Walking the BPM Talk at Littlewoods… …with TM1

Mark Bodger BA ACMA

Business Information Controller BPM: Make it live in 2005

Tuesday 19 th April 2005, IOD

Contents

1. Company Background 2. BPM Requirement 3. Why Olap? Why TM1?

4. Case Study 5. BPM Reports 6. Conclusion

Company Background

-

Largest Mail Order business in the UK

-

Recent merger with GUS Home Shopping

-

Combined Turnover £2bn

-

4.5m Customers

Definition of BPM

•

BPM

is a set of integrated, closed-loop management and

analytic processes

, supported by technology, that address financial as well as operational activities •

BPM

is an

enabler

for businesses in defining strategic goals, and then

measuring

and managing performance against those goals • Core

BPM

processes include

financial and operational planning

, consolidation and reporting, modelling, analysis and

monitoring

of key performance indicators (KPIs) linked to organizational strategy.

BPM Standards Group March 2004

BPM Requirement

•

To satisfy every manager’s dream of being able to access budget, forecast and actual performance data from one source

•

To remove the pain of “information retrieval“ and simplify weekly performance reporting

•

To deliver information to decision makers that is relevant , timely and summarised

•

To integrate business planning information across functional areas (Marketing, B&M, Operations and Finance) = one plan!

Why Olap? Why TM1?

• • • • •

Planning process dependent upon hundreds of (undocumented) Excel spreadsheets Lack of version control – poor communication of changes Inconsistent use of activity drivers and assumptions across the business Large complex business required robust solution to data management TM1’s key strengths

–

“Real-time” data refresh

– – – –

Multi-cube architecture Flexible reporting and consolidation Integration with Excel Fast implementation

•

TM1 Case Study

A “multi-cube” solution to support the Financial and Operational Planning process

• • • •

Activity Planning Model

– – –

Marketing Sales Plan linked to B&M Sales Plan Converts Marketing Sales to volumes that drive activities Weekly sales, margin and volume reporting Carriage Model

– –

Calculates the carriage cost plan by carrier Weekly cost of carriage by brand Stock Intake Model

– –

Calculates the stock intake plan by warehouse Weekly activity performance monitoring Contact Centres Model

– –

Calculates contact centre activities Call handling capacity planning A modular approach…tailored to business requirements

TM1 Multi-Cubes

I N P U T S (Data)

Budget Assumptions Actual (Data Extracts) Forecast Assumptions TM1 TAPS Cube

TM1 MULTI-CUBES

TM1 Carriage Cube TM1 Intake Planning Cube TM1 Contact Centre Cube TM1 Rules and Feeders (Logic)

OUTPUT REPORTS

Sales and Margin Stock Movement etc All cubes are driven by the same sales data and volume drivers

TAPS Model

TM1 Activity Planning Model

This cube has 7 dimensions and allows weekly performance monitoring of key activity drivers, actual against budget and latest forecast ; Measures|Time|Version| Brand|Product Group|Handling Type|Sales Outlet Purpose

– To plan and monitor Sales, Margin and volumes by Brand, Product Group, Sales Outlet and Week

Actual data

– Data is loaded weekly and is used for

performance reporting

(compared to budget, forecast and last year) – Model used by Finance, Marketing, Trading, Supply Chain – Reports issued to Board, Executives and Senior Management

Carriage Model

Carriage costs are analysed using a 6 dimension cube; Measures | Time | Version Brand | Carriers | Handling Type Purpose

– To plan and monitor the cost of parcel delivery to the customer by Carrier by Brand – Planning data is driven by volumes created in the TAPS cube (which is fed automatically)

Actual data

– Data is loaded weekly directly into the application from TM1 input templates using Excel

Stock Intake Model

This cube has 6 dimensions and allows weekly performance monitoring of key activity drivers, actual against budget and latest forecast ; Measures | Time | Version Product Group | DC Location | Handling Type Purpose

•To plan and monitor stock intake and stock movements by DC and Product Group in £s and units •To calculate the cash flow required to support merchandise stock intake •To produce activities (units) by DC location to drive Warehouse Manpower planning

Actual data

•Data is loaded weekly and is used for

performance reporting

budget, forecast and last year) •Model used by Finance, B&M and Warehouse operations (compared to

Warehouse Activity by Location Intake Qty

400000 300000 200000 100000 0 FYW K0 1 FYW K0 4 FYW K0 7 FYW K1 0 FYW K1 3 FYW K1 6 FYW K1 9 FYW K2 2 FYW K2 5 FYW K2 8 FYW K3 1 FYW K3 4 FYW K3 7 FYW K4 0 FYW K4 3 FYW K4 6 FYW K4 9 FYW K5 2 DC06 - Wrexham DC07 - Little Hulton DC12 - Shaw Stock intake profile reflects seasonality of catalogue launches (Summer and Winter)

Warehouse Activity - Despatches Shaw DC

700000 600000 500000 400000 300000 200000 100000 0 FYW K0 1 FYW K0 3 FYW K0 5 FYW K0 7 FYW K0 9 FYW K1 1 FYW K1 3 FYW K1 5 FYW K1 7 FYW K1 9 FYW K2 1 FYW K2 3 FYW K2 5 FYW K2 7 FYW K2 9 FYW K3 1 FYW K3 3 FYW K3 5 FYW K3 7 FYW K3 9 FYW K4 1 FYW K4 3 FYW K4 5 FYW K4 7 FYW K4 9 Budget Actual Weekly chart comparing actual picking activity to budget

Contact Centre Model

This cube has 7 dimensions and allows weekly performance monitoring of key activity drivers, actual against budget and latest forecast ; Measures | Time | Version Brand | CC Location | Customer Type | Activity Purpose

•To produce activities by Contact Centre to drive Manpower planning and budgeting •To determine manpower resource requirements and to identify peaks

Actual Data

• Weekly actual data loaded for reporting against budget and forecast

Contact Centre Activity by Location

600,000 500,000 400,000 300,000 200,000 100,000 0 FYW K0 1 FYW K0 4 FYW K0 7 FYW K1 0 FYW K1 3 FYW K1 6 FYW K1 9 FYW K2 2 FYW K2 5 FYW K2 8 FYW K3 1 FYW K3 4 FYW K3 7 FYW K4 0 FYW K4 3 FYW K4 6 FYW K4 9 FYW K5 2 Sunderland Crosby Preston High volatility in the pre Christmas period as customer demand increases = hire temporary staff for peak

BPM Checklist

BPM Objective

Analytic processes, supported by technology, that address financial as well as operational activities Measuring and managing performance against business goals Processes include financial and operational planning, consolidation and reporting, modelling, analysis and monitoring of key performance indicators (KPIs)

Objective Achieved?

  

Finance and Operations

Performance Reporting (Actual vs Budget vs Forecast)

Weekly Flash Sales and Margin - by brand, by outlet type, this year last year

Users of TM1

Group Exec Brand Exec Weekly Trading and Marketing performance reports - by brand, outlet, product category, this year last year Weekly Operational Reports - stock and intake by site by product type, this year last year Warehousing Exec Monthly Carriage Account - by carrier, by brand Monthly Carriage charge – by carrier, by brand, by product line Warehousing Exec Bus Express Exec Brand Exec Ad hoc reporting Business function analysts

TM1 Users by function

User Department

Finance Marketing Buying and Merchandising Operations Financial Services E Commerce / NBD Business Express Contact Centres Others

Total Users

58 31 30 22 8 8 4 4 6

171 %

34% 18% 18% 13% 5% 5% 2% 2% 4%

100%

Conclusion

• • • • • • • Integrated business planning process Financial planning Operational planning Analytical capability Weekly performance reporting KPI monitoring Using TM1 technology TM1 TAPS Cube TM1 Intake Planning Cube TM1 Carriage Cube TM1 Contact Centre Cube

= A working BPM solution!

Contact details

Mark Bodger

Business Information Controller SJMB, 13 th Floor 100 Old Hall Street Liverpool L70 1AB

0151 235 4890 [email protected]