October 2016 Orlando, FL

Data & Analytics

Share Group
Identifying the Big Imperatives
Topics for Discussion

Introduction 10 mins

Organizing for Analytics Excellence 45 mins

Identifying the Big Imperatives 45mins

Q&A 20mins

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Executives see data-driven decision making as important,
but find it challenging to embed in their organizations...

4 of the top 5 barriers to

Big decisions have a getting more value from data
big impact on and analytics are behavior
Highly data-driven
future profitability. and skill related
companies are three
Majority of
times more likely to
respondents
report significant More big decisions are made
(59%) pegged their
improvement in opportunistically (67%) than
next big decision at deliberately (33%).
decision making,
a value of $100
but only 1 in 3
million or more. The majority of executives,
executives say their 62%, rely more on
organization is experience and advice than
highly data-driven. data to make business-
defining choices.

where majority
1,135 senior representing (74%) of companies
executives a total of 18 reported annual
interviewed from industries revenues of at least
across the word $1bn

Source: PwC’s Global Data & Analytics Survey: Big Decisions™ ®

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…and do not feel that their organizations have mature data
analytics capabilities

Source: PwC’s Industry 4.0: Building the Digital Enterprise

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They face a need to combine the Art with Science and
increase the speed and sophistication of decision-making...

Science:
Analytics & How can we
Data
increase the Speed

Speed
& Sophistication of
our Decision
Is there a better Making?
way to combine Art
& Science in
Decision Making? Sophistication

Speed Sophistication
Art: • Time to answer question • Analytics maturity
Experience & • Time to decide action • Data breadth and depth
Advice • Time to implement & measure • Decision approach

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…and establish a repeatable approach that can be applied to
many decisions – Discovery, Insights, Actions and Outcomes

Advantaged Analytics DIAO Approach

01
Discovery
02
Insights
“Observations to Information” “Information to Insights”
Find value in internal and external, Apply new techniques on existing
structured, and unstructured data and new data to generate insights

Automate data discovery , cleaning, Create a test-and-learn environment

and analysis Keys to Success for continuously harnessing insights

Time to value from

04 03
data and analytics

Outcomes Actions
“Decisions and actions to outcomes” “Insights to decisions & Outcomes”
Unlock value by transforming Link insights with decisions and
business function, unit, or industry actions to deliver quick wins

Recruit and train talent to Compete with faster and more

deliver improved metrics sophisticated decisions and actions

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Our session today will cover two main topics – Building
Analytics Excellence and Identifying the Big Imperatives

Building an Analytics Capability

Building Analytics Excellence

Strong executive
Capability development across six dimensions of Engagement
sponsorship and
analytics capability and
cultural steering
collaboration
Top-down Enable fact-based
advocacy for decision making
cultivating the right and realization of
culture and business
behaviors outcomes

Identifying the Big Imperatives

Identifying and prioritizing the high-value business
applications and accelerate speed to value

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Topics for Discussion

Introduction 10 mins

Organizing for Analytics Excellence 45 mins

Identifying the Big Imperatives 45mins

Q&A 20mins

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Building organizational muscle in data and analytics is a
top opportunity identified by CPG CEOs

Top opportunities for change identified by CPG CEOs

Considerations
Aspiration Action

Use and management of data and data analytics 6 57 36 • One size does not fit all – ‘best in
Customer growth and retention strategies 7 52 41 class’ capabilities are strategy-
Talent strategies 9 53 37 dependent
Technology investments 9 55 35

R&D and innovation capacity 11 55 33

Organisational structure/design 11 49 39 • Most CPG companies are not ‘best

Channels to market 12 57 30
in class’ across the board – certain
Approach to managing risk 14 60 25
capability dimensions may be
Investment in production capacity 14 45 38

50 34
stronger than others
Supply chain 15

M&A, joint ventures or strategic alliances 18 51 24

23 44 32
• The journey taken by most
Corporate governance

Location of key operations headquarters 44 35 20

companies in defining their
50% 0% 50% 100%
No need to change analytics strategy and building
Recognise need/developing strategy/concrete plans to chan
Change programme underway or completed
capabilities is not easily reduced to
Q: “To what extend are you currently making changes, if any, in the following areas? a snapshot ranking
Based on responses from 145 CPG/ retail CEOS

Source: PwC 17th Annual Global CEO Survey 2014

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Opportunities exist to enhance efficiency and effectiveness of
analytics activities in both the short- and long-term

Analytics Capability Development

Immediate Opportunities Longer-term Opportunities

Laying the Building on the Building advanced

foundation foundation capabilities

• In the short-term, how do we • What is the vision and path • How do we build advanced
deploy existing resources forward for realizing value capabilities (e.g.
effectively against priority from differentiated analytics Advantaged analytics) that
initiatives and realize capabilities? will provide answers to our
efficiencies? emerging & most difficult
challenges?

6 to 12 months

12 to 18 months

36 to 60 months

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Developing the right analytics capability requires a review
across 6 dimensions

Advantaged Analytics Capability

What are we using analytics for?

Business
Applications

How can we build a Do we have access to

Culture Data the right data?
data-driven culture?

Advantaged
Analytics
Capability

Are our governance Processes & Do we have the right

Technology systems and tools?
processes optimal? Governance

Talent &
Organization
Do we have the right skills and org.
structure?

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Best in class companies exhibit coherence across the
continuum of these 6 dimensions

Advantaged Analytics Capability

Business
Applications Best in class organizations…

• Allow Business Applications decisions to define the role

Culture Data of analytics to drive requirements along all other
capability dimensions
Advantaged
Analytics • In the short-term, Talent & Organization, Technology and
Capability Processes are the primary levers that drive increased
efficiency and effectiveness in analytics
Processes &
Governance Technology
• Over the longer-term, however, companies focus on
identifying and prioritizing forward-looking Business
Talent & Applications and invest in building enabling
Organization capabilities accordingly

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 Business Applications

Organizations first identify the Big Imperatives and how and

when analytics can enable realization of its vision

Identify the key business applications… …prioritize based on benefits & complexity

Approaches of Application Identification Application Prioritization Framework

01 Scan the market and see what’s

possible

02 Draw lessons from best in class

companies

03 Review industry players and

competitors for insights

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 Data

Best in class companies harmonize internal and external data

sources, setting the stage for new data applications

Data Sources Non-traditional data applications

High
Complexity
• Leverage social / unstructured
Social and data (e.g., Twitter, Facebook) to
unstructured better understand customer
Unstructured Unstructured
data preferences to tailoring
Internal External
analytics marketing messages and
product/ service offers

Non- • Combine advantaged analytics

Structured Structured
Internal External traditional techniques with traditional
data models to unlock insights and
utilization unmet market needs
Low
Complexity
Low High
Complexity Complexity

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 Technology

Exemplars strategically invest in technology that enables the

right analytics and makes data available to the right people

Investment can facilitate migration of

Decision Dashboards
technologies required for the right analytics to
be performed…

Advantaged Analytics

Analytics Tool
Query /
Data Big Data
SQL
Discovery Analytics
Engine
Data Applications and Tools
Mart
Data Mart /DWH

Big Data
(Hadoop)
Automated ETL

Data Quality Tool Decision Cockpit

Structured / Small Data

Large Data Machine Data …and enable data to be visible and accessible
(e.g. social, (Cellular, across the organization to facilitate decision
Sources
clickstream) GPS)
making

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 Talent and Organization

An organization’s Advantaged Analytics operating model

should align with its strategic intent…

1 The Information Enabler Model 2 The Functional Mode

Group Group
Business Unit Business Unit CIO Business Unit Business Unit Cross Business Unit
Functional Unit Functional Unit Analytics Group Functional Unit Functional Unit  IT
 Finance
Analytics Group Analytics Group  Operations
 Strategy
Functional Unit Functional Unit Functional Unit Functional Unit

Analytics Group Analytics Group

3 The Performance Optimizer Model 4 The New Value Creation Model

Group Group
Business Unit Business Unit Cross Business Unit Business Unit Business Unit Cross Business Unit
CSO / COO / CFO CSO / COO / CFO Analytics Group Analytics Office
 IT
Analytics Group Analytics Group  Finance Analytics Group Analytics Group
 Operations
Functional Unit Functional Unit  Strategy Functional Unit Functional Unit

Functional Unit Functional Unit Functional Unit Functional Unit

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 Talent and Organization

…and be supported by a leadership and execution team

Analytics Organizational Support Structure

Chief Analytics
Officer

Data, Products and

Strategic Analytics
Services

Reporting,
Product Technology and
Data Science Business Solutions Visualization &
Development Data Architecture
Alerts

Liaison and Conducted

Identify and solve
prioritize with the Develop analytics automated and Interface with
business
Business (LOB, apps and tools self-service enterprise IT
challenges
Funct. Area) reporting

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 Processes & Governance

Organizations will need to update business and data

governance processes to align analytics, business and IT

Businesses Processes Data Governance

Updated business processes Strategic Data

should… Governance
Value Delivery
 Standardize routines and enhancement future value
interactions with clear decision rights
between teams
Optimizing Value of
 Facilitate collaboration and teams Internal Data
working together as cohesive unit
rather than in silos
Optimizing 3rd Party Data

 Establish clear norms for data

stewardship and data governance
Operational Data
 Define metrics and rules Governance
Assessing current governance, risk
documented to enable accountability management and control
Value
protection

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 Culture

Building an analytics capability requires strong leadership

sponsorship and a proactive change management plan

Establish Right Culture Address Key Change Management Challenges

 Senior leaders reinforce the

role of analytics and  Identify time and pace of transition
champions cultural Transition
 Use pilots in advance of full roll-out
Management
transformation  Manage disruption to getting business done

 Message that analytics

 Find / assimilate senior leader hire into
viewed as a core Talent management team
competency Acquisition  Build culture and “branding” of analytics group
 Establish talent pipeline/talent value proposition
 Commitment and sense of
urgency for change  Clarify around objectives, rationale and expected
Communi- outcomes of change
 Avoid disengagement cation  Have clear responses to core questions such as,
“what’s in it for me?,” “why are we changing?”

Source: Strategy& analysis and external research

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Breakout Session

In your breakout groups, spend 15 minutes discussing the following questions…

Which element of the analytics capability does your

organization struggle with the most?

Why?

What is your organization’s current analytics operating

model?

What are the challenges it faces today?

Please be prepared to share 2 – 3 key insights with the broader group

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Topics for Discussion

Introduction 10 mins

Organizing for Analytics Excellence 45 mins

Identifying the Big Imperatives 45mins

Q&A 20mins

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There are many approaches that organizations can use to
prioritize development of analytics applications or use cases

Approaches for Analytics Application and Use Case Development

Ad-Hoc Design to Value Big Bang

“Targeted investments to enable “Extensive upfront investments to
priority application” enable broad-base analysis”

• Data and analytics operationalized as strategic capability

• Data and analytics not considered
differentiating capability • Broad c-suite sponsorship and support

• Lack of overarching data and • Data-driven decision making embedded in company DNA
analytics strategy
• Emphasis on one-off application
• Defined roadmap of prioritized, • Undifferentiated investment
areas
high-value apps / use cases strategy…
• Lack of senior executive
• Targeted investment strategy, • … Focused on broad
championing and organizational
geared to app. roadmap infrastructure build out, with
cascade
requirements usage as a follow on

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CPG companies typically have a long list of use cases across
its organization
NOT EXHAUSTIVE

Marketing & Category

General & Administrative Supply Chain & Operations Customer & Commercial
Management

Talent Retention Procurement / Sourcing Market Scanning / Social Listening Channel Optimization
Talent Retention & Route-to-Market Opportunity
Churn Management
Succession Planning Optimization Identification
Telemetry for Early Warning Trade & Consumer
Connected Equip. System Promo Optimization
Cost Control Asset Utilization Rate Brand, Portfolio, and
Consumer Insights /
Indirect Spend Improvement Targeting
Price Pack Opt.
Improvements Personalized Dynamic
Use Cases

Consumer Offers Planograms

Travel & Expense Inventory Management
Spend Reduction Prioritized Outlet
Loyalty Program Activation
SKU Mix
Omni-channel Media
On Shelf Availability Optimization Category Captainship
Audit & Compliance
Optimize Marketing Predictive Category
Audit Supplier Captainships
Mix
Overspend
Predictive Analytics
Audit Media Spend
Strategy
Development
Marketing Asset
Valuations

Key Performance Indicators

Master Data Foundation
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The Design to Value approach evaluates each use case based
on opportunity, difficulty and organizational readiness…

Evaluation Criteria Description

Strategic Importance • Potential source of significant competitive advantage (vs. operational driver)

Value
• Size of the prize and opportunity potential
Potential

Data • Number, type, and variety of data sources, i.e., volume/ size, dynamic/ static,
Complexity structured/ unstructured, etc.

Ease of Analytics
Complexity
• Modeling using advanced techniques, predictive/ prescription, dynamic/ static
Execution

Implementation • Integration into business processes; training, change management, and

Complexity executive buy-in required

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 …and allows decision makers to prioritize use cases and
maximize speed to benefit

Use Case Prioritization CLIENT EXAMPLE

Potential
Advantage

Strategic
Importance

Tactical
Benefits
Low / Long-Term Impl. Ease of Execution High – Short-Term Impl.

Size of Bubble Low

Medium High Color of Bubble Marketing & Category Management Supply Chain & Operations
($Y-Zm (>$Zm OPP)
represents (<$Xm represents
OPP) Customer & Commercial General & Administrative
Value Potential OPP) Capability Area

Strategy& | PwC Confidential Property October 2016 Prepared for 2016 CGT Conference 24
A repeatable Advantaged Analytics approach can be applied
to each use case – Discovery, Insights, Actions and Outcomes

Advantaged Analytics DIAO Approach

01
Discovery
02
Insights
“Observations to Information” “Information to Insights”
Find value in internal and external, Apply new techniques on existing
structured, and unstructured data and new data to generate insights

Automate data discovery , cleaning, Create a test-and-learn environment

and analysis Keys to Success for continuously harnessing insights

Time to value from

04 03
data and analytics

Outcomes Actions
“Decisions and actions to outcomes” “Insights to decisions & Outcomes”
Unlock value by transforming Link insights with decisions and
business function, unit, or industry actions to deliver quick wins

Recruit and train talent to Compete with faster and more

deliver improved metrics sophisticated decisions and actions

Strategy& | PwC Confidential Property October 2016 Prepared for 2016 CGT Conference 25
Breakout Session

In your breakout groups, spend 15 minutes discussing the following questions…

1. Evaluate each use case from the long list discussed during this session
and consider how it applies to your organization

2. Determine how you would rank each in the prioritization matrix

Are there use cases missing from What use cases would you like to
the list? discuss in future meetings?

Please be prepared to share 2 – 3 key insights with the broader group

Strategy& | PwC Confidential Property October 2016 Prepared for 2016 CGT Conference 26
Topics for Discussion

Introduction 10 mins

Organizing for Analytics Excellence 45 mins

Identifying the Big Imperatives 45mins

Q&A 20mins

Strategy& | PwC Confidential Property October 2016 Prepared for 2016 CGT Conference 27
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