SSA Notebook | Winter 2015

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Who Will Race Ahead in the Rapidly Changing Auto Industry?

According to The Atlantic, a world with driverless cars is drawing nearer. Key players – Apple, Google, and Uber – are all competing for leadership in this new sector. “They know what it’s like to demolish the incumbent in an industry because they’ve all done it before,” the author describes. Apple has the advantage of its software tied to all of its devices and Google has the advantage of its geospatial capabilities. Uber recently poached nearly one third of Carnegie Melon’s robotics engineers to get into this space. Driverless cars could allow Uber to entirely disrupt its business model and significantly increase profit margins by eliminating drivers, the company’s biggest cost. Meanwhile, as a countermove, Toyota announced a $1 billion investment in artificial intelligence to collect data on its vehicles and make driving safer for humans, rather than completely replacing them.

How the “Uber for Doctor House Calls” Could Disrupt the Healthcare Industry

Pager aims to make healthcare the next industry to adopt the on-demand model. Pager, which partners with companies including Birchbox and Spotify, is one of several new businesses that position their services as a way for companies to offer cost-effective, on-site, basic primary care for employees without making large investments in medical staff or facilities. Pager CEO Gaspar de Druezy, says that his company is “focused on tech, design, and delivering a better, more affordable experience.” Offering on-site medical benefits can attract candidates, minimize productivity lost to sickness, and cut costs by spending on preventative rather than emergency care. On-demand healthcare has potential to both change the patient/employee experience and disrupt current insurance and healthcare delivery models.

Amazon Executes Cyber Monday Best Because It Prepares for Peak Shopping Year-Round

According to this Fortune article, Amazon generated an estimated 36.1% of all online sales on Cyber Monday: more than twice the shares of retailers Best Buy, Walmart, Nordstrom, and Macy’s combined. What distinguishes Amazon from its peers is not steep discounts, but its preparation for surge traffic. A Seeking Alpha author posits that Amazon practices and prepares for spikes in traffic all year: “its cloud systems are designed to handle surges of traffic, and its warehouses have been scaled to handle the flow.” Meanwhile, other retailers faced technical and operational issues when scaling for shopping spikes. As a corollary, an organization’s preparation is only as good as its forecasting abilities, and Amazon excels with advanced analytics in their forecasting. Companies that bolster their operations by aligning people, processes, data, and systems to meet spikes in consumer demands year-round will have an advantage in the competition for holiday sales.

Getting Mobile Right is Critical for Retailers to Get Closer to Their Customers

According to a Reuters poll, more consumers than ever plan to use their mobile phones in stores to compare prices, take photos, and research products. In response to this trend, retailers are incorporating mobile tools to enrich in-store experience and draw online customers to stores. For example, Best Buy equips sales associates with tablets to offer customers price-matching and demonstrate that their items are competitively priced. Wal-Mart’s app includes a feature for shoppers to scan items in-store to add to a digital wish list, making them searchable for friends and family. Businesses that fail to offer mobile features – or poorly execute them – will lose customers to competitors quickly. The new point of sale is the customer, wherever they are.

This year, #GivingTuesday generated $117 million in donations in 24 hours, a 155% increase from last year. As Causecast CEO Ryan Scott writes in Forbes and Retail Dive, charitable works are becoming a larger part of branding for companies who want to reach and connect with customers. “Messaging alignment with this day of generosity elevates the consumer’s perspective of the brand, and gives them a sense of pride when they choose to invest in your product,” Scott writes. The day also offers companies a chance to live and breathe their missions. Several companies are capitalizing on the movement to showcase their commitment to corporate social responsibility, from Salesforce’s “Pledge 1%” initiative, to Kenneth Cole’s “Look Good, for Good” campaign.

Big Data: The Latest Rage in Supply Chain Management

CFO.com recently featured an article from SSA’s Regenia Sanders, Vice President, Supply Chain Practice and Jason Meil, Managing Director, New Products and Innovation, discussing the potential of big data in supply chain management. “A company’s supply chain is rich with data, and it’s also a large cost component. Combined, those facts mean that advanced analytics can become a strategic weapon for optimizing the supply chain,” say Sanders and Meil. Using advanced analytics, companies can predict customer patterns and preferences as well as micro- and macro-economic trends, yielding valuable insights to help leaders strategize. With the tremendous potential big data holds for operations, CFOs must lead the way in applying data analytics to drive supply chain performance and create more value.

Smart Light Bulbs Shed Light on New Data-Centered Innovation Opportunities

This Forbes article highlights a new light bulb company, BeOn Home, which has created “an innovative smart home bulb as a home security device that can network itself using wireless technology.” BeOn works through its app to automatically detect how customers use their lights over the day and week and repeat the learned pattern for them. Gathering data from everyday items such as light bulbs holds tremendous potential beyond personal use. Smart light bulbs could benefit commercial strategy, urban planning, and law enforcement – from drugstore lights tracking customer travel patterns to street lights detecting gunshots and notifying law enforcement immediately.

How Startups are Using Smartphone Data to Predict Microlending Risk

Silicon Valley microlending startups are analyzing applicants’ smartphone usage to assess borrower risk in developing economies, where many people have smartphones but few have established formal credit. These companies analyze up to thousands of indicators – including daily miles traveled, frequency of phone charging, or number of texts received – to predict the reliability of customers and assign interest rates accordingly. Cell phones generate massive quantities of personal data that can be used to find surprising insights. For example, one algorithm found that “users who wait until after 10 p.m. to make calls – when rates are lower – are lower-risk borrowers.” Nontraditional data sources and advanced analytics offer tremendous opportunities for forward-thinking companies who use data in innovate ways.

Building a Data-Driven Culture with Deb Henretta, P&G’s Former Group President of e-Business

Recently, we convened over 30 executives across a variety of industries – including financial services, industrials, media, and private equity – in New York City to discuss pragmatic ways of embedding data and advanced analytics into a company’s leadership and culture. The luncheon featured Deb Henretta, whose work transformed P&G’s business models to win in the digital economy, where nearly half of its $83 billion sales are transacted or influenced. We’ve developed a Playbook which highlights a few of the key insights from the discussion.

SSA & Company Named One of Consulting Magazine’s Fastest Growing Firms

We are honored to accept this award, featured in the December edition of Consulting Magazine. We attribute our growth to our focus on strategy execution and advanced analytics. In a slow growth environment, organic growth and productivity are two levers that CEOs are focused on. Being able to execute on those with advanced analytics makes performance improvement even more impactful.

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