Attention: Consumer Electronics Trade-In Programs–Key Element #2: Business Analytics

Attention: Consumer Electronics Trade-In Programs

Blog Series Summary:
You will probably agree there are no shortages of “trade-in” programs for practically every industry under the sun; from ink cartridges to transmission converters.  The question is what makes up a successful “trade-in” program?  You will see from the graph below my “7 Key Elements of a Successful Trade-In Program.”  These elements can be applied across nearly any industry; however I will focus on consumer electronics.  I will summarize my thoughts on each element separately, along with some comments of the major players in the industry (Walmart, Sams, GameStop and others).


Key Element #2:  Business Analytics
As discussed in Key Element #1, People, we see what lengths it would take to ensure you have the right people in the right role, with the right skill sets.  The culture, not the personality, of the organization needs to be built upon trusts and integrity with it daily being communicated, demonstrated and adhered to at all levels of the organization, starting from the top.  It is a lot of work, however is it harder to clean up a mess along with the collateral damage or negate it all by making the tough and thorough decisions?  If your organization has almost reached it, working towards or at the starting line; imagine the automatic honest flow of information between departments, employees, company levels, vendors and customers.  The impact of your organization would change the very landscape of markets, industries and the world of business as we know it.  Top talent would flock to your company and other organizations would want or be forced to replicate it.  Your question now is what does this “perfect company” dream have to do with a trade-in program and business analytics?   Everything.

Business Analytics or Business Intelligence is another key element of the total solution and without a solid grasp of the current health of your organization, coupled with powerful automated and what-if tools to give you insight into all levels in real-time; you are probably behind your competiton, slow to react to the marketplace and/or hemmoraging due to decisions based on bad or old data.

Now that we got the painful punch to your “we have business analytics” ego out of the way…let’s note some comparisons of good vs. no so good business analytic thinking.

1.      Not So Good:  We have a group of data analyst experts who are awesome at Excel and pivot tables.
Good:  We replaced three of the FTEs with automated tools complete with dashboards and what-if scenarios.  We saved over $312,000 in yearly total compensation packages alone, not counting the priceless savings we achieved with speed of access, accuracy and versatility.
2.      No So Good:  We use the data from last month and sometimes we get fresh data from one week ago to base our business decisions.
Good:  We use automated tools pulling data from all our different systems to bring real-time information into our reports, dashboards and what-if scenarios to help ensure we are making the most informed decisions possible.
3.      No So Good:  We base our decisions on how we have always done business since the days of the founding of our organization and our leaders are seasoned experts.
Good:  We look at real-time data analysis to show us past, present and future trending to help us adjust or continue our current strategy.
4.      No So Good:  We have to start over on our manual pricing strategies when C-suite makes a knee-jerk decision based on an announcement in the industry or worse, our competition.
Good:  We use automated pricing tools and reports in order to quickly respond to internal and external factors.  We gave our C-suite dashboards to conduct what-if scenarios based on the real-time data to make timely but solid decisons to determine company, shareholder and market impact.
5.      No So Good:  When looking at Mergers and Acquisitions, we evalute the financials, leadership, marketshare  and potential.
Good:  When looking at Mergers and Acquisitions, we evalute the financials, leadership, marketshare  and potential; however we incorporate their data into our business analytic tools to conduct what-if scenarios for a true impact to our organzition giving us strategic direction on how to move forward or not.
6.      No So Good:  We hire market data firms to provide analysis to determine if we should open new locations.
Good:  We pull information from our database to conduct geomapping for customer demographic clustering.
The above samples of the not so good thinking are what most companies consider when they think Business Analytics.  It is more than just throwing data in a spreadsheet, analyzing it and presenting eye candy graphs; it is one of the 7 key elements in the building blocks of a complete strategy and without it you’re shooting from the hip or playing your odds against the house.  If you just rely on Business Analytics to drive your decisions, you will end up with a catastrophe and I do hope you already have the right people in place to help clean it up.

In the article, “How The Top 10 Richest Americans Failed Before, During or After They Made Millions,” is interesting to evaluate each of them on the surface against the “7 key elements…” chart.  Each one is missing at least two of the elements to help ensure success.  One product was ahead of it’s time (missing elements:  marketing, supply/demand and people), another was a potential illegal venture (missing elements:  legal, operations and people) and another was losing money on negative orders (missing elements:  marketing, operations and people).

So the questions you need to ask yourself as a CEO, CXO, President, Owner, Partner or other Senior Manager within the Consumer Product Industry with a Trade-In Program or wanting to start one:

1.      Are GameStop, Walmart, Sams, Cosco, Best Buy, RadioShack and others applying the first two of the 7 Key Elements of a Successful Trade-In Program?
2.      Do they need the other 5 key elements to have a successful and balanced trade-in program?

Now speaking to the CEO, CXO, President, Owner, Partner or other Senior Managers in consumer products where you don’t feel a trade-in program is warranted or you’re in another industry.  Remember a slight variation of the questions above impact any company on Wall Street to Main Street within any industry:

1.      Do you have the right people in the right place with the best business analytic tools available in the marketplace to check the short and long term health of your company?
2.      Do you need the other 5 key elements to have a successful and balanced business?

The next Key Element will be Legal…which I may need to note a disclaimer since I’m not a lawyer, however I wanted to play one on TV.

Feel free to email or call me with questions on any business topic, industry or company.  The first 15 minutes is free and I am also available to meet @ any Starbucks in Dallas/Fort Worth, Texas if you are buying.  –nathan

-nathan c whitington | 214.556.1322 | nwhitington@gmail.com

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