Case-3: Piloting Procter & Gamble from Decision Cockpits

Company Brief

P&G has made available to 38,000 users analytical solutions called Business Sphere and Decision Cockpits.  The Business Sphere was developed in partnership with BOI, Cisco, HP, SAP, Nielsen and TIBCO Spot fire.

The first project, launched in 2010, is the Business Sufficiency program, which gives executives predictions about P&G market share and other performance stats six to 12 months into the future. At its core is a series of analytic models designed to reveal what’s happening in the business now, why it’s happening, and what actions P&G can take. The “what” models focus on data such as shipments, sales, and market share? The “why” models highlight sales data down to the country, territory, product line, and store levels, as well as drivers such as advertising and consumer consumption, factoring in region- and country-specific economic data. The “actions” analysis look at levers P&G can pull, such as pricing, advertising, and product mix, and provide estimates on what they deliver. Business Sphere is the further integration of technology, visualization, and information enables leaders to drill-down into data to get answers in real-time. 

What management, organization, and technology issues had to be addressed when implementing Business Sufficiency, Business Sphere, and Decision Cockpits?

P&G's success has been due to its robust information technology and its willingness to pursue new IT innovations to maintain a competitive advantage. Its Global Business Service Division is building analytics expertise such as Business Sufficiency, Business Sphere and Decision Cockpits.

Management Issues:

Human resource management (HRM or simply HR) is a function in organizations designed to maximize employee performance in service of their employer’s strategic objectives. HR is primarily concerned with how people are managed within organizations, focusing on policies and systems. HR departments and units in organizations are typically responsible for a number of activities, including employee recruitment, training and development, performance appraisal, and rewarding (e.g., managing pay and benefit systems.

Organization issues:

The organization dimension of information systems involves the organization’s hierarchy, functional specialties, business processes, culture and political interest group. Since P & G pursue new IT innovation to maintain the competitive advantage.

Technology issues:

The organization dimension of information systems consist of computer hardware, software, data management technology and networking / telecommunications technology (including the Internet). By implementing Business Sufficiency, Business Sphere and Decision Cockpits, P&G change the way its gathers, reports and interprets data.

How did these decision-making tools change the way the company ran its business? How effective are they? Why?

These solutions eliminate time spent debating different data sets, and instead use a system that allows leaders to focus on immediate business decisions using the most accurate data available at that precise moment. The Business Sufficiency program, furnishes executives with predictions about market share and other key performance metrics six to twelve months into the future. It’s based on analytic models that show what is occurring in the business right now, why it’s happening, and what actions the company can take to mitigate the situation. By providing the “why,” the company can take a more appropriate action.

The Business Sphere interactive system reveals insights, trends and opportunities for leaders, and prompts them to ask focused business questions that can be addressed with the right data on the spot. Thousands of algorithms and analytical models aggregate data, organize them appropriately and then monitor trends. Everyone in the meeting or organization sees the same information.

The Decision Cockpit eliminates time spent by employees debating the validity of competing data versions. Employees are able to focus instead on decisions for improving the business. The Business Sphere and Decision Cockpits encourage P&G employees and managers to manage by exception and devote their time and energy where it is most needed.

How are these systems related to P&G’s business strategy?

Managers and employees are able to make faster and better decisions than were previously possible. The company enjoys a reduced complexity involved in generating a statistical report, as well as cost reductions from maintaining one standardized set of data across the enterprise instead of duplicated, redundant data. Employee-generated emails have dropped sharply since more workers can answer their own questions and obtain their own information. The company is also able to better anticipate future events affecting the business and more quickly respond to market stimuli.