E-business improves productivity for Britvic
customer relationship management is critically important to their
competitive positioning. This is perhaps because it increases
customer satisfaction and productivity by an average of 20 per cent
and increases revenues by 12 per cent, according to an Andersen
study by Knowledge Systems and Research.
Most executives in the food and beverage industry believe that customer relationship management is critically important to their competitive positioning. This is perhaps because it increases customer satisfaction and productivity by an average of 20 per cent and increases revenues by 12 per cent, according to an Andersen study by Knowledge Systems and Research.
In November 2000, Britvic Soft Drinks, a subsidiary of Six Continents (formerly Bass), decided to explore opportunities in the eBusiness environment to provide better customer service, cut costs and enhance efficiency. Specifically, it wanted to know what its options were in establishing a virtual trading environment for an important segment of its customer base and to understand in detail the costs, benefits, organisational and resource implications.
Britvic has three broad customer bands, encompassing everything from the large supermarket chains in tier one, down to corner store-type outlets in tier three. Its midsized clients in tier two typically comprise newsagent groups, cinemas, restaurants, pubs, wholesalers and nightclubs.
It was becoming apparent that there were alternative ways of serving these customers other than the traditional telesales route. The involvement of many staff in the many steps between gaining the order and banking the cash left considerable scope both for inefficiencies and for adding cost.
Furthermore, calls could not always be made at times convenient to the customer, so orders were often inaccurate or incomplete, requiring top-up deliveries at greater cost to both the customer and Britvic. Head of eBusiness, Jon Dunkelman, was keen to harness technology to automate key business processes and improve the relationship with the customer. He saw benefits for both customers and Britvic.
The right virtual trading system would provide customers with control over their orders, access to historical data, useful marketing and promotional information and the opportunity to reduce administrative effort. It would enable Britvic to monitor and enforce centrally agreed purchasing agreements with individual outlets, and drive compliance with product promotions. Britvic also wanted to use the technology to offer access to a content management system, providing tailored information and resources that would enable its customers to use their space better to sell more soft drinks.
As the project progressed, weekly strategy sessions took place with the Britvic director of IT and director of business development. Key decisions were referred to the eBusiness steering group, a subset of the main Board.
The Britvic-Andersen team worked together on four work streams in preparation for the final report to the Board: Customer analysis; Process analysis; Business strategy development; Technology assessment.
The joint team defined the target sector, building a database of prospective clients and identifying those which Britvic believed would benefit from and therefore be interested in adopting a virtual trading solution. By gathering information on client size and core characteristics in terms of buying behaviour, processes and use of technology, the joint Britvic-Andersen team was able to define seven distinct types of client and to make recommendations on which categories would be willing and profitable participants in a virtual trading solution.
The team interviewed personnel from key departments and analysed the existing 'order to cash' process to locate opportunities for cost-cutting and other improvements.
This resulted in high-level maps defining optimum new processes for the planned virtual trading environment, together with 'best guess' cost savings which formed part of the quantified business case that was presented to the Board.
Big opportunities for process improvement were identified across the board, resulting in a number of advantages, including reduction in delivery costs and errors, reduction in workloads and reductions in employment costs.
Defining the right business strategy was key to the success of the whole project. The Britvic team comprising the director of IT and director of business development and Jon Dunkelman met weekly with the Andersen partner and manager team to review progress.
Business model frameworks were proposed and development route maps created that identified a virtual trading strategy for each customer segment.
Several technology approaches were assessed in the light of customer needs, potential business models, partnering opportunities and cost. The team concluded that a bespoke virtual trading system, coupled with a commercial content management package would be the most practical and cost-effective solution. It would enable Britvic to retain control of the site, offer an appropriate level of functionality and be sufficiently flexible to benefit from association with other supplier and customer portals.
Commenting on Andersen's involvement, Jon Dunkelman said: "They brought a robust methodology to our strategy definition and to developing a business case in an area where ROI (return on investment) is difficult to quantify. They also provided the skills and experience to get the job done in a very short time scale."
This project served to demonstrate how IT was integral to the strategic development of Britvic, not just to its cost base. As a result there is now an established eBusiness team with a clear strategy and dedicated staff. The team has the full support of the Board and has become the 'incubator' for the strategic eBusiness projects which, claims Anderson, will keep Britvic at the "forefront of the market".