JESSIE NETTE R, PARAGAT

MSIT 208 – System Analysis and Design/Business Intelligence

First Semester 2022-2023
Dr. Andrew P. Ponte

Synthesis

First Tennessee Bank

Banks are offering a more diverse portfolio of services, over a wider range of channels,
than ever before. Competition intensifies as banks determine how best to optimize
marketing resources. In the past, First Tennessee Bank measured its marketing effort
by how much it spent. FTB sought an accountability framework to measure more than
overall marketing spend. FTB needed to measure impact. Leveraging predictive
analytics, FTB combines a granular understanding of customer needs by segment with
real P&L data. More efficient allocation of its marketing resources has provided FTB
with a 600% overall return on its investment. The bank has also realized a 3.1%
increase in marketing response rates and significant cost reductions as a result of more
accurate targeting of its offer resources and other banks are applying the power of IBM
analytics to optimize their marketing effort in increasingly competitive environments.
IBM big data & analytics can help you apply vast amounts of customer data to deepen
connections, build long-term relationships and foster continued customer satisfaction.

Globe Telecom

Globe telecom needed to reach a new level of agility in the creation and management of
promotional service offerings. In a joint engagement, IBM and Nokia Siemens Networks
designed and built a SOA-based service creation and delivery platform that enables
Globe to rapidly and cost-effectively create service offerings from reusable service
components. Globe is able to drive revenue improvement from hundreds of
simultaneous targeted promotions, which are enabled by the integration of customer
intelligence, behavior segmentation, profit simulation and promotion execution-all
delivered through an integrated and automated solution. We can react very quickly
promotional opportunities when they arise.

Memphis Police Department

With traditional policing practices challenged by a rising rate of criminal activity and tight
budgets, the Memphis Police Department pioneered a way to focus our patrol resources
more intelligently and restructure the way the department works. Our program for
reducing crime, Blue CRUSH, is more than adopting a new technology—it’s an
evidence-based, comprehensive change of the department’s culture that has had a
dramatic impact on how we work together, our relationship with the community and how
we fight crime. The department now focuses on the management principles for driving
innovation by breaking down organizational silos, de-emphasizing hierarchy, pushing
accountability and developing collective intelligence.

Papa Gino’s

Papa Gino’s boosts sales and customer loyalty

Using business analytics to maximize the profitability of marketing campaigns and

promotions

Based in Dedham, Massachusetts, Papa Gino’s, Inc. is the parent company of the Papa
Gino’s Pizzeria and D’Angelo Grilled Sandwiches restaurant chains. The company
operates more than 275 company-owned and franchised Papa Gino’s, D’Angelo and
dual-location restaurants and employs more than 5,000 people across New England.
Both D’Angelo and Papa Gino’s are committed to providing high-quality products,
attentive service, clean, convenient, attractive restaurants and a premium value
experience for every guest.

To maintain competitive advantage and support business growth, the Papa Gino’s
senior management team decided to rethink its information technology strategy and
invest in innovation. The company’s IT team was tasked with assessing the existing
technology landscape and identifying the areas where new systems and processes
could deliver the greatest business value.

Moving away from spreadsheets

“At that time, we effectively had three main business systems: our JD Edwards ERP
system, our restaurant point-of-sale system and Microsoft® Excel®, which we used very
extensively,” explains Martha Lieber, Director of Business Systems at Papa Gino’s.
“Basically, almost everything that wasn’t covered by the other two systems was
managed in spreadsheets, which meant we had numerous sources of ‘truth’ across the
organization. For company-wide processes like budgeting, this was a major problem,
because it could take up to four months to consolidate and validate data from all the
different spreadsheets and complete the process.”

Paul Valle, CIO, adds: “We knew that if we could create a single central solution for
business analytics, we could standardize and significantly accelerate our planning and
reporting processes. We also realized that it would allow us to analyze operational
performance in areas that we had never previously been able to measure accurately –
such as pizza delivery times and marketing campaign effectiveness. When we
presented our ideas to the board, they immediately agreed that this should be the top
priority in our IT transformation.”

Building a partnership
In partnership with QueBIT, an IBM Premier Business Partner, the IT team deployed a
suite of IBM Cognos software including IBM Cognos Business Intelligence, IBM Cognos
Planning and IBM Cognos Finance.

“QueBIT is a great partner for our organization, and the QueBIT consultants have done
a terrific job throughout all the projects we have worked on with them,” comments
Martha Lieber. “By working closely with us, they have not only given our in-house team
a lot of very valuable insight into the Cognos solutions; they have also gained a great
understanding of how our business works. As a result, they have definitely become our
go-to partner for business analytics projects.”

From data collection to analysis

The first priority for the Papa Gino’s and QueBIT team was to integrate the IBM Cognos
solutions with the ERP and point-of-sale systems, migrate data from existing
spreadsheets, and create the new standard financial reports and budgeting process.
Next, the team embarked on a series of projects to monitor operational metrics and
provide data to different groups of business users in near real time. “The main objective
is to turn people from data gatherers into analysts – not just at corporate level, but all
the way down into the field,” says Martha Lieber. “For example, we have district
managers who are responsible for all the restaurants in their territory. Previously, they
had to spend hours each day pulling together all the information they needed to manage
their restaurants: now, they get a simple, one-page report every morning that tells them
everything they need to know. Beyond that report, we’ve really focused on managing by
exception, so online reports highlight the parameters that are outside of the normal
range. Instead of looking at 50 data points for every single restaurant to find out what is
going on, they can see the problems immediately and focus on solving them.”

Optimizing labor costs

One of the first projects was to optimize labor costs by using IBM Cognos Enterprise
Planning to provide trend analysis based on current and historical sales data. The
solution compares recent weeks’ sales figures with previous years’ figures to provide a
two-week forecast of probable staffing requirements, helping managers ensure that
each restaurant has the right number of staff to provide excellent customer service at all
times, while managing cost levels. “The ability to predict staffing requirements and to
make this data available to executives and district managers in real time helps to
identify problems quickly and nip them in the bud,” explains Paul Valle. “For example,
we had a situation in one of our restaurants where we saw sales increasing significantly,
but the labor costs were decreasing. We immediately investigated this incongruity, and
found that there were some errors that needed to be corrected. Previously, we probably
wouldn’t have spotted the problem until much later; the effect on sales and customer
service might have been significant.”

Better customer service

A second project was to start measuring order management performance using metrics
such as the average time taken to deliver orders to customers’ homes compared to the
estimated time. “The insight we obtained from measuring delivery times in Cognos was
really an eye-opener,” comments Martha Lieber. “We found that, on average, we were
promising to deliver pizzas within 45 minutes, but we were actually delivering them in
less than 30 minutes. As a result, we started to adjust the promise time to reflect reality
– setting our customers’ expectations more accurately and potentially avoiding lost
orders.”

More effective marketing

The third major area where the Cognos analytics solution is helping to optimize
operations is in marketing and promotions management. “We do a lot of email, SMS
and postal marketing where we send coupons to our customers with special deals and
offers,” explains Paul Valle. “With Cognos, we can track which coupons are actually
being used, so we can see which kinds of deal are most attractive to customers and
create the most sales. We recently created a loyalty program for regular customers
which provides rewards that can be used on future orders and, thanks to Cognos, we
have been able to track its effect on sales. What we’ve found is that customers who are
members of the loyalty program order from us about 33 percent more frequently than
those who haven’t joined yet. So this insight has led to a real drive to encourage
customers to sign up.” Martha Lieber adds: “Similarly, we can now compare the sales
figures for orders that are placed online with those that are placed by phone or other
channels. We are seeing that, depending on seasonal changes, online orders are
between 40 and 70 percent larger – so, again, it is now our strategy to promote our
online service and make it our customers’ preferred channel.” Since it is easy to track
customer behavior via the Cognos solution, the Papa Gino’s marketing team can create
numerous nuanced versions of each campaign or promotion, and then compare the
results. As a consequence, the company is able to constantly fine-tune its marketing
effort and focus on the campaigns and deals that deliver the highest returns.

Streamlining the budgeting process

A further area where the introduction of IBM Cognos solutions has improved operations
for Papa Gino’s is in financial planning. The company’s budgeting process, which
previously required the planning team to gather data from across the business in
spreadsheets and manually check and collate it, is now substantially simplified and
improved. “While the duration of the plan process has stayed consistent, what has
changed is our capability to process scenarios and/ or adjustments that flow through to
other aspects of the plan,” comments Paul Valle. “It is estimated that our efficiency has
improved by 25 percent, enabling us to take deeper dives into the key drivers of plan
results and improving overall plan quality. Automating time-consuming spreadsheet-
based processes has increased accuracy as well as stakeholder confidence in the plan
as a whole.”

Social media and mobile applications

“We see social media playing a significant role in the future of the restaurant business,
so we’re currently active on Facebook and Twitter, and we’re working on projects with
Foursquare, Yelp, Groupon and a dozen other social media sites,” comments Paul
Valle. “We’re also due to launch apps for the iPhone, BlackBerry and Android mobile
platforms. The great thing about the Cognos solution is that we’ll be able to use our
existing solution to monitor the performance of these new channels too, so we can
continue to optimize our sales performance and focus on the most productive areas.”
Martha Lieber concludes: “For the future, we’re looking at upgrading to the latest
version of Cognos and providing better mobile access for our district managers –
perhaps via iPads or Android tablets. This will help them work more effectively when
they are visiting their restaurants and really do a ‘show and tell’ with their team
members to highlight areas where operational performance can be improved. These
types of initiatives, powered by IBM Cognos technologies, will help us maintain our
position as an innovator and stay ahead of our rivals in a highly competitive
marketplace.”