Career IT Courses

A merger occurred between two North American manufacturing companies. They were able to unite forces to bring unique value to the construction, transportation, materials handling, and agricultural industries in Canada and the United States.

This new multinational company had undergone mergers and acquisitions in the past and had several different IT systems. There were looking for ways to enable access to consolidated information to better serve customers across the globe.

Further compounding the problem was a disparity in business models of the merged entities. Dealing with multiple systems was causing confusion and tremendous overhead on their employees. Not to mention the reduction in quality of service provided to their customers.

A ‘Bridge and Gasket’ Approach to Consolidated Business Intelligence

The client was surprised to learn how datacubes could be used to ‘bridge’ data from their various ERP systems and other sources including Excel. Business users would then have access to a consolidated view of sales and profits across divisions and regions.

Not only did this approach accelerate their ability to analyze important information, it also reduced the current IT report backlog. Users were empowered to mine the information to meet their own reporting requirements (the ‘gasket’).

Leaking Profits Saved by a Web Store

The Business Intelligence solution provided other benefits. A user analyzing the datacubes discovered that customers that bought on-line were paying full price while phone orders were often discounted. A decision was made to restrict the discounts available for certain items. This immediately drove profits higher as on-line ordering increased and profit margins were restored.

China Sourcing and Business Model Reversal

The sales forecasting process in use for some time depended on Sales reps and managers forecasting based on product sales history plus traditional criteria such as product class and customer group. But this approach didn’t factor in an increase in the number of comparable products offered by the company’s Chinese manufacturers.

Today the company sources roughly one third of its supply from North America and up to two thirds internationally. Of about a dozen suppliers, as many as half might be Chinese. And going forward, four of those suppliers might be replaced by three, four or five different Chinese suppliers which provide similar but not identical products to be sold.

While this supplier substitution delivered a new competitive price and quality combination, it created havoc with customer forecasts effectively reversing the business model from customer driven to product driven. Forecasts became useless over time.

A unique approach was adapted to their growing problem of dealing with product driven business models and forecasts. Yet another way a perspective-driven business intelligence approach increases margins and drives profits for companies in aggressive industries.

Discover how focused business intelligence for mergers and acquisitions will reconcile disparate data and help you better manage multiple business models. Our BI Road Map Accelerator offers a try before you buy alternative for immediate, low-risk business value.