Business intelligence keeps baker's profits on the rise

Business intelligence is a buzzword the whole industry knows but has struggled to define. However, for George Weston Foods, bakers of the Tip Top brand of bread, the translation is simple -- a more efficient way to be profitable.

Roger Marquet, MIS manager at George Weston Foods, said the company's new business intelligence system, built around Cognos' suite of tools, delivers a multidimensional reporting capability that's continuing to sharpen the organisation's competitive edge by optimising sales and reducing returns of unsold bread.

The business intelligence system helps business managers identify slow selling product lines, correlate profit margins against sales volume and improve demand forecast information within the division, which makes about one million loaves of bread a day.

Marquet said George Weston Foods developed the system in response to demand from business users who sought a replacement for a purpose-built reporting system that had fallen below par.

"We have large volumes of data and need to be able to look at that information from all facets," Marquet said.

Key drivers behind the implementation included a demand for portability of business data and more meaningful business reports. Now, sales managers can download data to notebook computers for use in the field and management can obtain a previously unavailable national view of operations.

The Cognos-based system was initially rolled out in NSW and applied to George Weston Foods' six NSW bakeries. Now it is being rolled out across the entire organisation, providing business intelligence on 4500 products and 50,000 customers around Australia.

"Having the most accurate demand and profitability information at their fingertips, sales managers provide more accurate and timely information to production managers at the bakeries," Marquet said.

Data cubes

Around 150 employees within the baking division currently use the Cognos tools. The company's IT team designs specific 'data cubes' -- multidimensional models of the business that users can explore to identify trends, track business performance and create reports for each user group -- according to users' preferences and needs. The cubes provide managers with the tailored information for everyday business decisions.

Managers can explore data in any combination, from any angle: 'slicing and dicing' data to explore emerging trends, drilling down for further information or simply analysing and examining data. Some of the business parameters George Weston Foods uses include a comparison of budget versus actual figures, sales, returns, and combinations of these.

But Marquet said that as with any business intelligence implementation, George Weston Foods learnt during implementation that data volumes can be critical.

"If you get too large a volume you have performance issues; you either have to spend a lot of money on servers and upgrading PCs, or you start thinking about your data more carefully so that you can reduce the sizes, in Cognos-speak, of the cubes you're creating," he said.

Is business intelligence really cooking?

Business intelligence is the third generation of business information systems, after host-based query and reporting (first generation) and data warehousing (second generation).

Dialog executive director Len Rust told a briefing session last year that Gartner Group had identified business intelligence as a "hot new industry sector".

That's because organisations everywhere are starting to recognise turning transaction data -- which generally comes from ERP (enterprise resource planning) systems -- into information and knowledge is the key to gaining a competitive edge.

Graham Penn, general manager of research at IDC, said business intelligence is winning support amongst Australian business, particularly large companies.

But he points out that if companies are to maintain the competitive advantage business intelligence delivers, they will also need to be able to compile, query and report on data external to their corporate databases.

Penn predicts this migration to a more encompassing business intelligence strategy could give rise to specialist managers who will be responsible for collating internal and external data and presenting it to executive management.

Looking to boost the business IQ

Business Objects WebIntelligence Extranet EditionCognos enterprise BI solutionInformatica Business Components for SAP R/3Oracle Reports 6i BetaOracle Discoverer 3i Beta

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