. We have been through their analysis,
able to identify and address multiple factors limiting operational productivity and resource utilization.
5.
As a large organization, you possibly work with a variety of partners. How does TCS differentiate itself
in your mind in the context of the shared services / Analytics KPO?
I consider intellectual capital to be the biggest differentiator that TCS analytics team brings to the table. As an
organization, they have been exposed to virtually every area of banking and their operating philosophies are
not quite unlike our own. They have in depth knowledge of platforms used by most banks today and
effectively leverage their product and process expertise to develop and track key business indicators critical to
our P/L management across regions.
Their global footprint has also helped identify a number of technology & process synergies and realizing saves
on that front.
6.
Are there any specific highlights of the relationship that you would like to bring out?
We have through insights provided by TCS, identified a number of opportunities for optimizing operational
costs and maximizing revenues. A number of variations in specific business segments were identified and
flagged which led to substantial cost reduction exercises. They also helped us plug multiple gaps on resource
mapping. They have also given us end-to-end solutions across functions and practices. The model developed
by them is today used for management reviews across regions and to track progress of various initiatives.
7.
As a veteran in setting up an analytics KPO, would you wish to share a few words of wisdom for people
initiating such a journey?
It is important for buyers to provide their partners with a vision of the top level goals of the organization in
addition to business specific goals. This will allow the partners to align their delivery towards the collective
actualization of these goals.
Over the years, there have been innumerable instances where TCS proactively suggested solutions leveraging
multiple cogs of their delivery channel. This has been possible because we always showed them both micro
and macro objectives and we have always worked together cohesively like a team.
I look forward to working with Karan Kanchan, Amalan, Ananya and the Business Analytics team as they are
key partners and always there to go the extra mile when required.
Increased Business Agility
through Outsourcing
Analytics: An Industry
Perspective
Shyam Kerkar
AVP & Head – Marketing,
BPO Services, TCS
Jui Narendran
Consultant,
BPO Services, TCS
Introduction
Over the years, many companies have been able to build large data warehouses;
however, it is the interpretation and the predictive value of analyzing data, that is
critical to business planners today. Unfortunately, many companies lack the skills or
the expertise to analyze their data. Much like the outsourcing of IT and business
process services earlier, companies are beginning to realize the value of outsourcing
research and analytics services to skilled service providers. Cost pressures and labor
arbitrage are not the major factors in these decisions, since there are a number of
other critical factors to consider as well. These include, but are not limited to, access
to a skilled and experienced talent pool, domain expertise, availability of tools and
technology needed especially for analytics and the business value added by these
services.
We at TCS recently conducted a survey among buyers of outsourcing services,
providers of IT and business process services and analysts, to understand their
requirements on outsourcing analytics and other knowledge intensive work in the
larger context. Of the total number of respondents, about 40% were buyers of
outsourcing services, 45% were service providers and 15% were analysts and
advisors. The buyer community constituted a healthy mix of different industry
segments and organization sizes.
Others, 9%
Telecom, 1%
50,000
employees,
16%
TTH, 6%
Banking and financial
services, 23%
Media & Information
Services, 2%
Retail & CPG,
7%
Government /
Non-profit, 3%
Manufacturing, 13%
Life Sciences &
Healthcare,
14.0%
25,000 49,999
employees,
17%
Hi-tech, 10%
10,000 24,999
employees,
20%
Insurance,
12%
Healthy buyer mix across industry verticals
Fewer than
1,000
employees,
22%
1,000 10,000
employees,
25%
Fairly even mix of buyers across company sizes
Critical factors driving the decision to outsource the analytics process
A significant 40% of the buyers felt the functional expertise in the domain was the key factor in choosing a service
provider and an additional 35% sought experience in the same industry.
In contrast to that the influencer community had only about 25% of them asking for the exact experience. TCS
believes that the influencers’ willingness to look at similarity of the experience rather than the exact same
experiences comes from the fact that to a large extent all analytics work can be grouped into the following n Financial Analytics providing insights to manage expenditure, cash flow & investments to grow revenues
n Consumer Analytics & Insights around consumption & loyalty patterns
n Supply Chain Analytics driving spend & inventory optimization
n Risk Analytics to prevent fraud, project claims & other losses
Experience in technology
deployment for the process,
8%
Available technology and
infrastructure platform
for the domain,
6%
Experience in
reengineering the
processes,
11%
Functional expertise in the
domain being outsourced,
38%
Experience in the same
industry/similar client base,
37%
Buyer Perspective: Functional expertise is a key factor in choosing a partner
Experience in technology
deployment for the process,
8%
Available technology and
infrastructure platform
for the domain,
6%
Experience in
reengineering the
processes,
11%
Functional expertise in the
domain being outsourced,
38%
Experience in the same
industry/similar client base,
37%
Influencer Perspective: Seek similar but not same experience
There are of course some specific analytics which are relevant to only an industry such as biostatistics for the
pharmaceutical world. It’s important to marry the industry domain expertise with the statisticians’ expertise to
interpret data to deliver results in such scenarios.
It’s also not surprising that influencers continue to consider presence of a technology platform a critical aspect to
outsourcing. The buyers tend to see this as a relatively low importance factor in decision making since the business
and technology decisions are made separately. The influencers who are seeing a convergence in these two areas
realize the value that a Platform can bring in significantly minimizing the deployment time and capital expenses.
The need for “experience in re-engineering” that both buyers and influencers find necessary drives home the need
to not only deploy processes once but to deliver year on year value through improving processes. It thus becomes
critical to work with a provider who can partner to help the buyer gain leadership, and not just deliver immediate
results.
Interestingly, among the buyers, more than 50% of those who are currently outsourcing sought functional
expertise in the partner organization, while over 60% of those planning to outsource in the near future said they
would look for similar experience in the industry. A buyer experienced in outsourcing is perhaps looking at the
nuances that the partner can bring, particularly in case of analytics services. Hence, a partner with enough
experience in the domain is desirable. For a buyer that has not outsourced before, similar industry experience is a
confidence building factor.
Plan to outsource
22%
Currently outsourced
61%
53%
0%
20%
27%
40%
60%
11%6%
13%7%
80%
100%
Functional expertise in the domain being outsourced
Experience in the same industry/similar client base
Experience in reengineering the processes
Experience in technology deployment for the process
Buyer perspective: Functional expertise important for those already outsourcing
Specific customer- focused processes, but industry best-in-class application models
While close to half the buyers felt that there were several processes that were specific and unique to the company, a
quarter of the respondents also preferred industry best-in-class processes. Given that the unique characteristic of
the analytics service mix is the complexity of the processes; buyers also want industry best-in-class business
applications or other governance and deployment applications for their analytics functions.
Managed by provider /
transparent to the customer,
6%
Industry best in
class defined,
25%
Specific and unique
to a customer,
46%
Shared common across
similar companies,
24%
Buyer process types serving business needs
A significant number of advisors/analysts also recommend industry best-in-class business applications and
governance models to their buyers. Thus, although analytics is often not heavily process oriented, buyers demand
from their partners industry best-in-class support to manage and provide these services.
It is noteworthy that for larger organizations (more than 25,000 employees), processes that were unique and
specific were important. On the other hand, smaller organizations (up to 25,000 employees) were almost equally
divided on processes that were specific and unique; were shared across similar companies and were industry bestin class.
50,000+ employees
57%
25,000 - 49,999 employees
58%
10,000 - 24,999 employees
29%
8%
53%
1,000 - 10,000 employees
Fewer than 1,000...
31%
0%
20%
24%
30%
25%
40%
8%
25%
24%
40%
14%
25%
31%
60%
5%
13%
80%
100%
Specific and unique to a customer
Shared common across similar companies
Industry best in class defined
Managed by provider / transparent to the customer
Buyer perspective: Larger organizations looking for specific processes;
smaller organizations want best-in-class processes
Technology and infrastructure key to transformation
It is quite evident that success in transformation for analytics processes is dependent on technology and
infrastructure. Close to 50% of the buyers in our survey said that technology and infrastructure were key elements
where they looked at their partners for help. Analytics deals with vast quantities of data and hence using
technology for activities such as rationalization is particularly helpful for buyers. Also, many buyers are looking to
migrate to newer technologies, particularly from the cost and time to market perspective. Here the support and
necessary skills of a technology competent partner for the buyer is extremely critical. Buyers are also looking at
process standardization from their partners, with 28% of the buyers in our survey saying that this was critical for
them. People consolidation and automation are important in as much as they help in cutting the costs to the
buyers.
Interestingly, influencers placed a slightly higher weightage on technology and infrastructure rationalization when
recommending to their clients. Over a quarter of the influencers said that they would also include automation to
minimize labor for their buyers. Both technology and automation being closely related, it is evident that influencers
look at these aspects prior to any other recommendations to their buyers. To influencers, process standardization
and people consolidation come later.
Process
standardization,
28%
Technology and
infrastructure change /
migration to newer
technologies,
21%
People
consolidation,
22%
Automation to
minimize labor,
22%
Technology and
infrastructure rationalization
(including virtualization), 28%
Buyer perspective: Technology and infrastructure
important elements in transformation
Process
standardization,
28%
Technology and
infrastructure change /
migration to newer
technologies,
21%
People
consolidation,
22%
Automation to
minimize labor,
22%
Technology and
infrastructure rationalization
(including virtualization), 28%
Influencer perspective: Corroborate with buyers;
technology and infrastructure are important
Pricing models for analytics services are evolving
As the outsourcing industry matures and pricing models evolve, newer pricing models will be accepted. Buyers,
advisors and service providers have been wanting to move from the traditional input based or effort based pricing
to an output based or transaction based pricing model and eventually an outcome based model. However, there
are challenges in this transition and as the services and outsourcing relationships mature, maturity in pricing
models will also be viable. In our survey, a fifth of the buyers said they opted for the FTE based pricing model, while
16% said they went for the fixed price model. There were about 14% of buyers who preferred an output based
pricing model. This corroborates the fact that while mature pricing models are desired, it may be possible only with
some depth of relationship with the partner.
The influencers, on the other hand, were a little more aggressive on the outcome based pricing model, with 18% of
them saying they recommended it to their clients. At the same time, close to one third still recommended the FTE
based pricing model and about a fifth recommended the fixed pricing model.
Outcome
based
pricing,
4%
Transaction
based pricing
(Output based),
14%
Outcome
based
pricing,
18%
FTE based model,
20%
FTE based model,
29%
Transaction
based pricing
(Output based),
12%
Fixed periodical cost model,
16%
Fixed periodical cost model,
21%
Buyer perspective: Moving towards mature pricing models
Influencer perspective: Recommending traditional pricing models,
but veering towards outcome based pricing
Buyers who were currently outsourcing analytics processes preferred the more traditional FTE based or fixed price
model. However, it is interesting to note that close to 40% of the buyers planning to outsource in the next 12 – 18
months preferred output based or transaction based pricing models, with about 9% even willing to opt for an
outcome based pricing model.
Plan to outsource in the 4% 26%
next 12 - 18 months
Currently outsourced
39%
55%
0%
20%
23%
40%
60%
9%
9% 5%
80%
100%
FTE based model
Fixed periodical cost model
Transaction based pricing (Output based)
Outcome based pricing
Buyers planning to outsource are looking for mature pricing models
Location preference in outsourcing knowledge based or analytics services
Cost is not a significant driver in offshoring knowledge or analytics services. Moreover, the processes are not as
easily carved out as in some of the other business processes in the buyers’ business, such as finance and
accounting. Also, in many companies, these processes are not always back office processes. Therefore, the decision
to outsource to a particular location is based on other factors such as domain expertise, industry experience and so
on as discussed earlier in this paper.
Our survey indicated that mid to large size organizations have adopted offshoring quite well. Some of the larger
organizations (those between 10,000 and 50,000 employees) have also preferred offshore destinations with some
onshore presence for their analytics processes.
Also noteworthy is that those who are currently outsourcing prefer offshore destinations or those with some
onshore presence, as compared to those planning to outsource in the next 12 – 18 months. This is understandable
given that buyers with experience of outsourcing have already reaped the benefits of an offshore delivery presence.
50,000+ employees
53%
25,000 - 49,999 employees
44%
18% 12% 6%12%
11%
52%
10,000 - 24,999 employees
1,000 - 10,000 employees
10%
48%
0%
20%
22%
24%
14%
15% 15% 7% 15%
38%
Fewer than 1,000 employees
22%
21%
40%
17% 4% 21%
60%
80%
100%
Onshore
Nearshore
Offshore
Offshore with limited onshore
Equitable mix
Mid to large organizations are more amenable to offshore delivery
Influencers, as expected, were more amenable to recommending an equitable mix of offshore and onshore
locations, as is evident from 35% of the sample. However, more than 40% of influencers also said that they
recommend offshore locations for delivery of research and analytics processes for their clients, albeit with a limited
onshore presence, as stated by about 24% of them. It’s also noteworthy that near shore destinations are not
strongly recommended by influencers.
Outcome
based
pricing,
4%
Onshore,
15%
Equitable mix,
35%
Nearshore,
9%
Offshore,
18%
Offshore with
limited onshore,
24%
Influencers recommend offshore locations, but also an equitable mix
Analytics Outsourcing is Becoming Mainstream
To summarize, buyers are increasingly evaluating analytics outsourcing to meet their business needs. They are
seeking partners who can bring in industry domain expertise, functional and process knowledge, an ability to
leverage technology as well as a global delivery footprint.
Industry Perspectives
Boosting Business in Retail Analytics to Drive Customer
Loyalty & Increased RoI
N Mallikarjun Sarma , – Head, Knowledge Services, TCS
(Interview)
1.
How is the retail industry evolving today? What are the key growth drivers and challenges for the
industry?
The retail industry has become intensely competitive and margins are slimming down. There is an increased
pricing pressure in an ever difficult economy, rising costs across the channels right from raw material to
getting the product on shelf. The Demand and Supply chain shift are creating a heterogeneous and complex
demographic mix. Customer loyalty is no more a static data point, nor a given. Thus the prime driver has
changed to increased customer retention rather than increasing customer basket value. This need has to be
further balanced against the need to minimize erosion in store margins. An interesting conundrum of the
retail revolution has been the sheer volume of data that is now available. The data available has expanded
beyond the POS data to include consumer data, and demographic and other pattern information available
from online & mobile usage. While it gives the retailer considerable information it also leaves him with the
dilemma of what is right and how much is right.
All this combines to create a complex environment where it becomes a challenge for retailers to familiarize
themselves with the potential of decision support and build strategies driven by analytics. Moving from just
making data available, to getting meaningful insights and predictability is the true evolution that is the “need
of the hour” for any industry and retail is no exception.
There is also a multitude of technologies associated with all these, not to mention a plethora of Business
Intelligence technologies that vendors have made available. All this combines to create a complex
environment where it becomes a challenge for retailers to familiarize themselves with the potential of decision
support and build strategies driven by analytics.
2.
What can the retail industry expect today from outsourcing service providers? What, in particular can
analytics services deliver?
Getting closer to the customer at an affordable cost and increased return on investment are some of the
expectations from the outsourcing providers. They should bring in the global experience not only of the
similar industry but from across industry experience.
Outsourcing partners can provide solutions with quick turnaround time and help move towards optimization
in functions across the retail value chain. Optimization in some functions such as store operations,
merchandizing, logistics, inventory management, ROMI, customer centricity will address their core needs,
promotions etc.
3.
What are the prerequisites for analytics in retail to be effective?
Trustworthy data & management sponsorship comes to mind. Most retailers have access to clean, high quality,
integrated, and accessible data through their own channels such as POS transactions, websites, credit
programs, current loyalty programs and from enterprise resource planning (ERP) and other business
applications. Leading retailers have already engaged partners like TCS to capture this data in the form of a data
warehouse. The sophisticated retailers that TCS works with have already built an enterprise data warehouse
(EDW) including customer, product, pricing, supply chain, and financial data—making it much easier to interrelate data across those functions.
The management sponsorship then allows for the exploration and development of analytical models &
processes over time. A related factor is a retailer’s desire to build up their own analytical capabilities, rather
than relying on the CPG providers. Historically, the grocery and CPG providers did much of the analysis for the
retail industry. Today retailers prefer managing their own categories, optimizing their own shelf space, and
monitoring the lift of their own promotions. In fact, retailers today are reluctant to share their data with
syndicators; since they want control over data distribution as well. This in turn means that the syndicators and
the CPG providers will have to offer new analytical insights on how best to market their own goods if they wish
for the retailers to continue to leverage the analytics they provide. TCS has the advantage that it continues to
provide value across Retailers, Providers and Syndicators.
The ability to draw a sustainable road-map and required threshold to benefit from the analytics investments is
critical. This is because the benefits of analytics work are more strategic and less tactical.
4.
n
n
n
What are the key areas of analytics that help retailers improve their topline as well as bottomline?
We at TCS believe that key areas which focus on our retail customers’ objectives rest on 3 levers and the
specific analytics offerings are woven around these. Examples of these offerings associated with each of these
levers are given below:
Enhance customer shopping experience by aligning merchandise strategy with customer – An example of this
would be the Purchase Path Analysis where analysis is done to find out what a customer buys after a particular
product, which helps the retailer retain customer loyalty and also gain insights into stocking and merchandise
placement in the outlet. Another instance would be Shopper Mission Analysis which enables the retailer
unearth the customers’ rationale for the shopping trip thus helping to determine store layout, store
assortment and so on.
Reduce supply chain costs through integrated planning and optimization – Some key analytics offerings
would include - Channel Usage and Profitability Analysis, which provides data points to dispassionately make
decisions about channel investments and identify reasons behind the poor performance of any channel;
Product Preference and Profitability Analysis, which assesses the value and ROI on a product across customer
groups and channels.
Enhance sales experience across stores and other channels – Examples are Need State Segmentation that can
identify the key need-states in the category and measure the relative volume that each satisfies, thus helping
retailers identify unmet needs, new need markets, and new offerings. Social Network Analysis is the mapping
and measuring of relationships and flows between people, groups, organizations, computers, URLs, and other
connected information/knowledge entities. This helps understand customer sentiment and is a cost effective
marketing tool as well.
5.
What do you think are the key challenges retailers will face in the next 5 – 10 years? How is TCS gearing
up to help them face these challenges?
A decade after the dot.com boom, the retail industry has still not come fully to terms with the e-business
paradigm. The advancements in technology offers challenges and solutions - multiple interface points with
customers, increasingly demanding customers, need to tailor products and offerings to suit various
demographic groups, addressing new geographies and markets for expansion, and so on. TCS has helped a
wide variety of retailers to implement and maximize the value of e-business models and expects to continue
to helping them increasing the insights they glean from the data collected.
Apart from this evolving business model, retail will face challenges similar to the other industries. The industry
needs to gear up to increased competition, pricing pressures, changing demographics, market dynamics and
so on. TCS’s core industry expertise allows it to create an unique suite solutions that would help retailers find
new avenues of revenue through better merchandize management and better customer experience.
6.
n
n
n
n
In light of these challenges, how will analytics in the retail industry evolve in the future?
Retailers are faced with two major challenges – the evolution of the market based on macroeconomic factors
and the evolution of their customers. Thus, the future retail landscape will depend on how well the retailers
are able to maximize customer satisfaction and profitability while optimizing their supply chain, product mix,
quality, service and value to the customers.
The evolution can be thus grouped into three broad streams
Increasing depth of the data collected and analyzed
Working with Partners to optimize the cost of analytics
Increasing real-time analysis of data
Servicing customer through various channels
We have already seen some of the diverse ways that we can derive insights in the previous question. In terms
of optimizing the cost of analytics, various solutions are being explored. TCS’s Platform approach is one of
them. TCS offers pre-built technology environment with pre-configured data marts and various predictive
models provide solutions to support customer intelligence, merchandise intelligence, operations intelligence
and performance management. It enables customers to gain competitive differentiation, achieve greater focus
on core capabilities, derive value from high volume of interaction and transactional data, improve time to
market leading to better market/customer focus, and reduce total cost of ownership (TCO).
7.
You talked about Real time Analytics being the future; can you explain how providers can help retailers
of the future?
In the near future, real time analytics would be of great importance. Data today is no longer accurate and data
standardization and cleansing will not be possible. Retailers will have to increasingly use multiple estimation
techniques to arrive at forecasts and trends. Some techniques such as event driven analysis will be used to
predict future trends based on events and insights from the past.
The correlation between supply chain and consumption is important. To optimize supply chain and converge
with sales, demand and customer preferences with the help of predictive models will prevail in the future. This
is being done today as well, but will gain increasing prominence as retailers look to curtail cost pressures.
At TCS, we believe that the next phase of analytics and business intelligence will be defined by an ‘enterprise
information fusion’ approach to risk, performance and relationship management. Given the complexity of the
business, IT, and external environment that modern large enterprises live in, we believe that they need to
develop capabilities similar to an ‘intelligence’ organization, both technological and operational. In other
words, an organization is impacted not only by how it operates but the entire eco-system (consisting of
customers, partners, government, competitors, etc.) in which it operates and anything happening within this
entire eco-system can impact the organization. It is therefore important to analyze, integrate and fuse
information on events happening inside as well as outside the enterprise, and being able to take actions so as
to be on the right side of change; which is what this framework will enable. Towards this aim, TCS has
embarked on creating Enterprise Information Fusion (EIF) framework architecture.
8.
How are retail customers benefiting from turning analytics into actionable insights? Can you give
examples?
It is possible to use customer insights to increase customer loyalty, Return on Investment on various marketing
Initiatives and to minimize fraud.
For instance, it’s quite common to see an increase in the wallet-share with existing customers through
analyzing their needs and identifying ways to provide merchandize that they were not able to find. Retailers
have seen individual customer’s monthly spends with them go up 2-3 times.
It’s similarly not unusual to find a 10% increase in the overall sales through targeted promotions. A classic
case would be coupons, an integral part of promotions; usually these have seen a very high wastage (non
redemptions). It’s possible to increase the redemption rate 10-15 times the industry average by providing the
relevant coupons.
Another good example of actionable insights is our ability to see through various functions within a retailer’s
business and provide holistic solutions. We have also conducted a study for a retailer on the correlation
between the employee satisfaction on the shop-floor and the category sales, thereby helping to increase the
category sales.
It’s for this reason that increasingly retailers see analytics as a profit center rather than a cost center.
9.
How is TCS helping its retail customers adapt to the emerging analytics needs?
TCS has been helping customers keep ahead of their competition, gain insights into their customers, help
them maximise on their investments and minimize risks.
An example would be the work we do for a leading retail client. The challenges were around product pricing,
inventory planning and high SG&A costs. Our analytics solutions helped to optimize pricing by geography
leading to higher customer retention and higher inventory returns. We were also able to use forecasting and
give a 10-15% increase of the seasonal clearance to this customer.
Another leading retail provider who had recently merged with another retailer was having issues with pricing.
The TCS solution included designing, building and implementing a new price management model and tool
encompassing regular, promotion and clearance pricing. This helped the merged entity deal with their pricing
issues for the future as well.
TCS Offices:
Australia
Level 3, 76 Berry Street,
North Sydney, NSW 2060
Phone: + 61.28.456.2800
Germany
MesseTurm, D- 60308
Frankfurt am Main
Phone:- +49.69.7870.2000
Brazil
Avenida Aruanã, 70
Tamboré Barueri
Sao Paulo 06460-010
Phone:+55.11.3306.7000
Hungary
Science Park B, 1st Floor
Irinyi Joszef utca 4-20
Budapest 1117
Phone:- + 36-1-886-8000
Canada
1555, Rue Carrie Derick
Montreal, Quebec H3C 4S9
Phone: +1. 514.868.7005
India
TCS House,
Raveline street,
Fort, Mumbai - 400 001
Phone: +91.22.6778.9999
Chile
Curico 18, Piso 3,
Santiago, Chile
Phone:- +56.2.250.5500
China
8th floor, #9 Building, Hangzhou
Hi Tech Software Park
#1 Chuangye Road,
Bin Jiang District
Hangzhou, PRC 310053
Phone:- +86.571.8669.9989
Philippines
18/F Unit A & C , Rufino
Pacific Tower,
6784 Ayala Ave. Cor V.A.
Rufino St. Makati City
Phone:-+63.28.1103.7678
Sweden
Mäster Samuelsgatan 42
111 57 Stockholm
Phone:- + 46.85.038.8400
United Kingdom
4th Floor
33 Grosvenor Place
London SW1X 7HY
Phone: +44.207.245.1800
Japan
Queen’s Tower A -1408,
Nishi-ku, Yokohama-shi,
Kanagawa 220 6014
Phone:- +52 .33.3003.8282
United States
101 Park Avenue, 26th Floor
New York, NY 10178
Phone : +1.212.557.8038
Mexico
Avenue Tizoc #97Colonia
Ciudad del SolZapopan
Jalisco, 45050
Phone:- +52 .33.3003.8282
Uruguay
Ruta 8 Km17, 500
600 Building, Zonamerica,
CP: 91600 Montevideo
Phone :- + 59.82.518.5600
About TCS BPO
Business Process Services (BPO) at TCS is about managing & executing business operations.
Our domain expertise helps deliver core business processing across industries, analytics &
insights and support processes such as accounting, HR and supply chain management. TCS
partners with customers to accelerate co-transformation, and generates business value for
customers through delivery excellence, risk management and through innovative models such
as Platform BPO which delivers process as a service. With annual BPO revenues of greater than
US$ 1 billion, TCS is one of the largest BPO providers with 35,000+ employees servicing 175+
customers across the globe.
Contact
For more information, contact bpo.imo@tcs.com
About Tata Consultancy Services (TCS)
Tata Consultancy Services is an IT services, consulting and business solutions organization that
delivers real results to global business, ensuring a level of certainty no other firm can match.
TCS offers a consulting-led, integrated portfolio of IT and IT-enabled infrastructure, engineering
and assurance services. This is delivered through its unique Global Network Delivery ModelTM,
recognized as the benchmark of excellence in software development. A part of the Tata Group,
India’s largest industrial conglomerate, TCS has a global footprint and is listed on the National
Stock Exchange and Bombay Stock Exchange in India.
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