Country organizations are being asked to do more with less and “decision-support” has been culled in many leading global CP companies. To efficiently build effective NRM capability requires a transformational approach and mindset.
- Establish analytics centers of excellence (CoE)
Local sales insight, relationships and field presence remain core commercial assets. But data-driven activities, such as pricing, promotional analytics and point-of-sale (POS) segmentation, can now often be better undertaken by dedicated analytics teams with real economies of scope and scale — the analytics CoE.
On- or near-shore NRM resources translate price, promotional, POS and shopper analytics outputs into practical direction and guidance that sales can execute. When consumable insights are plugged into local decision makers at the right times, above-market analytics can be both effective and efficient.
- Define the end state and codify collaborative working
Rerouting and streamlining processes through analytics CoEs require a reset of roles and responsibilities across the sales and marketing organization, and end-to-end processes spanning on-, near- and off-shore locations.
Given the complexity and scale of implementing NRM, a clear end state and compelling case for change are needed to galvanize stakeholders. That can be daunting enough for the sales and marketing organization, but NRM needs to be synchronized with supply chain to fulfil demand effectively and efficiently. Given the level of change associated with implementing NRM, some leading companies are building NRM capability as part of a wider IBP program.
IBP, as NRM, can mean different things in different organizations. For some, it is sales and operational planning by another name. But leading companies are now viewing IBP more strategically, as a means to break down functional silos and reconnect strategy with execution. In effect, IBP integrates planning processes and governance across functions, geographies and time horizons to efficiently execute strategy and deliver targets. In this way, IBP synchronizes demand and supply to create more agile, responsive and efficient organizations, reorientated toward winning with the consumer and long-term value creation.
Where to start
This can seem an overwhelming challenge, which is why a compelling case for change is needed.
- Size the global trade spend opportunity
The good, or bad, thing for NRM advocates or practitioners is that trade spend is in the billions of dollars for global CP companies. Minor improvement in ROI can drive material differences to net revenue and profit. In our experience, the case for change is compelling. But few can currently see the size of the prize — or the risk.A quick but credible global scan can reveal levels of opportunity and risk, identifying drill-sites by country, brand, channel, product and customer (depending on data granularity).
- Conduct rapid NRM capability assessment and identify pain points
Many of the pain points in organizations have common root causes. For example, “data isn’t reliable, systems and tools need too much manual entry, process timings don’t work for me or my team, too much time spent on planning and re-planning.” Rapid cross-functional interviews or surveys, desk assessments and headcount or role analysis identifies duplicated, redundant activities and creates buy-in to tackle inefficiencies and their root causes.These will span people, process and technology, and require a cross-functional response.
Widening the scope of profitable growth challenge can create complexity but also creates synergies and scale to drive transformational change.This will help codify a better business-as-usual that tackles pain points and that respects the dependencies across functions. This will require behavioral and cultural change.In the short term, however, it is advisable to focus on a region or strategic market(s) to get the details right and reflect reality on the ground. This is critical to get stakeholder buy-in.
A “narrow-front” approach concentrates the organization’s global resources and effort on making capability breakthroughs in a few, priority markets or a region to prove the concept, build the benefits case and learn lessons for subsequent roll-outs.
NRM can help CP organizations reconnect strategy with execution and drive sustainable, profitable growth.
Today, digitalization is transforming the way brands interact with consumers, shoppers and suppliers. The fragmentation of routes to consumer, retail environments and personalization of brand messages, propositions and services will increase the need for an intermediary, hybrid capability such as NRM. It is here to stay.
While it will demand transformational change, this is the next frontier of shareholder value creation — and survival will depend on it.