Industry: Media – Music

Business Challenge: Inadequate  Sales Tracking

Based in London, this company is the world’s  largest independent music company, operating directly in 50 countries. Around  the world the company supports a roster of current pop, classical and jazz  stars plus a back catalog of 150,000 recordings. A key management requirement  is next-day sales data from the company’s 45 operating companies around the  world; however the legacy system was stretched to capacity and could only  support a single metric ― physical units sold. These limitations slowed and  complicated such crucial operations as sales analysis, customer analysis and  marketing campaign analysis. In such a fast moving industry ― where new  products succeed or fail within a few days of release ― this made it difficult  to quickly fix campaigns that weren’t working, or make the most of ones that  were.

No  Support for a Critical New Product Line

By the middle of 2005, a new sales channel of  digital product line revenues accounted for 4.8 per cent of the company’s total  revenues, with that figure expected to reach 25 per cent in five years. But  since this new sales channel/product line’s sales are processed differently  than physical store sales it was not possible to track them by region or  operating company. Having only high level aggregate sales data made it  difficult to forecast local sales trends and develop new marketing campaigns,  let alone measure the effectiveness of current initiatives.

Incomplete  Financial Reporting

The company’s existing financial consolidation  system, based around Hyperion, was user unfriendly and could only be used by a  handful of skilled analysts. That meant that executives in need of financial  data had to place a request to the finance department, and then sit through a  lag time to get it ― for every query. This awkward process meant that directors  could not spontaneously examine elements of their division’s financial  performance. Not being able to follow wherever the data led meant they were  missing opportunities for insights that could make the business perform better.  Additionally, information was trapped in silos by operating company and region,  making it impossible for executives to benchmark their performance against  peers in other regions ― another missed opportunity for improvement.

Challenge Highlights

  • The legacy sales reporting  system did not provide enough information for the organization to quickly  respond to sales trends or fine-tune marketing campaigns
  • Limited information on new  sales channels and product line sales hampered critical sales and marketing  initiatives
  • A user-unfriendly financial  system made it difficult for executives to get the data needed to identify  problems in their performance or capitalize on successes
  • No opportunity for financial  benchmarking

Solution

Expand  Sales Data

The Company is using Panorama’s BI Solution  to improve the sales management process by including sales value and customer  information as well as units sold in its next-day reporting. For marketing  purposes it’s much more meaningful to track sales targets that are based around  value, so this new data saves manual effort and leads to more accurate and  informed decision making about which programs are working, which aren’t and how  to fix them. The system will eventually offer such features as margin analysis,  cross-border pricing analysis, shipments analysis and customer analysis.  For customer analysis, the company will be  tracking consumer behavior, attitudes and trends to guide investments in  products/product lines.

Include  New Data Streams

A feed on new sales channels and product line  sales has been added to the reporting system to allow comprehensive tracking of  sales by operating company and region. So for the first time the performance of  a new and critical product line can be analyzed in detail. This allows the  company to forecast local sales trends, develop new marketing campaigns,  measure the effectives of current initiatives and take the necessary steps to keep  sales strong.  For the company,  maximizing revenue and keeping sales strong means maintaining the right  products in the various local markets and aligning the product promotions  (airtime) to the correct local markets.

Make  Sales Information Available to All

The company has launched an intranet sales  information portal that is available to every one of the company’s 6500  employees. Because it’s based on user friendly intuitive tools, that users are  most familiar with, the portal requires no training and has quickly become the  destination site for sales and marketing staff that need to compare results.  This program of delivering BI to every desktop gives every employee a picture  of how the company’s key products are doing, fostering both a team spirit and  an attitude of healthy competition.

Enable  Self-Service Access to Financials

A key responsibility of Managing Directors  and Financial Directors is looking for trends in their financial data that  suggests problems in some areas that need to be fixed or highlight other areas  that are doing well and should be expanded. By using Panorama BI Solution as  part of its financial reporting system, the company is able to provide a highly  guided set of analytical reports to a global executive audience. Directors can now  access their financial data faster and on their own, instead of requesting and  waiting for reports. This self-service approach to BI lets them identify and  respond to problems, or capitalize on successes much more quickly than they  could before. Also, for the first time executives can benchmark themselves  against their peers at other operating companies and in other regions. This  sharing of information allows them to glean new ideas by seeing what’s working  elsewhere within the company or improve in areas where they are falling behind.

Develop  a More Transparent Culture

The company is now actively working to do  away with the old culture that developed from systems that locked down sales  and financial information to a few users within a territory. The goal is to  develop a culture where all staff ― from the Chief Executive on down ― share  information as widely as possible and learn from what their peers are doing.

Solution Summary

  • Enable faster, more accurate  sales and marketing analysis with expanded sales reporting
  • Facilitate self-service access  to investigate key financial trends
  • Provide the ability to  benchmark financial performance
  • Promote cultural change based  on sharing and access to data

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