By Peter Turgoose
In this month’s lead article David talks about FMCG getting faster. This poses the question of what does this mean for the design of organizations competing in this space? In previous editions of this Digest we have discussed the implications for the design of FMCG Supply Chains, and OTM has made available a case study of the work we did to support the redesign of one of the UK’s most successful Supply Chain organisations. The complexity that multi-product FMCG organisations have to design for in their supply chains is driven by the need to remain Operationally Excellent whilst having a Customer Intimate front-end that ensures that their customer, the stores and other channels to market, find them easy to do business with at the right price.
However, the Supply Chain is only the meat in the sandwich which gets goods from a product idea into a consumer’s basket. Today an Operationally Excellent end-to-end Supply Chain is an essential to get into the market, but it is not sufficient on its own to win in that market.
The question for organisations is how to quickly get new and innovative products onto the shelf and into the consumer’s basket in response to rapidly changing market dynamics. How to find out fast both what has changed and why, and how to respond quickly. In the new world of big data and data analytics the organizations that win will be those that are designed with right information flows, decision making and management mechanisms, to enable them to enact their product strategy. Whether the strategy is to be an operationally excellent fast-follower offering low cost products or a premium-priced product leader, the organization design must be aligned to it. The design must ensure that the upstream product innovation/design/ development work is not left disconnected from the Supply Chain or the Customer.
OTM’s March 2016 webinar revealed the Top 10 considerations for Organization Designers when Big Data and Data Analytics are a core part of the organization’s strategy.
A FMCG organization that wants to stay ahead in a faster moving market should use the 10 Considerations as a simple diagnostic to determine whether a redesign effort is required. The organization should be asking itself whether the upstream work and its supporting management and decision making mechanisms, information flows and systems have been designed to allow the right roles with the right skills and capabilities to make innovative changes to products based on real time insight. In our experience the data, the insight, and the decision making becomes fragmented across the value stream resulting in slow decision making based on incomplete and often out-of-date data thus stifling rapid product innovation.
Bolting Big Data and Data Analytics onto an existing organization design rarely, if ever, results in better or faster decision making.