Unlocking value through leading commercial planning capabilities
In the face of fundamental shifts in consumer behavior, the emergence of disruptive competitors, and the rise of new channels, consumer products (CP) companies are under tremendous pressure to do more with less. Given the significant size of commercial spend (e.g., marketing and sales spend) in an average CP company’s P&L, it should come as no surprise that the spotlight is increasingly placed on commercial planning. In particular, many CP companies struggle with allocating commercial investments across brands, customers, and regions in a way that meets their strategic objectives and financial targets.
There are several reasons that make the optimal allocation of commercial investments challenging—from intrinsic industry-specific characteristics, such as complex product and customer hierarchies and multiple routes to market, to the plethora of internal and external data sources. For many CP companies, having full visibility into the commercial plans and P&L at different levels (such as brand or customer) requires significant manual analysis and consolidation of offline spreadsheets. Furthermore, assessing the return on investment for commercial spend typically requires up to several days or weeks of analysis, minimizing the ability to use these insights for future planning decisions.
Deloitte’s commercial planning solution, which runs on Anaplan’s Connected Planning platform, is designed to help companies drive more effective collaboration in the development and in-year management of commercial plans. It’s based on leading-edge cognitive analytic capabilities that are part of Deloitte’s DemandBrain solution.
Some potential benefit areas and use cases of this solution include:
Annual operating planning (AOP) development
- Target setting (top line and bottom line) based on enterprise-level expectations and financial targets.
- Disaggregation of targets at various levels across the organization (customers, brands, and geographies) based on a historical mix of the business, strategic priorities, and innovation.
- Reconciliation of top-down targets with bottom-up plans, with the ability to identify and visualize major gaps and options for resolution.
Key account planning
- Development of key account plans, including consumer, trade, and customer investments.
- Variance analysis (e.g., plan vs. actual) and visualization.
- Visibility into how investment shifts result in volume forecast, in real-time, through “what -if” scenario planning.
Predictive uplift and scenario planning
- Statistical decomposition of historical volume into business drivers.
- Generation of causal coefficients to calculate expected uplift in volume based on attributes of events and/or investments.
- “What-if” scenarios based on pre-defined lift factors and coefficients (at individual event or account plan levels).
- Tracking of actual vs. predicted performance (ROI).
- Actualization of metrics at the event level (base volume, lift volume, revenue, margin, ROI, etc.).
- Ability to adjust in-year commercial plans and visualize impact on top line and bottom line at various levels (e.g., key account, brand, region).
The commercial planning capability journey
A cloud-based, connected commercial planning solution like Deloitte’s can help you leapfrog the maturity curve of your commercial planning capability via the following three key benefits:
- VISIBILITY: Transitioning from manual and offline planning to a centralized planning and collaborative platform.
- OPTIMIZATION: Leveraging cognitive analytics and machine learning and embedding these insights into your day-to-day decision-making process through an intuitive user interface.
- INTEGRATION: Integrating commercial plans with financial and demand/supply plans, allowing for improved cross-functional collaboration and faster decision-making.
For a deeper dive into leading commercial planning capabilities, and to see a demo of Deloitte’s commercial planning solution, get in touch.
As used in this document, “Deloitte” means Deloitte Consulting LLP, a subsidiary of Deloitte LLP. Please see www.deloitte.com/us/about/ for a detailed description of our legal structure. Certain services may not be available to specific clients under the rules and regulations of public accounting.